It’s raining on the Eurozone leaders again this morning. To get you caught up, let me go back to what happened since I signed off on Friday morning. First of all Greek Prime Minister (PM) Papandreou, did receive a positive Confidence Vote from his Parliament, regarding the Eurozone Grand Plan… But there was a caveat to the vote… It was approved only on the understanding that Papandreou would step down, and that a new government would be formed to take them into the next election on February 19, 2012.
[Read more...]Government Shutdown Averted
April 11, 2011 By Leave a Comment
Well… The government did avert a shutdown late Friday night… I’m going to tick a few people off with this statement, but oh well… On Friday, the government agencies had to make up lists of “essential workers” and “non-essential workers”… Wanna reduce the government debt? If those people are “non-essential” then… Well, why are taxpayers paying for “non-essential” workers?
[Read more...]Currency Manipulators Created $7 Trillion, Causing the Global Economic Bubble
February 13, 2011 By Leave a Comment
The single most important development affecting the global economy over the past decade has been the creation of $7 trillion worth of paper money by central banks in developing countries. This explosion of money creation drove up the price of stocks, bonds and commodities – and drove down yields – all around the planet. It caused the Fed to lose control over interest rates and over the economy. In short, this new money (along with the US trade deficit which played a role in its creation) caused the global economic bubble that imploded in 2008.
[Read more...]China Reduces Treasury Holdings
August 17, 2010 By Leave a Comment
Front and center today, the TIC flows data from June was very interesting yesterday… Before we get into this, let me explain what I'm talking about for the new “kids? in class… TIC stands for Treasury International Capital, and it's just a fancy way of saying that someone is tracking the net security purchases… Why is this important? Well, security purchases by foreigners is how the US finances its ever growing deficit. For example, the trade deficit and foreign direct investment makes up the current account… But just to keep this simple, the trade deficit in June was $49.9 billion… The net security purchases to finance that deficit in June was… $44.4 billion…
[Read more...]Dollar Gets Sold On Bad Data Prints
July 6, 2010 By Leave a Comment
The currencies traded yesterday, but in very tight ranges, as the US was on holiday. This morning, the bias is to sell dollars, much like it was on Friday before the liquidity of Europe went to the pubs… Let's go back now, and revisit Friday's action…
Well… There was more proof on Friday that the double dip is coming…
[Read more...]US Debt and Deficit Numbers Overlooked by the Mainstream
May 13, 2010 By Leave a Comment
Two big numbers made news yesterday as we approached the market close. No one, to our knowledge, made a connection between the two. But to us, the connection is screamingly obvious. And frankly, your financial future hinges on that connection.
Heres the first number: $82.7 billion. Thats the deficit the US Treasury posted last month. Thats awful for April, which usually records a positive number, thanks to tax receipts flooding in around the 15th. Last year recorded a loss too. But that was only $21 billion. So this year, the bleeding is nearly four times as bad.
[Read more...]A Global Rebalancing Act
May 3, 2010 By Leave a Comment
For about the past half century the US has maintained a trade deficit. On the other hand, China has developed a trade surplus mostly because of the lopsided trade situation between the two countries. China makes a wide range of cheap goods and most of them are bought in the US.
During the financial crisis, and its aftermath, these imbalances seemed to rein in a bit and trade between the two countries looked like it could at least be headed back in the direction of a healthy alignment. However, it was a temporary and misleading close in the gap. The imbalance reduced only because global trade overall was shrinking including the distortions not because there was any real improvement in the US-China trade situation.
[Read more...]US Trade Deficit Widens
January 13, 2010 By Leave a Comment
The price of oil has dropped from $83.18 a week ago, to $79.80 this morning… Why did this spoil my day? Well, like Lloyd Bridges in Airplane, I must have picked a bad day to fill my gas tank the other day, when oil was so high!
Well… Even with oil backing off, the Canadian dollar/loonie (CAD), remains well bid this morning… Thats strange… But, in the whole scheme of things, not too strange… I mean, not Tiny Tim strange… Just strange enough to make someone think for a moment about what else could be underpinning the loonie? It sure wasnt their return to a deficit, which, by the way, was only $0.3 billion in November, which reversed Octobers $0.5 billion surplus… Im talking about trade balances here.
[Read more...]
Greece Forms a New Government
It’s raining on the Eurozone leaders again this morning. To get you caught up, let me go back to what happened since I signed off on Friday morning. First of all Greek Prime Minister (PM) Papandreou, did receive a positive Confidence Vote from his Parliament, regarding the Eurozone Grand Plan… But there was a caveat to the vote… It was approved only on the understanding that Papandreou would step down, and that a new government would be formed to take them into the next election on February 19, 2012.
[Read more...]