It was neither humor nor humbleness, but rather hubris, being highlighted in London on June 27, 2017 when Federal Reserve Chair Janet Yellen managed to make light of a heavy subject in a live televised Q&A with British Academy President Lord Nicholas Stern. Chuckling in response to one query, Yellen offered up the following on our collective financial future….It was these last few words that ignited the ire of so many central banking detractors. Was she hoping we’d come to see the softer side of central banking?
Entangled alliances and miscalculations could lead to a larger war. The launch of World War I is infamous for its deadly domino line of alliances, crises, and escalations, and it is that labyrinthine history to which my mind turns in response to the rapid-fire news out of Syria this month. Last Monday, a U.S. coalition aircraft shot down a Syrian government plane, the second direct U.S. strike against the Bashar al-Assad regime to date. Within hours, Assad’s allies in Moscow announced Russian forces in Syria would shoot down any American or coalition planes caught west of the Euphrates, an area that comprises about a third of Syrian territory and includes Raqqa, the de facto capital of the Islamic State. The Pentagon soon responded in kind, indicating U.S. troops would “not hesitate” to return fire if their sorties face Russian interference.
The past week provided important support for the “peak monetary stimulus” thesis. There is mounting evidence that global central bankers are monitoring inflating asset prices with heightened concern. The intense focus on CPI is beginning to blur. They would prefer to be on a cautious path toward policy normalization.
As a much-vaunted Trump reflation trade fizzled and the U.S. president found himself embroiled in controversy, the big market surprise in the first half was that volatility actually fell. Traders who shorted the VIX saw their bets pay off as the gauge plunged 20 percent, taking its quarterly average to the lowest level since 2006. The question is, how long can it last? JPMorgan Chase & Co. is warning of more market turbulence as the European Central Bank and Bank of Japan begin paring their economic stimulus, while Goldman Sachs Group Inc. says net positions in exchange-traded products favor long bets on volatility over short. In other words, investors are bracing for less stable times.
Tesla Inc. deliveries are flatlining amid persistent production snafus, reinforcing concern that Elon Musk may again be setting targets that his electric-car company won’t hit on time.
Some 241 years later, Washington claims more of our money as its own than King George could have ever imagined. What do we get in this bargain? We get a federal government larger and more oppressive than before 1776, a government that increasingly views us as the enemy. Think about NSA surveillance. As we have learned from brave whistleblowers like William Binney and Edward Snowden, the US intelligence community is not protecting us from foreigners who seek to destroy our way of life. The US intelligence community is itself destroying our way of life. Literally every one of our electronic communications is captured and stored in vast computer networks. Perhaps they will be used against “dissidents” in the future who question government tyranny.
How did Donald Trump defy all the pollsters, the pundits, and the Twitterverse “experts” and take the White House? According to the Democrats, it was all a Russian plot – Kremlin-directed Twitter “bots” spread “misinformation” and “fake news”…….What hasn’t emerged from the shock and horror of the elites, however, is a reasonably convincing explanation for the Trump victory: the storied “deplorables,” as Mrs. Clinton described them, rose up in rebellion against the coastal elites and delivered them a blow from which they are still reeling. Disdained, forgotten, and left behind, these rural not-college-educated near-the-poverty-line voters, who had traditionally voted Democratic, deserted the party – but why?
The auto segment is perhaps the sharpest cyclical signal of the US economy right now. Vehicle sales and finance escaped the 2012 slowdown largely on trend, remaining one of the few actually strong parts of an otherwise faltering “expansion.” It wasn’t until the full effects of the “rising dollar” that consumers, as well as fleet customers, finally pulled back – not into recession but at least of sudden caution.
The Gulf countries really cannot afford to be at odds. The half-dozen Gulf states share a critical characteristic: all are essentially fake countries. To be sure, they have governments, diplomats, and military. But they are monarchies, some of recent vintage, in a world that long ago abandoned primogeniture. And all contract out the hardest work, from manual to professional, to foreigners. Instead of being countries, they resemble country clubs, in which a dominant few paying customers effectively make the rules and hire others to implement them. A large share of their populations are foreign and live in the shadows, with few rights and no opportunity to participate politically in the societies in which they live.
China struck deal after deal to acquire companies abroad over the last few years. Now the bill is coming due. The nation’s top corporate dealmakers, including HNA Group Co. and Fosun International Ltd., must pay off the equivalent of at least $11.5 billion in bonds and loans by the end of 2018 — a feat now complicated by government efforts to rein in their aggressive rush overseas.