Macro-Economics

In July 2015, the USA, UK, France, China, Russia, plus Germany agreed to the Iran Nuclear Deal formally known as the Joint Comprehensive Plan of Action (JCPOA) with Iran. The purpose of the deal was to ensure Iran wouldn’t be able to develop a nuclear weapon by capping uranium enrichment. The...

The next FOMC meeting is on March 18 and every economic report should be evaluated on whether it increases the odds of a rate cut or maintaining the status quo. As discussed in the February Macro Tides, there are three groups within the FOMC. “Those favoring lower rates are convinced inflation...

The January Employment Report, which was delayed because of the government shutdown, will be released on February 11 and the January Consumer Price Index (CPI) is due on Friday February 13.

Anxiety about the health of the labor market was heightened after three reports released last...

The labor market appears to have stabilized, GDP growth is comfortably above the economy’s long term non-inflationary growth potential of 1.9%, and inflation is above the 2% target. This mix of economic variables has created three groups within the FOMC. Those...

Japanese government bond yields have been climbing for many months. Initially, it was in response to the Bank of Japan (BOJ) unwinding decades of extreme monetary accommodation. In response to a collapse in real estate values and the Nikkie 225, the BOJ slashed its policy rate from 6.0% in 1991...

On January 17 President Trump threatened to impose a 10% tariff on imports from Denmark, Norway, Sweden, France, Germany, the UK, the Netherlands, and Finland unless they dropped their...

The stock market suffers significant declines when a good reason to sell develops, and being overvalued isn’t a good reason. High valuation does however leave the market vulnerable to a large decline when good reasons appear. History tells us it’s not a question of if, but...

I grew up in the Midwest and in January and February lakes and ponds would freeze over and allow ice skating since the ice was thick. As spring approached (never fast enough as I got older), the ice was thinner and skaters had to be careful. The worst sound a...

After surging to 60.13 on April 7, Volatility as measured by the VIX, spent the remainder of 2025 below its long term average of 19.5 since its introduction in 1990 (Blue horizontal line is at 20.0). The VIX experienced a brief spike higher on October 20 after China said it was enacting export...

Bifurcation is inherently unstable since it creates a tension between sections of a whole and by definition shows that everyone isn’t pulling in the same direction. It’s difficult to solve challenging and complex problems even when everyone is seeking a common solution,...

On December 1 a Governor for the Bank of Japan indicated that the BOJ would likely increase their policy rate at the next meeting on December 19. Inflation has been consistently above the BOJ’s 2% target, with the Headline CPI at 3.0% in November and the Core CPI at 3.1%. On November 20 Japan’s...

On Sunday 8 Democrats voted with 52 Republicans to move forward and presumably end the longest government shutdown in history. The vote on November 9 came after 14 previous attempts failed. Five additional Democrats agreed to join the three Dems who had voted yes in the prior 14 votes. The...

As expected, the FOMC voted to end its Quantitative Tightening program on December 1, so it will no longer allow $5 billion of Treasury debt a month roll off. The FOMC did vote to continue allowing $35 billion a month of Mortgage-Backed-Securities (MBS) to roll off. The $35 billion will be...

At one time the phrase “ A watched pot never boils” meant time seems to pass more slowly when one is waiting for something to happen. The time waiting also allows expectations to grow and I remember when the event I had been waiting for finally...