Eurodollar University

Robert Bleiberg, an expert in macroeconomic analysis and monetary policy, unpacks the historical fiasco of price controls during the Nixon administration. He argues that government interventions are often misguided, revealing how these measures failed to curb inflation and exacerbated economic issues. Bleiberg highlights past lessons, emphasizing that politicians' quick fixes don't address underlying problems like purchasing power and unemployment. He offers a cautionary tale about the dangers of repeating such mistakes in today’s economic landscape.

Economic turmoil is brewing as Japan faces sharp stock declines and a soaring yen, signaling recession fears. The podcast delves into the fragility of the global economy, highlighting concerning US labor data with rising layoffs. It scrutinizes the risks of relying on carry trades amid these shifts. As oil prices crash, the complexities of forward rates create a chaotic financial landscape, illustrating how Japan's struggles could ripple across markets.

While the world was focused on financial volatility and liquidations at the start of August, something odd happened at the Federal Reserve's Discount Window (DW). Given everything else that has gone on since then, starting with the yield curve then considering now-cracking commodities, plus foreigners' dollar buffers and even US dealer banks' collateral holdings, there aren't that many ways to interpret what banks are doing - or not - at the DW.Eurodollar University's Money & Macro AnalysisFRB Michael Barr The Importance of Effective Liquidity Risk Managementhttps://www.federalreserve.gov/newsevents/speech/barr20231201a.htmReuters Discount window reform bill introduced as Fed works on its own overhaulhttps://www.reuters.com/markets/discount-window-reform-bill-introduced-fed-works-its-own-overhaul-2024-07-29/FRBNY Staff Report 1103 Can Discount Window Stigma Be Cured? An Experimental Investigationhttps://www.newyorkfed.org/medialibrary/media/research/staff_reports/sr1103.pdf?sc_lang=enhttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Wholesale gasoline prices plunged in August to their lowest since the start of the year. This sounds like a positive, both for consumers as well as Fed policymakers and the disinflationary impact on consumer prices. But refinery margins have crashed to their lowest in three and a half years which instead points to more and bigger trouble. Eurodollar University's Money & Macro AnalysisCNBC Oil prices ease on US gasoline demand worries, economic datahttps://www.cnbc.com/2024/05/29/oil-rises-as-major-producers-expected-to-keep-output-cuts-in-place.htmlThe Globe & Mail Crude Prices Fall on Energy Demand Concerns and Increased Russian Crude Exportshttps://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Steve Van Metre, an expert in economic trends and personal finance, discusses the alarming drop in U.S. consumer savings to just 2.9%. He explains how this decline signals a potential economic downturn and raises concerns about consumer spending and job insecurity. Businesses face challenges in workforce retention and inventory management as consumers become increasingly anxious about their financial futures. Van Metre also addresses the impact of rate cuts on economic stability amidst these troubling trends.

The podcast dives into the puzzling rise in US GDP estimates despite widespread economic struggles. Experts discuss the disconnect between government optimism and the reality faced by consumers and businesses, suggesting troubling signs in the Treasury yield curve. The difference between GDP and Gross Domestic Income is explored, with GDI presenting a more honest assessment of economic health, particularly during downturns. The conversation highlights the stark contrasts between official data and everyday experiences, raising questions about future recessions.

New information from various sources all around the US service sector shows a downturn taking hold in that segment with employment signals turning more and more negative. It confirms the ongoing and more decisive bull steepening continuing to take shape in the Treasury market. Even mainstream sources are having to cover the fact there is something big happening when you can see it in services.Eurodollar University's Money & Macro AnalysisCNN A key part of America’s economy has shifted into reversehttps://www.cnn.com/2024/07/07/economy/stocks-week-ahead-services-sector-slow-restaurants-stores/index.htmlFRB Philadelphia August 2024 Nonmanufacturing Business Outlook Surveyhttps://www.philadelphiafed.org/surveys-and-data/regional-economic-analysis/nbos-2024-08Fifth District Survey of Service Sector Activityhttps://www.richmondfed.org/region_communities/regional_data_analysis/surveys/service_sectorTexas Service Sector Outlook Surveyhttps://www.dallasfed.org/research/surveys/tssos/2024/2408https://www.eurodollar.universityTwitter: https://twitter.com/JeffSnider_EDU

Germany is facing an alarming economic crisis, with consumer sentiment and business expectations plummeting. The podcast delves into the impact of the struggling U.S. economy on European markets and reveals contrasting forecasts from optimistic Bundesbank predictions and dire PMI reports. Insights into the deteriorating IFO Business Climate Index illustrate the severity of the situation, while fears of a global recession loom large, particularly due to trends in the U.S. and China.

The podcast dives into the shocking 30% drop in shares of Temu's parent company, revealing the turbulence in China's consumer market. It discusses the struggles that Chinese firms face amid government attempts to manipulate market rates. The conversation also critiques the ineffectiveness of recent rate cuts by the People's Bank of China, raising concerns about weak demand and declining inflation. Overall, it paints a troubling picture of China's economic challenges and their potential global impacts.

Nouriel Roubini, a famed economist known for his crisis forecasts, joins Janet Yellen, the former Federal Reserve chair and current Treasury Secretary. They dive into the surprising realities behind low interest rates, suggesting they're not just manipulated by governments but rather reflect deeper economic truths. The conversation critiques common misconceptions about monetary policy and emphasizes the need to understand interest rates as signals of market conditions rather than mere tools of manipulation.