by Simon White | Aug 5, 2017 | Emerging Markets, Global Economy
The macro-economic landscape has profoundly changed since the financial crisis. Developed markets deleveraged, and emerging markets became the engine of global credit and money growth. The top-left chart from the BIS shows this very clearly. EMEs (emerging market...
by Bill | Apr 28, 2017 | US Economy
Over the past few weeks we have expressed scepticism on the Trump reflation trade and we have argued that bank stocks should underperform. We have shown previously that when you look at the 3 and 6 month change in Commercial & Industrial lending as well as the...
by Bill | Apr 7, 2017 | China
Chinese excess liquidity does a good job of leading asset prices as well as China-related commodities. We define excess liquidity as M1 money growth minus Inflation minus economic growth. This captures how much excess money there is beyond what the real economy can...
by Bill | Mar 11, 2016 | Monetary Policy
Financial conditions are slowly but surely tightening. We have had one actual rate hike by the Fed, but conditions had begun to tighten before this. This is primarily a developed market phenomenon. Real M1 for the G7 has been trending down for the past 6 months....
by Bill | Jan 27, 2016 | China
China is in the midst of a debt-deflationary bust. It is an ongoing process that has gathered pace recently. Capital outflows are a symptom of this, and a weaker yuan is an integral part of the attempted cure. We expect more of this to come. We wrote back in the...
by Bill | Jul 29, 2015 | European Economy
For all of Spain’s entrenched structural issues (as we detailed in our April thematic, Spain – Still a Hole in Europe’s Balance Sheet), leading economic data continues to point towards a cyclical recovery in Spain. Real M1 is growing at 15% YoY, consumer confidence is...
by Bill | Jul 7, 2015 | European Economy
If you ignore the ongoing Greek sideshow, rarely has European money growth been as accommodative as it is today. Europe has enormous structural problems of too much debt, an inflexible currency and an ageing population, but cyclical factors are very positive. Leading...
