Here's our summary of key economic events overnight that affect New Zealand, with news markets are hoping today's data heralds a downshift in central bank rate hike pressures.
The closely anticipated American inflation rate eased to 6.5% in December, confirming analysts' expectations. That was a pull back from the 7.1% rate in November. The shift from November to December was actually a tiny decline, mainly as a result of lower petrol prices. The latest 6.5% rate is their lowest since September 2021 and the negative month-on-month shift the lowest since April 2020, and prior to that pandemic bump, August 2015.
Bond yields sank and the USD slipped. Equity markets rose. Market bets that the Fed will dial back the pace of its rate rises rose on this conviction.
Meanwhile, US jobless claims stayed low yet again, suggesting their labour market remains quite resilient. Obviously they rose in actual number after the holiday period but less than seasonal factors would have suggested. There are now 1.87 mln people currently on this support, an insured unemployment rate of just 1.3%.
Meanwhile, American estimates for grain supplies are little-changed. But they expect to import more beef from Brazil, produce less milk, and are also seeing egg production fall. Egg prices are rising very fast there.
There were also no surprises in the December inflation data from China, coming in as expected at 1.8% which was up very marginally from 1.6% in November. But the annualised rate of change between November and December was 0%. Food prices rose +3.7% year-on-year but are easing off now. Beef and lamb prices fell from November. Milk prices rose, and at a surprising fast clip in the month (annualised +8%).
China's producer prices fell -0.7% in December from a year ago, after a -1.3% dropped in the previous month, worse than market forecasts of just a -0.1% decline. This was the third straight month of decrease in factory gate prices, amid weakening domestic demand and falling commodity prices. But the annualised rate of decline from November to December was more than -5% pa. so pressure is building.
The Indian consumer inflation rate eased as well to 5.7%, also reporting a small deflation from November.
India industrial production however rose strongly in December and by much more than expected. It was an impressive result.
In Australia, their trade surplus rose to +AU$13.2 bln in November for both goods and services, from October’s of +AU$12.7 bln, beating market forecasts of a +AU$10 bln surplus. It was the largest trade surplus since June, as exports dropped less than imports, amid high inflation and aggressive monetary tightening by major economies. Australia has now recorded a +AU$135 bln trade surplus for the year to November, and back up to its all-time high first recorded in the year to June 2022. That is a surplus of +5.7% of their GDP.
Australia reported its CPI data already. New Zealand reports ours on Wednesday, January 25.
And our weekly look at container shipping freight rates reveals little-change. Bulk cargo rates however are still falling. The heat has gone right out of this supply-chain logistics cost as global trade flows slow, especially from China.
The UST 10yr yield starts today at 3.44%, and down -14 bps from yesterday. The UST 2-10 rate curve is still inverted at -66 bps. But their 1-5 curve is a little more inverted at -111 bps. Their 30 day-10yr curve is more inverted too at -77 bps. The Australian ten year bond is down -10 bps at 3.54%. The China Govt ten year bond is little-changed bps at 2.92%. And the New Zealand Govt ten year is starting at 4.12% and down -14 bps.
On Wall Street, the S&P500 has started their Thursday session up +0.5%. Overnight, European markets all rose about +0.8%. Yesterday, Tokyo ended virtually unchanged, Hong Kong was up +0.4%, and Shanghai also ended little-changed. The ASX200 ended its Thursday session up a strong +1.2% as well, but the NZX50 only rose +0.2%.
The price of gold will open today at US$1894/oz and up +US$20.
And oil prices start today +50 USc higher than yesterday's levels at just over US$78.50/bbl in the US while the international Brent price is just under US$84/bbl.
The Kiwi dollar has risen +¼c, now at 63.8 USc. Against the Australian dollar however we are -¼c softer at 91.8 AUc. Against the euro we are soft at 58.9 euro cents. That all means our TWI-5 starts today at 70.9, and -20 bps lower than this time yesterday.
The bitcoin price is now at US$18,150 and up a strong +4.5% from this time yesterday. But volatility over the past 24 hours has been remained low at just +/- 0.6%.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
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89 Comments
Called it. Will have peaked and be in decline by June.
