GDP revisions and the US personal savings rate
This report was the first under a major revision to reporting of US economic data. The personal savings rate stood out.
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Browsing Tag
interest rates
More on whether Powell’s comments about the economy were hawkish or dovish
The sense I get is that Powell is a closet Taylor Rule devotee. If I'm right, then the neutral rate is quite a bit higher than where we are now.
Are the tales about a Goldilocks economy and the worries about recession conflicting narratives?
These are conflicting narratives, yes. But they don't have to be because, as Minsky quipped, stability breeds instability.
Fed overtightening risk now begins in earnest with yield curve at my predicted 25 basis points
The yield curve has flattened to the point where two-year yields are only 25 basis points lower than 10-year yields. I have been predicting this outcome for several months and see this as a level to worry about the Fed's ability to engineer…
The next emerging markets crisis is now: Turkey as a canary in the coalmine
Turkish bond yields are skyrocketing as the Turkish lira plummets. The question, though, is whether Turkey is an outlier or a sign of more to come.
Playing the yield curve
Right now, we are still very much in the bull market phase. So the number of macro theses which make money are limited. US curve flattening and the prospect of Fed overtightening presents the best risk/reward.
GDPNow still near 4%, showing Q2 likely to be a monster quarter
The Fed is likely to continue to talk up the US economy. And I believe markets will react. With the yield curve at 32 basis points spread between 2- and 1-year Treasuries, we still have scope for further curve flattening.
A brief note on the political crisis at the Fed
Note: This post first appeared on Patreon on 2 Jul 2018
I saw a Twitter exchange this morning that reminded me that the Fed is facing a political crisis due to its quantitative easing program. And I think this will limit the Fed's…
Continued economic expansion and curve flattening dominate US data flow
GDPNow for the second quarter is still at a breathtakingly high 4.5%. And it's beginning to look like we are going to come in well above 3% growth for the quarter. Consensus estimates are at 3.5%. Meanwhile the yield curve continues to…
The Fed’s fourth 2018 rate hike: proof positive of my accelerated timetable warnings
Increasing the pace of quantitative tightening in lieu of raising rates would give the Fed the opportunity to test what impact this has on the slope of the yield curve.