The economic calm which has succeeded the turbulent conclusion to 2018 was abruptly shattered on the 16th of September. On that day, rates in the repo markets spiked by 248 basis points to more than double the overnight lending rate of the...
Errata in the third paragraph ("steepening" -> "flattening") corrected in 04/08. Yield curve inversion has spooked the markets. In all honesty, it should not have come as a surprise. After the Federal Reserve pivoted early January and ...
2019 has started more calmly after a very volatile year-end [...]
The world economy has never faced a more perilous situation. While many have just started to debate whether a recession will start in 2019 or 2020, very few perceive the 'black hole' the global economy is about to get sucked into. The hole has two...
Whatever has the nature of arising, has the nature of [...]
Errata in the effects of QE corrected 10/21. Market liquidity [...]
The Eurozone is a fragile financial mammoth. While its GDP lacks the US by around $3 trillion, assets of the banking sector are some 240 percent of GDP vs. around 90 percent in the US. It has been kept standing only through the large-scale asset purc...
The general storyline of the Global Financial Crisis (GFC) goes about like this: funds from all over the world headed to the US, where the banks, to finance the housing market boom, developed unsound financial products which then brought down the glo...
The sudden and fast rise in the London Interbank Offered [...]
Since early February, the financial markets have been wobbly. After [...]
