Category Archives: Economy

Leading and Other Indicators: Time to Hike?

By -

According to the amalgamation of ‘Leading Indicators’ to the economy, it is time for a rate hike. Here is the graph of LI and Fed Funds, from Wisdom Tree’s post on the subject.

leading indicators

It is and has been also time to hike based on employment numbers. This was supposed to be the last thing to get squared away before normalization, wasn’t it? LI is thought to lead inflation in the economy, which has thus far been held in check by a global deflation that is devouring funny munny sprayed from global policy hoses.


“No Recession, But…”

By -

By Biiwii

Excerpted from the September 13 edition of Notes From the Rabbit Hole, NFTRH 360…

I am personally not yet convinced an ultimate bull market top is in despite the obvious similarities of the recent interim top to 2007 [the first sign in this regard would be a loss of the October 2014 and August 2015 lows]. It could also be a 1998 clone, as we have noted by chart similarities and by global financial similarities (China/Asia). However, in 2007 the stock market did a good job of forecasting the coming “Great Recession” (a sanitized way of saying ‘impulsive unwinding of leverage’). Here is what economists think today (ref. Bloomberg article): 2018 it is, according to a majority of buttoned down dart throwers.

recession predictions by economists, from Bloomberg

Source: Bloomberg News Survey

What were they saying in December 2007? Let’s take a look, also from Bloomberg…

(Dec. 17, 2007): No Recession, But… (more…)

A Lower-Risk Way To Bet Against Oil

By -

Our Highest-Ranked ETF is a Bet Against Oil – And The Global Economy

Each trading day, Portfolio Armor calculates potential returns for every security with options traded on it in the U.S. Potential returns are high-end estimates of how the security might perform over the next six months, and they’re based on an analysis of price history and on option market sentiment. On Friday, the security with the 5th highest potential return in our universe (which consists of all securities with options traded on them in the U.S.) was the ProShares Ultra Short Bloomberg Crude Oil ETF (SCO), which is 2x short oil.

SCO had a potential return of 19%, which was 5th overall, but the highest of any ETF in our system. Here’s a way an investor who wants to bet against oil (and, by extension, much of the global economy) can own SCO while limiting his downside risk to a decline of no more than 15% if SCO moves against him. The best part is, the cost of this hedge is negative, so our investor would essentially be getting paid to hedge.

Getting Paid To Hedge SCO (more…)

Microcosm Expanding

By -


NFTRH 353 introduced the idea of a Macrocosm, a planetary representation of elements that need to come into place for a real investment stance on the gold stock sector (as opposed to the imagined elements cooked up by perma-bulls over the last few years). The Macrocosm idea came to me when the gold sector was acting firmly counter-cyclical on a day that most other markets were suffering. Then it happened again.


Grossly Inflated Gargantuan Asset Prices

By -

Humbly Submitted by the Macro Crotch Shop 

STEALTHFLATION: An intractable economic condition that inevitably arises as excessively issued fiat currency compulsively pursues non-productive wealth assets in a grossly over-leveraged economy, which has been artificially reflated by the Central Banking authorities, in a misguided attempt to synthetically engineer growth via extreme monetization.  (ie: Counterfeit Quantitative Easing & Interest Rate Suppression)

This ill-advised monetary regime effectively prevents the real economy on the ground from realizing the healthy normalization of free market forces crucial to genuine capital formation, authentically derived from bona fide industrious production generating actually earned savings, the very life blood essential to inducing legitimate and sustainable economic growth.


Is Japan’s Inflation Failing?

By -

By Biiwii

We begin with’s post from July 16 noting the message I got from a former associate (from my previous life as a manufacturer)…

“Just an update for you, some disturbing news has leaked out this week. Machine tool builders have put out blow out [lists] to all sales persons in the USA, not sure if world wide. Mori Seiki list has 600 to 700 machines on it WOW!!! never have i heard of such a huge list by any one Builder. Not sure what they see coming but it can’t be good.”

My comment from that post: “Mori is a big builder and when the big builders start blowing out it goes right down the food chain.”