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2022-05-31

Twelve propositions on the state of the world, Wolf

Ours is an age of culture wars, identity politics, nationalism and geopolitical rivalry. It is also, as a result, an age of division, within and among countries.

Despite the rise of China, the west, defined as the high-income democracies, is hugely powerful. 

Over the long run, Asia is likely to become the dominant economic region of the world.

However deep the rifts become, we share this planet. We still need to avoid cataclysmic wars, economic collapse and, above all, destruction of the environment.

Gven the immense political and organisational challenges, the chances that humanity will prevent damaging climate change are slim.

Our leaders have to rise to the occasion. Will they do so? One can only hope so.

Martin Wolf FT 31 May 2022

https://www.ft.com/content/517fbdac-507a-4e55-97fd-55375c1fe1f1

Lysande


The War in Ukraine May Be Impossible to Stop. And the U.S. Deserves Much of the Blame

In 2014 the United States backed an uprising — in its final stages a violent uprising — against the legitimately elected Ukrainian government of Viktor Yanukovych, which was pro-Russian. 

(The corruption of Mr. Yanukovych’s government has been much adduced by the rebellion’s defenders, but corruption is a perennial Ukrainian problem, even today.) 

Russia, in turn, annexed Crimea, a historically Russian-speaking part of Ukraine that since the 18th century had been home to Russia’s Black Sea Fleet.

One can argue about Russian claims to Crimea, but Russians take them seriously. Hundreds of thousands of Russian and Soviet fighters died defending the Crimean city of Sevastopol from European forces during two sieges — one during the Crimean War and one during World War II.

The United States started arming and training Ukraine’s military, hesitantly at first under President Barack Obama. Modern hardware began flowing during the Trump administration, though, and today the country is armed to the teeth.

The United States is trying to maintain the fiction that arming one’s allies is not the same thing as participating in combat.

In the information age, this distinction is growing more and more artificial. The United States has provided intelligence used to kill Russian generals. It obtained targeting information that helped to sink the Russian Black Sea missile cruiser the Moskva, an incident in which about 40 seamen were killed.

Christopher Caldwell New York Times 31 May 2022


Christopher Caldwell is a contributing Opinion writer for The New York Times. He is a contributing editor at The Claremont Review of Books and a member of the editorial committee of the French quarterly Commentaire. He is the author of “Reflections on the Revolution in Europe: Immigration, Islam and the West” and “The Age of Entitlement: America Since the Sixties.” Born and raised in Massachusetts, he was also a senior editor at The Weekly Standard and a columnist for The Financial Times.

Börsen 31 maj 2022

 









Väldigt viktigt att få inflationen tillbaka till två procent, säger Stefan Ingves

 På senaste räntemötet i april tog Ingves och hans direktion klivet upp på plusränta för första gången sedan hösten 2014. Samtidigt presenterade de en räntebana där de skissat in tre räntehöjningar på 0,25 procentenheter styck före årsskiftet.

Styrräntan skulle därmed på lite drygt ett halvår höjas från dagens 0,25 till omkring 1 procent. Därefter räknar Riksbanken med fortsatta räntehöjningar, upp till strax under 2 procent om tre år.

SvD/TT 31 maj 2022

https://www.svd.se/a/Ea8Rma/ingves-det-kan-bli-dubbelhojd-styrranta


Riksbanken förlänger perioden med nollränta åtminstone fram till tredje kvartalet 2024  

SvD /TT 1 juli 2021


The Case-Shiller Home Price Index rose 20.6% ...

 in the year that ended in March, up from a 20% annual rate the prior month. 

March marked the highest annual rate of price growth since the index began in 1987.

https://www.wsj.com/articles/home-price-growth-hit-record-in-march-11654002144


Inflationen kan bli riktigt låg redan nästa år

Snittsvensken känner sig väldigt trygg på arbetsmarknaden men tycker att det är olustigt när priserna stiger med 12 procent och tror att de ska lyfta med ytterligare 10 procent om ett år. 

Klart att man blir bekymrad om man lever i denna vanföreställning.

Hittills finns det inget i statistiken som tyder på en konsumtionskrasch. 

Henrik Mitelman DI 30 maj 2022

https://www.di.se/analys/inflationen-kan-bli-riktigt-lag-redan-nasta-ar/


Den tongivande medelklassen i Sverige skulle inte klara av någon mer omfattande ränteuppgång

Min gissning är att  de rörliga boräntorna toppar på 3-3,5 procent. 

Det blir kännbart, men vi överlever. Räntechocken uteblir.

Henrik Mitelman DI 11 april 2022

https://englundmacro.blogspot.com/2022/04/den-tongivande-medelklassen-i-sverige.html


Nu måste vi väl i alla fall vara nära botten?


 

Fed Fears Hit Mortgage Bonds

Fed has started raising interest rates, which hits the value of all existing fixed-rate bonds, but also because it might start selling some of its $2.7 trillion holdings of the bonds, potentially further diminishing their value. 

The housing market, which after two years of surging prices has widely been described as overheated.

With the average 30-year mortgage rate rising to 5%, homeownership might now be out of reach for millions more Americans.

WSJ 31 May 2022

https://www.wsj.com/articles/fed-fears-hit-mortgage-bonds-attracting-investors-11653850219


De stora skulder som byggts upp under den långa perioden av låga räntor sätter press på högt skuldsatta hushåll och företag

Finansinspektionen 31 maj 2022

https://www.fi.se/sv/publicerat/pressmeddelanden/2022/stigande-rantor-pressar-skuldsatta-hushall-och-foretag/


Även om räntorna stiger i rekordfart har Finansinspektionen inga planer på att komma till de skuldsatta hushållens undsättning.

Nu pratar vi om att räntekostnaden kan tredubblas. I den meningen är det en ganska kraftig åtstramning vi ser, säger FI:s generaldirektör Erik Thedéen  

Men även om enstaka hushåll riskerar att drabbas hårt om räntan på kort tid stiger från drygt 1 procent till upp emot 4 procent, ser FI än så länge inget hot mot det finansiella systemet. 

Det är först vid en ränta på 7 procent som FI tror att en del hushåll kommer att få svårt att klara boendekostnaderna.

SvD 31 maj 2022

https://www.svd.se/a/8Qa5jW/ingen-hjalp-fran-fi-fortsatta-amorteringskrav-nar-borantan-stiger



Riksbanken förlänger perioden med nollränta åtminstone fram till tredje kvartalet 2024  SvD /TT 1 juli 2021

RE: Är dom alldeles från vettet?

Englund blogg 27 april 2021

https://englundmacro.blogspot.com/2021/07/riksbanken-forlanger-perioden-med.html


Varför Finansinspektionen teg om Swedbank?

https://englundmacro.blogspot.com/2019/03/varfor-finansinspektionen-teg-om.html


Oljepriset i euros

 


När både dollarn och oljan stiger

Price of Crude Jumps as EU Foolishly Doubles Down On Sanctions




Between 2001 and 2020, rents shot up by 150% ...

 at the same time CPI’s measure of housing costs grew by a mere 54%. 

