By FF Wiley – In Part 1 of this series, I said I would challenge popular beliefs about inflation, while at the same time proposing an alternative theory. I also promised that the theory leads to an inflation indicator with an excellent prediction record...
By FF Wiley – Have you ever questioned Milton Friedman’s famous claim about inflation? Ever heard anyone else question it? Unless you read obscure stuff written for the academic community you’re probably not used to Friedman’s...
By FF Wiley – If 2018 rings in a bear market, it could look something like the Kennedy Slide of 1962. That was my conclusion in “Riding the Slide,” published in early September, where I showed that the Kennedy Slide was...
By FF Wiley – We’ve been seeing more and more commentaries discussing bad stuff that can happen when the Fed tightens policy and, as a result, the yield curve flattens. No doubt, the Fed’s rate hikes will lead to mishaps as they...
By FF Wiley – In September, we proposed a theory of the Fed and suggested that the FOMC will soon worry mostly about financial imbalances without much concern for recession risks. We reached that conclusion by simply...
By FF Wiley – Forget about big hair, Ray-Bans, and Donkey Kong. Don’t even think about Live-Aid, Thriller, and E.T. Above all else, the 1980s were the gravy days of the money supply aggregates. Beginning in late 1979...
By FF Wiley – Many pundits told the addition story as QE was underway. They expected banks to “multiply up” reserves by aggressively expanding their loan books. But reserves never significantly multiplied. We think there are five reasons why the “money...
By FF Wiley – First, certain other indicators actually have helped foretell major market turning points. Nearly all of the past 13 bear markets, for example, were explained partly by some combination of sharply rising inflation...
By FF Wiley – Pension plan administrators do it. Their actuaries and consultants do it. Professional endowment and foundation investors do it. Financial advisors do it. Private investors may or may not do it, but they...
By FF Wiley – Even as the Fed’s decision makers are beginning to worry less about a recession and more about bubbly stock prices, we’re not yet moved by their attempts to curb the market’s enthusiasm. After all, the fed...
By FF Wiley – The world hardly needs another theory of the Fed, especially so soon after its Jackson Hole symposium. But we have a theory, too, and who knows, ours could be as close to the bulls-eye as any of the others. Plus, our theory is...
By FF Wiley – It seems every bank, including central banks, publishes a financial conditions index these days. And because financial conditions typically lead the economy, it makes sense to track them. In fact, they might contain even more...
It stands to reason that when the Fed eventually lifts interest rates, we’ll see the usual effects. After a sustained rise in rates, you can safely bet on...
Sometimes the most interesting results are the ones you didn’t see coming. We recently picked through financial flows data looking for clues about where a dollar of quantitative easing (QE) ends up.
We get experts on everything that sound like they’re scientific experts — They’ll sit at a typewriter and make up all this stuff as if it’s science and then become an expert — Now, I might be quite wrong, maybe they do know all these things.
With 2013′s economic data mostly complete, let’s have a look at where the race stands. We’ll start by asking what needs to happen before we get the robust recovery that many economists have predicted for the past four years.
Emerging market stability is far from the most important factor for U.S. stocks. The present crisis is likely to create more market volatility, but stocks were due for a period of consolidation with or without Turkey’s corruption scandal...
We offered our take on stock valuation several times last year, while arguing that traditional price-to-earnings multiples (P/Es) are almost useless during periods of heavy policy stimulus.
In “Why the Fed Won’t Taper in December,” we pretended to write the first paragraph of the Federal Open Market Committee’s (FOMC) statement for next week’s meeting. By thinking about the likely mix of upgrades and downgrades to its assessment of the economy...
