Central Banks

Alan "Bubbles" Greenspan Returns To Gold

The former Fed chairman says he believes another debt crisis is inevitable. He believes it will lead to high levels of inflation. His solution? Gold: “Now if we went back on the gold standard and we adhered to the actual structure of the gold standard as it exists let’s say, prior to 1913, we’d be fine. Remember that the period 1870 to 1913 was one of the most aggressive periods economically that we’ve had in the U.S., and that was a golden period of the gold standard.

 

Entire US Cyber Network Is Already Compromised, Clinton Emails Are The Least Of Our Worries

Hillary Clinton's emails and server misconduct are the least of our worries. The fact that her server was receiving files that passed through or originated on the State Department servers is enough to know she exposed her private system to hackers. Michael McCaul, a Texas Congressman and Chairman of The House Committee On Homeland Security called Clinton "careless" and said she "potentially did harm" to national security, but the truth is the US system is/was/has been compromised, for years, since before Hillary tapped in her new network

Beautiful Brexit & The Five Stages Of Grief

The post-Brexit ‘conversation’ in Britain is taking on grotesque proportions. Nobody seems to know how to react, at least not in a rational manner. They all look to be stuck in phase one of Kübler Ross’s Five Stages of Grief, i.e. Denial. Phase two is supposed to be Anger, and while there’s plenty of that, the shape it takes makes one think Angry Denial, instead of a progression between phases. That is to say, I don’t think I’ve seen one voice expressing anger at themselves. It’s all somebody else’s fault. And it just keeps going.

Larry Summers Wants To Give You A Free Lunch

According to Summers, with this low growth and low interest context, government debt levels no longer matter. In other words, federal governments have free reign to massively increase deficit spending and run-up federal debts, because, on balance, the fiscal stimulus will pay for itself. But who are we to question Summers’ unique qualifications - for example, unlike Summers, we’ve never lost $1.8 billion of other people’s money.

The Great Market Tide Has Now Shifted

Risk-on assets (stocks) rising at the same time as safe-haven assets is akin to dogs marrying cats and living happily ever after. What the heck is going on? Why is the market acting so schizophrenic? What’s changed?

Bank of America Throws In The Towel: "The Profits Recovery Won't Live Up To Expectations"

"In the wake of the weaker-than-our-expected 1Q results and recent macro headwinds, we are trimming our S&P 500 EPS forecasts by 3% in 2016 and 2% in 2017. Given the S&P 500’s 15% rally since mid- February, we are concerned that much of the improvement in earnings growth may already be priced in, especially with signs that earnings revision trends may be rolling over."

When Narratives Go Bad

There’s a … tiredness … to the status quo Narratives, a Marie Antoinette-ish world weariness that sighs and pouts about those darn peasants all the way to the guillotine.

Weekend Reading: Central Banks Save The World

For now, Central Banks have seemingly accomplished the rescue of the entire global financial system by one again lofting asset prices higher. The problem, however, remains the underlying fundamental issues of weak earnings, slowing economic growth and a collapsing Chinese economy. There is a point, unknown to anyone currently, where the failure of monetary policy will occur.

Trader Asks: "Remember The All Time Highs After Bear's Subprime Funds Blew Up?"

One of the most enduring legacies of the financial crisis is the death of the credible notion that traders flock in and out of "safe havens." As Bloomberg's Richard Breslow notes, investors don't particularly care to seek safety. Why waste the effort when the central banks will be buying the dip if you don't.

Goldman Hires Former EU President As Advisor

Having cornered the central banker market, with its alumni manning key positions at most central banks, Goldman has decided to tip its cards into its next zone of interest: geopolitics, and has done so by hiring none other than the former head of the European Commission, Jean-Claude Juncker's predecessor and one-time Nigel Farage nemesis, Jose Manuel Barroso as an advisor and non-executive chairman of its international business. 

S&P Back To All Time Highs After 17 Consecutive Weeks Of Mutual Fund Outflows

The biggest fund flow surprise was in the space of equity funds. According to Lipper stock funds - including both mutual and ETF funds - posted yet another week of outflows totaling $1.4 billion. The optimism of exchange-traded fund investors that the Brexit vote might not derail stocks was nonetheless overwhelmed by a long-running trend of withdrawals from stock mutual funds. And while stock ETFs took in $4.6 billion in the latest week ended Wednesday, U.S.-based stock funds posted $6.1 billion in outflows in the latest week, their 17th week of cash withdrawals, according to Lipper data.

Krushing Krugman? Lacy Hunt On The Negative Multiplier Of Government Debt

The trap is listening to Keynesian economists like Krugman because doing so only digs deeper and deeper debt holes. The real solution is a writedown of unproductive debt, not increased fiscal stimulus. Instead central banks attempt to cram more and more debt into a system clearly overloaded with debt.

One Trader's Take On Today's Jobs Number

Non-farm payrolls are coming. There’s no shortage of opinions on what the numbers will be. And if they come in as widely expected, they’ll be pretty good. Good enough that had this been last month, we’d still be having the tiresome “every month is live” debate.  This time around, markets may have to deal with how to trade a result where the number is sound, maybe even outright strong, and we’re still on perma-hold. A weak number will stink for the economy but is relatively easy to react to.