Eugene Ludwig MarketWatch 27 May 2022

https://www.marketwatch.com/story/inflation-has-been-pummeling-the-middle-class-for-decades-but-the-out-of-touch-cpi-masks-this-reality-11653671201

Eugene Ludwig, a former U.S. comptroller of the currency, is chair of the Ludwig Institute for Shared Economic Prosperity and author of “The Vanishing American Dream.“


CPI Understated? Yes, by a lot.

I do not believe OER is only up 4.56%. Nor do I believe rent is only up 4.46%.

Moreover, home prices are not directly in the CPI, only OER and and Rent.

My Case-Shiller adjusted CPI is calculated by substituting the percentage change in the Case-Shiller national index for OER in the CPI.

The result is an adjusted annual CPI rise of 11.42%. 

That's a new record high for this data series.

Mish 31 May 2022

https://mishtalk.com/economics/case-shiller-home-prices-reach-new-record-high-but-this-is-rear-view-mirror-look


Real inflation is hard to measure

Tim Harford FT 4 January 2022

https://englundmacro.blogspot.com/2022/02/real-inflation-is-hard-to-measure.html


2022-05-30

Börsen 30 maj 2022

 


Could Index Funds Be ‘Worse Than Marxism’?

Economists and policy makers are worried that the Vanguard model of passive investment is hurting markets.

For millions of Americans, getting into the market no longer means picking stocks or hiring a portfolio manager to pick them for you. It means pushing money into an index fund, as offered by financial giants such as Vanguard, BlackRock, and State Street, otherwise known as the Big Three.

Index funds mirror the market, in other words, rather than trying to pick winners and losers within it.

Actively managed investment options could make up for their higher fees with higher returns. And some do, some of the time. Yet scores of industry and academic studies stretching over decades show that trying to beat the market tends to result in lower returns than just buying the market.

One primary concern comes from the analysts at Bernstein: “A supposedly capitalist economy where the only investment is passive is worse than either a centrally planned economy or an economy with active, market-led capital management.” 

The point of their research note, if rendered a touch inscrutable with references to Hayek and the Gossnab, is about market signals and capital allocation.

Annie Lowrey The Atlantic 5 April 2021

https://www.theatlantic.com/ideas/archive/2021/04/the-autopilot-economy/618497/

 

Fondförvaltaren Cathie Wood blev techboomens frontfigur...

när hon lockade in miljarder till sin kontroversiella investeringsstrategi. 

Men när kraschen kom gick hon från världsstjärna till ifrågasatt.

Tittar man fem år tillbaka i tiden hade småsparare tjänat mer pengar på att köpa en vanlig indexfond för S&P 500 än att ha Ark Invests fonder.

På universitetet USC i sin hemstad träffade hon Arthur Laffer, professor i företagsekonomi och känd som mannen bakom Laffer-kurvan.

SvD 27 maj 2022

https://www.svd.se/a/oWgJxm/ark-invests-cathie-wood-forlorar-miljarder-men-vagrar-ge-sig

Cathie Wood says her innovation stocks are ‘way undervalued’ and recent fund losses temporary

CNBC 17 February 2022

https://englundmacro.blogspot.com/2022/02/cathie-wood-says-her-innovation-stocks.html
 

2022-05-29

Inflation expected to hit Germany 8 per cent. ECB zero rate by September

 Det EU-harmoniserade konsumentprisindexet, HIKP, steg 8,7 procent på årsbasis. Det är den högsta noteringen för indexet någonsin. 

I april var HIKP-inflationen 7,8 procent. Väntat var 8,0 procent.

Direkt DI 30 maj 2022

The surge in inflation, which is expected to hit a new 40-year high in Germany of 8 per cent, as well as rising in France, Spain and Italy when national data are released on Monday and Tuesday, has prompted policymakers to promise an imminent response.

Christine Lagarde said last week it was on track to raise its deposit rate from minus 0.5 per cent to at least zero by September

FT 29 May 2022
https://www.ft.com/content/9bd69366-bcf6-4ae3-a9e4-0dda1dd07249

Minusräntorna beror på försvaret av euron

https://englundmacro.blogspot.com/2022/05/nollrantan-och-greklandskrisen.html

ECB last summer concluded a two-year strategy review

https://www.ecb.europa.eu/home/search/review/html/ecb.strategyreview_monpol_strategy_statement.en.html

that was concerned mostly with the problem of low inflation.

ECB should tighten the criteria for its targeted longer-term refinancing operations (TLTROs), which provide low-cost funds to banks that lend to the real economy.

(Targeted longer-term refinancing operations (TLTROs)

https://www.ecb.europa.eu/mopo/implement/omo/tltro/html/index.en.html


The ECB’s Interest-Rate Balancing Act

Jun 1, 2022 JENS VAN ‘T KLOOSTER

https://www.project-syndicate.org/commentary/ecb-interest-rate-hikes-financial-stability-green-transition-by-jens-van-t-klooster-1-2022-06



Stephen S. Roach: Poor Jerome Powell

With US inflation close to a 40-year high, the Federal Reserve chair knows what he needs to do. 

Volcker raised US interest rates to unheard-of levels in 1980-81

Using the political cover provided by the 1978 Humphrey-Hawkins Act, which formalized the Fed’s price-stability mandate, and drawing operational support from a shift to targeting the money supply, Volcker increased its benchmark federal funds rate from 10.5% in July 1979 to 17.6% in April 1980.

Volcker then reversed course during an ill-advised but short-lived experiment with credit controls in the spring of 1980, before resuming a monetary-policy tightening that eventually pushed the funds rate to a monthly peak of 19.1% in June 1981. 

Only then did the fever of double-digit inflation break.  

By late 1982, with the US in deep recession, annual headline CPI inflation had slipped below 4%, and the Fed started to reduce the benchmark policy rate. 

Powell’s problem is all the more evident when viewed through the inflation-adjusted lens of real interest rates.

The real federal funds rate has averaged -1.95% (with a stress on the minus sign). This extraordinary monetary accommodation is unmatched in modern times.

I suspect that the federal funds rate will remain below the US inflation rate well into 2023. That would push the Powell average down to -2.25% over the 59 months ending in December 2022.