The next big story will be job losses in a world where two people need to work to pay the mortgage.
I don’t think we will see high unemployment for a long time. Need plenty of workers to look after all those retirees and help them spend their millions in capital gains.
We may not see *high* unemployment (7 or 8% plus) but we could see moderate unemployment of 5-6%.
5-6% unemployment is more likely because there is no shortage of low-paying jobs in our two largest export sectors - agriculture and tourism - both of which tend to do fine during tough times.
The real concern for those servicing huge mortgages and/or struggling with soaring costs will be low wages, not jobs. Middle-income earners will see their living standards plummet and the economy will take a further slide in competitiveness. Alternatively, socioeconomic reforms could improve the landscape but don't hold your breath for that.
Capacity Utilization - Countries - List (tradingeconomics.com)
Capital gains isn't real money until the property is sold and turned into a bank deposit. Then they'll probably need it to buy their slot into a retirement village, who anecdotally I hear are well established at ensuring they are getting a tidy cut of retirees wealth.
Not only that. Those elderly, dementia etc, that end up in hospital care will contribute all of their assets save about $230k, towards the cost of that which is obviously quite appropriate. Whereas those that are say renters, and without any sizeable assets, are an immediate cost to the taxpayer. And with regard to the first scenario, the relative government agencies have become extremely efficient at rooting out funds that may have been gifted or buried in trusts etc judging by the questions in the process our family has encountered recently.
I totally agree. I know 2 separate mates with elderly parents, both possessed homes prior to being forced into retirement spots with assisted care. The minute a spot was located, the family home was on the market and the retirement home/hospital started charging. The days of parents being able to leave their kids a nest egg are gone.
Am I missing something? I thought that the family home was the one asset that is safe from being raided for retirement care
I believe if you're not funding your retirement care yourself directly, the state will take most of your estate, if you have one.
It is however you are only allowed like $230K total in assets after that you start paying the retirement home. The choice then becomes do I rent out the house to cover the retirement home or just sell it and invest the money to cover the retirement home. Interest rates are now back up high enough to sell and invest. With the interest plus the super you need at least $1000 a week to cover the retirement (that was 5 years ago now). We were one of the suckers paying that, the rest got organised with a trust.
No it’s the first priority they go after. Something of a problem too if one is incapacitated and the other not. Depending on the ownership structure, the latter has to come up with the funds while also meeting the usual living expenses etc.
Well if they are now chasing trust accounts, that's something new. Like I said 5 years ago I discovered that 2/3 of the resident were not paying for care when the workers got that pay rise and we were lumped with finding another $90 a week while the rest were getting the lot paid by the government. I guess the government finally got smart.
Unless you are super rich the threat of prosecution by the crown is more than alarming for most. The crown has a bottomless pit of tax payers funds at their disposal for legal costs, KCs et al. Not so most families that might want to fight them over funds in a trust that are targeted. Leverage with very heavy hands in other words.
The new trust laws around disclosure to IR are making it difficult to hide anything in plain sight (which is what a trust does).
The new trust laws around disclosure to IR are making it difficult to hide anything in plain sight (which is what a trust does).
If your partner is in care you can stay in your own home.
You need to have done everything at least 7 years in advance. 2 out of 3 of people out there have it squirreled away in a trust. Parents can gift the money away if they start early enough. At some point in your life you find out how much your parents actually like you and more importantly, trust you.
Trust not required (though may be used...at a price).
The 230k residual may not necessarily be reached...average Auckland home sold for 1 million and invested will provide sufficient to service rest home care when added to government super.
Rest home care currently around 6k p/m....average period in care around 2 years.
And mortgagee sales by young FHB families rather than the usual suspects.
And as people have all fixed at 7% plus (often for longer periods to avoid higher rates) it won't be possible to reverse the effects for another year or two at least.
A great time to be cashed up!
Cash is King baby.
