Monday, May 18, 2009

A Half-Assed Job

Astute readers may have discerned a small autobiographical element to Holmes' latest adventure. While Macro Man knew that doing a kitchen extension was a major project, he had little notion that the task would prove more arduous than the Labours of Hercules. Alas, this particular labour was completed imperfectly, and so the kitchen men are returning to Casa Macro once again today to properly finish what they started nearly three months ago.

Mrs. Macro will no doubt hope that it brings an end to what has been a tiresomely frequent refrain from your author, whose mantra throughout the project has vowed a refusal to "accept a half-assed job."

Sadly, the British tradesman does not have a monopoly on performing half-assed jobs. Macro Man finds himself encountering them with distressing frequency in his professional life as well.

His old friends the SNB are a prime example; after warning of their ability to sell "limitless" amounts of Swiss francs in the foreign exchange market, they somehow forgot to sell one franc in the market. At least until close of business on Friday, that it, when popular belief is that the SNB did a little drive-by at about quarter past five in the afternoon, local time.

Now, Macro Man cannot be entirely sure that this was in fact the SNB, but a number of reports suggest that it was. And if that's the, what a half-assed job. Really, if that's the best that they can do in a liquidity-constrained end-of-week intervention round, Macro Man cannot be terribly upbeat about the prognosis for EUR/CHF. Fortunately, he had the sense to leave the rotting carcass of that particular trade by the side of the road several weeks ago.

Another organization guilty of performing a half-assed job is the UK's Office for National Statistics. As the recession started to grip Britain last year, the ONS reported that May retail sales growth hit a 29-year high. Macro Man said at the time that the figure was "literally unbelievable". And so it proved to be. On Friday the ONS was forced into a red-faced admission that its retail sales figures have been utter rubbish.

Now, perhaps we'll never know whether the egregious over-statement of economic activity was down to some sort of Stalinist manipulation of the figures, or merely wretched incompetence. But it serves as a timely reminder that if you think data seems too good to be true, it might not just be you; it could be the product of a half-assed job.


Anonymous said...

"Never ascribe to malice, that which can be explained by incompetence"


Anonymous said...

This bear market is another example of half assed job.

Anonymous said...

Always remember if Mrs. Macro ain't happy, Mr. Macro ain't happy.

Even the Micro Macros suffer.

And that's some Firm Theory you can bank on.

Anonymous said...

CHF, inly incompetence ?

Anonymous said...

we are trying to make money in the chf since the begining of the year! Not easy...

Professional Gringo said...

MM, care to share your thoughts on the GBP/USD? Consensus being the 1.55-1.6 mark for now because???

The Forex is beginning to resemble the crude markets with respect to logic if you ask me.

Anonymous said...

Ah, kitchens.

Ah, tradesmen.

Ah, large amounts of money and annoyance.

MM, would you agree with the analysis that (a) there are large amounts of money on the sidelines, (b) people are making trades, not investments, (c) therefore, the markets are essentially moving randomly, and (d) that the markets are consequently very dangerous?

--Charles of MercuryRising

Anonymous said...


The actual quote is:

"Never attribute to malice that which is adequately explained by stupidity."Thanks to WikiQuote!

Macro Man said...

It certainly feels like many markets are being whipped around by fast money, G10 FX perhaps more than any other. If anything, my sense is that the inexorability of this equity rally has been some of the sidelined money coming back to the market, but it's difficult to know for certain.

The sterling bull trade is one largely predicated on positioning, in my view (i.e., £ is cheap and there is a stale long-term short out there.)

Professional Gringo said...

Nice to see that even MM believes that a somewhat shaky perception is moving the market rather than any fundamentals.

At some point I expect to see a head of the Treasury somewhere say:

"you mean actions have consequences? Shut. Up."

Anonymous said...

hows the leg healing up.
struggling to stay 100% bullish w the technicals here: ps i hqte french keyboqrds. in st tropez

Professional Gringo said...

I can't in good conscience continue to pay these exorbitant monthly subscription fees here at Macro Man because the FX info provided is something akin to re-arranging the deck chairs of the Titanic.

I'm shorting the GBP/USD out of spite at this point.

Hope and change, hope and change.

Anonymous said...

professional gringo
you sound familiar


Professional Gringo said...

Sorry, brown shoe Commander-yes, a Sarge-nope. I was the rolling thunder end of that deal.

And I'm still short the GBP on principle and down but on the come.