Business

Via TimeMoney.com,

Output Gap Explained

The output gap is the difference between actual and potential economic output and is used by economists to understand the health of the economy.

Authored by Steve H. Hanke of the Johns Hopkins University. Follow him on Twitter @Steve_Hanke.

The Grim Reaper has taken his scythe to the Venezuelan bolivar. The death of the bolivar is depicted in the following chart. A bolivar is worth less, and with its collapse, Venezuela is witnessing today the world’s worst inflation. 

Authored by Nick Cunningham via OilPrice.com,

Oil from Canada’s oil sands is now selling at a $27-per-barrel discount relative to WTI, the sharpest difference in more than four years.

Western Canada Select (WCS), a benchmark for oil from Alberta’s oil sands, has plunged in December, falling to just $30 per barrel at the end of this past week. WCS typically trades at a discount to WTI, reflecting the differences in quality from lighter forms of oil, as well as the extra transportation costs to move oil hundreds of miles out of Alberta.

Following last week's 'successful' launch of Cboe Bitcoin futures, CME will begin trading of their own 'more institutional' Bitcoin futures contract today.

Here are some of the differences between the products to be offered by the exchange operators.

CONTRACT UNIT

• The Cboe Bitcoin Futures Contract will use the ticker XBT and will equal one bitcoin.
• The CME Bitcoin Futures Contract will use the ticker BTC and will equal five bitcoins.

PRICING AND SETTLEMENT

Authored by Daniel Nevins via FFWiley.com,

We’ve been seeing more and more commentaries discussing bad stuff that can happen when the Fed tightens policy and, as a result, the yield curve flattens. (See, for example, this piece from Citi Research and ZeroHedge.)

No doubt, the Fed’s rate hikes will lead to mishaps as they usually do—in both markets and the economy.