As the UK continues it's descent (sickest man of Europe yet again), it has at least provided the rest of that continent with a pertinent lesson - don't leave the EU, because things can always get worse. Clearly the European population is realizing this.....
https://www.theguardian.com/world/2023/jan/12/support-for-leaving-eu-ha…
You mean Greece is outperforming the UK with Italy and Spain ahead of the UK!
What KOTW probably means is that Greece, Spain and Italy could do a lot worse if they were to leave the EU. Those economies are faltering mainly because of their own deep-entrenched structural issues and the EU is a good scapegoat for it.
You mean the EU is their only hope at improving their situation. Lots of people moaning about organisations like the EU. Sure, the whole circus costs millions in billions in extra admin but there's still huge net benefits for every EU member in terms of economic prosperity & progression.
Not the point. The structural woes in those countries go much deeper than just their EU membership status. So, leaving the EU alone is not going to be the silver bullet like it was sold by Eurosceptics.
It is the same as politicians conveniently blaming all our economic woes on the tyranny of distance instead of implementing policy and infrastructure reforms.
We had the 3rd highest GDP per capita in the 1950s and there has been no significant pick up in continental drift ever since. Or are they claiming that geographical distance mattered less in economic success back then than it does now?
The lesson is that if enough of the voting population feel marginalized then they are more likely to vote for an option that is bad for them in the long term.
I was in Bradford 6 months ago. The poor in Bradford have better cars and posher supermarkets than myself and neighbours in Auckland North Shore. The UK certainly has problems - it even manages to have a govt far worse than we do - the UK may well be in decline but it is certainly doing so from a higher standard of living than Kiwis have.
US services inflation is going to be sticky with tight labour market.
Nonetheless, real average weekly earnings continue to decline - this is the 21st month in a row.
Is the US rate of 1.3% unemployed a like for like with NZ rate?
If so much better off than us
by Carlos67 | 12th Jan 23, 11:21am
Nobody wants to buy into Bitcoin as a "Stable Asset". The only way to make money with it is on the wild swings. 2022 was a very bad year for Bitcoin, 2023 will be worse. The smart ones got out at $67k and left the rest holding the empty bag.
Up 13% YTD..
You called anyone who bought or sold bitcoin smart?
I call them either gamblers with a lot of spare money or just greedy bunch who got swayed by media hype and wanted to make a quick buck.
No smart people don't buy bitcoin, rich with lots of money do who can scam greedy wanna become rich quick ones easily and legally.
I hear this all the time. And yet I've probably bought bitcoin (and other cryptos) maybe 1500 times since 2013 (mainly dollar cost averaging each day - I stop when we enter insane over valued FOMO territory).
Of all those buys around 90% would be in profit now. That's pretty good odds for gambling over a 10 year period.
And I don't trade either (that is where the gambling aspect comes in, if at all).
I hear this all the time. And yet I've probably bought bitcoin (and other cryptos) maybe 1500 times since 2013 (mainly dollar cost averaging each day - I stop when we enter insane over valued FOMO territory).
Nice work Wolfie. We play a similar game but it's not easy to explain to normies. It's a different behavior that they've never experienced chipping away over the long term in a market that never sleeps (although momentum has been slow over the last 1-3 months). One thing I noticed y'day is that I have balanced investments in ol' ratty, ETH, and gold meaning that the fiat value of each is now quite similar. And a silver position that I would like to have been bigger.
As for ol' ratty, it's getting to a point where you can't afford NOT to own it. $100, $1,000 or $1 mio equiv or 1%, 10%, or %50 of a portfolio.
... suggest you edit or remove that comment ... why be nasty toward fellow bloggers ?
Its not nasty GBH - as stated "No smart people buy bitcoin" - which is not correct.
Example
Michael Saylor is an American entrepreneur, executive, inventor, author, and philanthropist. He was born to a military family in Lincoln, Nebraska, in 1965 and spent his childhood living on various U.S. Air Force bases around the world. By his teenage years, his family had settled at Wright-Patterson Air Force Base near Dayton, Ohio—the birthplace of aviation and home of the Wright brothers. He graduated from high school first in his class, served as both class marshal and valedictorian, and was voted most likely to succeed by his peers.