If the Fed wishes to avoid a replay of the stagflation of the late 1970s and early 1980s, it needs to recognize the extraordinary gulf between Volcker’s 4.4% real interest rate and Powell’s -2.25%

Stephen S. Roach Project Syndicate 25 May 2022

https://www.project-syndicate.org/commentary/jerome-powell-paul-volcker-inflation-interest-rate-contrast-by-stephen-s-roach-2022-05

Volcker: “If I had known what was going to happen, I never would have done it.” 

https://englundmacro.blogspot.com/2022/05/volcker-if-i-had-known-what-was-going.html
 

A hard landing and a return to lower inflation, or a stagflationary scenario

We now know that Team Persistent won the 2021 inflation debate
 

With inflation surging close to double digits, the US Federal Reserve and other central banks have conceded that the problem is not transitory, and that it must be urgently addressed by tightening monetary policy. 

That has spurred another big debate: whether economic policymakers can engineer a “soft landing” for the global economy

The Fed and other central banks contend that they will be able to raise their policy rates by just enough to pull the inflation rate down to their 2% target without causing a recession. 

A soft-landing scenario looks like wishful thinking.

Simply put, the effort to fight inflation could easily crash the economy, the markets, or both. Already, central banks’ modest amount of tightening has shaken financial markets 

Yet if central banks wimp out now, the outcome will resemble the stagflationary 1970s, when a recession was accompanied by high inflation and de-anchored inflation expectations. 

That leaves either a hard landing and a return to lower inflation, or a stagflationary scenario. 

Either way, a recession in the next two years is likely. 

Nouriel Roubin Project Syndicate 26 May 2022

https://www.project-syndicate.org/commentary/reducing-inflation-likely-to-cause-recession-by-nouriel-roubini-2022-05

Arvingarna

När man frågar någon bekant, som haft framgång på bostadsmarknaden och nu har en bostad värd ett antal miljoner, om en inte skall casha in, får man som regel svaret att man måste ju bo någonstans.

Men arvingarna har inte det problemet. De bor redan någonstans, kanske i en bostad som de kunnat köpa med hjälp av föräldrarna. 

Bostädernas värde handlar om väldiga belopp som skall överföras till nästa generation.

Men det är inte något man gärna talar om. Allra minst i debatten om dödshjälp.

Olika falla ödets lotter, heter det.

Om detta handlade en artikel i Financial Times nyligen.

- The neglected division in UK politics (and indeed across the rich world) isn’t between generations, but within them On the one hand are the people who will inherit assets and wealth from parents and grandparents.

On the other who have no pot of familial money in their futures.

Stephen Bush  FT 24 May 2022

https://www.ft.com/content/6f11e75c-5edb-4ad9-bd26-05352c40321c

Jag har tidigare behandlat en näraliggande fråga. Om lönepengar och lånepengar

Lånepengar vet vi alla vad det är när vi skriver på den prickade raden för att få det vi önskar.

Lönepengar är det vi får för att vi har uträttat något.

Det är dock inte alltid så lätt att skilja på lönepengar och lånepengar. Bilarbetarna på Saab, GM, Opel och Volvo anser sig hämta lönepengar i lönekuvertet, men om bilarna köps med lånepengar kanske även deras lönepengar är ett slags lånepengar.

Likaså anser sig den som fått ett arv av sina avlidna föräldrar bestående av pengar erhållna vid en försäljning av deras hus med stor rea-vinst ha rätt att med gott samvete köpa en segelbåt för pengarna. Detta utan att tänka på att segelbåten är köpt med lånepengar; lånade av den som köpte huset.

De senaste tio åren eller så har en stor del av konsumtionen (och därmed BNP) i USA, Sverige och andra länder kommit från lånepengar. Detta fick sig en rejäl törn häromåret. Därav finanskrisen.

https://englundmacro.blogspot.com/2009/08/om-lonepengar-och-lanepengar.html 

Gradvis och i all tysthet så har vi frångått tanken att lån är något som skall betalas tillbaka.
Nuförtiden skall lån inte betalas tillbaka utan rullas runt, eller ändå hellre höjas, i takt med att priset om än inte värdet, på huset stiger.

Det hade inte varit någon fara med subprimelånen om inte villapriserna hade sjunkit. 

https://englundmacro.blogspot.com/2010/03/tank-om-vi-lever-i-en-ny-era.html

Några av mina artiklar
https://englundmacro.blogspot.com/search/label/Ego

About me

What have I done? Caveat Emptor 

https://englundmacro.blogspot.com/2021/11/what-have-i-done-caveat-emptor.html

2022-05-28

Venice 1630 plague on the dangers of helcopter money

The government had much to fear, and undertook its massive fiscal and monetary expansion to avoid the threat of riots.

Interest in helicopter money was fed by more than a decade of subpar growth and interest rates that remained stuck at the zero lower bound, even in the face of vast quantitative easing.

Matthew Brooker Bloomberg 28 May 2022

https://www.bloomberg.com/opinion/articles/2022-05-28/venice-has-a-400-year-old-covid-monetary-lesson-on-helicopter-money

Helicopter money is a valid tool for central bankers

FT View Editorial 6 April 2020

https://englundmacro.blogspot.com/2020/04/ledare-i-financial-times-oppnar-for.html

 

Medium-term inflation expectations appear to have reached a plateau

  “While short-term inflation expectations have continued to trend upward, medium-term inflation expectations appear to have reached a plateau over the past few months, and longer-term inflation expectations have remained remarkably stable,” the researchers wrote in a blog post that was co-authored by New York Fed President John Williams.
https://www.bloomberg.com/news/articles/2022-05-26/us-consumers-expect-inflation-shock-to-pass-ny-fed-survey-finds

Professor Irving Fisher, October 1929:
"stock prices have reached what looks like a permanently high plateau."

“Eventually, the market will come back”

 The sobering news is that the market had 15 separate episodes in which stocks fell at least 20 percent. 

On average, these were the findings from those bear markets:

Total loss from market peak: 34.8 percent.

Duration of the decline until the market bottom: 264 trading days.

Time required to recoup those losses after the bottom: 567 trading days.

Remember, those are average figures.

Tons of academic research suggests that it is fruitless to try to outsmart the market, so I use diversified low-cost index funds that track the entire stock and bond universe in the expectation of long-term gains.

This approach makes sense for people with long horizons, but the earlier you need the money, the more difficult your choices will be.

U.S. government I bonds, which now yield 9.62 percent, a rate that is reset every six months. 

Jeff Sommer NYT 27 May 2022

https://www.nytimes.com/2022/05/27/business/stock-market-bear-bull.html

I-Bonds are U.S. savings bonds whose yields are adjusted by the prevailing inflation rate

https://englundmacro.blogspot.com/2022/04/i-bonds-are-us-savings-bonds-whose.html

Should Congress Shrink the Deficit to Fight Inflation?

 



Stephanie Kelton 27 May 2022

Should Congress Shrink the Deficit to Fight Inflation? (substack.com)


Inflation in the United States has probably peaked

I realize in saying that I risk coming across as the boy who cried “no wolf.”

Markets have noticed the relatively good news on inflation. We can more or less directly calculate market expectations of inflation by looking at the “breakeven rate,” the interest rate spread between ordinary United States bonds and bonds that are indexed to protect investors against inflation. 

