...the belief that stocks will keep going up because central banks will keep supporting them is based largely on the simple belief that since it has worked for ten years, it will continue to work. This, of course, is a fallacy...
After three months of massive liquidity injections to stabilize the repo market around year-end, the liquidity drain finally begins next week when nearly $72 billion in term repos mature.
To be frank, every year should be the year of repo. But by and large nobody cares because no one can see it... for the first time since 2008, last year they were forced to pay attention again...
The most important price in an economy is the exchange rate between the local currency and the world’s reserve currency — the U.S. dollar. As long as there is an active black-market (read: free market) for currency and the data are available, changes in the black-market exchange rate can be reliably transformed into accurate estimates of countrywide inflation rates—if the annual inflation rates exceed 25%.
... but since the semantic definition of the Fed directly funding the US deficit is gently violated, it's enough for Powell to swear before Congress that he is not monetizing the debt.
"If Iran tried to close off the Strait of Hormuz, we’ve previously estimated that Brent crude would jump to $150pb. This would push up inflation across the world – by as much as 3.5-4.0%-pts in the OECD countries."
Tesla posted 112,000 vehicles delivered in the fourth quarter, beating out Wall Street's expectations of 106,000 vehicles delivered. Shares of the automaker are up about $10 in pre-market trade as Wall Street reacts to the news, which seems to be adding fuel to the ongoing short squeeze fire that has seen Tesla shares rocket over the last several months.
