Englund

in a severe economic downturn, according to European stress tests that also delivered relatively weak results for Deutsche Bank and Société Générale. FT 30 July 2021 https://www.ft.com/content/c4207dc7-578f-428e-bb72-6aabbaf31f57 Mario Draghi Has to Explain One Last Thing. So what happened, exactly, at Monte Paschi? https://englundmacro.blogspot.com/2019/07/mario-draghi-has-to-explain-one-last.html  European Banking Authority https://www.eba.europa.eu/eba-publishes-results-its-2021-eu-wide-stress-test Twenty-three banks, including JPMorgan Chase and Goldman Sachs, underwent “stress tests” by the Fed that modelled the financial damage from a series of doomsday scenarios.  These included a US stock market crash, a steep drop in economic output and substantial distress in commercial real estate. The results, released on Thursday, pave the way for billions of dollars in stock buybacks and dividends, which bank investors have been eagerly anticipating. FT 25 June 2021 https://www.ft.com/con

 The Fed has never justified 2%. It is a number dreamt up, without explanation but unfortunately now used world-wide. 2% inflation benefits banks, the wealthy, and those with first access to money. https://mishtalk.com/economics/economic-nonsense-is-extremely-well-anchored-in-fantasyland-and-not-just-at-the-fed Amid a wide range of options, inflation targeting remains the simplest and least bad https://englundmacro.blogspot.com/2021/03/amid-wide-range-of-options-inflation.html

That’s a finding in the latest Bank of America flow show report, which, in fairness, is a number that’s been trotted out before. It’s based on a 2005 book about the history of interest rates, but the chart is still incredible to examine. The Bank of America report pointed out there was a record weekly inflow to Treasury inflation-protected securities of $3.2 billion.   The 10-Year Treasury Inflation-Indexed security yielded a record low negative 1.15% on Thursday. MarketWatch July 30, 2021 https://www.marketwatch.com/story/interest-rates-havent-been-this-low-in-5-000-years-11627644496 https://www.wiley.com/en-gb/A+History+of+Interest+Rates,+4th+Edition-p-9780471732839 Vi kan mycket väl bevittna världshistoriens största och kanske farligaste bubbla. Räntorna är de lägsta på åtminstone 5 000 år. Detta betyder att priset på obligationer är de högsta på 5 000 år. Andreas Cervenka, SvD 27 januari 2016

Even if we stopped emitting greenhouse gases today, global warming would continue to happen for at least several more decades, if not centuries. https://climate.nasa.gov/faq/16/is-it-too-late-to-prevent-climate-change/

or as a stolen wallet full of cash?  South Africa is a case study of what happens when the elite’s time horizon shortens. There are only a few lucky countries whose elites reliably think decades ahead. This is an unfairly self-perpetuating system. Typically, these are old democracies, where members of the elite live in old houses. Even there, elites have varying time horizons. Simon Kuper FT 29 July 2021 https://www.ft.com/content/73f6ba3a-c381-424d-a94d-138921a896ce

August marks the 50th anniversary of a momentous event: Richard Nixon, then the US president, summoned his advisers to Camp David  to take the collective decision to sever the dollar’s link with the gold standard. Jeffrey E Garten book Three Days at Camp David  America simply did not possess enough gold to honour dollar claims. And that issue raised a bigger question that always stalks finance: what is the basis on which money commands value and trust? David Graeber, a former anthropology professor,  in his book Debt, The First 5,000 Years. Before then nobody thought money had value because an independent central bank had an inflation target.  Gillian Tett FT 28 July 2021 https://www.ft.com/content/bb2bd452-727f-4fe4-877c-4d0875c187d3 John Connally, when Treasury secretary in President Richard Nixon’s cabinet, famously told his European counterparts in 1971 that the dollar “is our currency but your problem” Trichet: "It is extremely important that the US has been saying that a str

 Oreskes and her colleagues wrote in a 2012 paper, “core scientific values of objectivity, rationality and dispassion” have led to conservative projections about the impact of climate change, even in IPCC assessments. The short answer is that scientists are divided about whether a more dangerous phase of non-linear change has begun.   FT 28 July 2021              https://www.ft.com/content/3125bee9-73ae-4abf-ac58-615fe8e43396                    

https://www.youtube.com/watch?v=00roxpI3Y7I Le Charme discret de la bourgeoisie https://englundmacro.blogspot.com/2016/11/le-charme-discret-de-la-bourgeoisie.html Carl-Johan Westholm är upphovsman till uttryck som "Skapande eller bevakande Sverige"” och "Borgerlighetens diskreta skam".  https://www.mynewsdesk.com/se/timbro/pressreleases/ny-skrift-fraan-timbro-se-staten-foer-statsblinda-92988  