Mr. Saylor attended the Massachusetts Institute of Technology (MIT) on a full Air Force Reserve Officer Training Corps scholarship.
In 1987, Mr. Saylor graduated with highest honors from MIT. Having already successfully completed flight officer training at Lackland Air Force Base in San Antonio, Texas, where he learned to fly, he was commissioned as a Second Lieutenant in the United States Air Force. He joined the Air Force Reserve and began a career in consulting, with a focus on constructing computer simulations to support strategic decision-making at companies such as DuPont, Dow, and Exxon.
Mr. Saylor is the author of the book The Mobile Wave: How Mobile Intelligence Will Change Everything, published by Perseus Books in 2012. The book anticipated the impact of mobile, cloud, and social networks on worldwide political and economic development, along with the rise of Apple, Amazon, Facebook, and Google as transnational technology leaders that would destabilize the status quo across most industrial and political domains. The Mobile Wave appeared on both The New York Times and The Wall Street Journal Best Seller lists. In 1999, Mr. Saylor established The Saylor Foundation, which has donated millions to philanthropic causes including children's health, refugee relief, education, environmental conservation, and support for the arts. The foundation runs the Saylor Academy (Saylor.org), which offers free college education and continuing professional development courses to students worldwide. To date, it has provided free educational services to more than 1.4 million students.
Explaining is losing : just edit out the ad hominem comment , Mr B ...
Explaining is losing?? You lost me there but yes will edit comment - education goes along way ..
I am happy to be corrected but give me one solid example of what bitcoin has added to the society for last do many years it's been in existence?
Funded a good idea? Mostly it's been used by scammers and anti social people to move their funds. In the end most who buy and sell bitcoin they do it on their currency of choice. So please guide me the usefulness of it.
Heres an example when a near dictator trashes a economy ..
First, let’s start with the lira. Turkey’s inflation rate recently surpassed 83%, a 24-year high, though some researchers estimate the inflation rate to be significantly higher. The lira also reached a record low against the U.S. dollar amid the government’s unorthodox policy of cutting interest rates. Critics blame the government’s monetary policy for inflation, while the government has pointed to attacks by “foreign financial tools.”
Certainly there are 100's of Paid articles on the internet. But can i buy a loaf of beard with coin in Turkey right now?
Please don't tell me it will happen as fortune-tellers do. I believe in today.
Yes this virtual currency is very active in Turkey right now because people want to move their illegal funds in an easy way as value of their currency is dropping and all those want to save their money on which they probably haven't paid taxes. May be i am wrong in my assumption but really today that virtual currency has no significance as it's not backed by any one.
Did you actually read the article? Maybe you just lack desire or ability to accept new ideas?
I'm no great fan, however Baywatch you make some good points that the anti btc should note (of which I have been one)
For those who live in countries with massive inflation and who cannot afford to invest in art or Florida real estate, putting their mediocre savings into btc is one way of avoiding the ravages of inflation.
If BTC can stabilize, then for those with no other means of protecting their wealth or with access to a decent or any banking system, BTC helps.
Thanks you Ratus..I may have been on the other side of the debate (Bitcoin maximalist) but this year will try to debate the subject with actual data and facts, hopefully others will try as this site is a great place pick up new ideas and information.
... i only could find my $50 btc that i purchased and never arrived!
Family giving me grief about it...don't believe me when I tell them that I haven't lost it, just need a btc guru to find what the heck i did wrong when i purchased it!
i only could find my $50 btc that i purchased and never arrived!
This is unfortunate. There are no regulated exchanges locally AFAIK. EasyCrypto might be regulated to some degree but it's not a spot price exchange. Therefore, the avenues to buy a little and understand the market is limited compared to say the U.S., Japan, or S'pore. Kiwis can open accounts on Independent Reserve in Aussie but there's still a bit of hoop jumping.
.
Personally from my experience, I can buy and sell items using crypto (books mainly) with no middle man or fees.
I could send donations to the Ukraine Military within minutes of their request. Funds arrived in 1 minute with a fee of 20c.
On a more global level, imagine you had to flee your war-torn country and needed to move your assets urgently to another country. Banks are closed, property is ruined, the border officials are corrupt. With bitcoin you could move your entire wealth using just a code (easily hidden in various ways or even memorized in your head).
Did you know ngutoroa there are at least 100 - 200 projects in the crypto space, that all have some kind of innovative, commercial potential. ie Web 3
Those "coins" are backing these projects, with Bitcoin itself the "Gold standard" of digital currencies.
You should take a look at the banks and how their exchange rates are "wired" for their spread - there's the REAL scammer with lots of money, stripping the little guy of the value of their funds.
If that is the case why people still buy coins with hard cash currency of their country?
Can one of these so called currencies bitcoin, ethereum, dogecoin etc buy each other. Yes buy a book but at the end of the day you need bread to eat. When I can buy it with coin etc, I will believe in this wonderful currency of wonderland.
Still when you sell it you want cash in the currency of your country.
But still keep believing in the Tulips and the Y2K.
I am not a fan of banks either, they are the creation of rich man keeping the poor always poor. But Bitcoin etc is not a creation of poor man either.
yes buy a crypto debit card and you can live your daily life without NZD. Just spend your BTC or ETH anywhere that takes a visa card.
I know that there will be things like taxes or rates that you must pay in cash, but you can just sell out of your BTC into NZD for those one off events.
Well I got out at $41k but I certainly wouldn't call myself smart. Just not foolish.
That said I've been happily DCAing in ever since the super crash started.
But I still think ETH is the better bet, even if it takes another year or two to transpire.
I'm just squirrelling a bit into ETH each week (and an even smaller amount into a "revolving" list of other 2nd tier cryptos, e.g. I buy one in week 1 of the month, a different one in week 2). It's money I'd otherwise spend on takeaways, lunches etc so I figure I'm not losing much - if anything my waistline is thanking me.
I am not expecting to strike it rich; short of another absurd bull run or a lucky crypto moon shot I've missed the boat for the foreseeable future ... I'm not dependent on any wild swings.
yes indeed I'm doing the same when I (try to) quit alcohol. The money from alcohol goes into Dogecoin. Its funny but its been a good little investment and helps with health.
Same..(BTC however) - one man's meat is another man's poison
May be invest that money in a startup or an idea which needs investment to grow. It will be more helpful than putting money in any coin as it's gambling and not adding any value to the society.
You must be joking.
I attended a seminar run by a well known angel investor VC who went through the trials and tribulations of VC and seed investing in New Zealand.
In short, it needs to be an absolute labour of love with countless hours of your time spent and ideally you would need 20+ investments to make the risk / reward worthwhile. The minimum investment required means you really need a nest egg of millions to deploy.
Multiple stories of investors misappropriating funds or just ghosting away - no accountability for the investments.
Now that is what I call gambling. Why risk it all when you can DCA into say BTC or ETH at $20 a day?
Are you my wealthier doppelganger by any chance? I too attended an angel investing seminar, and walked away being even less enthusiastic than I was before, for the reasons you outlined. Not my cup of tea.
Sometimes it's a good idea to just not comment at all when you are clueless on a certain topic. Ethereum is not a "coin" - it's the future global settlement layer for finance on the internet. It most certainly does add value to society (staking literally creates value) and this will become more clear in the 5-10 years ahead of us.
Sure, let's talk in 5-10 years about value when it does but at the moment it doesn't and i live my life in the present. I don't trust in fortune tellers.
What are you going to do when CBDC (Central Banks Digital Currency) are rolled out (probably the next few years)....read your tea leaves?
CBDCs are/will be real digital money, they will be backed by the govt. None of this it's worth something because cryptography nonsense.
Yep not that its worth something because there are only 21 million of them rubbish. Bitcoin owners better pray that CBDC doesn't happen anytime soon.
Yep not that its worth something because there are only 21 million of them rubbish. Bitcoin owners better pray that CBDC doesn't happen anytime soon.
Yes. BTC supply is limited. CBDC supply is infinite. BTC is decentralized. CBDC requires nanny state and has access to all your data.
I'm scratching the surface. They are very different.
