Today's economic news extended two strands of the narrative we've been following.
In Asia, Taiwan's August money growth put in a third month of spectacular outperformance of trend. It's all down to rises in reserve money, which, in turn, is an irresistible function result of the huge build-up of foreign assets on the central bank's balance sheet. We don't know the exact number for August yet, but between May and July, that build-up of foreign assets was roughly equivalent to the average yearly build-up of the last five years!
In the US, the housing market numbers continue to soar. With 1,011k new homes sold in August, that's the busiest month since Sept 2006! What's intriguing is that even though inventories are falling, so too are median prices. In fact, the premium put on new homes vs existing homes, which has been in decline since 2014, disappeared almost entirely in August.
