Discover and read the best of Twitter Threads about #inflation

Most recents (24)

"Theory tells us why Japan didn't inflate" Really? News to most! But two things may explain it - business made a big shift from heavily indebted to positive cash, mirrored by the state's plunge into the red, intermediated by the BOJ... 1/x
In effect, corporate debt was slowly washed to the government whose IOUs were bought by the #centralbank. Reserves issued v these offset bank deposit liabilities to the now flush businesses happy to hold them because #NIRP destroyed transaction/savings balance differences 2/x
Meanwhile, much of #Japan's newly created money was swapped up and used to finance speculative purchases elsewhere in the world - as shown for Grand Cayman 3/x
Read 7 tweets
Not to root for state or CB intervention, with #coronavirus, its inevitability must be faced. So how to make it the least damaging and not allow it to become entrenched in the system and lead to another decade of distortion & waste like post-#GFC? 1/x
Problem is to try to avoid the failure of otw viable firms because of disruptions due to the global health emergency - & also to spare their employees from ruin. Flooding money into financial markets is NOT the answer, #JayPowell! Blind fiscal expansion, neither, #DonaldTrump 2/x
Here's the kernel of an idea. Finmarkets are desperate for 'safe assets'. nominal yields are trifling; real ones negative. S-o-o, launch a special series of #Treasury bonds to sate the market's hunger & halt the potentially disastrous collapse in yields. 3/x
Read 11 tweets
Lets talk about #Oil and the #Corona / #COVID19 #Virus. What is it doing to #Global #Energy #Demand & what does it mean for #OPEC?
On March 5th 2020, the Organisation of #Petroleum Exporting Countries #OPEC concluded its 178th Extraordinary meeting. Aside from Ecuador's withdrawal from OPEC, the #Oil #Cartel was hard pressed to fashion a response to the impact of #COVID19 on #Global oil #Demand...
It is no secret that the #global #oil #market is awash in oil. The glut in supply has seen, in the past, a collaboration of sorts between #OPEC & Non-OPEC (mainly #Russia) oil exporters to monitor supply & maintain output at "mutually profitable" levels...
Read 9 tweets
Ein paar Gedanken zu den ökonomischen Effekten von Corona / #Covid19, und was die Politik jetzt tun könnte, bzw. sollte. /thread
Die Unterscheidung #Angebot und Nachfrage ist hier nicht sehr hilfreich. Ja, es betrifft erstmal die Angebotsseite der Wirtschaft, aber es ist kein Öl-Schock, und es wird sehr schnell ein Nachfrageproblem draus. /1
Denn in einer nicht-linearen Welt haben auch temporäre Phänomene permanente Folgen. Firmen die #Pleite gehen, obwohl sie ohne #Corona profitabel wären; Menschen, die nicht arbeiten können, und Gehalt/Konsum verlieren etc. /2
Read 23 tweets
The #everythingbubble is in it’s first stage of popping. We expect sharp monetary and fiscal reactions to a slowing economy and eventually an overdose which brings inflation and finally the bursting of the debt bubble in a second stage:

A short thread.
In our @IGWTreport s we have been writing a lot about the #everythingbubble and various pins which may prick them. It seems, as if the #bubble finally found it’s needle last week.

Graph from IGWT Report 2017.
Last week’s market reaction priced in a highly deflationary scenario, which - all things being equal - seems quite rational as economic growth and velocity of money is plunging.
Read 7 tweets
#Deflation phase has started. Stocks will plummet in 5 waves down to ~1800 in #SP500. Wave 2 and 4 will be corrections. We have break of 200SMA and trendline from early 2019. I think we see a backtest of these (yellow area?). But - in general trend is down - and fast!
#USD #DXY is about to set off on a major move higher. The current correction is a wave 2 (blue) and hence next wave will take us to min. 103 - but more likely 106-107 in an impulsive move. Do not stand in front of the USD train coming months!
#EURUSD kissing 50SMA and pot. also 200SMA "Goodbye" - before turning down hard. Next wave will take down to - and likely below bottom from early 2017 - only for a short consolidation before EUR crash continues. LT-target remains ~0.85
Read 14 tweets
The 2.1% #GDP print gives "optical illusion" of an economy chugging along at moderate 2% clip at end-2019, but composition of growth reveals softer picture.

