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China Tries to Muscle in on Dollar as Dominant ‘Payments Currency,’ But It’s a Thankless Slog
China Tries to Muscle in on Dollar as Dominant ‘Payments Currency,’ But It’s a Thankless Slog Dollar Hegemony is a tough nut to crack. China is taking another baby step in promoting the internationalization of the renminbi and nibble on the hegemony of the US dollar: It’s pushing a proposal to add a pile of […]
Currencies threatened by a credit crisis
Currencies threatened by a credit crisis In this article I draw attention to the similarities between the current economic situation and that of 1929, and the threat to today’s unbacked currencies. There is the coincidence of trade protectionism with the top of the credit cycle, and there are the inflationary events that preceded it. The […]
The Stock Market Just Crashed In Italy, And Argentina Has Panic-Raised Interest Rates To 65 Percent
The Stock Market Just Crashed In Italy, And Argentina Has Panic-Raised Interest Rates To 65 Percent In the 9th largest economy in the world, the financial markets are crashing, and in the 21st largest economy in the world the central bank just raised interest rates to 65 percent to support a currency that is completely […]
Venezuela Has Officially Abandoned The Petrodollar – Does This Make War With Venezuela More Likely?
Venezuela Has Officially Abandoned The Petrodollar – Does This Make War With Venezuela More Likely? Venezuela is the 11th largest oil producing country in the entire world, and it has just announced that it is going to stop using the petrodollar. Most Americans don’t even know what the petrodollar is, but for those of you […]
Currency Armageddon? A Word about the Hated Dollar
Currency Armageddon? A Word about the Hated Dollar The “death of the dollar” will have to be rescheduled. Sharply higher yields on Treasury securities and the prospect of more rate hikes by the Fed – in a world where other major central banks are still stewing innocent bystanders in the juices of NIRP, negative yields, and […]
The Confidence Game Is Ending
The Confidence Game Is Ending Immediately after the Fed hiked interest rates last Wednesday – after sitting at 0% for 7 years – markets acted pretty much as one might expect. The Fed tightens monetary policy when the economy is strong so rising stock prices, rising interest rates and a strong dollar are all things […]
Will the Fed Have to Save Emerging Markets with QE4?
Will the Fed Have to Save Emerging Markets with QE4? The risk-off tide is rising, and sand castles of QE will only hold the tide back for a brief period of apparent calm. A funny thing happened on the way to permanently expanding global markets: unintended consequences. Borrowing cheap, abundant U.S. dollars seemed like a good […]
These Currencies Could Be The Next To Tumble In Global FX Wars
These Currencies Could Be The Next To Tumble In Global FX Wars Earlier this week, Kazakhstan moved to a free float for the tenge, prompting the currency to plunge by some 25%. The move came after the country’s exporters could no longer stand the pain from plunging crude prices and the RUB’s relative weakness. China’s move to […]
Greece Fallout: Italy and Spain Have Funded a Massive Backdoor Bailout of French Banks
Greece Fallout: Italy and Spain Have Funded a Massive Backdoor Bailout of French Banks In March 2010, two months before the announcement of the first Greek bailout, European banks had €134 billion worth ofclaims on Greece. French banks, as shown in the right-hand figure above, had by far the largest exposure: €52 billion – this was 1.6 […]
