econ link roundup
Oct. 12th, 2012 11:52 am![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
solarbirdI have too many tabs open in Firefox and a security update is downloading, so welcome to linkfest!
Alphaville talks about a housing recovery, and touches upon a thought I've entertained (and suggested) before: that much of the buildout in housing in the housing boom was what they call inefficient, which is to say, nobody will ever fucking want it. Which, in turn, means that in terms of a construction recovery, it doesn't count as inventory.
Think about it a second and it makes sense. All the exurbian bullshit which got slapped up in the middle of nowhere is completely opposite indicated living trends, particularly from younger people. That housing may as well not even be out there, in terms of demand and supply. (I exaggerate, of course, but only so much.) So don't wait for that to be made whole before a construction recovery begins.
Zero Hedge talks about the H.4.1, "other reserves." It's an interesting chart, to say the least:
Relevantly, Doug Noland at Credit Bubble Bulletin has choice commentary on the strange stability of European debt against fundamentals, and the ability of the bond market to intimidate central banks. It all has to do with advance commitment to interest rates, and the resultant speculative market - and backstop for it:
JP Morgan/Chase has a lot of exposure to European periphery debt, by the way. Just sayin'.
Yves Bonzon has commentary on the differences at this point between US and Euro central bank action consequences. In the same issue of Perspectives, "Two factors dominating the global economic scene" talks about the reduced risk of ongoing liquidity crises, but no abatement in solvency crisis. Tyler Durden sees the European Central Bank as having inadvertently set up a debt feedback loop.
Also check out A Tinhat Full of Dollars, again at Alphaville. USD as a haven currency? Not so much lately, at least, not observationally. This is a weird fuckin' chart to me, because other than the Swiss franc, this is almost an inverse of recent currency stability.
Particularly so, given this: Scott Minard of Guggenheim on the defacto Bretton Woods II, and how it's no more stable than the original Bretton Woods was in 1968; fundamentally, the saturation of foreign holder markets with T-bills, and China's sloooow moves towards shifting to a domestic-consumption-driven economy. There are a couple of interestingly parallel graphs; when you look at the Y axises, you'll be tempted to cry foul over the different scales, but the scale differences actually reduce the potential impact rather than increase it, so, um, yeah. But BEII being on the ropes shouldn't surprise anyone reading these posts.
Finally, here's Goldman Sachs's analysis of the probable Congressional action in December/January w.r.t. the "fiscal cliff."
It's October. Scary month. Boo!
Alphaville talks about a housing recovery, and touches upon a thought I've entertained (and suggested) before: that much of the buildout in housing in the housing boom was what they call inefficient, which is to say, nobody will ever fucking want it. Which, in turn, means that in terms of a construction recovery, it doesn't count as inventory.
Think about it a second and it makes sense. All the exurbian bullshit which got slapped up in the middle of nowhere is completely opposite indicated living trends, particularly from younger people. That housing may as well not even be out there, in terms of demand and supply. (I exaggerate, of course, but only so much.) So don't wait for that to be made whole before a construction recovery begins.
Zero Hedge talks about the H.4.1, "other reserves." It's an interesting chart, to say the least:
Speculation says it's most likely European sovereign bonds - at least some of it is acknowledged as such, but nobody knows how much, because lol data what is data. But being ESBs makes sense, with the not-really-secret backstopping of the ECB by the Fed. Still, this is a very high-probability target for monetisation should the countries whose bonds any ESB backstop stack are likely to be drop out of the Euro and/or default.
Relevantly, Doug Noland at Credit Bubble Bulletin has choice commentary on the strange stability of European debt against fundamentals, and the ability of the bond market to intimidate central banks. It all has to do with advance commitment to interest rates, and the resultant speculative market - and backstop for it:
There’s a lot that will likely go really wrong in Europe, perhaps even in the short-term. Greece is an unmitigated disaster, and Spain is running a close second. There was further dismal economic news this week, most notably from France. But that hasn’t in the least diminished recent keen speculative interest in European debt. Indeed, after the Fed sold its soul, I’ve often believed that the speculators became adept at recognizing periods of rising systemic stress and market vulnerability as opportunities to load up on Treasuries and MBS. And then it becomes a game: “OK Federal Reserve, make the value of these securities (or spread trades) go up or we’ll dump them.” They haven’t had to dump. The ECB has similarly opened itself up to blackmail. “Be ready with the OMT (Outright Monetary Transactions - SB) as promised - or we dump.” “Spanish and Italian politicians, play ball or we’ll dump.” “Mr. Weidmann and the Bundesbank, fall in line - or we dump!” “All policymakers everywhere, play or we dump.” At least in Europe, this is developing into one fascinating multifaceted game of chicken.All this in the context of European banks needing to sell US$4.5T in assets, in the next 14 months. Is that drool?
JP Morgan/Chase has a lot of exposure to European periphery debt, by the way. Just sayin'.
Yves Bonzon has commentary on the differences at this point between US and Euro central bank action consequences. In the same issue of Perspectives, "Two factors dominating the global economic scene" talks about the reduced risk of ongoing liquidity crises, but no abatement in solvency crisis. Tyler Durden sees the European Central Bank as having inadvertently set up a debt feedback loop.
Also check out A Tinhat Full of Dollars, again at Alphaville. USD as a haven currency? Not so much lately, at least, not observationally. This is a weird fuckin' chart to me, because other than the Swiss franc, this is almost an inverse of recent currency stability.
Particularly so, given this: Scott Minard of Guggenheim on the defacto Bretton Woods II, and how it's no more stable than the original Bretton Woods was in 1968; fundamentally, the saturation of foreign holder markets with T-bills, and China's sloooow moves towards shifting to a domestic-consumption-driven economy. There are a couple of interestingly parallel graphs; when you look at the Y axises, you'll be tempted to cry foul over the different scales, but the scale differences actually reduce the potential impact rather than increase it, so, um, yeah. But BEII being on the ropes shouldn't surprise anyone reading these posts.
Finally, here's Goldman Sachs's analysis of the probable Congressional action in December/January w.r.t. the "fiscal cliff."
It's October. Scary month. Boo!