More than 70% of Q4 advance came from temporary collapse in imports, business investment subdued & consumers + cautious
Average 2.3% GDP advance in 2019 is marginally weaker than 2.4% print in 2017 but this is another optical illusion as most recent 3 Qs mark economy’s worst performance since the 2016 slump.
Even momentum headed into 2020 is softer than the 2.3% y/y print would indicate
Consumer spending only +1.8% in Q4 as households exercised more caution in the face of elevated policy uncertainty and moderating income growth.

In 2020, cooler employment trends and lower income growth prospects will lead consumers to gently rein in spending
Read 8 tweets
Let us talk about the #FED #FOMC's 1st #MonetaryPolicy meeting of 2020. Specifically, let us talk about the puzzle that is a flatter #PhillipsCurve...
The #FederalOpenMarketCommittee (#FOMC) of the #FederalReserveBank (#FED) of the #US concluded its 1st meeting of 2020 on the 29th January 2020. As expected, the FED did not change rates but left the #KeyPolicyRate, the #FederalFundsRate (#FFR) in the 1.5%-1.75% range...
Indeed, if one considers the #FED #Dotplot of December 2019, the decision to keep rates unchanged would not come as a surprise. What I wanted to focus on today is some key passages in the statement, highlighted in yellow in the screenshot below...its all #PhillipsCurve...
Read 17 tweets
Will #deflation be the end for business? Hardly. Deflation is only a problem for businesses in an inflationary economy. Sounds contradictory, but the point is that business is properly operated aimed toward (meeting or creating) the future--not to repeat but to *leverage* the
past. Entrepreneurs and managers continuously forecast and try to position their businesses with respect to the future market situation. In today's heavily distorted, #inflation-suffering markets, businesses have learned to anticipate that prices will continue to rise: buying
(factor, input) prices as well as selling (output) prices. This is more than simply relying on experience, which is a shaky foundation for predicting the future. In present markets, government through central planning of national currencies *promise* to *enforce* inflation. The
Read 7 tweets
Lets talk about how important it is to frequently #Review #CentralBank #MonetaryPolicy #Frameworks...
I will set things off by pointing out that the various facets of #BusinessCycles (early, mid, late / boom & busts) consistently keep reminding us that what goes up, must come down. We might find ourselves in a prolonged #expansion, but eventually it decelerates into a #recession
As part of #Macroeconomic management (counter cyclical), a #CentralBank's objective (through its #MonetaryPolicy) is to maintain #PriceStability & #FinancialStability & in other cases, to promote #FullEmployment. It does this hand in hand with #FiscalPolicy...
Read 15 tweets
Lets talk about #Oil and #Inflation and whether the relationship is #Linear or #NonLinear...
We have all been witness to the recent volatility in the #Global #Oil markets. We have seen how disruptions in oil #Supply, be it from #SaudiArabia, #Nigeria, #Venezuela, #Iran or #Libya can cause upticks in the global #Price of oil...
On the same token, we are aware how muted #oil #demand can arise from a slow down in #global #growth. For e.g. a persistent slowdown in #China often translates into a softening of global oil prices. Similarly, high #inventories & the impact of #US #shale drives down prices...
Read 9 tweets
A convo not too long about how Arkansas and Kansas happened ("Ar-Can-Saw" and "Kan-zas"), got me to thinking we don't talk nearly as much as we should about how names are used to erase histories. So sit back #NativeTwitter, lemme tell you about the #Caribbean.
First, Conquerors and Settlers frequently have no idea what they're talking about. That should be fairly obvious. It's why the Lakota are also "the Sioux" and the Lenape are also "The Deleware". It's all gibberish and nonsense when settler naming gets involved.
So it is with "Kansas" and "Arkansas". One's French and the other's Spanish/English for 'Land of the Kansa'. See, easy, two states, whose pronunciations were popularized by two different phonemic culture groups, and the same spelling suddenly gets all nonsensical.
Read 26 tweets
Let us briefly #Reflect on the #SARB's first #MPC #Meeting of 2020 and their #MonetaryPolicy decision to cut rates by 25bps from 6.5% to 6.25%...
Everyone with some interest in such matters is without a doubt already aware that the #SouthAfricanReserveBank's #MonetaryPolicyCommittee cut its key #PolicyRate, the #Repo by 25 basis points from 6.5% to 6.25%. The move can perhaps best be summarised by the following statement:
It is clear from the statement above that the SARB moved on the back of a growth story. They would want to see the level of #inflation creep closer to 4.5% but they didnt tighten to achieve this end. Rather, they provided more accommodation for growth & inflation might pick up...
Read 11 tweets
Let us talk about the #SouthAfricanReserveBank & what we can expect from their #MonetaryPolicy in 2020...
The #SouthAfricanReserveBank #SARB #MonetaryPolicyCommittee #MPC will conclude its first meeting of 2020 tomorrow 16th January 2020...The #KeyPolicyRate, the #RepoRate is currently 6.5% and #Inflation (#CPI inflation) is within the Bank's 3%-6% target range, at 3.6%...
The #SARB #MPC will consider #domestic #regional & #global #economic / #macroeconomic developments in deciding on its policy stance. The SARB is an inflation targeting #CentralBank whose mandate is to ensure #Price & #Financial #Stability necessary to support economic #Growth...
Read 6 tweets
Lets talk #New #Tools for #MonetaryPolicy...
The #Global #Financial #Crisis of 2007/08 taught the policy making world that something special beyond #Conventional #MonetaryPolicy was necessary to lift economies out of the economic malaise...tinkering with the key rates was not enough anymore...
To this end, #centralbanks in the developed world (The US, UK, Japan, The EuroArea) adopted what they termed #UnconventionalMonetaryPolicy #UMP which is characterised by #ForwardGuidance #NegativeInterestRatePolicy & #QuantitativeEasing...but, have they helped?
Read 10 tweets
@droehnemeyer @Ismailtipi @Franz54712417 1.Null #Zinsen & #Negativzinsen sind der größte Raub der Financeplayer in Generationen!

