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Japan Is Perhaps the Most Important Risk in the World
Japan Is Perhaps the Most Important Risk in the World Speculation is mounting that the Bank of Japan is losing control of the bond market. Jim Grant, editor of «Grant’s Interest Rate Observer», believes this could trigger a shock to the global financial system. He also explains why he expects further surges in inflation and […]
Bank of England intervenes in bond markets again, warns of ‘material risk’ to UK financial stability
Bank of England intervenes in bond markets again, warns of ‘material risk’ to UK financial stability “Dysfunction in this market, and the prospect of self-reinforcing ‘fire sale’ dynamics pose a material risk to UK financial stability,” the Bank of England warned. The move marks the second expansion of the central bank’s extraordinary rescue package in […]
BoE’s New Support Plan Fails As UK Gilt Yields Explode Higher
BoE’s New Support Plan Fails As UK Gilt Yields Explode Higher Update (1030ET): Despite The BoE promises to do almost ‘whatever it takes’, long-dated gilt prices are collapsing today. 30Y gilt yields are up a stunning 34bps now, soaring towards crisis highs… What next for BoE? The pain in the UK is spreading to US yields (remember […]
A historic global bond-market crash threatens liquidation of the world’s most crowded trades, says BofA
A historic global bond-market crash threatens liquidation of the world’s most crowded trades, says BofA ‘If the bond market does not function, then no other market functions, really,’ say Ben Emons of Medley Global Advisors A newspaper headline is shown after the Treaty of Versailles was signed in 1919. Global bonds are in one of […]
“Potential For Extreme Havoc”: $50 Trillion Question Is What If Yields Spike Higher
“Potential For Extreme Havoc”: $50 Trillion Question Is What If Yields Spike Higher The size of the global government bond market surged by $10 trillion in the space of two years to reach about $50 trillion. Those outstanding borrowings are at least one gorilla in the room as investors gear up for a year in […]
Weekly Commentary: Regime Change
Weekly Commentary: Regime Change Ten-year Treasury yields closed out a tumultuous week at 1.41% bps, pulling back after Thursday’s spike to a one-year high 1.61%. Ten-year Treasury yields are now up 49 bps from the start of the year and almost 100 bps (1 percentage point) off August 2020 lows. More dramatic, five-year yields jumped […]
The Fed Wrecked the World’s Most Important Market
The Fed Wrecked the World’s Most Important Market Do you wish to know where the economy is heading? The bond market holds the answer, say the veterans. The birds of the moment, the flighty birds, flock to the stock market. But the owls nest in the bond market. The owls are the wiseacres. The Federal Reserve’s […]
Broke Bond Markets Mounting: Italy Surpasses Greece As Europe’s Riskiest Sovereign
Broke Bond Markets Mounting: Italy Surpasses Greece As Europe’s Riskiest Sovereign As yields soar optimistically around the world, pushing negative-yielding debt below $12 trillion – the lowest since June, but hey, it’s still $12,000,000,000,000 of insanity, central-planners’ incessant meddling with global markets has sparked another WTF-moment in capital market history. A mere twelve trillion dollars worth […]
Market Commentary: China Watch
Market Commentary: China Watch I’ve held the view that Chinese finance has been at the epicenter of international market unease. The U.S./China trade war was not the predominant global risk. However, it has had the potential to become a catalyst for Chinese financial instability. And there remains a high probability for an eruption of Chinese […]
Japanese Bond Crash, Margin Call Sends Shockwaves Around The Globe
Japanese Bond Crash, Margin Call Sends Shockwaves Around The Globe For a dramatic preview of what will happen in a flash to all those record low interest rates without the backstop of central banks and ravenous pension fund, look no further than what happened in Japan overnight, where bond futures suffered the biggest one-day crash […]
The Global Debt Bubble Enters Its Blow-Off Stage
The Global Debt Bubble Enters Its Blow-Off Stage People have been talking about a “debt bubble” for some years now. They’ve been right, of course, based on the combination of surging borrowing and plunging rates. But the bubble hasn’t stopped inflating, and recently it entered what certainsly looks like a terminal blow-off stage. Some highlights: […]
Here’s What I’m Worried About. And It’s Not a Recession
Here’s What I’m Worried About. And It’s Not a Recession A rout in the hyper-inflated bond market can blow up everything at this point. The locker room at my swim club has become the litmus test. When a complex topic, after years of being absent or ignored, suddenly crops up in conversation, and not just […]
“A Big Wake Up Call”: Chinese Bond Market Roiled By First Ever Bank Failure
“A Big Wake Up Call”: Chinese Bond Market Roiled By First Ever Bank Failure Late last Friday, we reported that several hours after the market close, China’s financial regulator and central bank made a shocking announcement: for the first time in nearly 30 year, China would take control of a bank, in this case the troubled inner […]
The Arrival of the Credit Crisis
THE ARRIVAL OF THE CREDIT CRISIS Those of us who closely follow the credit cycle should not be surprised by the current slide in equity markets. It was going to happen anyway. The timing had recently become apparent as well, and in early August I was able to write the following: “The timing for the […]
Is The Long-Anticipated Crash Now Upon Us?
Shutterstock Is The Long-Anticipated Crash Now Upon Us? Is this the market’s breaking point? I admit: I’m a permabear. This is no surprise to those who know and have followed me over the years. But I’m publicly proclaiming my ‘bearishness’ because doing so might open up a needed and long overdue dialog. Here’s my fundamental […]