  The main reason for the heavy losses lay in the Il-2’s vulnerability in the air. Its heavy armor protected it from ground attacks but was less useful against enemy fighters. The Il-2 was no match for enemy fighters when it came to speed and maneuverability, as it had been designed for toughness, not agility. https://www.warhistoryonline.com/instant-articles/the-ilyushin-il-2.html

 Negative real yields pose a big problem for pension funds and other long-term asset allocators that are also grappling with equity markets trading at high valuations. FT 26 July 2021 https://www.ft.com/content/71d6661d-7a62-4a5f-959b-4cb2f1e94d68 Investors pour $3.2bn into inflation-protected US Treasuries FT 30 July 2021 https://www.ft.com/content/f81485d3-4796-460c-bf23-79c0857d9a3c

The possibility of stagflation — an economic environment marked by high unemployment, high inflation, and low economic growth, experienced in the U.S. in the 1970s — has moved onto the radar screen of some market analysts. MarketWatch 26 July 2021 https://www.marketwatch.com/story/stagflation-is-a-legitimate-risk-that-would-be-painful-for-u-s-markets-11627093835

Slaget på Åsundens is eller slaget vid Bogesund utspelades den 19 januari 1520 tre km söder om Bogesund (nuvarande Ulricehamn).  En svensk styrka under riksföreståndaren Sten Sture den yngre förlorade slaget mot en dansk armé.  Sten Sture sårades dödligt, varför slaget fick långtgående konsekvenser för den politiska utvecklingen i Sverige. https://sv.wikipedia.org/wiki/Slaget_p%C3%A5_%C3%85sundens_is

 It feels like we are living through the first vertiginous 15 minutes of a disaster movie, maybe one called “The Day After Tomorrow Was Yesterday.” Crazy storms that used to hit every century now seem quotidian, overwhelming systems that cannot withstand such a battering. As Angela Merkel and President Biden touted a climate and energy partnership on her recent visit here, nature mocked them. While the two leaders had dinner, rains submerged huge swaths of Germany, including medieval towns. “Everything we worried about is happening, and it’s all happening at the high end of projections, even faster than the previous most pessimistic estimates,”  Maureen Dowd Opinion Columnist New York Times 24 July 2021 https://www.nytimes.com/2021/07/24/opinion/sunday/climate-change-floods-wildfires.html Scientists say the shifting pattern of the jet stream is exacerbating the effects of climate change https://englundmacro.blogspot.com/2021/07/scientists-say-shifting-pattern-of-jet.html Det är kört. S

This represented 22.5 per cent of the banks’ total loan books, up from 16.3 per cent in mid-2017. FT 24 July 2021 https://www.ft.com/content/8a328af4-b8f2-48c5-82a9-d7dc1c345e1c

Historian Niall Ferguson says Britain could have lived with German victory and should have stayed out of war Guardian 3 0 January 2014 https://internetional.se/bookskontrafaktisk.htm Britain fighting in the First World War was 'the biggest error in modern history'  Britain fighting in the First World War was 'the biggest error in modern history' according to leading historian | Daily Mail Online Gray Tide in the East is the best-selling counterfactual history of the First World War, if the Germans had not invaded Belgium in 1914 and thereby brought Great Britain and, eventually, the United States into the war.  August 1, 1914, Berlin: Kaiser Wilhelm II cancels the German invasion of Belgium over the objections of his generals, sending his armies East against Russia instead of West to France, and sets off a chain of events that will radically change the course of modern history. https://www.amazon.com/Gray-Tide-East-alternate-history-ebook/dp/B077G9LCNZ/ref=sr_1_4?dchild

The systemic meltdown risk had passed. The fire was still smoldering but at that point, it was mainly a fiscal fire.  Fire Chief Jerome Powell himself said so, repeatedly begging Congress to deal with unemployment and business failures more effectively. He admitted there was little else his fire trucks could do but he kept them there anyway in the form of massive quantitative easing and keeping rates at the zero bound.  They are still on-scene now. It is my opinion that this has the potential to go down as the greatest policy error in central bank history. I know that’s saying a lot. Here’s a handy timeline summarizing the Fed’s near-daily actions in March and April 2020.  Consumer Price Index is a terrible proxy for consumer prices. One argument, to which I am somewhat sympathetic, is that this doesn’t matter because the Fed can’t generate inflation even if it wants to. It’s been trying and failing for over a decade.  Stock prices and home prices both respond to liquidity, and the Fed

