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Tag Archives: EuroDollar

Three From Xi (bonus 4th for CNY)

Physical cash vs. bank reserves. Quality growth vs. quantity. Xi Jinping vs. everyone not onboard with Xi Jinping. All three contests are actually very simple and straightforward – once you let go of the strong economy, money printing Federal Reserve nonsense. As to the last of the trio, Emperor Xi has been awfully keen this year to redo government flags.Communists are big into such symbolism. What isn’t mere symbol, at least not in the same way, is Chinese cash. Renminbi seems like it...

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It Shouldn’t Be Anything Like This

You pick up a newspaper (metaphorically, hardly anyone does this literally anymore) and you’d be left with the impression the year is 1979 again. Forget 2017; that was child’s play, more like 1968 in the mainstream imagination. October 2020 is going to mark the beginning of the biggest one in decades. Any day now.Inflation, of course. The Fed, the media says, has printed so much money it’s only a matter of time. Once the glut of cash filters its way into the real economy (not just the stock...

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Quarrel With Quarles Over Too Little, Not Too Many

It wasn’t the first time the ground had already been eroding underneath his feet. Randall Quarles took at turn at the Treasury Department during the Bush Administration, rising to Undersecretary for Domestic Finance during the most maniacal part of the eurodollar-fueled housing bubble. Not surprisingly, among the last things he did there was tell the public how great everything was going.But then Quarles jumped from Treasury to…Carlyle. Because everyone has been told 2008 was about subprime...

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A True Horror Tale

The “maestro” was neither the monster’s creator nor its handler, but he did preside over much of what followed the standard horror story template. Alan Greenspan said the words “proliferation of products” in June of 2000, now more than two decades ago. But the proliferation vexing him and monetary policymakers at the dawn of the 21st century had actually begun in the middle of 20th. And when the monetary paranormal really started cooking had been the sixties and seventies. As such, only now...

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CNY + TIC = October 2020, or 2017?

The dominating feature during the last months and days of globally synchronized growth (Reflation #3, to you and me) wasn’t inflation nor growth. It was instead CNY. Taken at face value, the marvelous resurrection of China’s currency after 2014-16’s debacle (Euro$ #3, to you and me) did seem consistent with a global dollar system (eurodollar, to you and me) rebound.And there was a legitimate basis to believe this – up until September 2017. Before then, you could see as CNY rose the level of...

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Is There Enough?

It’s just not fast enough. And with the labor market spitting out numbers across a broad economic cross-section that look increasingly tired suggesting an economy running out of momentum, there’s the added urgency of time. Late summer figures still aren’t close to where they need to be even though when you view them in isolation they can look tremendous.Start with PMI’s, a bunch of them from last week and early this week. Many are the highest in many months, years for quite a few. But...

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Q3’s Gigantic Positives Were A Nice Start, But They Weren’t The Story

Back in late July, the government of Ecuador opened negotiations with a particular set of what it called institutional bondholders. Like so many other nations, every other nation, Ecuador needs dollars and borrows them from global markets. Eurodollars, as in directly bank loans, those have been harder to come by post-2013. Eurobonds, however, they’ve been somewhat of a different story especially during 2016-17’s globally synchronized growth nonsense and the tainted repo backing behind it....

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Reopening Inertia, Asian Dollar Style (Still Waiting On The Crash)

Why are there still outstanding dollar swap balances? It is the middle of September, for cryin’ out loud, and the Federal Reserve reports $52.3 billion remains on its books as of yesterday. Six months after Jay Powell conducted what he called a “flood”, with every financial media outlet reporting as fact this stream of digital dollars into every corner of the world, how can there be anything greater than zero in overseas liquidity swaps?Six months is an eternity.While you think about that,...

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Mid-September 2020 Hasn’t Disappointed At All

For the first time, it was encouraging to see and hear quite a lot of people talking about the September calendar quirk. That’s progress; a small but noticeable segment of the financial public setting aside the mythical dogma of bank reserves and asking the right questions. However, I fear that having been “disappointed” by this year’s version of it, how many will end up concluding it was all nothing to begin with? In short, expectations were high (pushed higher by WTI) that something would...

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Getting Harder to Spell T-R-A-D-E Without An ‘L’

The good news: the World Trade Organization (WTO) has crunched the numbers for 2020’s horrific second quarter and where global trade is concerned it may not have been as bad as first feared. Make no mistake, it was bad but not crashing down as far as the most pessimistic of the dreamed-up scenarios. Given where things stand now with only partial data and related soft figures to go on, the organization believes trade volumes across the global economy suffered a 14% reduction in Q2 from Q1....

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