Macro Voices All-Stars

All-Star Prof. Steve Keen and Erik discuss:

• Erik’s book and recent videos’ central prediction is that the USD will eventually be replaced as global reserve currency by a global digital reserve currency system
• Steve’s take: Central Bankers often make their boldest moves on their way OUT of office
• Steve thinks the rest of the world is more than ready for the USD to be displaced by something else as reserve currency
• Steve & Erik lament about Carney’s reference to Facebook’s Libra as the digital currency system to model a global reserve currency system on

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All-Star Jeff Snider and Erik discuss: 

• Jeff explains why banks are willing to pay thru the nose for negative-yielding sovereign debt
• If sovereign bonds serve as an insurance policy for the banking system, what do they see coming they need to insure against?
• Why the problem is not really term premia, as Janet Yellen recently suggested
• Graphs and charts are presented as evidence against the term premia argument
• Why Gold is up so much despite dollar strength
• The Long Eurodollar Futures trade and why it’s become so popular lately

Jeff Snider Chartbook 2019 08 26 

Collateral Reserves: What Is Behind Record Low and Negative Yields 

                                                                  Eurodollar University: Diagramming Repo Reserves And Negative Yields

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All-Star Dr. Pippa Malmgren and Erik discuss:

• Big picture macro outlook
• Why Pippa thinks it’s not as bad as many fear
• Why pensions will rush in to buy treasuries if China really divests its holdings en masse
• Why Pippa predicts more Boomers will go back to work in coming years

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All-Star Luke Gromen and Erik discuss:

• Recap of Luke’s viewpoints expressed in prior All-Stars Interviews for context
• Why USD liquidity squeeze explains apparent disagreement between stock and bond markets
• Why this is a U.S. Fiscal problem in the making, despite crashing bond yields
• Luke’s outlook for risk assets

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All-Star Prof. Steve Keen and Erik discuss:

• Update on Steve’s recession outlook for U.S. in the wake of the yield curve inversion
• Balance sheet recessions 
• Are negative interest rates evidence of central bank policy errors?
• The “wildcard factor”: China

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All-Star Louis-Vincent Gave and Erik discuss:

• History and drivers of the protests in Hong Kong and their implications in financial markets
• Gold breakout and what comes next
• Bonds and gold: Safety trade assets are clearly catching a bid!
• So why hasn’t the S&P 500 taken the hint when other global stock markets clearly have?

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All-Star Jeff Snider and Erik discuss:

• Why there’s more to the yuan devaluation story that meets the eye (or the mainstream narrative)
• Comparison to prior devaluations and analysis of true driving forces
• Why China’s U.S. Treasury holdings are encumbered and selling them doesn have the effects most people assume
• China’s behind-the-scenes derivatives-based USD “War Chest”
• Is China really manipulating its currency, and what are the consequences?

Jeff Snider Chartbook August 12 2019 

CNY 7 The Gears Behind the Clockface

The Aid of TIC In Sorting Shorts and Shortages

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All-Star Luke Gromen and Erik discuss:

• Central Bank Gold Agreement (CBGA) not renewed for first time in 20 years
• Yet central banks around the world are buying gold hand over fist!
• Luke’s take on what’s driving this and why it’s so important
• Fundamental case for gold (review) and is this a good time to buy?

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All-Star Brent Johnson and Erik discuss:

• Why Brent remains convinced the USD has much higher to go
• The case for gold, and analysis of recent moves in reaction to the Trump China Tweet
• U.S. Stock market outlook

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All-Star Juliette Declercq and Erik discuss:

•  The fed needed to take action in response to tightening global Dollar liquidity squeezing the USD higher, which will cause serious problems if not addressed.
• They had their chance last week, but blew it!
• In a rare moment of agreement with Donald Trump, Juliette says Powell should be fired!
• Great graphs and charts support Juliette’s entire narrative
• Despite these developments, Juliette believes recent dollar strength is still ultimately unsustainable

Juliette Declercq Chartbook August 5 2019 

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All-Star Professor Steve Keen and Erik discuss:

• Why Steve doesn’t expect a U.S. recession
• Steve’s economic outlook for the rest of the world
• Why Steve is concerned about the financial sector
• Will the secular bond bull market reverse or just plateau at sustained near-zero interest rates?

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All-Star Jeff Snider and Erik discuss:

• Anomalous behavior of EFF relative to IOER in 2018/19
• Why the Fed describes IOER as a floor or double-floor BELOW EFF
• Why it doesn’t work that way in the real world
• Contrasting Jeff’s views with Luke Gromen’s “balance sheet capacity” argument
• Why treasuries and other sovereign credits are really balance sheet instruments, not investments
• Japanese vs. U.S. over-indebtedness and implications

Jeff Snider Chartbook July 30 2019 

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All-Star Danielle DiMartino Booth and Erik discuss:

• What to expect from this week’s FOMC
• Will we get a 50bps cut or just 25?
• Is there a risk that a 25bps cut would disappoint markets and still lead to a big correction?
• How will the ECB and other central banks react?
• What’s in store when Christine Lagarde eventually takes the helm of the ECB in November?

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All-Star Pippa Malmgren and Erik discuss:

• Iran geopolitical situation – what’s at risk and what comes next?
• Update to Pippa’s prediction Donald Trump has aspirations of a major media empire after the White House
• Personal data monetization trends and Facebook’s record $5bn fine for privacy violations

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All-Star Julian Brigden and Erik discuss:

• If central banks are powerless to contain deflationary pressures, what are the implications for Pensions?
• Is it possible to enter recession without first seeing a 2s10s curve inversion?
• Longer-term outlook for bond yields, esp. U.S. 10yr

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All-Star Luke Gromen and Erik discuss:

• Luke says the real reason for the coming rate cut is to enable US private sector financing of government deficits
• Luke elaborates on his views about balance sheet capacity driving FF>IOER
• Luke’s expectations for market moves when a debt ceiling increase is confirmed

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All-Star Danielle DiMartino-Booth and Erik discuss:

• As Danielle explained in her prior interview, the U.S. economy isn’t immune to the global growth slowdown.
• But what about Brent Johnson’s view that a global safety trade could keep the stock market party going a while longer?
• Danielle’s take on the possibility of President Trump bypassing the Fed and intervening to weaken the dollar through executive action
• Why we should be thinking about the possibility of #DoubleEasing – both QE and rate cuts at the same time

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All-Star Prof. Steve Keen and Erik discuss:

• How the field of economics lost its way and lost touch with how the real world actually works
• Several examples of clear disconnects between widely accepted economic theory and real-world actuality
• Prof. Steve’s book recommendations for those who want an interpretation of Economics that’s a little closer to reality than the mainstream

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All-Star Jeff Snider and Erik discuss: 

• Review of Fed Funds rate and Interest on Excess Reserves (IOER) – what do they mean and why are they important
• The theorydescribing how the Fed believed that IOER would effectively cap the Fed Funds rate within their target range
• Hard data shows the theory doesn’t match actual reality
• Jeff’s explanation of what’s really going on, and why a shortage of USD liquidity in the global offshore Eurodollar market is what’s really driving the observed behavior of Fed Funds and IOER

 All-Stars Jeff Snider Chartbook July 15 2019 

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All-Star Julian Brigden and Erik discuss:

• What should we make of crypto currencies suddenly making a come-back? And what about Facebook’s Libra project?
• Why Julian remains bullish Gold, and his outlook for Silver
• Why Julian is turning bearish on the USD

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