https://www.youtube.com/watch?v=mknTDi70KFE

Robert Skidelsky is a historian, an epic biographer of John Maynard Keynes, and a prolific debater in the United Kingdom’s House of Lords. He calls What’s Wrong with Economics? a “primer,” Although the neoclassical hegemony was disrupted by the Great Depression and the rise of Keynesian models, that period proved to be merely a 40-year digression. The economics profession today is as Skidelsky describes it: an army of neoclassical technicians ... academics compete for attention, citations, rankings, promotions, and – above all – the approval of those who taught them those tools in the first place. As such, Skidelsky’s appeal for a return to an economics that is rooted in history, sensitive to ethics, and alert to the limits of the “self-regulating” market is doomed to fall on deaf ears.  In The Age of Fragmentation, Italian economist Alessandro Roncaglia, formerly of Sapienza University of Rome, provides a wide-ranging critical history of contemporary mainstream economic thought. Harva

The deadly weather that has unfolded in recent weeks has left climate scientists “shocked” and concerned that extreme events are arriving even faster than models predicted. FT 24 July 2021 https://www.ft.com/content/9a647a51-ede8-480e-ba78-cbf14ad878b7 Väderkartan är konstig (inte som den var förr) Rolf Englund blog 12 maj 2010 https://englundmacro.blogspot.com/2014/11/allt-du-behover-veta-om-vadret-och-jet.html

For the past decade, inflation outcomes in the eurozone have persistently undershot the objective of the European Central Bank. Output and employment have been lower than they needed to be to deliver on the ECB’s self-defined measure of price stability.  For almost all of this period of inflation undershoot, the ECB has set monetary policy while its own forecasts showed inflation would not reach its objective over the usual two to three-year horizon Malcolm Barr, head of western European economics at JPMorgan, FT 22 July  2021 https://www.ft.com/content/a590671c-7c16-4767-b54f-c6ba592b6b4e

ECB President Mario Draghi effectively sidestepped both obstacles by launching a program of quantitative easing so enormous that it will finance the entire deficits of all eurozone governments (now including Greece) and mutualize a significant proportion of their outstanding bonds. Germany, Spain, Italy, and several northern European countries required, for domestic political reasons, a ritual humiliation of radical Greek politicians and voters who openly defied EU institutions and austerity demands. Having achieved this, EU leaders have no further reason to impose austerity on Greece or strictly enforce the terms of the latest bailout.  Instead, they have every incentive to demonstrate the success of their “tough love” policies by easing austerity to accelerate economic growth, not only in Greece but throughout the eurozone. Anatole Kaletsky MarketWatch July 22, 2015  https://www.marketwatch.com/story/why-the-greek-deal-will-work-2015-07-22

“We call it a whiff of stagflation,” said Paul Ashworth, chief U.S. economist at Capital Economics Businesses are complaining of labor shortages and offering all kinds of inducements to attract workers. Yet the unemployment rate is a recession-like 5.9 percent.  And the share of adults in the labor was 63.3 percent in February 2020 but has bounced around between 61.4 percent and 61.7 percent for more than a year. In the first three months of the year, longer-term bond yields soared and the yield curve steepened. That has reversed in recent weeks.  NYT 22 July 2021 https://www.nytimes.com/2021/07/21/upshot/economy-usa.html

fueling concern that a new real estate bubble has formed. So far, nothing has been done, despite protest from some Fed officials like Boston Fed President Eric Rosengren, who recently argued that a “boom and bust cycle” in real estate is incompatible with financial stability. Former Federal Reserve Vice-Chairman Donald Kohn made a similar point in a 2017 speech that Washington regulators “need the power to put limits on loan-to-value and debt-to-income measures, when loosening standards, perhaps occurring outside the banking system, threaten financial and economic stability.” MarketWatch 21 July 2021 https://www.marketwatch.com/story/washington-might-have-to-go-to-war-to-fight-a-housing-bubble-does-it-have-the-tools-to-win-11626881606 Vi har en hushållssektor som är mer räntekänslig än den någonsin varit tidigare, säger Stefan Ingves juli 2021 https://englundmacro.blogspot.com/2021/07/vi-har-en-hushallssektor-som-ar-mer.html

Shelter costs account for about a third of the overall CPI, and comprise rental prices as well as what is known as “owner-equivalent rent”, the estimated cost of a house occupied by an owner if it were rented out. “We calculate the market won’t be fully in balance until 2023 or 2024. So I’m not sure that the uptick in rents is particularly shortlived,” said Ali Wolf FT 21 July 2021 https://www.ft.com/content/efdf1845-6138-4af7-8d2b-c20df9fed218

 I veckan skrev jag en krönika om min djupa känsla av osläktskap med politikerna, om att jag hatar Annie Lööf för hennes lögner och väljarsvek.  https://www.fokus.se/2021/07/anna-bjorklund-darfor-kanner-jag-avsky/ Den partipolitiska låtsasleken håller jag inte på med och det gör få smarta människor jag känner. Och det är väl det som är grundproblemet. Politik har en gång varit ärofyllt och hedersamt, till och med snobbiga näringslivspersoner och kulturmänniskor har engagerat sig. Nu är återväxten usel, de flesta håller med om att landet har problem, men de som vill arbeta med att lösa dem blir allt färre.  Anna Björklund Fokus  2021-07-19 https://www.fokus.se/2021/07/att-den-politiska-klassen-star-handfallen-och-forvirrad-ar-inte-konstigt

Some 9.3 million Americans remain unemployed, according to the June unemployment report published by the Bureau of Labor Statistics.  Some 4 million people have been unemployed for more than 27 weeks — that’s 2.9 million more people than there were in February. MarketWatch 20 July 2021 https://www.marketwatch.com/story/the-pandemic-induced-recession-ended-more-than-a-year-ago-but-the-u-s-economy-isnt-out-of-the-woods-yet-11626788581

 Pent-up savings and a capex restocking cycle should pick up the baton as state support fades (the US fiscal impulse turns negative this quarter). The UK is the world’s laboratory for opening up. Unfortunately it has done so with breathtaking incompetence and given the process a bad name. It will soon become clear to market traders across the globe whether British hospitalisations will remain manageable or whether the pandemic again approaches the catastrophism of Professor Neil Ferguson.  Every time the US Federal Reserve in particular has tried to extricate itself from the great QE experiment, it has set off bond market turmoil. The attempt in late 2018 to unwind QE by ‘automatic pilot’ led to a plunge in yields and a major Wall Street scare. The Powell Fed was forced to retreat. Ambrose Evans-Pritchard Telegraph 20 July 2021 https://www.telegraph.co.uk/business/2021/07/20/markets-fear-inflation-much-delta-variant / Covid: UK faces a difficult summer, says leading scientist https://w

  Värnhems klosterkyrka Götiska Förbundet Reklam för film på Amazon Prime

Men om många av dem nu säger att den här dippen skall jag inte köpa in i. Vem skall då köpa? When the walls come down, investors will scavenge the news for “catalysts.” Don’t fall into this trap. Undoubtedly, some “catalyst” will be found, but the mistake will be in believing that the collapse is caused by that piece of “bad” news.  The important question to ask is “What drove the bubble?” That’s where the lessons are.  John P. Hussman Världsberömd Permabjörn. https://englundmacro.blogspot.com/2021/07/what-triggered-crash-hussman-funds.html

 as we experience a meaningful deceleration in earnings and economic growth,” wrote Mike Wilson, Morgan Stanley’s chief U.S. equity strategist, in a note Monday.  “Market breadth has been deteriorating for months and is just another confirmation of the mid-cycle transition, in our view. It usually ends with a material (10-20%) index level correction.” The morning sell-off in stock futures is accelerating with Dow futures now down 450 points PUBLISHED SUN, JUL 18 20216:06 PM EDT https://www.cnbc.com/2021/07/18/stock-market-futures-open-to-close-news.html Monday 19 July Wall Street fredag 16 July

In fact, economic theory gives very little robust guidance on whether, say, 3 per cent inflation is better than 2 per cent in normal times, so long as it remains reasonably stable and predictable.  When Olivier Blanchard was IMF chief economist in 2010, he argued that inflation targets should be raised to 4 per cent. Kenneth Rogoff FT 16 July 2021 The writer is a professor of economics and public policy at Harvard university and former chief economist at the IMF https://www.ft.com/content/a7c101be-7361-4307-981d-b8edf6d002be Riktiga karlar är inte rädda för lite inflation https://englundmacro.blogspot.com/2010/02/riktiga-karlar-ar-inte-radda-for-lite.html Did inflation targeting fail? Martin Wolf, Financial Times, May 5 2009 https://englundmacro.blogspot.com/2020/07/the-troubling-bit-is-that-these.html Riksbankens mål om 2,0 procents inflation tillkom i all hast för litet mer än 20 år sedan Inflationsmålet skulle inte ha funnits där, om Sverige hade klarat att hålla fast växelkurs. Joh