Millionen Sparer & #Rentner verlieren einen großen Teil ihres Geldes und wir bekommen millionen Armutsrentner!

Und nur das Großkapital gewinnt (#Asset-#Bubbles, #Aktienrückkäufe).
@droehnemeyer @Ismailtipi @Franz54712417 2. Verkauft wurde diese #Enteignung die in 2009 läuft erst um die #Banken zu stützen, dann um die "Wirtschaft" zu stützen (fragt sich welche? Zombiefirmen?) und dann um 2% #Inflation zu erreichen: Davon sind wir weit weg! Aber das Spiel geht weiter!
#FED #EZB #ECB #TheBigShort
@droehnemeyer @Ismailtipi @Franz54712417 3. Und wie geht es weiter?
a) Der kleine Sparer wird in #Aktien gedrängt (und seine Miete wird wegen #Betongold teurer, er zahlt für #Teuerstrom & findet die "Luftsteuer", #CO2Steuer, geil!): Die big boys wissen wann es Zeit ist zu verkaufen (Jetzt!).
#TheBigShort #ECB
Read 8 tweets
#Stagflation 2020
US CPI coming up this week - and my expectations are for beats on Headline & Core
#Inflation
Energy is set to provide a positive contribution in this release and going forward
And food inflation is poised to accelerate as climate change is having a significant impact on harvests
Read 4 tweets
India MPC - Initial thoughts
1. No cut was a surprise. I had gone in with 35!
2. Looks like the RBI listened to the market which has been saying that further cuts will not help revive growth.
3. Clearly RBI is satisfied with transmission - 137 in call money and 218 in CPs! /1
India MPC - Initial thoughts
Contd.

