Liquidity, of course, is simply the ease with which an asset can be converted to cash. It’s best defined as that thing that is always there when you don’t care about it and never there when you do. read more »

When I’m not writing blog posts I like to watch great movies, like Dumb and Dumber. In case you don’t know the film, it follows the lives of two young men, Harry and Lloyd, in the years before they were named to the Federal Reserve Board. read more »

We’ve talked about how NIRP – negative interest rate policy – tends to turn the world upside down and in ways that are unpredictable, given that no one now alive has had experience investing or making economic decisions in a NIRP world. I’ve also pointed out that central bankers, desperate to do something, have deployed unconventional policies that aspire to raise inflation and rates to about the 2% level, but which have actually driven inflation to 1% or less in the US, Britain and China and to negative levels – deflation – in Germany, Italy and Spain. read more »

“It’s like learning to drive a car backwards.” read more »

The longer the music plays and the louder it gets, the more deafening is the silence that follows. read more »