The Friday File: The most ethical and honest profession is nursing. 29% of American consider them to be very highly honest and ethical and 50% consider them highly ethical and honest. Doctors follow at 17% and 45%, and pharmacists at 14% and 44%. At the other end, telemarketers are the worst at 1% … [Read more...]

After every scheduled Fed meeting to make potential changes to the Fed funds rate, a press release is provided. 30 minutes later there’s a presser. When Bernanke and Yellen were Fed heads, markets responded identically to the press release and the presser. It was that way for Powell pre-Covid. Since … [Read more...]

In a move largely anticipated, today the Fed boosted the Fed funds rate by 25bps, and strongly implied that the peak rate is no more than 25bps away, suggesting maybe one more hike. However, in a nod to current conditions the Fed removed the phrase “ongoing increases in the target rate” and replaced … [Read more...]

In the rush to safety during the week preceding the Credit Suisse failure, the biggest gainers among commodities included silver, up almost 10%, and gold, up about 6%. The biggest decliners were crude oil, down over 10%, gasoline, down about 6%, and copper, down almost 4%. Bitcoin was a huge gainer, … [Read more...]

The Fed raises the Fed funds rate to tighten both financial conditions and lending standards. They in turn result in reduced lending and investment, which leads to slowing economic activity, and usually a recession. Since the SVB debacle, financial conditions and lending standards have quickly … [Read more...]

The Friday File: 61% of Americans plan to celebrate St. Patrick’s Day and in the process collectively spend $6.9 billion. The previous record was $6.2 set in 2020. And it’s no wonder, 1 in 10 Americans can claim Irish heritage making it the country’s second-largest ethnic group. While Ireland has a … [Read more...]

Ten days ago the 2-year 10-year yield curve was deeply inverted. Today the inversion is less than half what it was. The long end has fallen by half a point while the short end has fallen by over a point. Should the yield curve de-invert, watch out. Historically, from the day the yield curve is no … [Read more...]

February CPI rose 0.4%, down from 0.5% in January, and is up 6% Y-o-Y, down from 6.4% last month. However, core CPI rose 0.5% in February, up from 0.4% in January and is up 5.5% Y-o-Y, barely down from 5.6% last month. Worse, core services CPI, the Fed’s favorite measure, is up M-o-M for the second … [Read more...]

While distasteful, the Fed/Treasury/FDIC troika had no choice but to protect all bank deposits even in accounts with balances exceeding the $250,000 insured threshold. Absent that guarantee, depositors with holdings exceeding $250,000 would have raced to withdraw their excess monies, causing bank … [Read more...]

While the failures of Silvergate and Signature are purely crypto related and meaningless, there are two lessons to be learned from the failure of SVB. First, major risks to the financial system can come from non-money-center banks, and second, borrowing short (by holding customer deposits) to lend … [Read more...]