Stagflation

US PMIs Tumble To 9-Month Lows, Catching Down To Collapse In 'Hard' Data

Following disappointment from China last week, and Europe this morning, US PMIs (both manufacturing and services) dropped and disappointed as it appears the lagged impact of China's slumping credit impulse are finally hitting the world's economies. With 'hard' data collapsing to 13 month lows, it is not surprising that 'soft' survey data is finally catching down with Manufacturing at 8-month lows.

Stagflation Builds As US Producer Prices Spike Most In 5 Years

For the 3rd month in a row, US Producer Prices have risen at a faster rate than The Fed's mandate. April healdine PPI rose 2.5% YoY - the most since Feb 2012, and well above the highest anayst estimate, despite disinflationary credit impulse pressures from China being seen in industrial metals. The biggest driver is surging costs for investment advice!

Why We Should Be Concerned About Low Oil Prices

Most people assume that oil prices, and for that matter other energy prices, will rise as we reach limits. This isn’t really the way the system works; oil prices can be expected to fall too low, as we reach limits. Thus, we should not be surprised if the OPEC/Russia agreement to limit oil extraction falls apart, and oil prices fall further. This is the way the “end” is reached, not through high prices.