Discover and read the best of Twitter Threads about #Macroeconomics

Most recents (24)

For this we need to understand P/E ratio. It basically tells us the number of years at constant profits it will take to return the investment.
It tends to capture the agony and ecstasy of the market.
In bear phase investors are despondent about the future, P/E ratios of companies and indices will contract. Exactly opposite happens in bull phase.
Read 11 tweets
The @federalreserve is talking of hiking interest rates and end their quantitative easing (QE) policy to halt rising inflation. A Thread 🧵 to understand what it means.

#macroeconomics #investing #economy

@JustPunforfun @564pankaj @CNBCTV18News @bloombergquint @EconomicTimes Image
With inflation currently around 7%(USA) and 6,95%(India), businesses and consumers are feeling the pinch.
The Fed’s actions are designed to reduce the inflation rate to a more comfortable 2.00%-3.00% (USA).
@RBI expects India to be down to 5.7% for this financial Year.
2/n Image
To accomplish this, the Fed / Central Banks will raise its Federal Funds rate. The Federal Funds rate is the rate at which banks can borrow and lend from each other so they can continue to provide loans to businesses and individuals.
3/n
Read 11 tweets
Positive Real Interest Rates are required to reduce inflation.
Negative Real IR's do not help rein prices.
This little much cannot be understood by the central bankers in high-inflation economies?
That works if the source of inflation is the money supply growth due to the deficit
However, if the source of #inflation is supply-side shocks, then raising policy interest rates might hurt more.
For e.g. the Exchange rate shock which brings in imported inflation into the economy needs forex supply to counter the import/outflow demand.
IR is the painful lever
yes, a higher CB Rate should technically curb aggregate demand and expenditures in the economy.
It can reduce the domestic money supply as bank borrowing declines and thereby reduces the monetary base.
Which should taper the imports & adjust the Current a/c.
Shock Therapy 101
Read 9 tweets
#PPCParis is about to begin! If you can't join us live at @SciencesPo_CEE then make sure to check out our Twitter highlights!

/THREAD🧵
Welcome to DAY 1⃣ of #PPCParis! Florence Haegel from @SciencesPo_CEE is opening the conference now: "The overlapping of #EU2022FR with the #FrenchElections of 2022 will frame the agenda of the French Presidency to a great extent"

/2
As part of these welcoming words to #PPCParis we thank Florence Haegel for her warm words and short analysis of the upcoming French Presidency of the @EUCouncil

We're about to hear also from TEPSA Secretary-General @CloosJim

/3
Read 61 tweets
The line in the sand now stands at (2.6%) for Canada's economic Downwave/credit cycle.

This is the point that the record amount of "debt" will overwhelm the “real” economy unless interest rates resume their decline to zero.

#economy #kondratiev #schumpeter #Macroeconomics
"In The Wealth of Nations (V, iii), Adam Smith observed that “Bankruptcy is always the end of the great accumulation of debt. The liberation of the public revenue, if it has ever been brought about at all, has always been brought about by a bankruptcy; sometimes by an avowed one,
but always by a real one, though frequently by a pretended payment.”The tendency of debts to accumulate at compound rates of interest explains why Smith’s axiom applies so universally. The principle was described graphically by one of Smith’s contemporaries, the dissenting
Read 4 tweets
Durante estos días, y por la publicación en castellano de #TheDeficitMyth, os traeremos un #HiloDeLibros sobre obras relevantes para comprender la Teoría Monetaria Moderna, desde aquellas que la defienden y explican hasta las más críticas desde diversas escuelas económicas #TMM Image
@UCM_ECONOMICAS @Economia_EA @el_mmt @MariodelRosal @juanrallo @edugaresp @Evanshm @ptcherneva @billy_blog 🦉#ElMitoDelDéficit (@StephanieKelton; 2021, 400 pp. Ed. @tauruseditorial)

¿Y si el déficit fiscal no fuera dañino para un país... sino necesario para su progreso? Uno de los libros de economía más divisivos de los últimos años, escrito por la asesora económica de Bernie Sanders Image
🦉#TeoríaMonetariaModerna (L. R. Wray; 2015, 295 pp. Ed. @LolaBooks)