And breakeven rates have come down a lot over the past month or two:



So how have the permahawks reacted to the inflationary surge of 2021-22? With stern expressions of concern, of course. But you didn’t have to do much reading between the lines to detect a fair bit of underlying glee that this time their proclamations of doom were finally coming true.

The good news is that this wave of doomsaying will probably be, um, transitory.

Paul Krugman NYT 27 May 2022

https://www.nytimes.com/2022/05/27/opinion/inflation-prices-stagflation.html

 

Why the Dow finally bounced 

Real, or inflation-adjusted, interest rates fell over the past week, corporate credit spreads tightened, and investor expectations for future Federal Reserve rate increases moderated,

That leaves uncertainty about how high the federal funds rate, currently at 0.75% to 1%, will ultimately go. Market pricing points to a so-called terminal rate between 2.5% and 3%, but anything that hints it will be higher than that will rattle investors

MarketWatch 28 May 2022

https://www.marketwatch.com/story/why-the-dow-finally-bounced-and-what-it-will-take-to-convince-investors-its-for-real-11653698825

 

 

 

Bill White, the former chief economist at the Bank for International Settlements and my favorite central banker

 It would be an understatement to say he’s concerned.

Bill’s top fear is the Federal Reserve may get so far behind the curve it can’t ever catch up. This could happen if inflation rises faster than the Fed hikes. In that case, real interest rates would actually be moving lower.

Bill’s most interesting point is one I have made many times: central banks are overconfident in their own ability to control the economy. He says it more eloquently, so I’m going to quote him at length.

“Mark Twain said, ‘It ain’t the things that you don’t know what gets you, it’s the things what you know for sure, what ain’t so.’ And Oliver Cromwell wrote a letter to the Scottish parliament, I think it was…  And what he said was, ‘Brothers, I beg you in the bowels of Christ, think it possible that you might be wrong.’ And this problem of people holding on to false beliefs seems to me to have been around for a very long period of time. The first question, I guess, is, do we think that the Central Bankers actually have got it wrong?

“And in consequence, the economy is not understandable, and it is not controllable. Maybe controllable within certain limits, but it will not take the maximization that has been going on without having some unintended consequences that, over some longer run, will come back and bite you in the bum. And that’s precisely what’s been going on.

Most of this was during the Alan Greenspan era. The initial mistakes seemed innocent. The Fed became more accommodating to markets in the Mexican peso crisis, then later with Asian and Russian debt crises. These were indeed bad situations. The Fed had to respond, which it did, preventing the markets from imploding. 

Wall Street hailed Greenspan as a genius. But then bankers and investors came to think the Fed could manage its way out of any crisis. This was the genesis of the overconfidence Bill White talked about, and other central banks had it, too.

This went from bad to worse in 2007 as Ben Bernanke became Fed chair. A small group—not the entire FOMC—came up with the “Bernanke Doctrine” of zero rates and large-scale asset purchases. This was well before the Bear Stearns and Lehman Brothers failures.

Hoenig thinks there is a very real chance the Fed will soon make that same mistake again.

“Will the Fed stay the course? Will the Fed even keep rates where they are? Let’s say they’re 2% by summer and they’re taking out the $95 billion a month, and the market begins to have a real anxiety attack. Will the Fed stay the course?

This is my fear as well. We saw a similar situation in 2018. I was critical at the time of the Fed doing what I called a “two-variable experiment.” The Fed was tightening, markets didn’t like it, and Powell gave in.

John Mauldin 27 May 2022

https://www.mauldineconomics.com/frontlinethoughts/rock-and-a-hard-place


Bill White world’s central banks were making a mistake with their single-minded focus on monetary policy

https://englundmacro.blogspot.com/2016/07/bill-white-worlds-central-banks-were.html


An unsustainable level of private sector debt is the main factor explaining the present severe downturn, as well as many previous downturns in history. 

William White FT 2 March 2010

https://www.internetional.se/stabiliseringspolitik.htm#whiteplanb


End of the 40-Year Bull in Debt and a “Global Depression” Threat

 Francis Hunt interviews Danielle DiMartino Booth in a must watch video

Mish 27 May 2022

https://mishtalk.com/economics/end-of-the-40-year-bull-in-debt-and-a-global-depression-threat


2022-05-27

Börsen 27 maj 2022

 




Stocks rise after inflation data; Dow aims to end longest weekly losing streak since 1932. 
The personal consumption expenditure index rose just 0.2% in April for its smallest monthly increase in a year and a half, due largely to a decline in gas prices which have subsequently rebounded



Börsen 26 maj 2022


 

2022-05-26

Olivier Blanchard argues we will return to very low real interest rates

 Olivier Blanchard argues that the current situation is a bump but that we will return to very low real interest rates and the same problems we had before.

Fed staff forecasts of March had unemployment staying at 3.5 per cent throughout the next two years and had inflation coming down nicely to two point something. That just will not happen.

3 per cent nominal interest rates with expected inflation above 3 per cent would not strike me as sufficient to slow down the economy and decrease inflation. 

Greek 10-year spread has increased by 93 basis points so far this year, and the Italian by 67 basis points over the same period. That could put the ECB in a difficult situation.

Martin Wolf FT 26 May 2022

https://www.ft.com/content/e63dab63-bf41-4c43-b827-1b1736fc518d


View, or perhaps hope, that the US economy is either at or near peak inflation

 Owners' Equivalent Rent

The CPI rent index will likely keep moving higher as the year goes on. There's still an element of catch-up in the CPI data just given the way the index is constructed. The debate among inflation forecasters is whether it finishes this year closer to say 6% YoY or 7%-7.5%.

You can't say that you "understand the hardship" that inflation is causing and then tell people that if you strip out food and energy, inflation's coming down.

Joe Weisenthal Bloomberg 25 maj 2022

https://www.bloomberg.com/news/articles/2022-05-25/q-a-omair-sharif-on-why-inflation-may-still-not-have-peaked


2022-05-25

Fed Minutes agreement on need for further half-point increases in June and July

 Mr. Powell last week laid out a relatively high bar to slow down rate increases. 

“This is not a time for tremendously nuanced readings of inflation,” he said. “We need to see inflation coming down in a convincing way. Until we do, we’ll keep going.”

WSJ 25 May 2022

https://www.wsj.com/articles/fed-minutes-show-growing-urgency-for-tighter-monetary-policy-11653501768


Regeringen inkallar stabilitetsrådet

Finansmarknadsminister Max Elger (S) kallar Riksbankschefen Stefan Ingves, Finansinspektionens chef Erik Thedéen och Riksgäldens chef Karolina Ekholm till ett möte i det finansiella stabilitetsrådet.

