sandy beach

This is hilarious!

OMG - you are like the Adrian Monk of pot farms! Who knew? Seriously I'm loving this. I think we should make this a daily stool op-ed.

Time for another pot farm post!

End of quarter long covering.

Federal government current expenditures: Interest payments.

There is now a mathematical limit to what the Fed can do before causing a debt crisis. A debt crisis that was over two decades in the making.

FED'S BRAINARD: THE FED IS DETERMINED NOT TO WITHDRAW PREMATURELY.

BEA: Inflation comes in hot! YoY PCE +6.2% (0.3% MoM) Goods +8.6% Services +5.0% Food +12.4% Energy +24.7% Core PCE +4.9% (0.6% MoM) https://www.bea.gov/news/2022/personal-income-and-outlays-august-2022-and-annual-update

Nike gets the boot after hours down over 13% on concern they have too much inventory.

Thanks! I find these very interesting! I may buy one some day

Bank of England launches £65bn move to calm markets Central bank to spend £5bn a day for 13 days as it warns of ‘material risk to UK financial stability’ “At some point this morning I was worried this was the beginning of the end,” said a senior London-based banker, adding that at one point on Wednesday morning there were no buyers of long-dated UK gilts. “It was not quite a Lehman moment. But it got close.” The most directly affected groups were final salary pension schemes that have hedged to ensure their ability to make future payments — so-called liability-driven investment strategies that are very sensitive to fast-moving gilt yields. “It appears that some players in the market ran out of collateral and dumped gilts,” said Peter Harrison, chief executive of Schroders, which has $55bn in global LDI business. https://www.ft.com/content/756e81d1-b2a6-4580-9054-206386353c4e

Turkey’s central bank makes big rate cut amid 80% inflation “Inflation is not a crippling economic threat,” Erdogan said in an interview with PBS NewsHour this week. “There are currently countries threatened by inflation rates of 8% and 9%. This rate is 80% in our country.” https://apnews.com/article/inflation-middle-east-recep-tayyip-erdogan-4184af38885e4195d1a1818f11d13a8b

Bank of America - commodity deflation:

Bond markets are experiencing "excited delirium."

ROTFLOL

Wait what? "White House officials are quietly preparing for the potential departure of Treasury Secretary Janet Yellen after the midterms" What does Janet know that we don't? https://www.axios.com/2022/09/28/janet-yellen-treasury-midterms-shuffle

BANK OF ENGLAND CANCELS SPEECH ON BALANCE SHEET REDUCTION BY ANDREW HAUSER, WHICH HAD BEEN DUE ON SEPT. 29

The UK intervention was admittedly a bail-out of insurance companies, pensions systems and the like. The first of many. Let's review the last time this started.

Mohamed El-Erian on Bloomberg: We thought the end of easy money would difficult involving a balance between inflation and recession but we found the result was financial risk. Central banks are now contributors to volatility. Central banks can no longer offer extended Q/E because of inflation. Central banks can not pivot due to changes in inflation metrics – that will take time. If they pivot it will be due to recession or financial market risk.

FT: It has been a very long time since we have seen a G7 economy experience what the UK has in the past six days — disorderly moves in its currency and bond markets, a loss of confidence in policymakers, direct central bank intervention in the government bond market, pressures for an emergency rate rise, and a warning from the IMF. -- Mohamed El-Erian https://www.ft.com/content/0f286249-299d-4ec4-8a2a-15b1ae0ba97f

Bank of England calls this "fragmentation risk." I guess they mean the fragmentation between reality and central planning expectations.

Post a link please if you have one.

Guy Johnson on Bloomberg admitting this was a "stability move" not a monetary "policy move" for "market functioning." Pressed on what was "dysfunctional" he admitted they are bailing out the fixed pension market and that the bonds can't “find” a price that is “acceptable” to buyers. The words find and acceptable doing a lot of work in that sentence. Meanwhile: "Bank’s Executive has postponed the beginning of gilt sale operations that were due to commence next week. The first gilt sale operations will take place on 31 October and proceed thereafter." https://www.bankofengland.co.uk/news/2022/september/bank-of-england-announces-gilt-market-operation?sf170940617=1 QE on Tuesdays and QT on Thursdays. 🤦‍ Bloomberg: "Quantitative Confusion." 🤣 Bloomberg declares market "unviable." We used to call these bond buyers - "bond vigilantes." The rate of the 30-year dropped 86 basis points overnight! System fragility created by central banks means their system can no longer tolerate monetary policy meant to fight inflation.

Getting killed? It does look beautiful. I'm getting sick of no rain in the SF Bay Area these last few years and the brown East Bay hills.