Central bankers want to stay on track; German record surplus; China profits zoom; India struggles with GST; UST 10yr yield at 2.17%; oil and gold up; NZ$1 = 72.4 US¢, TWI-5 = 74.7

The long expansion is ageing; the clouds over the consequences of a disheveled US Congress and White House are growing.

Hmmmm....

Excluding transportation, new orders for durable goods rose at about the same rate as the past few months, +6.9% year-over-year (NSA). Shipments were up in similar fashion, +6.1%. These growth rates are insufficient to count as a rebound, as in both shipments and new orders, capital goods as well as durable goods overall, activity in this part of the manufacturing sector remains still less than at the prior peak ten years ago.

Nothing so far this year suggests that will change. Seasonally-adjusted, durable goods orders (ex transportation) rose to $154.8 billion in July. That’s still $11.6 billion less than in June 2008 nine years ago. Peak to peak that works out to an annual rate of -0.8% compounded “growth” for this “recovery.” Read more

Firstly in Jackson Hole, Wyoming, Janet Yellen defended the series of regulatory responses to the GFC, facing off a White House and Republican calls to water down the Dodd-Frank banking reforms. She said these reforms have made the financial system safer.

But not better.

The idea behind reform and re-regulation (Dodd-Frank and other rules) was to make the financial system “resilient” in order to foster growth. If banks and institutions were confident about this new system arising from the ashes of the old, then recovery would happen; at least that was the assumption.

Now–a decade from the onset of the crisis and nearly seven years since the passage of the Dodd-Frank Act and international agreement on the key banking reforms–a new question is being asked: Have reforms gone too far, resulting in a financial system that is too burdened to support prudent risk-taking and economic growth?

People are only asking the question because there is every reason to suspect that “something” just ain’t right. Ten years is more than enough time (and five years of “transitory” doesn’t really convince anyone anymore). I don’t mean regulation specifically, but instead the monetary system. Yellen and her comrades are being pushed closer to the truth. It won’t surprise you that she believes the answer to her question is “no”, but the mere fact that she feels compelled to address the matter shows (as always) that she is worried that maybe there is something holding it all back, and that this something is within her area of bureaucracy.

Why is the Fed seeking to “raise rates?” Because what else are they going to do? They surely suspect by now that in the end it doesn’t matter either way. Things happen whether they do or they don’t; the “rising dollar” amply proving that point for the third time since 2007. When you don’t know what to do or why, you do what comes naturally or what you were trained to do. Read more

Mission accomplished - Well I never knew that

At the 6' 45" mark of last nights TVNZ news Bill English stated Christchurch is "substantially" rebuilt
Could'a fooled me. Have to admire the audacity of that one
Gotta be Fake

Meanwhile Ardern chucks $300 million extra at Christchurch to help them get on with it

Bernard Hickey and Mike Hosking both foaming at the mouth today over Winston Peters and $18000 - can't ever recall either one of them frothing-off about Multi-Nationals and their multi-millions of tax avoidance

In Germany, their federal budget surplus hit a record €18.3 bln for the first half of 2017 thanks to a solid economic performance and rising tax revenue. Lets hope they pay off some of their Debt, it sits at % of GDP
68.63%. China has Debt as % of GDP 42.09%, both reasonably acceptable but the United States of America trumps them both with a whopping Debt as % of GDP 106.31%
Little old NZ sits at Debt as % of GDP 33.49%, lets hope spending post election doesn't balloon this and we actually try and reduce this debt for the sake of long term stability.