Birgitta Forsberg SvD 25 maj 2022

https://www.svd.se/a/MLeQjR/regeringen-inkallar-finansiella-stabilitetsradet


https://www.sou.gov.se/finansiella-stabilitetsradet/


Finansinspektionen: Klarna är inte en systemviktig bank | SvD




Vi hör ofta att svenska hushåll har för mycket skulder. Vi anser att det är en alltför förenklad bild 
 
Danske Banks bankanalytiker Andreas Håkansson släppte i veckan en rapport tillsammans med aktiestrategen Molly Guggenheimer som bemöter olyckskorparnas kraxande om skuldbergets makroekonomiska risker.
 

Guggenheimer

 


 

Fed Searches for the Magic Number to Cool a Red-Hot U.S. Housing Market

The central bank must decide on an interest rate that will cap sky-high price growth without triggering a painful economic slowdown

America’s red-hot housing market threatens to make the Fed’s job tougher. With so many buyers competing for so few available properties, home prices in the U.S. rose 18.8% last year

Homeowners also have an incentive to stay put. Many don’t see where they can afford to move. 

In April, the monthly mortgage payment on the typical home jumped to $1,475, assuming a 30-year fixed-rate mortgage with a 20% down payment, according to Zillow Group Inc. 

That is up 34% since December and 53% from April 2021.

WSJ 24 May 2022

https://www.wsj.com/articles/the-fed-searches-for-the-magic-number-to-cool-a-red-hot-u-s-housing-market-11653402996


When the Federal Reserve set out to cool the economy and slow inflation in the past, it counted on the housing market to do much of the work. 

By raising interest rates, the central bank made mortgages more expensive and trimmed the number of buyers. This time, America’s red-hot housing market threatens to make the Fed’s job tougher. 




With so many buyers competing for so few available properties, home prices in the U.S. rose 18.8% last year

REAL TIME ECONOMICS

Börsen 25 maj 2022

 


Stockholmsbörsen stängde på dagslägsta
Trots en inledning som såg positiv ut stängde indexen på minus 
”Det är väldigt volatilt”, sa Anders Rudolfsson, mäklarchef på DNB, om börsläget.
Di 25 maj 2022







Wolf on Stagflation

 Are we moving into a new era of higher inflation and weak growth, similar to the stagflation of the 1970s. 

If so, what might this mean?

The US and other high-income economies experienced almost a decade of high inflation, unstable growth and weak stock markets. 

Excess demand causes supply shocks to turn into sustained inflation, as people struggle to maintain their real incomes and central banks seek to sustain real demand. 

This then leads to stagflation, as people lose their faith in stable and low inflation and central banks lack the courage needed to restore it.

At present, markets do not expect any such outcome. 

The growth of nominal demand is vastly higher than interest rates.

 Inflation will fall, but maybe only to 4 per cent or so. Higher inflation would become a new normal. The Fed would then need to act again or have to abandon its target, destabilising expectations and losing credibility. 

If the 1970s taught us anything, it is that the time to throttle an inflationary upsurge is at its beginning, when expectations are still on the policymakers’ side. 

Martin Wolf FT 24 May 2022

https://www.ft.com/content/734cb1ff-9dc1-4a67-a567-c2f681f18a77


2022-05-24

Realräntefond vs OMX i år

 






Börsen 24 maj 2022

 

En dag


I år





Riksbanken om finansiell stabilitet

 En förutsättning för att ekonomin ska fungera och växa är att det finansiella systemet är stabilt och fungerar väl.

Men systemet är känsligt eftersom dess centrala delar är sårbara. Exempelvis finansierar bankerna sin verksamhet på kort löptid men lånar ut på längre löptider, vilket gör dem beroende av allmänhetens och marknadens förtroende. 

Om detta går förlorat kan allvarliga problem snabbt uppstå.


Riksbanken: Hoten mot den finansiella stabiliteten har ökat

Riksbanken stöder Finansinspektionens ambition att i närtid fortsätta höja det kontracykliska buffertvärdet för att stärka motståndskraften i banksektorn och anser vidare att det är viktigt att åtgärda bristerna på den svenska marknaden för företagsobligationer samt öka användningen av fullt ut transaktionsbaserade referensräntor.

DI/Direkt 24 maj 2022 

https://www.di.se/live/riksbanken-hoten-mot-den-finansiella-stabiliteten-har-okat/


Riksbankens rapport Finansiell stabilitet

https://www.riksbank.se/sv/press-och-publicerat/nyheter-och-pressmeddelanden/pressmeddelanden/2022/hoten-mot-den-finansiella-stabiliteten-har-okat/

https://www.riksbank.se/globalassets/media/rapporter/fsr/svenska/2022/220514/finansiell-stabilitetsrapport-2022_1.pdf


”Det är osäkert hur ekonomins aktörer kan hantera högre räntor ”, skriver Riksbanken.

Ett ”dåligt scenario”, med högre boräntor och högre priser än väntat för energi och andra levnadskostnader samtidigt som bostadspriserna faller brant, hotar att bli ”mycket kännbart för många högt skuldsatta hushåll” och tvinga dem till kraftigt minskad konsumtion, varnar Riksbanken.

Nils Åkesson DI 24 maj 2022

https://www.di.se/analys/riksbanken-pekar-ut-storsta-hoten-mycket-kannbart/

Nollräntan och Greklandskrisen

PIIGS-krisen (Portugal, Italien, Irland, Grekland och Spaniens skuldproblem), eurokrisen – kärt barn har många namn.

Den slog till med full kraft under vårvintern år 2011, precis när riskaptiten på allvar hade repat sig efter finanskrisen 2008–2010. 

Börserna bottnade i början av 2009 (efter att ha prissatt jordens undergång) och steg sedan brant till april 2011 då framför allt Greklands skuldproblematik blev uppenbar. 

Det var en existentiell kris 2011–2012 och det var ganska enkelt att måla upp bilden av en katastrof som skulle få hela den monetära unionen på fall.

Slut på krisen när den dåvarande ECB-chefen Mario Draghi under sommaren 2012 deklarerade att man är redo att göra ”whatever it takes” 

Sedan år 2012 har vi inte brytt oss särskilt mycket om skulder, framför allt eftersom skuldbördan inte har spelat någon större roll när räntan plockades bort. 

De enorma skulderna bakbinder den europeiska centralbanken och därmed Riksbanken. Varken Grekland eller något annat land klarar av särskilt höga räntor. 

De höga skulderna gör paradoxalt nog att räntechocken uteblir, till gagn för både Grekland och svenska bolåntagare. 

Henrik Mitelman DI 24 maj 2022

https://www.di.se/analys/darfor-skanker-skuldberget-hopp/

 Lysande.


Minusräntorna beror på försvaret av euron

Rolf Englund 21 augusti 2019

https://englundmacro.blogspot.com/2019/08/minusrantorna-beror-pa-forsvaret-av.html


Federal Reserve Chairman Jerome Powell reiterated the central bank will support the economy “for as long as it takes.”

