Jake's View | This one indicator is a near perfect ‘crystal ball’ foretelling Fed rate increases
Hong Kong home price are signalling there won’t be a US interest rate tightening for a long time to come
Hong Kong shares traded higher for the fourth straight session yesterday, reaching their highest level since August last year as Friday’s weaker than expected US job numbers and positive sentiment from the G20 meeting continued to buoy investor sentiment ...
SCMP, September 7
How fashions come and go. There was a time that the monetary theories of Professor Milton Friedman prevailed and once a month everyone waited, eyes glued to Reuters screens (no Bloomberg then), for the latest US M2 growth figure. It would flash up and markets round the world would shake.
The theory worked perfectly in university classrooms, pity about the real world. M2 proved erratic and uncontrollable.
Our currency is formally linked to the US dollar and home prices in Hong Kong are critically sensitive to US interest rate trends
Then there was a time when the big question was whether the US government could keep its deficits under control and everyone waited for that number. The question is no longer of interest. There has been a definitive answer – no, it cannot. The US federal deficit is out of control.