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June US employment running warm, rather than hot – albeit a bit of a red herring for US Fed rates
If yesterday’s 10 year yield bounce to over 4% was a function of a more aggressive further interest rate rise by the Fed this month after the June ADP figures, then today’s cooler employment estimates for June from the BIS in its non-farm payroll figures may help dampen some of those fears. All this however, […]
Continue readingEquity’s siren call into early stagflation
Has the US Federal Reserve lost control of the narrative? Much as it has tried to sound hawkish, its actual actions into the first half of this year have instead communicated a lack of real resolve, which along with the political retreat on fiscal control with the abandonment of the ‘debt ceiling’, has left equity […]
Continue readingTreasury yields after debt ceiling ‘can-kicking’
Kabuki theatre remains alive and well in DC, and yet again, after all the histrionics from both sides of the aisle, the government will just keep spending money it doesn’t earn. While details have yet to be released, it seems the best result that Speaker McCarthy could secure was a budget cut of a measly […]
Continue reading1 month T-Bill yield spreads expand by >160 bps in April – Signs of growing stress!
Whether it’s a flight to safety, a rush for USD collateral, or perhaps something else, the sudden divergence of the 1 month US T-Bill yields against the rising trend across all the longer maturities over the first three weeks of April doesn’t appear to bode well for markets. For the USD however, this may reflect […]
Continue readingMMT – Safe and Effective?
An experimental theory adopted by a financially rewarded ruling oligarchy has always been difficult to fight against, so you won’t find many among those beholden to them that will be prepared to risk their careers by challenging the status quo. Until it is too late, that is! We therefore have entered a twilight zone where […]
Continue readingMarch Jobs data – further softening, but not there yet!
While the real action is increasingly out in currency markets, the monthly guesstimates from the BLS provide an element of background mood music. For March, the picture remains one of gently easing rates of net job additions, but not yet in negative terratiory, but with real incomes failing to keep pace with inflation and indeed, […]
Continue readingSVB bailout – failing the smell test!
So, no sooner than US Treasury Secretary Janet Yellen implies no bailout for failed woke bank SVB “We’re not going to do that again,” what to we get, but an effective bailout for its uber wealthy depositors. The yet unanswered question however, remains whether this is an abandonment of the $250k FDIC insurance cap on deposits, […]
Continue readingSVB failure – Moral Hazzard? Yellen Says No Bail Out
Will the US government again be bounced into bailouts following last week’s shock failure of Silicon Valley Bank (SVB) and subsequent seizure by the FDIC? The seemingly emphatic answer from ex US Fed chair and now US Treasury Secretary Janet Yellen is not. “We’re not going to do that again,” she is reported to have […]
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