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Media Archive

December 31, 2015
Mind the business cycle As regular readers know, we spend a lot of time on the business cycle because its existence is one of only a handful of things we can count on with economics (right under the proverbial death and taxes), and interest rates surely follow it. Economies expand and then economies contract; this we know since biblical times. But more th... read more
December 17, 2015
The Regressive Fed In a move that defines the word 'irony' better than the dictionary does, the Federal Reserve raised rates just five hours after their own Industrial Production series was released showing an almost certain entry into a US recession (see chart below).... read more
December 8, 2015
Why the declining trend in Manufacturing ISM matters Note: First off, if markets stay as calm as they are, we have to concede, that yes, the Fed will raise rates by 0.25% next week on December 16th. The Fed raising a second time, however; we think is unlikely. Our thesis continues to be that no matter what the Fed does, disinflat... read more
November 10, 2015
Worst case scenario? We genuinely don't think the Fed is raising rates in December or next year, but we have been asked several times, "what if you are wrong?" Given how vocal certain members of the Fed have gotten, we know it is hard to stomach this phase of the roller coaster and we certainly don't blame anyone for feeling queasy. Listening to the mains... read more
November 6, 2015
All of the reasons are here to begin tightening!...except any of them. Today’s strong jobs number is widely perceived to be the green light for Yellen to raise in December, and interest rates have sold off as a result. To most market participants, the December hike is now a foregone conclusion. While we certainly have to a... read more
October 27, 2015
Last Week's U.S. Treasuries Conference and our Suggestion [note: single left click on images to enlarge them]This conference was the first of its kind, germinated by Federal Reserve Governor Jerome Powell and coordinated between the NY Federal Reserve (site of the conference), Board of Governors of the Federal Reser... read more