Posts Tagged ‘Germany’

Notes From Underground: G-20 Photo Ops Become Relevant … For a Moment

July 10, 2017

All of the words and photos emanating from Hamburg are figments of the media’s confirmation bias. In Monday’s Financial Times, Wolfgang Munchau had a splendid op-ed titled, “From Brexit to Fake Trade Deals–the Curse of Confirmation Bias.” Munchau calls out the Euro-Japan trade deal headlines for as he points out it was announced on the eve of the G-20 summit in order to embarrass President Trump. I laughed when I read the stories about the aforementioned trade agreement because while EUROCRATS presumed a signed agreement, the FACT is each EU state will have to approve the agreement. So the acrimony from the Euro/Canada trade agreement still reverberates.

(more…)

Notes From Underground: Happy Memorial Day, A New Podcast from FRA

May 29, 2017

I am posting a new FRA podcast that was recorded May 24 with Richard Bonugli. We cover many important topics, including the rise of Bitcoin as an investable product. As I have said often, I need to learn more about crypto-currencies and their impact on the global financial system. Unlike Ben Bernanke, I understand GOLD but am seeking to understand BITCOINS. I am striving to learn the workings of the block chain mechanism and relying on the wisdom of one of favorite readers and supporters American Limey.

(more…)

Notes From Underground: Santelli and Harris Down By the Schoolyard

May 9, 2017

This is the most recent CNBC hit with Rick Santelli as we try to educate the world in another three-minute segment. This unrehearsed spot attempts to dig deep into the financial issues confronting traders and investors. The discussion about France is a continuation from the Notes From Underground post I wrote last night. I stress that the period ahead for Emmanuel Macron is going to be difficult, especially if the center-right wins the Parliament and thus the prime minister position. This summer will be fraught with street demonstrations as the Left moves to prevent any installation of German-initiated fiscal austerity and labor market reform. In typical French political fashion, labor and student groups are warning against Macron governing by decree and bypassing Parliament.

(Click on the image to watch me and Rick discuss French elections.)

(more…)

Notes From Underground: Trump Delivers on Using the Dollar as a Policy Tool

April 12, 2017

In an interview with the Wall Street Journal, the tweeter-in-chief was reported to have said, “The DOLLAR IS GETTING TOO STRONG.” As some pundits discussed, instead of Trump calling China a currency manipulator it seems he wants to use the dollar as a cudgel to pressure others into not embarking on policies to weaken their currencies. As I wrote on April 2:

“The Trump Administration’s efforts to curb the U.S. trade deficit may see the executive branch try to depreciate the U.S. dollar if Secretary Mnuchin and Secretary Ross fail to persuade certain global actors to embark upon policies to adjust their current account and trade surpluses. The Fed’s recent tightening has not rallied the dollar–it actually closed lower on the quarter–so if the political status quo is sustained in Europe and no new political crisis emerges, the DOLLAR will become a barometer of Trump’s policies on trade.”

(more…)

Notes From Underground: FRA Podcast Replay (January 29)

March 19, 2017

It has been a month since I last wrote. My hiatus was inadvertently extended as Ecclesiastes certainly entered my personal life. My sister Joyce suddenly passed away, which caused me to slow my mind and reflect on many things. Losing your baby sister will ┬ácause one to ponder, or as it was said in Cool Hand Luke: “When a man’s mother dies and he gets to thinking rabbit and running, a night in the box.” So I have put myself in a mental box. However, I have also experienced the birth of my second grandson, thus to every season a time and purpose.

During the seven-plus years I have been writing Notes From Underground I have shared many life-changing moments with my extended family of readers. So it is with a renewed spirit and laser focus thoughts that I embark on analyzing the global-macro world in search of profitable trades and investments. The FRA podcast I posted January 29 (click the highlighted text) is a renewal of this year’s focus on crafting the NOTES narrative. There has been much in the way of global political events during my hiatus but I will refer to some as significant in various aspects as we proceed.

(more…)

Notes From Underground: A Financial Repression Authority (FRA) Podcast With Peter Boockvar

February 12, 2017

It is a great honor to feature another podcast with Peter Boockvar for The Financial Repression Authority. Peter is certainly one of the regular commentators that I watch with great interest whenever he is on Bloomberg, Fox Business or CNBC. I think we cover much of the global financial landscape. While it may run long, it is a lot easier than reading a 20,000-word blog post. Pour the scotch and give it a listen.

CLICK HERE TO LISTEN TO THE PODCAST EPISODE!

(more…)

Notes From Underground: Let’s Look at Global Yield Curves

February 7, 2017

One of the most important indicators for financial markets is yield curves. They are predictive as they have historically shown coming economic turmoil, or, more importantly, the end of a business cycle. The severity of any recession depends on the amount of debt that has preceded the onset of an economic slowdown. I will remind readers that before the 2007-08 financial crisis, the U.S. 2/10 curve actually INVERTED to NEGATIVE SIX BASIS POINTS. Some financial pundits like to cynically advise consumers that the STOCK markets have predicted 10 of the last 5 recessions, but that is not so with yield curves. The difficulty with the signalling mechanism of yield curves is predicting the time for even during the GREAT RECESSION equity markets continued to rally even as the curve flattened.

(more…)

Notes From Underground: FOMC Decision Day Is Upon Us

January 31, 2017

Janet Yellen and the FED take center stage tomorrow and the consensus is for NO CHANGE. The market believes the FED will be on hold until March. BUT I OFFER THIS: If I was the FED chair I WOULD RAISE RATES 50 BASIS POINTS to take some of the risk out of the U.S. equity markets. The S&Ps are virtually unchanged since the December FOMC meeting but the market’s enthusiasm for anticipated tax cuts, regulatory relief, and possible currency intervention means the FED cannot wait to let the economy run “hotter for longer,” especially because of the 4.7% U3 unemployment level. If Chair Yellen wishes to burst the TRUMP exuberance it is time to move aggressively to stem the rise of a potential inflationary threat.

(more…)

Notes From Underground: First Friday Of The New Month, You Must Be ‘Jobbing’ Me

January 5, 2017

I’m still nursing a New Year’s hangover. It takes a long time for the mind to rid itself of all the news the mainstream media deems fit to read. But as the third rock keeps spinning, markets will keep moving and we will strive to untangle the ball of confusion. After today’s tepid ADP data the market has settled into a consensus for 175,000 nonfarm payrolls. Again, I would love to see a number greater than 250,000 just to test the recent market action. BONDS rallied, currencies rallied against the DOLLAR, precious metals are showing early year strength and commodities have held support levels in the age of TRUMFLATIONARY EXPANSIONARY EXPECTATIONS.

(more…)

Notes From Underground: Steve Bannon (Laugh, Laugh I Thought I’d Die)

December 6, 2016

Even though Steve Bannon is no Beau Brummel, the music of this early rock song must be ringing in his ears. It seems clear to all but the dumbest media talking heads that the Bannon plan of Trump’s continued flow of tweeting is an attempt to make sure the Trump team controls the NARRATIVE. (See Ben Hunt’s magnificent piece at Epsilon about the significance of narrative.) This is important for investors and traders because of Trump’s ability to control the narrative makes us all focus away from the most events of the greatest possible consequence. Today, the airwaves were echoing the Trump tweet of the President-elect threatening to cancel the orders for two new Air Force One planes, the President’s personal fleet.

(more…)