November 2009 Monthly Archive

Oh the nasty “tail” risk and lending “reflexivity”…

Gosh, it was looking so good. All those buildings, fancy shaped islands, money, and oil wealth. Who would’ve thunk it? Well, not the credit analysts, we know that now. Read more

Fed Fantasy: You can’t make this stuff up

Say what? Is that a misprint? Is it parallel universe time? Mr. Einstein, please call your office! Read more

A Good Price for the Euro

Perhaps you saw this morning’s release of Euroland’s economic data.German GDP jumped by 0.7% in the third quarter. Adding to GDP was an inventory build and capital investment; subtracting from GDP was consumption and trade. Read more

Regulatory Bank Cure – A Massive Unintended Fear Move to Gold?

John Ross wrote in a recent Currency Currents he didn’t want to rip-off the Milk Board advertising campaign by asking if you’ve “Got Gold.” But it appears more and more have “Got Gold.” Yet another new high was chalked up this morning in white-hot yellow metal. This comes at a very bad time for me and may reflect a lot deeper systemic concerns than we now realize. Read more

Friday Ramble

I noticed a Reuter’s poll today. All the top banks were asked to provide their guess on just how undervalued the Chinese currency–yuan- was against the US dollar. The average guesstimate was about 20%. Read more

Your recommended daily allowance of skepticism

For the past year – since November 4, 2008, actually – I’ve thought about walking around wearing a T-shirt that reads Read more

Oh yen, we wonder when…

We are taking a little break today. In place of my usual ramblings, below is an excellent article by Chris Fournier and Yasuhiko Seki of Bloomberg laying out the case for a weak yen based on the very ugly set of economic fundamentals and debt picture facing Japan. Read more

In One Emerging Currency, Volatility Counts for Something …

This isn’t an entirely new idea – we’ve made the connection in Currency Currents before and have since seen it presented elsewhere. Read more

Triple-think currency payoff?

Describing Russia, Winston Churchill said, “Russia is a riddle wrapped inside a mystery inside an enigma.” I wonder how he would describe modern China; I think it would be fun to hear that quip. Read more

Video Edit: The Global Stimulus and Emerging Markets Show

The latest G-20 communiqué said nothing new. You know … where the leaders told us they’re not yet ready to rein in the stimulus they’ve provided to their respective economies. Read more

Dollar higher on reported APEC buying

My reaction to the Mr. Geithner’s comment about a strong dollar is the typical reaction I bet; there is good reason. That’s because for about seven or eight years we have been told by Treasury Secretaries present and past that a strong dollar is good for America. Read more

Smooth-Talkers in the Far-East

For several years now most analysts have understood the way in which China reports their economic data. China says what its people, and often times the rest of the world, need to hear. Read more

Bubble Theory Battle Royale

I spoke at a conference yesterday. It shall remain nameless in order to protect the guilty. What was most funny/incredible/nutty is a belief by said conference chief the US dollar, and in fact all paper currencies, will disappear within 10-years. Read more

Risk-Takers are Getting Back in Gear

We all know that’s the bet gold bugs are throwing their chips on. And hey: why not? If the market is stopping at the early rungs on the logic ladder then that’s how we can expect prices will behave, for now. Read more

Change in Gold-Dollar Correlation

We recently warned of the potential for changing correlations, no sooner was the ink dry than we noticed a a big one concerning gold and the US dollar index… Read more

And the week isn’t even over yet …

The FOMC did nothing yesterday, as expected. The markets were crazy early on … and then again following the meeting. (A whole lot of jockeying, as Jack likes to say.) Read more

Who leads and who follows…

I recently downloaded Caesar’s Confessions on to my I-pod so I could listen while doing my strenuous exercise, which consists of a walk around the neighborhood once the US session is finished. Read more

Glenn Stevens says no more carry-trade, for now …

The profit-taking may have already begun after seeing the US dollar muster up strength here and there over the last couple days. But either way, RBA governor Glenn Stevens and his boys are seeing that the profit taking lasts a little bit longer. Read more

A Potential Premise that Fools the Crowd Big Time!

Excess Reserves on Bank Balance Sheets…this chart is almost comical in its appearance. Thus, no surprise lending to the real economy has declined this year as financial markets soared…but still hard to fathom given the weight of all that money… Read more