CNBC  22 september 2020

https://englundmacro.blogspot.com/2020/09/federal-reserve-chairman-jerome-powell.html


RE: Slutsats: Om dagens problem beror på den långvariga nollräntan och nollräntan beror på euron så beror dagens problem på euron och dess apologeter.

Apologet [-ge:ʹt] (grekiska apologēʹtēs ’försvarare’), försvarare, framför allt av en religiös tro. 
Källa Nationalencyklopedin




‘I feel like I am reliving the summer of 2008.’

 Strategist David Rosenberg sees bear market sinking the S&P 500 to 3,300

MarketWatch 23 May 2022 

https://www.marketwatch.com/story/i-feel-like-i-am-reliving-the-summer-of-2008-strategist-david-rosenberg-sees-bear-market-sinking-the-s-p-500-to-3-300-11653333623


Rescue From Recession Won’t Be So Easy This Time

With inflation raging, the famous ‘Fed put’ to save the day with cheap money might not be available.

For more than 30 years we have become used to a reassuringly familiar pattern in business cycles. 

As the economy expands, the Fed raises interest rates to curb inflationary pressures. Eventually some combination of credit squeeze or inventory over-accumulation then precipitates a downturn in the economy. 

The Fed cuts rates—and in recent cycles, supplied the added sugar of quantitative easing through asset purchases—and soon there’s enough free money to revive the animal spirits and get demand moving again.

Gerard Baker WSJ 23 May 2022 

https://www.wsj.com/articles/rescue-from-recession-wont-be-easy-inflation-fiscal-crisis-401k-baby-formula-housing-gas-prices-federal-reserve-biden-11653337995


2022-05-23

Börsen 23 maj 2022

 




6 months



It would be too optimistic to expect imminent Ukrainian EU membership

The president of the European Commission, Ursula von der Leyen, and Germany’s foreign affairs minister, Annalena Baerbock, have signaled that they would support such a move, but they both know that at least one of the 27 EU member states would veto full membership for Kyiv.

WSJ 22 May 2022

https://www.wsj.com/articles/why-europe-hedges-its-support-for-ukraine-russia-crude-oil-lng-gas-imports-exports-kyiv-war-eu-membership-zelensky-putin-germany-france-poland-11653247453?st=zxu83d0xzek6hko&reflink=desktopwebshare_permalink




ECB Likely to Exit Negative Rates by End of September

Net bond buying set to end ‘very early’ in third quarter

Governing Council has been building to raise the deposit rate from its current level of -0.5% in July. Lagarde’s comment suggests two increases of 25 basis points each at the July and September policy meetings. 


Lagarde reiterated that the ECB would also be able to “design and deploy new instruments” to make sure that monetary policy is properly transmitted through the euro area. 
(RE: Saving Italy, Greece, Spain, Portugal)

Bloomberg 23 May 2022



In 2022, “extreme vigilance” means getting rates back up to zero within four months.

That is still a lenient monetary policy by any definition

John Authers Bloomberg 24 maj 2022



ECB höjer räntan i juli för första gången sedan 2011

Olof Manner, senior rådgivare på Swedbank, noterar att styrräntan i dag är minus 0,5 procent och inflationen 7,5 procent.

Viktor Munkhammar DI 18 maj 2022



År det så hemskt att vi faktiskt inte vet hur vi skall undvika att den nuvarande ekonomin byggd på en allt högre belåning av stigande huspriser skall kunna brytas och ersättas med något annat, vad det nu kan vara?
Rolf Englund 8 juli 2014


Global power grids are about to face their biggest test in decades

Summer in much of the Northern Hemisphere is a typical peak for electricity use. air conditioners

When plants on the Texas power grid failed this month, wholesale power prices in Houston briefly jumped above the $5,000 a megawatt-hour price cap, surging 22 times higher than the average cos

Bloonberg 22 May 2022

https://www.bloomberg.com/news/features/2022-05-22/summer-blackouts-bring-deadly-risk-as-heatwaves-grip-the-globe


Air conditioners units in operation worldwide could jump from nearly 2 billion today to 5.6 billion by 2050

Deutsche Welle 25 January 2022

https://englundmacro.blogspot.com/2022/01/air-conditioners-units-in-operation.html


Is The Economy Headed For a Soft Landing, Stagflation, or Crash?

 The discussion about a target “neutral” nominal Federal Funds rate is fatuous: As long as real interest rates are negative there is no effective demand restraint emanating from monetary policy… except, perhaps, via asset prices. 

And here then is the central conundrum for the Fed. 

If the rise in rates and quantitative tightening is too slow, it will not constrain the inflation of goods and services prices. 

On the other hand, if tightening is rapid enough to constrain demand, it might result in a collapse in a swathe of asset prices, and financial turbulence that will move from Wall Street to Main Street and elicit a sharp recession. 

My bet for the present is on scenario three: stagflation. But... things could get worse.

Leslie Lipschitz Barrons 23 May 2022

https://www.marketwatch.com/articles/fed-economy-soft-landing-stagflation-crash-51653086991?mod=mw_latestnews


Investors are actually positioned for a relatively smooth landing scenario

Bridgewater Associates’ Greg Jensen, the co-chief investment officer of the world’s biggest hedge fund, warned of a toxic brew for asset prices as the Federal Reserve raises interest rates and unwinds its balance sheet to deal with the highest inflation in decades.

Bloomberg 23 May 2020

https://www.bloomberg.com/news/articles/2022-05-23/bridgewater-s-greg-jensen-warns-markets-are-still-overly-optimistic



Investors’ expectations that interest rates will not rise much may be very misguided

This time when growth slows, inflation will in all likelihood still be too high for the Fed to stop tightening.

The Fed seems to be hoping that inflation will fall back to its 2 per cent target despite policy interest rates remaining negative after taking into account inflation.

Inflation has asserted itself as a major social and political issue for the first time in more than 40 years. 

Sonal Desai FT 23 May 2022


The writer is chief investment officer at Franklin Templeton Fixed Income

The spread between Italy’s 10-year bond yield and Germany’s

has climbed as high as 2 percentage points in recent weeks

Italy relies heavily on Russia for its energy

Optimism seen at start of 2022 is fading fast 

FT 23 May 2022

https://www.ft.com/content/8dd69dbb-b476-4192-9db2-944f7e937f8f


How shadow banks threaten the global economy

 The constant flow of easy money out of central banks has fed serial crises for decades.

Shadow banks manage $63tn in financial assets — up from $30tn a decade ago.

The even bigger risk is that an accident in the markets settles the debate over how hard Fed tightening will hit the real economy.

