WSJ: What Is Hot Money?

By SIMON CONSTABLE

Investors in some emerging markets may hear warnings about hot money. So, what is it and why does it matter? Read more here.

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P.J. Media: The Government’s Inflation Data Caught 'Percentile Dysfunction'

By SIMON CONSTABLE

As if we didn’t already know something was wrong with the government’s inflation data, now up pops what looks like a confession. It’s part of a broader issue with government metrics that one economist dubs “percentile dysfunction.”

New research shows there’s a problem in how the prescription drug portion of the consumer price index gets calculated. Another, perhaps more realistic, index of drug prices far outgrew the CPI's drug metric over a recent five-year sample period, with one part of the alternative metric increasing 59 percent more. Read more here.

P.J. Media: Bad Monetary Move-- A Weak Dollar Is an America-Last Policy

By SIMON CONSTABLE

A weak dollar is not an America-first dollar. It is an America-last strategy.

Of course, it isn’t at all clear whether pushing the value of the greenback down is the goal of the administration.  Wall Street seems divided on the matter.

For instance, a recent report from Brown Brothers Harriman states the following: “Did U.S. Treasury Secretary Mnuchin signal a change in the U.S. dollar policy?  Probably not.” The reason, BBH says, is partly because of the Treasury’s urgent need to sell a lot of debt securities, possibly more than a trillion dollars. “It beggars belief that Mnuchin was talking the dollar down, introducing new currency risk, ahead of the quarterly refunding and a significant increase in the supply of Treasuries in the months ahead,” BBH continues. Read more here.

Briefings: A World of Doubts

By SIMON CONSTABLE

It was 2013, and the decision in China hardly raised any eyebrows in the global investment community—at least at first. Concerned about rogue financing, the government said it would crack down on so-called “shadow banking” firms, which are financial institutions that operate with little or no regulation. Too much bad lending, China’s leaders said, could mean a repeat of 2008.

Which appeared to make sense, except that over time, the move exposed a major weakness in China: its inability to attract enough investment and to switch to a US-style consumer-led economy at the same time. The crackdown would squeeze lending too much, and China’s economy slowed. But most importantly, it created new doubts about the nation’s policies—and ultimately a dramatic exodus of international investment.

All of which raises a curious question: How do you anticipate and measure investor confidence on a large scale? Read more here.

Briefings: Fishing's Power of Zen

By SIMON CONSTABLE

Most of Will Gardenswartz’s days are so consumed with games it stresses him out. As the CEO of the gamification consulting firm Life Carrot, Gardenswartz is always hustling to television executives and other entertainment producers to incorporate online games to increase audience size and engage viewers. It’s exhausting work.

But there’s one activity that’s anything but a game to Gardenswartz: fishing. He’s been doing it since he was a child. He even chose to live near Sun Valley, Idaho, to be close to some of the world’s best fishing spots. “In business, I’m easily distracted by things that don’t matter,” he says. But when he’s out on the water, he can devote his entire mind to the narrow matter of catching fish. Read more here.

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U.S. News: What Really Worries Wall Street Analysts?

By SIMON CONSTABLE

Investing professionals are paid to worry – not necessarily about whether they left the stove on or whether the boss will like their new shoes, but what's happening on Wall Street. In the world of stocks and bonds, successful pros need to be concerned about what could go wrong with their investment decisions.

And there's a lot to think about. Here are the biggest things that investment professionals lose sleep over today: Read more here.

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P.J. Media: Bundle Up the Economy and Brace for Colder Winters

By SIMON CONSTABLE

You’re gonna need a thicker sweater.

Either that, or a fatter bank balance.

Why? For the foreseeable future, we are likely to see the nasty combination of higher fuel costs and colder winter weather.

There are three reasons: Oil supplies look set to get interrupted this year, the dollar is weaker, and activity on the surface of the sun portends a period of frigid winters. Read more here.

Photo by Tijana Drndarski on Unsplash