When the time comes to ask the question – “What triggered the crash?” – remember that this is the least important question. A market crash requires nothing more than a shift in investor psychology from careless speculation to even modest risk-aversion.   With valuations at the most extreme level in history, the one thing that the market simply cannot tolerate is the eager attempt of a substantial number of investors to exit.  When the walls come down, investors will scavenge the news for “catalysts.” Don’t fall into this trap. Undoubtedly, some “catalyst” will be found, but the mistake will be in believing that the collapse is caused by that piece of “bad” news.  The important question to ask is “What drove the bubble?” That’s where the lessons are.  The root causes of a crash are always the factors that nurtured and encouraged the “happy” period of carefree and irresponsible speculation that led to the bubble extreme. John P. Hussman, Ph.D. President, Hussman Investment Trust July 202

The House of Lords committee on which Lord Mervyn King sits has laid into the policy he initiated. FT Alphaville 16 July 2021 https://www.ft.com/content/ce450316-d149-4ede-b4c6-5bc507e4f004   Mervyn King inflation fiscal union https://englundmacro.blogspot.com/2020/06/mervyn-king-inflation-fiscal-union.html

Hayes Martin bases his sobering forecast on the increasing divergences within the U.S. market, as indicated by fewer and fewer stocks participating in the headline-grabbing strength of the leading indices. Martin reports that the only area of the market not showing dangerous divergences right now is the large-cap dominated S&P 500.  Mark Hulbert MarketWatch July 15, 2021 at 4:23 p.m. ET https://www.marketwatch.com/story/expect-a-10-correction-in-u-s-stocks-by-mid-august-says-this-forecaster-with-a-proven-track-record-11626380633  

  Severe flooding in western Europe BBC 16th July 2021 https://www.bbc.com/weather/features/57862526 The Omega-Shaped Jet Stream Responsible for Europe’s Heatwave Englund blogg 26 juni 2019 https://englundmacro.blogspot.com/2019/06/the-omega-shaped-jet-stream-responsible.html Why Was the Discovery of the Jet Stream Mostly Ignored? Maybe because it was published in Esperanto. Between 1923 and 1925, Ooishi completed almost 1,300 observations of fierce high-altitude winds, later named the jetstream. The somewhat eccentric Ooishi was not only the director of Japan’s Tateno atmospheric observatory but also the head of the Japan Esperanto Society. Ooishi announced his discovery of the swift, high-altitude river of air in the Tateno observatory’s annual reports, which he published in Esperanto. Not surprisingly, his research was ignored, and the U.S. military was caught off guard by two consequences of the invisible jetstream. Thanks Wayne. https://www.airspacemag.com/as-next/as-next-may-unbe

Vägrade. Man la fram ett argument som man verkligen hade jobbat på och säkerställt att det är logiskt konsekvent, och du möts av ansikten med tomt stirrande blick. Som om du aldrig sagt något. Man hade lika gärna kunnat sjunga den svenska nationalsången – och fått samma svar. Det fanns sympatiska personer, som IMF-chefen Christine Lagarde, men eurogruppen däremot bestod av några otrevliga typer med mycket makt som stirrade på honom och sa: "Du har rätt i vad du säger, men vi kommer krossa dig ändå". SvD 14 juli 2015 https://www.svd.se/yanis-varoufakis-basta-citat Have you wondered how two Nobel laureate economists, sometimes sharing the same year’s prize, can consider each other charlatans? This would never happen among Nobel laureate physicists or biologists.  https://englundmacro.blogspot.com/2021/02/trump-is-more-dangerous-than-mere-liar.html

Henrik Mitelmam DI 14 juli 2021 https://www.di.se/analys/sluta-oroa-dig-for-ranteelandet/ Marshall-hjälpen och nästa svenska devalvering Med dagens kurs SEK/USD på cirka 5:60 uppgick alltså den totala  Marshall-hjälpen till 382 miljaaarder svensk kronor. Enligt dagens Dagens Industri (2/11) uppgår Sveriges utlandsskuld till 454 miljaarder kronor: Den privata räntebärande nettoskulden till utlandet är uppe i 473 miljarder.  Det är en ökning med mer än 200 miljarder på ett år. Rolf Englund 1990 11 02 Sänt till Carl Bildt 90-11-02 Utlagt på Internet 96-10-29 https://www.internetional.se/cabpm.html

The dilemmas of globalisation lie at the core of Seven Ways to Change the World, which joins an expanding library of works offering answers to the problems in the global system and describing a path to a better, post-pandemic future. If anything, Brown downplays the central role he played getting the G7 to write-off debt of the poorest developing countries in 2005, and rallying the G20 in 2009 to agree a bold plan for managing the global financial crisis. FT 18 June 2021 https://www.ft.com/content/544eb226-71a4-4aeb-b6c0-3100f85eca32 Gordon Brown räddade England och världen https://englundmacro.blogspot.com/2017/11/gordon-brown-raddade-england-och-varlden.html