A través del estudio histórico del dinero, #TMM describe la utilidad de las herramientas del Estado (moneda, impuestos, deuda, déficit) para conseguir a la vez crecimiento, pleno empleo y estabilidad de precios Image
Read 12 tweets
I am humbled and privilleged to note that my #Research paper; "Sources of #Unemployment in #Lesotho" is now available and can be accessed via the People's Republic of #China's National #Science and #Technology #Library - #NSTL. I give thanks 😎 Image
So far this year, I have successfully published three #Research articles in #Macroeconomics & #Finance, with another two in press. I am currently hammering away at a handful of working papers which will most certainly find a home in reputable #Journals, come 2021 🙏🏽🙂 Image
Im currently internalising the very insightful reviewer comments on my latest #Research paper titled; "Investigating Determinants of Commercial Bank Spreads in #Lesotho", from the good folks over at the globally reputable #International #Journal of #Finance & #Economics #IJFE 😊 ImageImage
Read 52 tweets
The Swiss National Bank will have its meeting today, and with Switzerland having fallen back into deflation, markets are pricing in a 30% chance for a small rate cut.
That said, the SNB already boasts the lowest rates worldwide, so it is unlikely to cut any deeper as running out of policy ammunition would risk generating a negative expectations loop. Instead, it will probably stick to huge FX interventions.
The CHF may tick higher if the SNB does not indicate any interest in rate cuts or even a thought to it, but any rally might not be sustained for long.

FULL REPORT: trackrecordasia2960.ac-page.com/mailing-list

#MakingSenseofHeadlines #MacroEconomics #TrackRecordDaily #ForexTrading #GlobalMacro #SNB
Read 3 tweets
DAY AHEAD: EUROPEAN PMIs

Any disappointment from the PMI data could temper the EUR rally. The single currency has been moving sideways during September as investors scale back some of their more optimistic forecasts for the Eurozone economy.
If the data fail to provide clear signals, the EUR is likely to extend its consolidation. However, strong surprises, whether positive or negative, have the potential to break this trading range as a clearer picture would emerge about where growth is headed in Q4.
Read 3 tweets
1/The death of Justice Ruth Bader Ginsburg less than two months before the presidential election tosses one more lit match into the tinderbox of national politics in 2020:
2/It will surely inflame a deeply polarised country already riven by a deadly pandemic, a steep economic downturn, and civil unrest in its major cities.

In Washington, the vacancy fight could ratchet up tensions to a level unseen even in the tumultuous Trump era.
3/He could also become the first president since Richard Nixon to install three justices on the high court in a single four-year term.

A successful GOP effort to replace Ginsburg with a conservative before or immediately after a Democratic victory will almost certainly lead to..
Read 5 tweets
1/It’s an action-packed week, with three major central bank meetings, the election over who will become Japan’s next leader, and an overload of key economic data. The Fed decision will be crucial (Thu). Image
2/Will the central bank reinforce its new inflation regime by signalling imminent stimulus, or will it sit back until the US election has passed? Neither the Bank of England (Thu) nor the Bank of Japan (Thu) is likely to act.
3/Instead, those currencies may be driven mostly by how the Brexit saga and global risk sentiment evolve.

FULL REPORT: trackrecordasia2960.ac-page.com/mailing-list

#GlobalMacroAtaGlance #MacroEconomics #TR2min #ForexTrading #GlobalMacroAnalysis #BoJ #BoE
Read 3 tweets
1/#GreenInitiative will be the narrative that underpins the need for unlimited fiscal spending to aid manufacturing and growth. The continent that is leading the charge in this theme is Europe.
2/They have been strongest advocates for carbon emissions, carbon tax, carbon credits (& Greta Thunberg). It’s a narrative that sticks and one that makes unlimited fiscal spending justifiable (for the good of humanity), this will be an emerging and huge theme going forward.
3/Assets that will benefit from this “Green Narrative” are #Uranium, and Uranium rich countries like Australia ($AUD) and Canada ($CAD).

