Information = Edge
Our thesis was driven by fiscal math gravity facing government budgets and game theory analysis for how central planners would react to it.
US from a year ago: – Export Price Index: 4.9% – Import Price Index: 4.3% – Shelter: 3.5% – Fuel oil: 25.3% – Transportation Services: 3.8% – Case Shiller Home Price Index: 6.8% – Retail Sales: 6% – Real Average Hourly Earnings: 0% (would be negative with a “less adjusted” index) Fed’s “preferred” PCE Index: still below 2%. Thank goodness […]
However, we would like to point out the most important passage in the statement supporting the “central bank put” thesis outlined in several Assist FX notes.
A major Bloomberg article gaining traction essentially lays out the case for why nothing matters anymore in risk asset markets. Just keep calm and buy the dip–and by dip, that means any dip you can find. No dip? No problem. Just buy anyways. Anything is better than getting left behind sitting in the dugout on a pile of rotting cash while passive index investors trot around the bases effortlessly.
The main driver of cryptocurrency demand, which we describe as “revenge of the savers,” is what concerns central banks, governments, and too-big-to-fail banking behemoths such as JP Morgan Chase.
Dominant Currencies Through History: Why USD is at Risk as a Reserve Currency and What Would Replace It
What has been overlooked by most are the strong back-to-back personal income figures of 0.4% m/m in May and 0.3% m/m (revised from 0.4%) in April. While April was revised a tick lower, May’s rebound capped off an impressive two month gain of 0.7% in personal incomes.
Inadequate Historical Valuation Measures and What Comes Next in This Monetary Bubble Investing Frontier
Dovish hike of 25bp
