Fed Shows Reluctance to Cut, Open to Rate Hikes
GS: Waller’s comments today and the minutes to the FOMC’s April meeting released on Wednesday suggest that the Committee has become more reluctant to cut... ...and more open to the possibility of rate hikes in recent weeks. https://t.co/8fABqSMYVP
5% Yield Spike Could Trim S&P Valuation 15%
Per the Fed Model, when stocks and bonds are correlated and offer similar yields, when bonds reprice, so will equities. That’s the transmission link between rates and equities. If yields rise to 5%, how much would equities need to derate? Per...
Erdogan's Power Grab Drives Turkey's Decade‑long High Rates
The price Turkey pays for Erdogan's relentless push to stay in power is sky-high interest rates that have taken the country back to the early 2000s. Interest rates these days are far above Turkey's EM peers and we're closing in...
RBI's March Dollar Sales Fell Short, Boosted by Forwards
After buying dollars in Jan and Feb, RBI sold dollars into the mad moves in March, about $9.7 billion. This was of course too less, but there's a bunch of forward sales too https://t.co/MARSGdhUbP
India Should Curb Rates, Boost Local Oil and Manufacturing
While it makes sense for the US, Iran and Russia to keep oil prices high, it makes no sense to have inflation ruin most others and in fact hurt the US. I believe we will see lower prices on crude,...
Govt Seeks to Curb Deficit, Delays Import Cuts
Govt Eyes Steps to Contain Widening Current Account Deficit The government is considering several measures to contain the widening Current Account Deficit. Minister Goyal has stated there are no plans to cut non-essential imports for now.
DiMartino Booth Analyzes Fed Minutes, Warsh on Bloomberg
Danielle DiMartino Booth Appears on ‘Bloomberg Surveillance’ To Discuss the Fed, Kevin Warsh and FOMC Minutes https://t.co/gIAvnY1b80 #federalreserve #powell #dimartinobooth #kevinwarsh #economy
Hormuz Disruptions Demand True Supply Chain Elasticity
The Strait of Hormuz has become a geopolitical pinball machine, disrupting 20% of global petroleum flows through a single chokepoint. From GPS spoofing to drone harassment, this is “attrition by algorithm.” Boards must stop planning for likely scenarios and build...
Bond Market Sticks to Mid‑2% Inflation Amid Peak Oil Stress
The Oil Stress vs Inflation Expectations chart below shows the distribution of inflation expectations (10-year TIPS break-even) at the top and the distribution of oil “stress” (the scarcity premium) at the bottom. The bond market apparently believes that inflation will...
BI's Rate Hike Aligns Money Growth with Inflation Target
To defend the Rupiah, Bank Indonesia raised interest rates by 50 bps. Meanwhile, inflation is 2.4%/yr. Indonesia's money supply is growing at 9.7%/yr. That's within Hanke’s Golden Growth Rate of 8.4%-10.4%/yr, a rate consistent with hitting BI's inflation target of 1.5%-3.5%/yr....
Full Hormuz Oil Flows Delayed Until 2027, Says ADNOC
Reuters: "Full oil flows through the Strait of Hormuz will not return before the first or second quarter of 2027, even if the Middle East conflict ended now, the head of the United Arab Emirates' state oil firm ADNOC said"...
Warsh's Fed Chair Inauguration Signals Uncertain Regime Change
On the eve of Warsh's swearing in as Fed chair on Friday, here's our piece from last week about what he means by regime change and how likely he is to achieve that https://t.co/Oogluog4lM @nytimes https://t.co/ccMkLzKge2
Trump’s Policies Drain US Economy Amid AI Boom
Some fun/depressing napkin-math from The Economist on how much Trump's trade & immigration policies - and chaotic policymaking overall - are costing the otherwise-solid US economy (thanks mainly to the AI boom): https://t.co/sAdCJvmSaF https://t.co/cDUJmNpHrW
Fed Rate Cuts Expose Fragile Risk Asset Dependence
Sock Puppets to Stocks? Crude, Gold, Commodities, Bitcoin, Bonds The Federal Reserve's 2025 rate cuts, despite the most inflated stock market vs. GDP since before the Great Depression, may have reinforced how dependent most risk assets are on the beta tide...
Fed Delay May Ignite Inflation Like 1928 Bubble
Adding Fuel to Inflation Fire May Not Fare Well Federal Reserve easing in 2025, despite the greatest stock market inflation since 1928-29, may be a top force buttressing consumer prices and what parabolic rallies in gold and silver sniffed out. History...