 Ruchir Sharma FT 23 May 2022 

https://www.ft.com/content/d22ec352-a4a4-4f4c-832a-cb05af5110f1


The world is in a debt trap

No matter what happens to near-term inflation and growth, the world is too indebted for rates to rise much higher.

Ruchir Sharma FT 22 November 2021

https://englundmacro.blogspot.com/2021/11/the-world-is-in-debt-trap.html


These structural changes in the way finance works may mean that markets are more prone to bouts of erratic trading and nervous breakdowns.

The Economst editorial 11 May 2022

https://englundmacro.blogspot.com/2022/05/one-question-is-whether-market-slump.html


The shadow banking system and The Volcker Rule

https://www.internetional.se/billgrossoctober1.htm


2022-05-22

This Will Make 1970’s Look Like NOTHING

The Money GPS 18 May 2022

(3) ⚠️ This Will Make 1970’s Look Like NOTHING ⚠️ - YouTube


Once Every Hundred Years This Happens 

The Money GPS 22 May 2022

https://www.youtube.com/watch?v=ecYsFORCr2E


Ben Bernanke, Federal Reserve Chair, January 3, 2010

 - Having experienced the damage that asset price bubbles can cause, we must be especially vigilant in ensuring that the recent experiences are not repeated.


Lundell konstaterar: Vita män står inte högt i kurs

 Vad vill Ulf Lundell? undrar Ann Heberlein.

https://www.svd.se/a/WjGeza/vad-vill-ulf-lundell-ann-heberlein-laser-vardagar-6-och-7


Anledningen till att så många äktenskap slutar i skilsmässor är helt enkelt att vi gifter oss med fel person

Augusti – tiden för kräftor, surströmming och skilsmässor.

När vi väl får tid att vara tillsammans med den vi en gång valt att leva med upptäcker vi att vi inte gillar varandra särskilt mycket.

Ann Heberlein SvD 13 augusti 2022

https://www.svd.se/a/7dEQ73/ann-heberlein-om-varfor-sa-manga-vill-skilja-sig-efter-semestern



My concern is that this time could be more like 1973-1974

 The risk is a series of bear-market rallies that don’t last, hurting dip buyers and further damaging investor confidence

That confidence is already weak.

In March 2020 that was enough, because central bankers and politicians were frightened, too. When they stepped in (Senate Approves Roughly $2 Trillion in Coronavirus Relief) it helped investors see that, with government support, companies could make it through.

This time central bankers are scared not by falling markets or the economic outlook, but by inflation. 

My concern is that this time could be more like 1973-1974. 

1974 the Fed kept raising rates even as a recession took hold because it was running to catch up with inflation. The result was a horrible bear market interspersed with soul-destroying temporary rallies, two of 10%, two of 8% and two of 7%, each snuffed out. 

It took 20 months before the low was reached

If inflation comes down, the Fed won’t need to raise rates as much as it has indicated

In really simple terms, though, after stocks more than doubled in two years, a market fall of more than 20% seems entirely plausible.

James Mackintosh WSJ 22 May 2022 

https://www.wsj.com/articles/conditions-are-ripe-for-a-deep-bear-market-11653166864


Megadrought’ threatens water and power supplies to millions in US

Water levels in two largest reservoirs at record lows as study says southwestern drought worst in 1,200 years

A US power regulator this week warned that a big swath of the US was at risk of blackouts, partly as a result of drought conditions curtailing hydroelectric supplies.

FT 21 May 2022

https://www.ft.com/content/9f00dfff-3a44-483f-9d5a-f58db7806046


Parts of Spain are experiencing their hottest May ever with temperatures of more than 40C in some places, according to the state weather agency, AEMET.

BBC 21 May 2022

https://www.bbc.com/news/world-europe-61533719


Englunds lag 3 (Inflation and the housing market)

Räntan (A) är vad som behövs för att stoppa inflationen.

Räntan (B) är den som gör att bostadsmarknaden kollapsar.

Om A är större än B har vi ett stort problem.


The interest rate (A) is what is needed to stop inflation.

The interest rate (B) is the one that causes the housing market to collapse.

If A is higher than B, we have a big problem.



Inflation och handelsbalans. Englunds lag 2,0.

https://englundmacro.blogspot.com/2021/04/inflation-och-handelsbalans-englunds.html


Englunds lag 1

Har man sagt A, måste man säga B, och har man sagt B är det svårt att säga att A var fel.

17 mars 1999

https://www.internetional.se/eso99.htm#lagen


Englund's Q 

How come that unemployment is rising when the recession is over?

It is the productivity, Stupid

For employment to rise GDP must increase more than Productivity (P), of course

https://englundmacro.blogspot.com/2009/12/englunds-q-how-come-that-unemployment.html


2022-05-20

“Are we headed for stagflation?”

 It depends on their definition of the term.

If it to mean a period of rising unemployment combined with inflation that’s still too high, the answer is that there’s a very good chance that we’ll suffer from that malady for at least a few months. 

But if they’re referring to something like the extreme pain we suffered to close out the 1970s, it looks unlikely.

1979 to ’80 The Federal Reserve, under Paul Volcker, responded with drastically tighter monetary policy, leading to a recession and a sharp rise in unemployment

Now look at the period from 2007 to the fall of 2008, just before the demise of Lehman Brothers. 

 While there was a severe recession — still generally known as the Great Recession — it had nothing to do with squeezing inflation out of the economy and everything to do with the fallout from a severe financial crisis.

In short, inflation doesn’t seem to be entrenched; 2022 isn’t 1980.

We’re probably headed for a period of weakening labor markets while inflation is still elevated, and many commentators will surely proclaim that we’re experiencing stagflation.

When people hear “stagflation,” most think of the late 1970s and early ’80s — but there’s no evidence that we’re facing anything comparable now.

Paul Krugman NYT 20 May 2022

https://www.nytimes.com/2022/05/20/opinion/stagflation-inflation-economy.html


Stagflation Is Sexy. It May Also Be Unlikely

Stagflation fears may be overdone.

Inflation targeting is the wrong policy for central banks.

Mark Gilbert Bloomberg 20 maj 2022

https://www.bloomberg.com/opinion/articles/2022-05-20/stagflation-is-sexy-it-may-also-be-unlikely





        

Börsen 20 maj 2022

 



The S&P 500 rallied all the way back from a 2.3% drop .

It May Be a Bear Market, But It’s Not a Panic. That’s Worrisome




Stephanie Kelton On MMT and Today’s High Inflation

We spoke with Stephanie Kelton, one of the foremost MMT economists and the author of the best-selling book “The Deficit Myth” to get her take on the macro environment, and what MMT can contribute to today's debate. 

Transcripts have been lightly edited for clarity.

Bloomberg 9 maj 2022

https://www.bloomberg.com/news/articles/2022-05-19/transcript-stephanie-kelton-on-mmt-and-today-s-high-inflation

 

Don’t count on Fed to ride to the rescue of a faltering stock market -- at least not yet

 That’s not encouraging for investors betting on the imminent exercise of a “Fed put” -- in which the central bank alters policy to prop up equity markets after a sharp decline. 