Well, there's 21 million BTC but 2.1 quadrillion satoshis. While these are limits, it's a lot more than current fiat I would imagine?
Cmon that is just silly.
You could divide fiat by whatever percent you want.
Imagine there is world hunger but only 1 pizza and no other food. Would dividing it into 100 trillion mini-pizzas solve the scarcity of food?
Why Carlos...bring them on I say, but you might have to upgrade your mobile phone first.
Similar strategy here, albeit funding small crypto purchases with proceeds from selling stuff I no longer use on trademe. No existing cash used and it's a good incentive to clean out the garage as well!
Selling at $41k isn't bad. How'd that tax bill look?
Seven figure tax bill. It hurts.
The good thing was I cashed out April 1 and put it into a tax pool. But then I think I underestimated so have a brutal UOMI bill plus penalties and a very large accounting bill.
I spent 120 hours doing my taxes last year, and have already spent two days of "holiday" trying to reconcilate my part year 2023 return (I cashed out early into the tax year so I have to figure out where the tax lies on each side of the year).
For completeness, I cashed out for taxes at 46k, sold 60% of my holdings at 41k, and the rest over the next few weeks. My final cash out was three days before the Luna crash. I think BTC was 35k then.
I am also buying ETH (the dips) and have been doing incredibly well (DEX).
Up 13% YTD..
Yes. And up +21% from the USD15500 low. The ATH is is approx. +260% from current prices.
Bill Phillips (of Phillips Curve fame) will be looking down and saying, 'Yes, of course a rapid change in import prices can lead to a shift in the wage and price level, and, yes of course, this can then stabilise or even fall when that shock is over - that is literally what my model predicts will happen.'
Sadly, the medieval monetarists took Phillips fine work and used it to create a model to justify crushing workers. Even worse, they taught thousands of economists their dumbed down version of the Phillips Curve (a term Phillips did not use) and they are out there today - often unknowingly - peddling a myth.
Bill Phillips did not himself consider the Phillips Curve to be his most important work. Indeed he supposedly knocked out the paper over a weekend. The key insight is very simple. But it is a big error (by others, not Phillips himself) to apply the specific quantification to situations other than those explicitly modeled.
KeithW
Thanks Keith. Yes, I couldn't believe it when I read his 1958 paper - and then I just got angry that people had taken that work and turned it into the two-dimensional (and damaging) nonsense in the textbooks.
"China’s Covid nightmare is the final proof: lockdowns were a total failure
Sweden’s refusal to impose compulsory shutdowns has now, by contrast, been completely vindicated"
https://www.telegraph.co.uk/news/2022/12/28/chinas-covid-nightmare-fina…
"We observed a mortality that was lower than expected for the age group 0–69 in both countries through the pandemic year compared with each of the five preceding years. Hence, for the working population that comprises >85% of the two countries, the COVID-19 pandemic has not had a negative impact on all-cause mortality. ...However, the decrease in mortality rate in the age group 0–69 years in Sweden in the pandemic year was significantly larger than in Norway."
https://journals.sagepub.com/doi/full/10.1177/14034948211047137
Ha!
some of us were hung, dried and quartered for suggesting Sweden’s approach might have been the best.
I have recently seen my brother and his family from Sweden, so refreshing to hear how relatively undisturbed my teenage nephews’ lives and education have been.
The sad thing is this was know very early on by anyone who bother to look at the Diamond Princess data, Ioannidis analysis etc.
'The number of deaths from any cause among the 1,951,905 children in Sweden (as of December 31, 2019) who were 1 to 16 years of age was 65 during the pre–Covid-19 period of November 2019 through February 2020 and 69 during 4 months of exposure to Covid-19 (March through June 2020)
...No child with Covid-19 died."
https://www.nejm.org/doi/full/10.1056/NEJMc2026670
https://www.sciencedirect.com/science/article/pii/S001393512201982X
This study shows that all-cause mortality in Norway was lower during the pandemic, whereas the all-cause mortality among elderly people in Sweden increased substantially. In previous years, both countries have seen a decreasing trend in all-cause mortality. It remains to be seen whether the observed excess deaths in Sweden during the pandemic may, in part, be explained by mortality displacement and whether the COVID-19 pandemic and mitigation measures are associated with other harms or benefits.
