Deep Economic Thoughts

Don't be alarmed by the harse tone of this episode. A contractionary phase in the monetary cycle is a difficult and challenging one for labor, real estate, and capital markets. After years of expanding the monetary base, which had led to misallocations of inexpensive capital, those funds must be now eviscerated.  Ivan explains the only two ways that capital is necessarily destroyed in a contractio...

Remember that ad campiagn in the 1980's, "Where's the Beef?!"... In this episode, Ivan exclaims, "Where's the Risk?!", in reference to the seemingly non-existent level of risk in the lower-end spectrum of investment grade bonds. Referencing data shared in AWAIM's latest  research highlight , Ivan shares how the OAS-to-Yield Ratio may reveal another perspective on the bond market's current risk ass...

This episode contains unscripted comments on the perceived burgeoning "banking crisis" and Fed Chair Powell's Congressional testimony that occurred earlier this week. © 2023, Ivan M. Illán

The U.S. Bureau of Labor Statistics (BLS) reported a seemingly phenomenal new jobs figure for January 2023. For the past several months, there have been many hundreds of thousand of new jobs created each month. But looking back over the past year to the types of jobs (part-time versus full-time) being created in the U.S. economy reveals an uneasy familiarity to prior economic cycles leading up to...

The U.S. Federal Reserve Bank is technically insolvent (or bankrupt in layman's terms). Of course, as "buyer of last resort", the U.S. Treasury would not allow the Fed to cease operations legally. Instead, the Fed maintains operations in the red (booking losses in the form of a "deferred asset") until such time it makes money again when it can once again make remittances to the U.S. Treasury. I ta...

Get ready for more stock market volatility, as the Federal Reserve and other central banks around the world implement tightening monetary policy.