4. Inflation per RBI seems a much greater risk than the market sees it. H2 revision from 3.5-3.7 to 4.7-5.1 is massive!
5. Growth revised down from 6.1 to 5 but there is belief that whatever the govt is doing to revive growth is /will work /2
India MPC - Initial thoughts
contd

Bonds have expectedly sold off more than 10 bps. Expect 10 yr to settle around 6.50%. Rupee seems unchanged at 71.57 and Nifty is holding above 12k.
/3
Read 4 tweets
#Thead
I get asked questions like this all the time "Is #MMT consistent with a post-capitalist system? #Socislism? #Imperialism? XYZism?"
MMT is compatible with any political system. 1/n
#MMT is an analytical approach that carefully estimates how much fiscal policy space a country has to meet its national priorities without causing #inflation. 2/n
Those national priorities are determined by a political system that can be participatory/dictatorial/fascist/capitalist/socialist/communist, or whatever. 3/n
Read 5 tweets
#Moodys has pulled down its growth forecast for FY19 to 5.8%. Only surprise is why it’s not even lower. In the past year growth has collapsed from 8% to 5%. /1
@threadreaderapp

#India #CPI #GDP #RBI #bonds #inflation #ratecut #NBFC #jobs #credit #NPA #NCLT #growth
On the other hand #CPI is now at 4.6%. The laxmanrekha of 4% has been breached. A mix of drought, floods and unseasonal rain is driving food prices up. Core #inflation continues to fall to 3.7% reflecting the slowdown. /2
#India #GDP #RBI #bonds #ratecut #NBFC #jobs #credit #NPA
The wisemen and women of the economy have only one mantra - Cut, Pray, Hope. When in doubt cut rates.135 bps done but transmission is limited. We are told don’t look at nominal, real rates are still high. A single large cut is required. /3
#India #CPI #GDP #RBI #bonds #inflation
Read 16 tweets
🚨THREAD🚨 Today, we released a paper with Christopher Wimer & Sophie Collyer at @CpspPoverty, and Xavier Jaravel at @LSEnews.

Key takeaway: 3 million more ppl would have been considered in #poverty in 2018 if we account for inflation inequality. 1/ bit.ly/2ChAvUk
In a supposed strong economy, how did we get here? Skyrocketing inequality in recent decades—driven almost exclusively by soaring incomes for the wealthiest Americans—has undermined the strength of our economy and our democracy. 2/
New research shows that income inequality ITSELF is causing prices to rise more quickly for people at the bottom of the income distribution than at the top, a phenomenon known as “#inflation inequality.” 3/
Read 6 tweets
1.) Is it just me or is everyone f’n brain washed into wanting a life devoid of freedom and happiness? Have people forgotten that WE make the world #economy work? We’re the consumers AND the work. The owners just facilitate between the groups & make a killing being middle men...
2.) If we ever broke free of our damn slumber & broke up these low competition industries there would be an entrepreneurial boom in the 2020s. Normal people will have opportunities to form businesses better than ever before without fear of reprisal from industry leaders...
3.) It’s absolutely imperative to expose these industry #Cartels who control every major revenue source in the world. There are 2,153 #Billionaires in the world who as a group, control more wealth & companies than the entire world population. They have boxed out small business.
Read 14 tweets
Statistics show that the average Malaysian makes about RM2,308 (median) or RM3,087 (mean) monthly.

How much do you need to survive?

#Malaysia #Salaries
Are Malaysian salaries insufficient? How much do you make compared to the average in your field?

Read more: bit.ly/insufficient-s…

#Wages
Are salaries keeping up with the cost of living? How does the national #inflation rate compare to the #growth of salaries in Malaysia?

Read More: bit.ly/salaries-keepi…
Read 3 tweets
1) Why do I keep posting this stuff? 1 word #inflation this is how your hard earned money is losing value every day.
Think of supply vs demand vs value if you increase supplies what does it do to the current supply? It diminishes it's value.

cointelegraph.com/news/the-fed-j…
2) If you have seen #Venezeula with paper in the streets that's worthless you would understand the perils of printing money so would you in #Zimbabwe, #Turkey, #Argentina and #Brazil @RonPaul
3) Printing money is killing off the inherent value of the current supply. So you work hard but tomorrow and the next day your dollar will be worth less and less. Why you should care is a better question then why you shouldn't and why many disregard talking about this @loomdart
Read 8 tweets

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