Amazing isn’t it? It was only back in H2 2018 when everybody but you (because you are as smart as I think you are or because you read NFTRH or nftrh.com) and me was unbelievably bearish about the TREASURY BOND BEAR MARKET!!!
Today… not so much. The herd is absolutely pile driving bonds right now. Full Story
When the Wall Street Journal put possibly imminent negative interest rates for the United States on page one and above the fold - it is (effectively) saying these changes are not in the past, but may just be getting started. The greater the degree of distortions, the less important that long term investment history in freer markets becomes, and the greater the importance of having a framework for understanding what is in "the middle" and how these extraordinary and heavy-handed interventions by the Fed transform the investment decision making process. Full Story
Clawing the wealth back is, fortunately for the rich, still anathema to Bubba, who always wanted to build his own way to the top and doesn’t want to feel he is taking it away from someone else just out of envy. And he still dreams of getting those special tax breaks himself if he ever makes it up there. Once he realizes, however, that he bought into a lie, he may feel angry at himself for believing the lie, and that will make him angry at those who sold it to him.
Dalio sees that day coming right away. His Davos friends, on the other hand, mostly hope to keep Bubba just happy enough with his F-250 and camper to avoid that day. Elizabeth and Bernie, on yet another hand, are banking their career moves on tapping into Bubba’s anger, just as Trump has been doing, but with their socialist solutions of free medicine and guaranteed wages even if you don’t work hard like Bubba.
Bubba was raised to hate socialism and to work hard for his money, but forty percent of Americans now embrace some form of socialism because of the rapacious greed that was baked into the lie fed to Bubba. With all the leading candidates tapping into that heat, 2020 could be a Bubbalicious year! Full Story
The charts posted immediately below tell one of the quiet, but perhaps most important stories unfolding in the world of high international finance. Gold has appreciated sharply in the currencies of all of the world’s top economies. In five of the top eight economies – the United Kingdom, Japan, Canada, Australia, and India – it is priced at all-time highs. In short, as currencies race for the bottom, gold is racing to the top. Investors everywhere are moving to insulate their portfolios against the combined threats of recession, plummeting yields, currency depreciation, and stock market instability. An over-arching nemesis not likely to relinquish its place any time soon has unleashed those four horsemen – the burgeoning trade and currency war.
Gold is up 25% in sterling; 22% in the yuan; 21.5% in euros; 19.7% in Australian dollars; 18% in rupee; 13% in Canadian dollars and 12% in Japanese yen. It is up sharply against a long list of emerging country currencies as well. By way of perspective, gold is up 16% in U.S. dollars thus far in 2019... Full Story
All important factors are finally putting tremendous pressure on the USDollar. The weak economy will result in lower interest rates, thus more downward USD pressure. The enormous USGovt debt will result in further bond dumps in addition to trade settlement outside the USD, thus more downward pressure. The resentment for threatened hot wars, trade wars, economic sanctions, and SWIFT obstructions will result in amplified resentment. They will respond with a global boycott of the King Dollar, dumping of USTreasury Bonds, and thus more downward pressure. Worse, a global currency war might erupt in the very near future, which might have basis in competing interest rates from monetary policy in addition to competing bond yields. The remarkable fact that has come to the table in the last few weeks is that foreign sovereign bond offerings are having strong demand despite lower bond yields offered than USTreasurys. However, the USTreasury auctions are being gradually noticed as failures, despite higher bond yields offered. The message is crystal clear, that collateral for the huge debt is far more important than the carry, namely the bond yield. Finally the USGovt debt is being questioned, as it rises past the $22 trillion level, as the debt limit is suspended, and as the over $20 trillion in missing funds is publicized. The USGovt financial room is a recognized crime scene. Full Story
Oh my gosh, what a load of BULL I keep reading among the gurus who whine about negative headlines and complain that this unmerited negativity is the only thing that is killing the bull market. Bull.
The bellowing bulls cry every time someone runs a negative headline, “Stop, you’re breaking our bull market with your negativity. That is the only reason it is going down.” The real truth is that headlines have been enormously biased toward a BULLish narrative for the better part of a decade, and bearish headlines are only just beginning to seep in. But that is too much for the bulls: “All this negativity is killing us.” Full Story
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