Home » Posts tagged 'markets' (Page 5)
Tag Archives: markets
Why the Financial System Will Break: You Can’t “Normalize” Markets that Depend on Extreme Monetary Stimulus
Why the Financial System Will Break: You Can’t “Normalize” Markets that Depend on Extreme Monetary Stimulus Central banks are now trapped. In a nutshell, central banks are promising to “normalize” their monetary policy extremes in 2018. Nice, but there’s a problem: you can’t “normalize” markets that are now entirely dependent on extremes of monetary stimulus. […]
How Much Death and Destruction Awaits Us in 2018?
How Much Death and Destruction Awaits Us in 2018? The New Year is one full of economic, political, and war threats. Among the economic threats are stock, bond, and real estate markets artificially pumped up by years of central bank money creation and by false reports of full employment. It is an open question whether […]
Three Bubbles/Strikes and You’re Out
Three Bubbles/Strikes and You’re Out Those betting on a fourth bubble of even greater extremes will find their time at bat has come to an end. The conventional investment wisdom holds that central banks will never let markets decline. This is an interesting belief, given that two previous asset bubbles based on central bank “easy […]
Are markets Really as Calm as They Seem?
ARE MARKETS REALLY AS CALM AS THEY SEEM? Indicators for financial market “stress” have reached their lowest levels in decades. For instance, stock market volatility has never been this low since the early 1990s. Credit spreads have been shrinking, and prices for credit default swaps have fallen to pre-crisis levels. In fact, investors are no […]
The Greatest Fear Today: The Lack of Fear
The Greatest Fear Today: The Lack of Fear Market crashes often happen not when everyone is worried about them, but when no one is worried about them. Complacency and overconfidence are good leading indicators of an overvalued market set for a correction or worse. Prominent magazine covers are notorious for declaring a boundless bull market […]
The Curious Case of Missing the Market Boom
The Curious Case of Missing the Market Boom Rembrandt Old man with a beard 1630“The Cost of Missing the Market Boom is Skyrocketing”, says a Bloomberg headline today. That must be the scariest headline I’ve seen in quite a while. For starters, it’s misleading, because people who ‘missed’ the boom haven’t lost anything other than […]
The S&P Is A Bloated Corpse
The S&P Is A Bloated Corpse Fan Ho In Paris 1953 Update: I never did this before, but now I think I must: change the title of an article. “Minsky and Volatility” isn’t nearly as good as “The S&P Is A Bloated Corpse”. Simple, really. The URL will be the same as before According to […]
Bubble About to Burst?
Bubble About to Burst? (ANTIMEDIA) — Last month, Anti-Media reported that some of the biggest institutions on Wall Street have issued warnings to investors that planet-wide financial markets are nearing a downturn. From an August 22 article by Bloomberg: “HSBC Holdings Plc, Citigroup Inc. and Morgan Stanley see mounting evidence that global markets are in the last stage of their rallies before a […]
China Orders No Market Turbulence Ahead Of Party Congress
China Orders No Market Turbulence Ahead Of Party Congress The most important event in China in five years is about to take place, and Beijing isn’t taking any chances. Ahead of the Communist Party’s twice-a-decade congress – an event so massive that according to Bloomberg “nothing escapes its pull” – which is slated to start […]
What Does the QE Experience Say About Rates in a Shrinking Fed Balance Sheet World?
What Does the QE Experience Say About Rates in a Shrinking Fed Balance Sheet World? The Federal Reserve is likely to decide next week to begin letting assets roll of its balance sheet as bonds mature, instead of reinvesting the proceeds. This means that the balance sheet will begin to shrink in size and other […]
Could Market Complexity Trigger The Next Crash?
Could Market Complexity Trigger The Next Crash? Complex systems are all around us. By one definition, a complex system is any system that features a large number of interacting components (agents, processes, etc.) whose aggregate activity is nonlinear (not derivable from the summations of the activity of individual components) and typically exhibits hierarchical self-organization under […]
Taken to the Cleaners
TAKEN TO THE CLEANERS Introduction Should regulators call the market? It has been a matter of vigorous debate in the regulatory community since the crisis. ‘Cleaners’ think you shouldn’t mess around with the market, although be prepared to clean up if markets collapse. ‘Leaners’ take the opposite view, divided between those who want to lean […]
Austrian Monetary Theory vs. Federal Reserve Inflation Targeting
AUSTRIAN MONETARY THEORY VS. FEDERAL RESERVE INFLATION TARGETING One of the leading policy guideposts for central banks and many monetary policy proponents nowadays is the idea of “inflation targeting.” Several major central banks around the world, including the Federal Reserve in the United States, have set a goal of two percent price inflation. The problem […]
Our Brave New ”’Markets”’
Our Brave New ”’Markets”’ How HFT algorithims risk a massive sudden sell-off One thing is clear: These aren’t your daddy’s markets anymore. Why? Because about 10 years ago the Rise of the Machines (aka high frequency trading algorithms) completely altered the terrain of what we call the ‘capital markets.’ Let’s look at this as a before […]
You Are Not An Investor
You Are Not An Investor Giotto Legend of St Francis, Exorcism of the Demons at Arezzo c.1297-1299 You are not an investor. One can only be an investor in functioning markets. There have been no functioning markets since at least 2008, and probably much longer. That’s when central banks started purchasing financial assets, for real, […]
