Consumer Prices

Helicopter Money - The Biggest Fed Power Grab Yet

The Cleveland Fed’s Loretta Mester is a clueless apparatchik and Fed lifer, who joined the system in 1985 fresh out of Barnard and Princeton and has imbibed in its Keynesian groupthink and institutional arrogance ever since. So it’s not surprising that she was out flogging - albeit downunder in Australia - the next step in the Fed’s rolling coup d’ etat...“So it’s my view that [helicopter money] would be sort of the next step if we ever found ourselves in a situation where we wanted to be more accommodative." It’s the ultimate in 'something for nothing' economics.

Did Citi Just Confiscate $1 Billion In Venezuela Gold

Venezuela's President Nicolas Maduro said on Monday that Citibank planned to shut his government's foreign currency accounts within a month, denouncing the move by one of its main foreign financial intermediaries as part of a "blockade." What Maduro did not mention is that among the central bank accounts closed by Citi will be at least one, rather prominent, gold swap launched just over a year earlier, which saw some 1.4 million ounces in gold swapped over to Citi in exchange for cash... gold which now appears to be confiscated.

Key Events In The Coming Week

With the key event of the week flying largely under the radar, which as previewed here last week was Bernanke's visit to Japan which has already led to another global market spike, here are the rest of the week's events.

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.

Futures Stumble As Global Bond Yields Drop To All Time Lows, Precious Metals Spike

Whether it is due to the conclusion of quarter-end window dressing, or due to a more poor manufacturing data out of China overnight, but the new quarter is starting off poorly for risk with Europe flat and US equities lower, while the scramble for safety means that bond yields across the developed world just hit new all time lows as precious metals are surging once again on ongoing speculation central banks will do anything to keep markets propped up and buy up even more assets.

How Low Can Bond Yields Go? Lower

How low can bond yields go? Every day seems to provide fresh evidence that we really don’t know. But whatever your answer, between the gravitational pull of central bank debt purchases and a slowing global economy, the reality is: probably lower.

The Fed Has Whiffed Again - Massive Monetary Stimulus Has Not Helped Labor, Part 2

In today’s world of flexible just-in-time production, hours-based labor scheduling and gig-based employment patterns, there is really no such standardized labor unit as a “job”. In that context, a simple paint-by-the-numbers exercise demonstrates the foolishness of the Fed’s obsession with hitting a quantitative “full employment” target.

Global Stocks, US Futures Slide On Mediocre Manufacturing Data, Yen Surge

Following the latest set of global economic news, most notably a mediocre set of Chinese Official and Caixin PMIs, coupled with a mix of lackluster European manufacturing reports and an abysmal Japanese PMI, European, Asian stocks and U.S. stock index futures have continued yesterday's losses. Oil slips for 4th day, heading for the longest run of declines since April, as OPEC ministers gather in Vienna ahead of a meeting on Thursday to discuss production policy. The biggest winner was the Yen, rising 1%, with the USDJPY tumbling overnight and pushing both the Nikkei 1.6% lower and weighing on US futures.