tag:blogger.com,1999:blog-6616959642391988608.post2648010964971156551..comments2024-03-28T00:18:25.641-07:00Comments on Calafia Beach Pundit: GDP highlights: money demand down, business investment upScott Grannishttp://www.blogger.com/profile/14028519647946868684noreply@blogger.comBlogger14125tag:blogger.com,1999:blog-6616959642391988608.post-44283985333369330052018-05-05T07:00:35.070-07:002018-05-05T07:00:35.070-07:00https://seekingalpha.com/article/4169767-everyone-...https://seekingalpha.com/article/4169767-everyone-side-boat?page=2<br /><br />I am not sure what the above post means, but the amount of speculation in oil markets is much, much larger than back in 2008, when last I took a deep look (by my amateur standards) at the market. <br /><br />Even back then in 2008, I thought the tail was wagging the dog (speculators, and possibly state actors, Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-41942871500374406202018-05-03T14:17:05.672-07:002018-05-03T14:17:05.672-07:00A parallel observation on "more money enterin...A parallel observation on "more money entering economy" aka "demand shock" by Gavyn Davies in FT on April 29. https://amp.ft.com/content/998b63b2-4879-11e8-8ee8-cae73aab7ccb?__twitter_impression=trueAdamhttps://www.blogger.com/profile/00325788638301535314noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-17382378303374640432018-05-03T04:06:05.491-07:002018-05-03T04:06:05.491-07:00Scott Grannis can say, "I told you so." ...Scott Grannis can say, "I told you so." <br /><br />Report: First-quarter gold demand hits 10-year low<br /><br />Global demand for gold has fallen to its lowest first-quarter point in 10 years, the World Gold Council says, amid lower demand both for physical bars and for gold-backed ETFs.<br /><br />Total gold investment demand fell to 973 metric tons, down 7% Y/Y, according to the Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-44028568279280236192018-05-01T04:07:41.199-07:002018-05-01T04:07:41.199-07:00Just talking to myself. It is a Brave New World.
...Just talking to myself. It is a Brave New World. <br /><br />US Treasury Secretary Steven Mnuchin said the bond market will absorb rising federal debt, no problem: "By definition, supply and demand will equate," he told Bloomberg. <br /><br />The "What me, worry?" Alfred E. Neuman Memorial Award goes to Mnuchin. This is a GOP Treasury Secretary? Whose GOP? We have come a long Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-27051122295869532472018-04-30T20:01:28.277-07:002018-04-30T20:01:28.277-07:00According to the slope of the yield curve, economi...According to the slope of the yield curve, economic growth expectations are neither exciting nor worrisome, just ho hum. If these monetary based expectations are realized, we're not going to get that a significant pickup in economic growth. I'm disappointed. I've been hoping for 3%-4% real growth and another 20%+ year for the stock market. Strong earnings are coming in for 1Q2018 but WealthMonyhttps://www.blogger.com/profile/04230914888633165083noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-4746033946593444492018-04-30T11:04:49.963-07:002018-04-30T11:04:49.963-07:00minnesota, re money demand/velocity. I define mone...minnesota, re money demand/velocity. I define money velocity as GDP/M2; the number of times a dollar of cash is spent every year. Money demand is the inverse, M2/GDP; the portion of a year's national income that is held in cash. When velocity goes down, demand goes up. The two are joined at the hip, as it were. Obviously, neither money demand nor money velocity are constant. They change as Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-45164406674836361642018-04-30T10:47:39.145-07:002018-04-30T10:47:39.145-07:00Scott,
Could you give me a short lesson in the rel...Scott,<br />Could you give me a short lesson in the relationship between money demand & velocity, and why you focus more on money and less on velocity? Is increasing velocity just another way of saying money demand is decreasing? <br />If banks increased the lending (decreasing their reserves), would that, by definition, decrease money demand?<br />Thank your for your years of economic minnesota nicehttps://www.blogger.com/profile/00727666702361173951noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-11931741425280567772018-04-30T08:34:28.830-07:002018-04-30T08:34:28.830-07:00Benjamin: Good comment on corporate earnings. I wo...Benjamin: Good comment on corporate earnings. I would add one important thing: the market has most likely fully priced in the big improvement in corporate earnings resulting from the tax cut. I said this near the end of last year. The other shoe that is yet to drop is a significant pickup in economic growth, which has not been priced in yet. I think we should see it, but the market is not yet Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-42222397379081428862018-04-30T02:37:57.457-07:002018-04-30T02:37:57.457-07:00"Overall, stocks continue to be supported by ..."Overall, stocks continue to be supported by strong first quarter corporate earnings. More than half of Wall Street's S&P 500 companies have reported and 79.4 per cent have beaten consensus estimates.<br /><br />Analysts now expect Q1 earnings growth of 24.6 per cent, more than double forecasts at the beginning of the year and thanks in large part to hefty tax cuts."<br /><br />Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-89169693716963154652018-04-29T04:34:46.304-07:002018-04-29T04:34:46.304-07:00FANG firms spending billions: https://www.bloomber...FANG firms spending billions: https://www.bloomberg.com/gadfly/articles/2018-04-27/alphabet-amazon-microsoft-and-facebook-wage-a-capex-warstevehttps://www.blogger.com/profile/07387986994469835875noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-24689944352332784112018-04-28T09:18:45.442-07:002018-04-28T09:18:45.442-07:00Chris: the M2/GDP relationship is not broken, it h...Chris: the M2/GDP relationship is not broken, it has simply changed. To better understand this, think of GDP as equivalent to the average person's annual income, and M2 as the average person's average balance in his or her checking account, plus cash, plus money market funds, plus bank savings deposits (i.e., cash or cash equivalents, call it "money"). For decades the average Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-28767763393852119552018-04-28T08:10:07.023-07:002018-04-28T08:10:07.023-07:00Scott,
If the relationship between nominal GDP an...Scott,<br /><br />If the relationship between nominal GDP and M2 is broken because of the demand for money, the next interesting question is, what is the catalyst to release the contained M2. Beyond the financial crisis, do you think that the baby boomers are the main reason that the demand for money is so high?Anonymoushttps://www.blogger.com/profile/11879352924145670473noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-84504825578119770082018-04-27T22:43:51.549-07:002018-04-27T22:43:51.549-07:00Great post.
Looks like more slow growth, low infl...Great post.<br /><br />Looks like more slow growth, low inflation, yet rising West Coast housing costs ahead (due to artificial supply constraints, property zoning). <br /><br />Some people are talking up the employment cost index for March, private-sector up 2.8% YOY March. They say it means inflation. <br /><br />But unit labor costs (which factor in productivity) have been dead in the water Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-71233875807525694152018-04-27T22:35:09.244-07:002018-04-27T22:35:09.244-07:00Scott, I am much interested in your “monetary take...Scott, I am much interested in your “monetary take” on things in this article!! It is not the common perspective I would say, and as such I would very much like to understand your way of reasoning in more detail.<br /><br />Do you agree that real money growth in a credit based system is with few exceptions based on new bank credit (I am not considering bank reserves here)? <br /><br />Also would terexhttps://www.blogger.com/profile/13878600108197052363noreply@blogger.com