Howard Hollem Times Square and vicinity on D-Day June 6, 1944 When I see a headline like this one at Bloomberg today, World Needs Record Saudi Oil Supply as OPEC Convenes, there’s just one thought that pops into my head: what the world needs is for us to stop doing this thing we’re doing. Even apart from peak oil concerns, it’s obvious we’re going to run out at some point or another, and it doesn’t matter whether that’s tomorrow or
Read More...
Office of War Information Watching D Day news line on New York Times building June 6, 1944 Much ado about nothing. That about sums up the real story behind the heated headlines on the “historic” decision by the ECB to lower its deposit rate into negative territory, from 0% to -0.1%. Because without any actual deposits, the move is empty, meaningless, showmanship, sleight of hand. There was a time when it made sense for banks to park reserves at the
Read More...
Arthur Rothstein Drought refugees; North Dakota farm family moving to Idaho July 1936 At the Automatic Earth, the phrase ‘Multiple Claims To Underlying Real Wealth’ has been a staple through the years. It must have been part of just about every single presentation Nicole Foss has prepared. It’s no exception for people to have some trouble understanding what exactly we mean by it; after all, how can multiple parties claim ownership of the same asset? In the Chinese port city
Read More...
Detroit Publishing Co. Excursion steamers Tashmoo and Idlewild at wharf, Detroit 1901 This is one of those days where I wonder what I’m going to say about this one. It’s all too convoluted six ways to Sunday. Yeah, Mario Draghi delivered for markets and investors, and stocks rise a bit more. Like they’re not high enough yet, setting records in . One thing he didn’t do is commit to asset backed securities purchases, and so that is now what markets
Read More...
Barbara Wright Damaged Lives, Knoxville, Tenn., 1941 The Fed itself has stated many times over the past years that it intends to keep interest rates low. And now it starts complaining about low volatility. It looks like Yellen et al want to have their cake and eat it too. Perhaps they should have paid a little more attention to Hyman Minsky. Who long ago wrote – paraphrased – that if and when markets are perceived as being stable, it’s that
Read More...
Arthur Rothstein General store closed on account of the drought, Grassy Butte, ND July 1936 Everyone expects Mario Draghi’s ECB to announce stimulus measures on Thursday. If the forward guidance, if we can call it that, which was ‘leaked’ by Draghi and his minions is accurate, we’ll see the bank’s main refinancing rate lowered, and the deposit rate perhaps even turned negative, with a less obvious set of measures that may include asset purchases also in the offing. The main
Read More...
Barbara Wright Fruit, flowers and veg stall, Knoxville, Tenn. 1941 It looks like we’ll have a few more days to watch this thing, this alleged market, until on Thursday Mario Draghi launches his modern day version of Greenspan’s oracle years and on Friday the BLS, which can rival any oracle when it comes to confusing utterances, has the US employment numbers. There seem to be people who think those numbers might be quite good, though that might be hard to
Read More...
Library of Congress Maya Angelou, Caribbean Calypso Festival, New York 1957 In a recent article, the Wall Street Journal uncovers a big problem in the US housing market, albeit, curiously, without necessarily identifying it as a problem. It would be nice if Americans could trust their once most trusted media to give them the best possible covering of a topic, but the Wall Street Journal apparently prefers to pick the side of, well, Wall Street. The problem not presented as
Read More...