Among the founder members were two heavy hitters in the history of economics, Thomas Malthus and David Ricardo.  Martin Wolf 14 July 2021 https://www.ft.com/content/95f2dcd9-937b-4f02-b6be-2d69c86a5370 The winning essays WE NEED TO LOOK BEYOND THE MARKET TO BEAT CLIMATE CHANGE https://www.ft.com/content/bb92c7aa-aa1d-4797-9739-81ce1054ceaa CONSPICUOUS CONSUMPTION CAN NO LONGER BE OUR ECONOMIC ENGINE https://www.ft.com/content/29aadf7b-10c3-4a02-b70e-dc87c474fa9d  

Vi riskerar att två kriser utbryter samtidigt: 1970-talets stagflation med ekonomisk nedgång och stigande konsumentpriser – och nya skuldkriser, eftersom både stater och hushåll är extremt belånade.  Roubini är förvisso en känd dysterkvist, men var en av dem som långt i förväg varnade för finanskrisen. Även om det skulle gå att fortsätta som nu ett tag till är frågan vad som skulle kunna uppnås. Japan har fört en expansiv ekonomisk politik i 30 år, men det som växt är statsskulden, inte ekonomin. Mattias Svensson SvD 13 juli 2021 https://www.svd.se/sloseri-ger-ingen-ny-ekonomi

Listen especiallly to the girl with a background at the Fed. Impressive. https://www.youtube.com/watch?v=Kqo2F9pIAb4

  I had encountered it originally through a public television version of “The Last of the Mohicans,” but I soon found that the real conflict exceeded even James Fenimore Cooper’s romantic imagination In world history it was folded into the larger categories of colonial warfare and endless Anglo-French conflict The war that evicted the French from North America was not only incredibly fascinating but also one of history’s most important wars. Indeed, from a certain perspective, it was more important than the American War of Independence:  The Revolution merely determined in what form Anglo-America would spread to embrace continental empire and global power, while the French and Indian War determined whether that continent-spanning America would come into being at all. Ross Douthat NYT July 2021 https://www.nytimes.com/2021/07/13/opinion/french-indian-war-american-history.html Vi som barn läste Den siste mohikanen vet att mohikanerna, som stred på engelsmännens sida, var ädla och tappra,

Are we capable of acting upon the implications?  That is the biggest question of the 21st century.  The answer, I fear, is no. Martin Wolf FT 13 July 2021 https://www.ft.com/content/c9448d15-8410-47d3-8f41-cd7ed41d8116

The rate of inflation in the 12 months ended in June climbed to 5.4% from 5%. The last time prices rose that fast was in 2008, when oil hit a record $150 a barrel. MarketWatch 13 July 2021 https://www.marketwatch.com/story/consumer-inflation-posts-biggest-increase-since-2008-cpi-shows-11626180086 ‘I worry about inflation. I do not believe inflation is going to be transitory" Larry Fink, chairman and CEO, BlackRock Inc.,the world’s largest asset manager MarketWatch 14 July 2021 https://www.marketwatch.com/story/i-worry-about-inflation-says-blackrocks-larry-fink-warns-its-unlikely-to-be-transitory-11626275810

The junk bond market is euphoric. Funds are happily mopping up the weakest CCC-rated corporate debt in the US as if there was no tomorrow, compressing risk spreads to levels that surpass the giddiest days of the pre-Lehman debt bubble.  The spread on BBB-rated debt has fallen to a record 1.11pc. Meanwhile, Bank of America says the trailing price-to-earnings ratio for the S&P 500 index on Wall Street is also at an all-time high of 29.8, topping the dotcom peak in 1999. Ambrose Evans-Pritchard Telegraph 13 July 2021 https://www.telegraph.co.uk/business/2021/07/13/global-growth-scare-false-alarm/

between southern and northern member states; indeed, it will not even be enough to prevent them from drifting further apart.  Since the EU’s poorer member states are already over-indebted, they cannot borrow much more, particularly if interest rates rise.  Whenever inflation begins to increase again, the European Central Bank’s implicit policy of monetizing member-state debt (through the unlimited purchase of government bonds from poorer countries) will have to end. Under these conditions, the only remaining way out would be a “transfer union" Sigmar Gabriel, former federal minister and vice chancellor of Germany, Chairman of Atlantik-Brücke, Project Syndicate 12 July 2021 https://www.project-syndicate.org/commentary/how-eu-germany-can-support-biden-democracy-agenda-by-sigmar-gabriel-2021-07 - Jag vill inte ha en federativ utveckling. Svenska folket har inte gått med i en federation.  - Logiken i det hela rör sig i federativ riktning... Sch! säger Kohl åt mig när jag tar upp det P

