All Macro-Thematic Trend Reports:

Investors beginning to realize the Fed’s dilemma is akin to that of an Emerging Market (FFTT, 3/23/22)

…the Fed is increasingly being forced to consider what is the least bad policy mistake it wishes to be remembered for: meeting its inflation target by causing a recession, or allowing high and potentially destabilizing inflation to persist well into 2023.  This awful trade-off is familiar to too many developing countries.-Mohamed El-Erian, March 22, 2022, via Bloomberg “Our economy will need deep structural changes in these new realities, and I won’t hide this—they won’t be

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The 10 Most Interesting Things We’ve Read Recently (FFTT, 3/18/22)

“Saudi Arabia considers accepting CNY instead of USD for Chinese oil sales” (Page 2) “But what can Saudi Arabia buy with CNY?!” (Page 3) “Saudi Arabia’s oil-for-yuan proposal won’t threaten the dollar” (Page 6) “What happens if Russia says ‘We’re selling oil and gas at say, 50 barrels equals one ounce of gold?’” (Page 11) “OPEC+ countries produced under quota again in February 2022, despite higher oil prices & geopolitical events” (Page 13) “Dutch limit

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Implications of Saudi Arabia potentially accepting CNY for oil (FFTT, 3/16/22)

Ali Shihabi…said the kingdom can’t ignore China’s desire to pay for oil imports in its own currency, particularly after the U.S. and EU blocked the Russian central bank from selling foreign currencies in its reserves stockpile.   “Any doubts countries had about the need to diversify into Yuan and other currencies/geographies would have ended with that huge step,” Mr. Shihabi tweeted in response to this article.– “Saudi Arabia considers accepting yuan instead of dollars for Chinese

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The 10 Most Interesting Things We’ve Read Recently (FFTT, 3/11/22)

Why critical thinking and intuition become indispensable during “the fog of war” (Page 2) “US Inflation soared 7.9% in the past year, a fresh 40-year high” (Page 3) Shelby: “Are you prepared to put the economy into recession to get inflation under control?”  Powell: “I hope.” (Page 5) “Faltering market liquidity renews prodding for Treasury buybacks of USTs” (Page 6) 10y UST yields are now UP from the day before Russia invaded Ukraine (Page 8)

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The US “closes the FX reserves window.”  Buy gold. (FFTT, 3/9/22)

If you are the central bank of anyone who is not a close ally of the US (even Israel which could conceivably be sanctioned), aren’t you going to have at least half your FX reserves in gold now?-Warren Buffett adherent (i.e., disdains gold) we have known for 20+ years, 3/1/22 While central banks have lately sought to buy and repatriate gold, it only makes up 13% of their assets. Foreign currencies are 78%. The rest

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The 10 Most Interesting Things We’ve Read Recently (FFTT, 3/4/22)

“Wall Street counsels Washington against Russian ban from SWIFT”; “may bring ‘unintended consequences’” (Page 2) “Russia’s FX reserves slip from its grasp” (Page 3) “If Russian currency reserves aren’t really money, the world is in for a shock” – WSJ (Page 5) “Russia Central Bank FX reserve freeze may hasten peak world FX reserves” (Page 7) Russia scrambles as its financial system collapses as a result of sanctions (Page 9) “Russian oil finds few buyers

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