Bloomberg Economics Says...

“I think the Fed welcomes it. The stock market has to decline a lot more -- double the current drop -- before it will get close to wiping out the stock gains during the pandemic. This sounds callous, but declining stocks will get more people to come out of early retirement.”

--Anna Wong, chief U.S. economist

Bloomberg 19 May 2022

https://www.bloomberg.com/news/articles/2022-05-19/fed-plans-for-half-point-hikes-won-t-be-shaken-by-stocks-rout


If you have only been in markets for, say, 15 years, 

you are seeing the collapse of everything that you have been told is true and have also observed to be true about markets.

Bonds prices rising in the bad times. Mostly when things look tricky in equity markets there is a reason (or central banks at least manage to find one) to cut interest rates to sort things out.

The only time this can’t happen is when inflation is already obviously out of control — and no amount of fretting about market crashes and looming recessions can allow central banks to even begin to look like they aren’t fully focused on having a go (however fruitless it may be) at bringing it back under control.

Merryn Somerset Webb FT 20 May 2022

https://www.ft.com/content/caf34f2c-f826-4015-ac2e-cfaac7429a8e

US market is more overvalued than in 1929, 1973 and 2007
Merryn Somerset Webb FT 28 December 2021


Lower share prices make people’s portfolios shrink, they feel less well off, and they are less likely to buy stuff

That is exactly what the Fed wants. 

It needs share prices to fall enough to influence behavior, which means that policy makers need this to turn into a true bear market, and not like one of the 20%-ish declines that were followed by rescues and resumed exuberance.

John Authers Bloomberg 20 maj 2022

https://www.bloomberg.com/opinion/articles/2022-05-20/a-stocks-rescue-is-the-last-thing-the-federal-reserve-wants


“There is no market put, and I think we’re all waking up to that fact now,”

MarketWatch 19 May 2022 

https://englundmacro.blogspot.com/2022/05/there-is-no-market-put-and-i-think-were.html


But I think that the Fed will lose its nerve.

The inflation will go on.

Rolf  Englund 20 May 2022



The coming food catastrophe

The Economist editorial 19 May 2022

https://www.economist.com/leaders/2022/05/19/the-coming-food-catastrophe


Mercedes-Benz 300 SLR 1955

 En Mercedes-Benz 300 SLR såldes nyligen av RM Sotheby´s för 135 miljoner euro, alltså cirka 1,4 miljarder kronor, i en affär som firman hävdar gör bilen till den dyraste någonsin att auktioneras ut.

Modellen designades av Rudolf Uhlenhaut 

DI 20 maj 2022

https://www.di.se/bil/mercedes-sald-for-1-4-miljarder-kronor/


The car was based on the company’s successful W 196 R Grand Prix car, which won two World Championships with driver Juan Manuel Fangio. 

Mercedes-Benz said it will donate the proceeds to create a fund for scholarships and educational research into the environment and decarbonization.

https://www.cnbc.com/2022/05/19/mercedes-benz-300-slr-uhlenhaut-coupe-sells-at-auction-for-143-million.html


Mercedes-Benz CEO Ola Källenius said the scholarship fund would allow more people from around the world to follow in the footsteps of the car's creator, Rudolf Uhlenhaut.

https://www.whichcar.com.au/news/mercedes-confirms-200-million-sale-of-300-slr-uhlenhaut-coupe


Company design chief Rudolf Uhlenhaut, architect of both the 300 SLR racer and the hybrids, appropriated one of the leftover mules as his personal car. Capable of approaching 290 km/h (180 mph), the Uhlenhaut Coupé was by far the fastest road car in the world in its day.

https://en.wikipedia.org/wiki/Mercedes-Benz_300_SLR


Mercedes-Benz Smashes Ferrari's Classic Car Record

https://www.bloomberg.com/news/articles/2022-05-19/-142-million-mercedes-benz-300-slr-uhlenhaut-coupe-smashes-ferrari-record





2022-05-19

What if higher interest rates and a recession don’t tame inflation?

 The next few months could be ugly if inflation fails to drop to tolerable levels

The lesson from the 1970s is not encouraging.

This continued until central banks, most notably the Volcker Fed, engineered their own recession, raising interest rates sufficiently to put millions of people out of work.

From an investor point of view, this was the worst of all worlds — countercyclical inflation (stagflation)

Dario Perkins MarketWatch 19 May 2022

https://www.marketwatch.com/story/the-worst-of-all-worlds-for-investors-what-if-higher-interest-rates-and-a-recession-dont-tame-inflation-11652968911


Den superlätta räntepolitiken har gjort sitt, menar chefen för BIS – "centralbankernas bank".

Fortsatt lågräntepolitik hotar att bygga upp nya obalanser, varnar han.

DI 24 juni 2013. Ja 2013.

https://www.di.se/artiklar/2013/6/24/bis-chefens-skarpa-varning/


Stefan Ingves, Viktor Munkhammar och Centralbankernas konspiration

Headline inflation är nu hög och svider i konsumenternas plånböcker. Alla vet att nu är det inflation. 

Se där ett gyllene tillfälle för centralbankerna att höja räntan och därmed sätta stopp för den långvariga skuldökningen hos hushåll och företag.


Yellen cites ‘stagflationary effects’ in a warning ahead of a meeting of leaders of seven wealthy nations

Earlier this week, Ben Bernanke raised the possibility of stagflation in an interview published in the New York Times. 


“Even under the benign scenario, we should have a slowing economy,” he said. “And inflation’s still too high but coming down. So there should be a period in the next year or two where growth is low, unemployment is at least up a little bit and inflation is still high.”



Ben Bernanke says the U.S. economy, for the first time since the 1970s, could be heading toward a period of stagflation

Bernanke told DealBook, in an exclusive interview with Andrew ahead of Bernanke’s new book. 

Bernanke says backing away from a 2 percent inflation target would be a mistake. “In everyday life, we judge the credibility of promises more by the reputations of the promise-makers than by the exact words they use,” 

The book, “21st Century Monetary Policy: The Federal Reserve From the Great Inflation to Covid-19,” 


Did inflation targeting fail?  

Martin Wolf m fl



Börsen 19 maj 2022

 





Börsen uppvisar just nu den största börsnedgången realt sett sedan 1974 







How climate is making Australia more unliveable

 Nowhere is this a bigger issue than in Queensland. It is home to almost 40% of the 500,000 homes projected to be effectively uninsurable.

Queensland has been ravaged by floods in recent months. In February, the state capital Brisbane had more than 70% of its average yearly rainfall in just three days.

BBC 19 May 2020

https://www.bbc.com/news/world-australia-61432462


Welcome to Queensland, Australia