John Mauldin 9 July 2021 https://www.mauldineconomics.com/frontlinethoughts/tina-is-stupid 12 juli 2021

until such companies achieve profitability (or not as the case may be). And the structure of capital markets generally is dictated increasingly by ultra-loose monetary policy.  In effect they outsourced liquidity management to the central bank with liquidity risk ultimately falling on the taxpayer. Under the rules of the Basel Committee on Banking Supervision, liquidity has since been rebuilt John Plender FT 12 July 2021 https://www.ft.com/content/fb3cddae-daca-4f4f-b0b7-aa58656041a0

 What is clear to me is that we are moving irresistibly closer to a critical question for the economy and markets, and not just in the US:  is there still the possibility of an orderly exit from what has been a remarkably long period of uber-loose monetary policies? Mohamed A. El-Erian FT 12 July 2021 https://www.ft.com/content/ae158a9c-b783-4301-85c6-8ff8bc55a6b8 Fed needs to consider seriously how best to slowly lift its foot off the monetary accelerator https://englundmacro.blogspot.com/2021/02/fed-needs-to-consider-seriously-how.html

This is at crash-warning levels, by historical standards.  Should a prolonged bear market occur, equity valuations might collapse. The valuations of the mid-1960s did not return for 30 years.  The big threat, then, is that, as John Maynard Keynes allegedly said, “the market can remain irrational longer than you can stay solvent.” In effect, there is a shortage of speculators able to prevent equities from remaining durably mispriced.  Martin Wolf FT 11 Julu 2021 https://www.ft.com/content/e3a621d3-5cfc-4410-bd3c-0fde3535582b

https://www.bbc.com/news/world-us-canada-57794263

The major future economic challenges, by Olivier Blanchard and Jean Tirole https://www.strategie.gouv.fr/english-articles/major-future-economic-challenges-olivier-blanchard-and-jean-tirole Inequality and the Macron Commission DANI RODRIK STEFANIE STANTCHEVA Procet Syndicate July 8, 2021 https://www.project-syndicate.org/commentary/inequality-report-of-macron-commission-by-dani-rodrik-and-stefanie-stantcheva-2021-07    

  At Yalta in February 1945, Winston Churchill, a dying Franklin Roosevelt and the cagey Joseph Stalin carved up Germany The British writer Giles Milton brings this epic story to exhilarating life in “Checkmate in Berlin: The Cold War Showdown That Shaped the Modern World,” WSJ 9  July 2021 https://www.wsj.com/articles/checkmate-in-berlin-review-breaking-the-blockade-11625836185 Yalta Conference https://en.wikipedia.org/wiki/Yalta_Conference

"Having experienced the damage that asset price bubbles can cause, we must be especially vigilant in ensuring that the recent experiences are not repeated." Source John P. Hussman https://twitter.com/hussmanjp/status/1412127964230258689?s=27

An investor consensus that took months to build, namely that robust economic growth and elevated inflation would bring about substantially higher interest rates, has been coming apart, and the pain for those caught in that trade has heightened with moves in the past couple of days. FT 8 July 2021 https://www.ft.com/content/23e57d39-193f-4fcb-b896-8dc3960ccb8d

  ECB President Christine Lagarde:  ... there might be some moderate, temporary deviation in either direction of that 2% and that is okay. What we are very concerned about is any sustainable, durable, significant deviation from the target and that will require forceful action.” CNBC 8 July 2021 https://www.cnbc.com/2021/07/08/ecb-lagarde-presents-first-policy-review-in-almost-two-decades.html

 Officials still expect recent inflation surges to be temporary WSJ 7 July 2021 https://www.wsj.com/articles/fed-debated-how-to-begin-pulling-back-on-stimulus-at-june-meeting-11625680801 Near Zero until 2023. Really? The market will force the Fed to act earlier, I think. Englund blogg 17 June 2021 https://englundmacro.blogspot.com/2021/06/near-zero-until-2023-really.html

 German outperformance compared to the rest of Europe - but not the world, which it lags badly - is mostly the fruit of an ‘internal devaluation’ within the closed eurozone system. This was made possible by the Hartz IV wage compression policies  Angela Merkel inherited a regime in which German industry had acquired a competitive edge of 20pc to 30pc against the Club Med bloc, which was nigh impossible for the South to reverse without going into debt deflation and making matters even worse. Ultimately this was untenable for a currency union, as became all too clear. Ambrose Evans-Pritchard Telegraph 2 July 2021 https://www.telegraph.co.uk/business/2021/07/02/love-mutti-merkel-leaves-trail-wreckage-across-europe/ Tyskland lyckades genomföra vad ekonomerna kallar en interndevalvering. Hur kunde då Tyskland lyckas med det som i dag framstår som omöjligt för länderna i Sydeuropa? https://englundmacro.blogspot.com/2011/12/wolodarski-och-tysklandss-framgang-med.html The Hartz IV reforms – so

