Especially after the recent market rally, talk of “resilient” has become commonplace and central to the bullish narrative. And this resilience – at home and abroad – is undoubtedly associated with the “buffer” created from Trillions of pandemic QE. The significant tightening of market financial conditions for the most part didn’t spark panic in corporate boardrooms.
Bitcoin was trading at about $5,200 when SBF announced plans for FTX, down significantly from the December 2017 spike to $19,000. There’s no way the crypto Bubble inflates into such a global phenomenon, if not for the Trillions of central bank “money printing.”
Powell’s head was elsewhere, perhaps drawing inspiration from the resolve Paul Volcker had demonstrated some 40 years earlier.
At least for now, markets seem convinced that the global central bank community has Blinked – just as they knew they would.
Years of unprecedented monetary inflation created false realities. The perception of endless cheap (free) “money” distorted how our market, economic, financial, political and social systems function.
Global de-risking/deleveraging has taken A Threatening Turn. It’s no exaggeration to write that the UK pension system was this week at the brink of spectacular collapse, with confidence in policy and market function hanging in the balance.September 28…
The main focus for the week was on a slew of central bank tightening measures. But Putin’s speech marked an alarming ratcheting up of geopolitical risk. It essentially guarantees months of Putin hardball and associated uncertainty.
And it’s unclear whether the Fed, ECB, or other central banks are prepared to abruptly shift course and orchestrate another concerted QE program to re-liquify liquidity-challenged global markets. And this is a huge issue. The world could now be in the early stage of history’s greatest globalized de-risking/deleveraging cycle – and a global central bank liquidity backstop is not a policy focus.
Accommodating historic Credit and speculative excess in the name of fighting supposedly insufficient inflation – and even deflation – has been an epic failure of runaway Bubbles.
The Federal Reserve and the global central bank community today confront the nightmare confluence
Global “Risk Off” gathers momentum by the week. Crisis Dynamics fester, as global central banks coalesce around a united front for battling inflation. The reality that central bankers will aggressively hike rates until something breaks has begun to s…
At critical junctures, Greenspan and Bernanke consistently veered toward looser and ever more precarious policy courses. Their monstrous egos put our nation’s wellbeing in jeopardy. When circumstances turned tough, they would resort to BS justification for only more outrageous monetary accommodation. Greenspan and Bernanke were both dangerous ideologues and inflationists that handed the keys to our nation’s future to Wall Street.