For balance you should always read Profiles links in full. There's seemingly cherry picking in virtually anything Profile posts.
Did you miss this cherry Pluto? I'm the cherry picker who provides links so you get the whole tree and make your own mind up. Or would you prefer I just paste the complete paper to cater to your sensibilities?
"A government-appointed commission in Sweden has stated that the country failed to protect elderly people and some have pointed out that health care staff in Swedish nursing homes were more likely to show up at work sick because of a lack of sick leave compensation for workers [31,32]. In addition, there were few health staff in Swedish nursing homes and many of the employees were part-time workers.
Another difference between Norway and Sweden that may have contributed to the differences in mortality is the proportion of self-employed general practitioners in primary care: about 95 and 20%, respectively [9]. Although primary health care is central in both countries, this might have affected how the pandemic was handled. For example, in Norway, every inhabitant is appointed to a personal general practitioner (fastlege) and there are twice as many general practitioners per inhabitant in Norway than in Sweden [9]. These general practitioners were central in contact tracing and the isolation of infected people during the first year of the pandemic."
https://journals.sagepub.com/doi/full/10.1177/14034948211047137
"Could the Covid-19 case fatality rate be that low? No, some say, pointing to the high rate in elderly people. However, even some so-called mild or common-cold-type coronaviruses that have been known for decades can have case fatality rates as high as 8% when they infect elderly people in nursing homes. In fact, such “mild” coronaviruses infect tens of millions of people every year, and account for 3% to 11% of those hospitalized in the U.S. with lower respiratory infections each winter."
https://www.statnews.com/2020/03/17/a-fiasco-in-the-making-as-the-coron…
Some Friday morning entertainment in the comment section of a controversial Stuff article.
Market bets that the Fed will dial back the pace of its rate rises rose on this conviction.
By far the biggest driver in the CPI right now is accounting. Any price index is flawed to begin with and they all have to do these things, but this really stands out for having 2021s home price bubble contribute the most to 2022s CPI for the Fed to set rates in 2023. Economics! Link
The Biden administration engineered the recent drop in crude oil prices and also pump prices in the US:
180 Million Barrels Of Crude May Never Be Returned To The SPR (yahoo.com)
Chevron Sending Tanker To Venezuela To Load Oil | OilPrice.com
Dems join GOP in vote to block Biden from selling strategic oil reserves to China | Fox News
HOUSTON, Dec 6 (Reuters) - An Iranian tanker carrying about 2 million barrels of ultra-light oil arrived this week in Venezuelan waters, non-government organization United Against Nuclear Iran said on Tuesday. Venezuela and Iran, both under United States sanctions, have recently expanded cooperation mainly through a swap that provides Venezuela's state-run oil company PDVSA with light oil for refining and diluents to produce exportable crude grades. PDVSA in return supplies Iran with Venezuelan heavy oil and fuel.
So that Chevron Tanker is probably picking up a Venezuelan/Iranian crude blend that is able to be refined in the US refineries.
Politics be damned. Americans need to be able to afford to drive their 6 litre V8 trucks to pickup the groceries and the kids from school.
Int rates to zoom higher. Yeah nah
DXY getting rag dolled at the moment and JPY flying. This is destroying all the smart contrarian positions (dollar milkshake theories, etc) and gold seems to have been woken from its slumber. These are very erratic and uncertain times.
..gold seems to have been woken from its slumber.
Decidedly lower US real yields ignites gold demand in anticipation of something bad happening.
A big picture macro chart to always bear in mind. As total economic debt increases over time, the level of real yields at which the economy can remain functional becomes lower and lower. Link
Soon enough a 4% CPI will be judged perfectly fine by central banks. With the bonus side effect that the existing private debt bloat will be eaten away over the next decade or so.
Good news for US mortgage borrowers sitting on 30 year fixed mortgages at <3%. What will our banks want to charge for mortgages in that environment ?
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