Post Archive

Март 2016

The last time Europe had at least two consecutive months of deflation was in late 2014/early 2015 when the ECB launched its sovereign QE, and when prices staged a modest rebound into the rest of the year. One year later, it’s more of the same, and as Eurostat revealed earlier today, after a headline price drop of -0.2% in February, March prices declined once more, this time by -0.1% in line with expectations, driven by a -8.7% plunge in energy prices. The good news for the ECB, which earlier this month unleashed the first instance of corporate bond QE, is

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Primary budget gap due to frustration in tax collection February deficit was more than double what analysts forecast Brazil recorded the largest-ever primary budget gap in 12 months through February as a two-year economic recession sapped tax collection while expenses grew further. The deficit before interest payments, which includes results of states, municipalities and government-owned companies, reached 125.14 billion reais ($35 billion) in the 12-month period, or a record 2.11 percent of gross domestic product, the central bank said Wednesday. The result shows a growing mismatch between government revenue and expense over the past year, said Tulio Maciel, head of

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While the Fed has long been focusing on the revenue part of the household income statement (which unfortunately has not been rising nearly fast enough to stimulate benign inflation in the form of nominal wages rising at the Fed’s preferred clip of 3.5% or higher), one largely ignored aspect of said balance sheet has been the expense side: after all, for any money to be left over and saved, income has to surpass expenses. However, according to a striking new Pew study while household spending has returned to pre-recession levels (the average household spent $36,800 in 2014) incomes have not.

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The recent weakness in Silver has done nothing to dissuade precious metal ‘hoarders’ from buying-the-dip. Silver ETF holdings rose 846 metric tons in March (so far) — the biggest jump since August 2013 — to the highest since April 2015. And all of this buying has occurred as prices dropped to one-month lows, as it seems — like China and Russia — taking advantage of lower precious metal prices amid the collapse of central bank credibility around the world. Read More

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Since February, major investors have predicted that oil prices were poised for a huge rally. Hedge funds and money managers piled into bets on rising oil prices, going long on the crude rally. Short sellers were squeezed, and the stampede become too much for many, resulting in a large liquidation of shorts. The short selling drove the rally, increasing oil prices by about 50 percent since early February. That has fueled optimism that the worst of the oil bust is over. And there is good reason to think that a rally is justified. U.S. oil production is off by about

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Investors allocating less due to volatility, weak growth Tightened regulations also reducing inventory and liquidity Emerging-markets debt trading in 2015 fell to the lowest in six years as investors allocated less to the asset class due to rising volatility and a weak growth outlook, EMTA said. Annual trading volume fell 20 percent to $4.73 trillion from $5.92 trillion in 2014, the lowest reported volume since 2009, according to a survey of 49 leading banks, asset management firms and hedge funds, conducted by the New York-based association for emerging-market debt trading and investment. Developing-nation local currency bonds lost a record 15

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