Today's daily newsletter has stories on US trade with Canada, Mexico and China, on predictions about the cycle ending, the Tesla saga, an interview with Hugh Hendry and much more
The way to think of a flattening yield curve is as a signal that the market expects Fed tightening to precipitate a slowdown that halts or even reverses future hikes. It's the market's way of saying they expect the Fed to tighten and then…
My first weekly post at Creit Writedowns Pro includes some thoughts on Tesla, Trump's Fed choices, the US trade war with China, M&A and corporate earnings.
The sense I get is that Powell is a closet Taylor Rule devotee. If I'm right, then the neutral rate is quite a bit higher than where we are now.
This is Credit Writedowns daily newsletter for 19 Jul 2018. The big issues: the US economy, Fed policy, currencies, trade and government deficits.
These are conflicting narratives, yes. But they don't have to be because, as Minsky quipped, stability breeds instability.
The yield curve has flattened to the point where two-year yields are only 25 basis points lower than 10-year yields. I have been predicting this outcome for several months and see this as a level to worry about the Fed's ability to engineer…