The Fed’s balance sheet may be flat but US banking indicators show systemic liquidity growing. Capital is flowing out of Europe, fleeing NIRP, and US corporate executives are still funding financial engineering schemes at a breakneck pace.
US macro liquidity grew in June, thanks to the Fed’s purchases of MBS from dealers and to the actions of the ECB and BoJ.
Real time withholding tax collections contracted in June.They’re not the only taxes that are falling.
Negative rates in Europe and Japan and a growing maelstrom in Europe continue to drive foreign capital to the US. This has put the US bond market in a position to break out and possibly drive yields even lower. It has also driven a recurring bid for US stocks that shows up any time a…
This report looks at the long term charts and outlook for the 10 Year Treasury Note and the US Dollar.
As US banking data continues to exhibit bubble behavior, European banking data reflects a deepening long term crisis of confidence among bankers. These may be harbingers of the endgame for central bank market manipulation.
Macro Liquidity and investor/dealer confidence in the central banks have reached a major inflection point. They are on the cusp of either breaking a yearlong cyclical downturn or rolling over and resuming what could be a secular decline.
Treasury supply increased in May, but not enough to knock the markets down. The massive money printing campaigns of the BoJ and ECB along with their negative interest rates drives capital to US markets, tilting the playing field against the bears.
Real time withholding tax collections had a meager gain in May, increasing by just 3.3% in nominal terms. Adjusting for the reported wage inflation for April of +2.5%, the indication is that the US economy barely grew at all in May. That’s no different than the low end of the growth range of the past…
Virtually nothing has changed since the last update, other than an uptick in current US GDP for the second quarter. When economic data releases begin to reflect this next month, the market reaction should be negative as traders conclude, correctly, that the Fed will tighten. Markets top out when the news is good, because that is, in fact, when the Fed turns the screws.