Central banks are supposed to manage economies over the medium term - through business cycles that last at least months but typically run years. Today, the U.S. central bank (the Fed) tells us it thinks the economy is strong enough to warrant a tiny rate hike, and while inflation is low, people still believe it will be normal in the…
A few years ago I hurt my elbow, and after six weeks of pain, I finally went to the doctor. He gave me a few choices. First, he suggested I try physical therapy, some anti-inflammatory medicine, and lots of ice. With lots of work and attention, I would probably have pain for another 3-4 weeks and then slowly it would…
Investors have lost faith in Brazil, and rightfully so. The currency has lost 36% of its value against the U.S. dollar this year, plunging nearly 7% in the last week alone. Yields on its bond issues are spiking, as investors demand higher and higher rates to loan Brazil or Brazilian companies money. Just six years ago in November 2009, Brazil…