Yet Europe’s internal borders remain wide open. The imperative of saving this year’s tourist season has paralysed political leaders. The ECB has been funding the entire budget deficits of the Latin bloc throughout the pandemic, drawing a veil over the underlying deterioration of sovereign debt profiles.  The Banco de España says Spain’s debt has jumped 30 percentage points to 125pc of GDP since Covid arrived. Portugal has hit 137pc. Italy is flirting with 160pc of GDP this year. Ambrose Evans-Pritchard Telegraph 6 July 2021 https://www.telegraph.co.uk/business/2021/07/06/europes-fourth-covid-wave-freighted-political-consequences/ https://www.telegraph.co.uk/business/2021/07/07/eurozone-panic-delta-variant-escalates/

Margaret Thatcher in 1989 at the UN  warning that greenhouse gases were "changing the environment of our planet in damaging and dangerous ways". Mrs Thatcher - formerly a research chemist - continued: "The result is that change in future is likely to be more fundamental and more widespread than anything we have known hitherto. It is comparable in its implications to the discovery of how to split the atom. Indeed, its results could be even more far-reaching. "It is no good squabbling over who is responsible or who should pay. We shall only succeed in dealing with the problems through a vast international, co-operative effort." This was extraordinarily prescient, and her words were even more devastating from the lips of a towering, right-wing world leader who couldn't be dismissed as a fretful hippy. T he world is probably heading for 1.5C of heating early next decade, and temperatures will push onwards to 2C and above unless policies radically change Some sc

  och min dotter sjungit med Adolf Fredrik. https://www.stadsmissionen.se/st-paul-en-motesplats-alla/st-paul-byggs-om

  https://www.goodreads.com/book/show/162120.Extraordinary_Popular_Delusions_and_the_Madness_of_Crowds https://englundmacro.blogspot.com/2020/11/what-south-sea-company-can-teach-us.html

a band of fast-moving air high in the atmosphere, develops a large wave pattern that keeps the dome locked in place.  Scientists are studying whether climate change is contributing to the jet stream’s unusual behaviour.  FT 2 July 2021 https://www.ft.com/content/8b33177e-e17f-4668-b3a0-5554af8c8293 Allt Du behöver veta om vädret och The Jet Stream https://englundmacro.blogspot.com/2014/11/allt-du-behover-veta-om-vadret-och-jet.html

―  Thomas Hobbes,  Leviathan https://www.goodreads.com/quotes/622711-hell-is-truth-seen-too-late

The industry accounts for about 2.6bn tonnes of carbon dioxide each year, or about 6 per cent of global emissions. If it were a country, it would be the fourth-biggest emitter, just behind India, ahead of Russia and Japan. FT 4 July 2021 https://www.ft.com/content/24d610a0-fb65-45bb-b747-e015e1f10c1a

 Rösta inte på dom. Det bara uppmuntrar dom Rolf Englund 2009-05-18 https://www.internetional.se/egoeuvaletmaj2009.htm

 It will also know, although we do not, how long this era lasts. Martin Wolf, FT, 2/5 2007 https://www.internetional.se/svdbu.htm

Baby boomers and older Americans have spent decades accumulating an enormous stockpile of money. At the end of this year’s first quarter, Americans age 70 and above had a net worth of nearly $35 trillion Older generations will hand down some $70 trillion between 2018 and 2042, according to research and consulting firm Cerulli Associates. Roughly $61 trillion will go to heirs—increasingly millennials and Generation Xers WSJ 2 July 2021 https://www.wsj.com/articles/older-americans-35-trillion-wealth-giving-away-heirs-philanthropy-11625234216 The more urgent question, in many economists’ minds, is whether the aging of the population will be a drag on economic growth overall,  as has already been a problem in Western Europe and Japan. MarketWatch 29 December 2014 https://www.internetional.se/shares.htm#overwhelm

the result was a severe double-dip recession in the United States and a debt crisis and lost decade for Latin America.  But now that global debt ratios are almost three times higher than in the early 1970s, any anti-inflationary policy would lead to a depression, rather than a severe recession. Nouriel Roubin MarketWatch 1 July 2021 https://www.marketwatch.com/story/the-looming-stagflationary-debt-crisis-will-deliver-a-one-two-punch-to-markets-and-economies-11625078897 Remember: the Volcker shock triggered the Latin American debt crisis https://englundmacro.blogspot.com/2021/06/remember-volcker-shock-triggered-latin.html