Thursday , February 27 2020
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Tag Archives: currency

Seth Levine: Commoditizing My Framework For A New Paradigm

When it comes to investing it’s never different this time; nor, however, is it ever the same. This difficult-to-navigate paradox creates a scarcity of longevity. Today’s persistently low yield environment has upped the ante and put many marquis names out of business. To be fair, alpha’s been elusive of late. It’s not that anyone suddenly became dumb. Rather, traditional methodologies are less robust today. Perhaps adopting a commodity framework can help generate returns in these investment...

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The Dollar’s Demise And All That

Back last June, the dollar had broken its upswing. DXY, one major dollar index, had fallen sharply as had most if not all of the rest. This one had given up most of its “gains” in a relatively short period. That said, to some, the greenback had definitely hit its high. All downhill from there. It didn’t help, supposedly, that the President was almost regularly tweeting his disapproval of both the US currency’s direction and Jay Powell’s. At least with the latter the Fed Chairman finally...

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How the US Dollar Became Trade’s Default

 Nearly 90% of international transactions in 2019 were in U.S. dollars, giving the U.S. extraordinary power over nearly every entity that imports or exports anything anywhere. Here is how the global economy runs on the U.S. dollar—and why some countries are trying to chip away at its dominance.  Dollar’s Surprise Surge Challenges Stock Market RallySource: WSJ 

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Seth Levine: The Unsurprising Repo Surprise

Have you heard? There’s trouble in the repo markets. Even casual investment market participants probably know that something’s amiss. While only a handful of investors participate in repo, this obscure corner of the investment markets rests at the epicenter of the financial system—hence all the attention. The turmoil caught many by surprise, prompting the Federal Reserve (Fed) into emergency action. However, the real surprise is, in my opinion, why this took any of us by surprise to begin...

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China’s Financial Stability: A Squeeze and a Strangle

I do get a big kick out of the way Communists over in China announce how they are dealing with their enormous problems especially as they may be getting worse. Each month, for example, the country’s National Bureau of Statistics (NBS) will publish figures on retail sales or industrial production at record lows but in the opening paragraphs the text will be full of praise for how the economy is being handled. If you thought the Western media was liberal with the word “strong” (经济强劲, I...

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Seth Levine: Why Are We So Scared

I always find this time of year to be self-reflective. Year-end provides a natural point for critiquing past performance and fitting it into a broader investing context. These holidays in particular have a way of foisting this perspective upon me, and with deep meaning. As a parent of two young kids, my holidays now kick off with Halloween. Perhaps stuck in this spirit, I find myself wondering: Why are we so scared? I can’t seem to shake this sense that we live in a culture that’s scared. I...

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In The Fed We TRUST – Part 2: What is Money?

Part one of this article can be found HERE. President Trump recently nominated Judy Shelton to fill an open seat on the Federal Reserve Board. She was recently quoted by the Washington Post as follows: “(I) would lower rates as fast, as efficiently, and as expeditiously as possible.” From a political perspective there is no doubting that Shelton is conservative. Janet Yellen, a Ph.D. economist from Brooklyn, New York, appointed by President Barack Obama, was the most liberal Fed...

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Negative Rates Are Destructive But Profitable

“Remember that Time is Money.” Benjamin Franklin, Advice to a Young Tradesman It’s unfortunate that such genius identifications as the above have long been forgotten by the economic community. First penned in 1748, Benjamin Franklin makes the connection between human effort—or rather the application of human effort towards productive work—and the effect/product, i.e. wealth. We measure this increase in prosperity, of course, in terms of money. Thus, “Time is Money” (or rather, time is...

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China’s Next Warning

Chinese monetary authorities announced today what will be for some of its banks a seventh round of “stimulus.” For the largest institutions, it will “only” be their sixth and the first one since January 2019. The PBOC has decided it is time for more RRR cuts. Effective September 16, the ratio all banks are required to hold of reserves will be reduced by 50 bps; applying to certain city banks, the decrease will be 100 bps. It sounds like a flood of stimulus, enabling China’s...

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The Fingerprints of Bumbling (China)

For a cabal of superpatient supergeniuses, the Chinese tend to play with fire quite often. According to many, the Communists have perfected the art of technocracy and are merely waiting out the impetuously free West. The dollar system will destroy itself (there’s the kernel of truth) allowing a perfectly positioned China to swoop in and rescue the global economy with its scientifically specified yuan. Some even have gone so far as to claim the new world order of CNY will surely be...

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