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While the Federal Reserve - rightly or wrongly - has initiated a rate hiking cycle it is not given the the central bank in neighboring Canada should follow suit. In fact, according to our our composited indicator for Canada monetary conditions monetary policy is too tight for the the Bank of Canada to hit its 2% inflation over the medium-term.
We - Markets & Money Advisory - will soon be launching a new website. As part of that the blog format will also be "updated" so that not only will it be possible to read blog posts, but we will also put out movies etc.
2016 was a busy year for me. It was the second year as my "own man". I am very happy about how things have developed.
I generally don't think I can beat the market, however, right now there is something, which worries me and that is that the "Trump rally" in the US stock market could be about to end.
It is hard to find any good economic arguments for protectionism. Economists have known this at least since Adam Smith wrote the Wealth of Nations in 1776. That, however, has not stopped president-elect Donald Trump putting forward his protectionist agenda.
In yesterday's blog post I wrote about why I believe it is the combination of Donald Trump's fiscal stimulus plans (infrastructure investments and tax cuts) combined with the Federal Reserve's willingness not to (fully) offset this, which has pushed inflation expectations in the bond markets up very significantly since Tuesday.
Today I was asked to do an interview with a Danish radio station about Donald Trump and about whether one could say anything positive about him or rather about his economic agenda. I declined to do the interview. I frankly speaking has nothing positive to say about Trump.
There is no doubt that I believe that the Federal Reserve under the leadership of Fed Chair Janet Yellen has kept monetary conditions too tight and I have particularly blamed Yellen's 1970s style obsession with the Phillips curve for this.
This morning we got some very good news out of Egypt as this statement was released by the Egyptian central bank: