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  • US October 2022 Fiscal Situation

    Alexander Gloy

    The good news: Individual federal income taxes are STILL growing, and growing at a good clip: Corporate income taxes are also growing, but barely: Unfortunately, the gap between receipts and outlays is widening again, and so is the deficit: The “official” deficit (last 12 months) stands at $1.3 trillion. However, the actual deficit, as calculated…

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  • Money, Matter, Anti-Matter

    Alexander Gloy

    You cannot create money (in our current fiat monetary system) without simultaneously creating the same amount of debt. That is a hard thing to understand. Yet it is the key to understanding our monetary system. Most people immediately say “Well, the central bank just prints the money – where is the debt?” Yes, central banks…

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  • Did US Fiscal Deficit Decline by “Record $1.4 Trillion”​?

    Alexander Gloy

    The US federal #fiscal #deficit decline by a record $1.4 trillion for the 12 months ending September 30. This is what the latest monthly #Treasury statement claims. But is that true? Let’s dig in. For a start, the September deficit went up almost by factor of 7. Partially due to debt limit theatre a year ago: The good news: individual…

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  • Two Versions of the US Fiscal Deficit

    Alexander Gloy

    The US (federal) fiscal deficit has been deteriorating recently. This is an odd thing during the late stages of an economic recovery. The budget for 2016/17 (September 30) has been missed by around 10%, and the current fiscal year target (440bn) looks far off. While spending continues to increase, receipts (government income) have leveled off…

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  • Bond Bulletin – May 2017

    Alexander Gloy

    Lighthouse – Bond Bulletin – 2017-05

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  • What the hell just happened – Part 2

    Alexander Gloy

    Part 2 (for part 1, please look here) At the beginning of part 1, I offered three theories to explain what happened on global stocks markets, culminating in the flash crash of August 24, 2015: Flash-crash induced by high-frequency traders and panic-covering of short positions in volatility products US and China mutually crashing each other’s…

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  • US June Retail Sales

    Alexander Gloy

    US June retail sales (-0.3% m/m) came in below expectations (+0.3%). Excluding car and gasoline sales, sales declined 0.2% (consensus +0.6%). On top of that, May sales were revised downwards by $1.7bn: Retail sales growth has slowed down into a range normally associated with recessions (see chart below). However, low inflation is partially to blame…

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  • June NFP

    Alexander Gloy

    US June non-farm payrolls (+223,000) came in roughly in line with expectations (+230,000). However, revisions over the past five months add up to -154,000. Each of the past five months has been revised downwards (something last seen during the 2008/09 financial crisis). No reason to sound the alarm, but definitely worth watching. Year-over-year, employment growth…

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  • Tsipras announces referendum on bailout

    Alexander Gloy

    From FT’s Peter Spiegel: “Alexis Tsipras, the Greek prime minister, has announced a national referendum on whether his country should agree to creditors’ demands that would release desperately-needed bailout aid to avoid national bankruptcy. In a televised address to the nation after a late-night meeting of his cabinet, Mr Tsipras announced that the plebiscite would…

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  • Bank Jog

    Alexander Gloy

    The Wall Street Journal called recent deposit outflows from Greek banks a “bank jog” (as opposed to “bank run”). A bank run usually leads to affected banks running out of cash quickly (within days or hours). The Greek banking system has been bleeding deposits since years. But the movement has been accelerating last week: If…

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