FULL REPORT: trackrecordasia2960.ac-page.com/mailing-list #GlobalMacroAtaGlance

#MacroEconomics #TR2min #ForexTrading #GlobalMacroAnalysis
Read 3 tweets
For now, the sell-off seems pretty much limited to leveraged players from ST speculators & in particular e retail sector. The HNW sector which typically would be killed in such a sell-off has reportedly been running v low leveraged since bloodbath in Mar. medium.com/global-macro-a…
However, increasing vol is nv a good thing especially when it’s accelerating down moves in stock markets. With the Nov election looming, Trump can ill-afford an end to the bullish stock market which he has consistently brandished as the barometer of the success of his policies.
Read 3 tweets
1/The virus rages on and it seems that countries are putting their economies first. A vaccine is paramount to a safe economic recovery.
2/The key to note here is that pharmaceuticals are considering how to price their vaccines and this is a highly positive nuance as a potent vaccine will have far reaching positive effects due to its “affordability”.
3/Any success in Phase III trials will be massively bullish for risk-assets, especially cyclical stocks (airlines, hospitality and construction).

FULL REPORT: trackrecordasia2960.ac-page.com/mailing-list

#GlobalMacroAtaGlance #MacroEconomics #TR2min #ForexTrading #GlobalMacroAnalysis
Read 3 tweets
1/This is a key and strategic move by the U.S., using Taiwan to set up a geopolitical and political tripwire to further antagonize and stifle Chinese ambitions In East Asia.
2/The fact that Washington is bound by law to rise to Taiwan’s defence is hugely unsettling for China and this will lead to more widespread repercussions. We are deeply entrenched in the Sino-American Thucydides Trap.
3/Understanding how to live and invest in a multi-polar world is increasingly important as new economic factions will emerge from this.

FULL REPORT: trackrecordasia2960.ac-page.com/mailing-list

#GlobalMacroAtaGlance #MacroEconomics #TR2min #ForexTrading #GlobalMacroAnalysis
Read 3 tweets
1/Abe wasn’t voted out or incapacitated. Though the resignation was abrupt, we believe that the economic and political transition will be smooth.
2/Japan is a society that places emphasis on stability & maintenance of the status quo. Likely trajectory of the JPY is that “Abenomics” or semblance of it will cont. and the “Shock Premium” of the JPY spike will abate in the coming weeks. We continue to like Long on dips
Read 3 tweets
With the dust from Powell’s speech at the Jackson Hole symposium on Thu settling, the fundamentals are re-exerting themselves. As we said, a switch to average inflation targeting will drive the price of hard assets higher and USD will weaken over time.

medium.com/global-macro-a…
If you are unfamiliar with what I’m going to say next, it means you haven’t been paying attention. Stick to the path. The gift that keeps on giving will keep on giving.

#GlobalMacroAtaGlance #MacroEconomics #TR2min #ForexTrading #GlobalMacroAnalysis #AverageInflationTargeting
Read 3 tweets
The immediate reaction of Fed Chair Powell saying, as was widely expected, that the U.S. central bank would roll out an aggressive new strategy to lift U.S. employment and inflation, was a USD sell-off. EUR reached a high of 1.1900 and Gold above 1975.

medium.com/global-macro-a…
However, everything reversed as USD bond yields started to creep higher on fears of future inflation. Market positioning was short USD and that showed as speculators reduced position in a classic “buy the rumour, sell the fact” situation.
Read 3 tweets
The level of political polarisation in the U.S. is unprecedented in recent decades. This will weigh on the country’s productivity and business sentiment as smaller enterprises are being destroyed by the unrest. Image
This will put pressure on the USD and long term trajectory of brick and mortar businesses. Inadvertently, it will also be a factor for unemployment, allowing Powell to run it hot as the lack of employment will stem inflation.
Read 3 tweets
Speculation is mounting that Powell will use the annual Jackson Hole conference to announce a revamp of how monetary policy is set. The speech, scheduled for the first day of the economic symposium later today, could outline a shift by the Fed towards average inflation targeting. Image
If the yields on long-dated Treasury notes shoot higher after the speech, likely lifting the $ up as well, that would imply..
...investors don’t think Fed has gone far enough in reassuring markets that i/r will remain low for a very long period of time if they anticipate that the new policy would push up inflation in the long run.
Read 5 tweets

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