{"id":27078,"date":"2017-10-21T10:50:29","date_gmt":"2017-10-21T15:50:29","guid":{"rendered":"http:\/\/olduvai.ca\/?p=27078"},"modified":"2017-10-21T10:50:29","modified_gmt":"2017-10-21T15:50:29","slug":"weekly-commentary-arms-race-in-bubbles","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=27078","title":{"rendered":"Weekly Commentary: Arms Race in Bubbles\u00a0"},"content":{"rendered":"<h3 class=\"post-title entry-title\"><a href=\"http:\/\/creditbubblebulletin.blogspot.ca\/2017\/10\/weekly-commentary-arms-race-in-bubbles.html\">Weekly Commentary: Arms Race in Bubbles\u00a0<\/a><\/h3>\n<div id=\"post-body-9103538622312834540\" class=\"post-body entry-content\">The week left me with an uneasy feeling. There were a number of articles noting the 30-year anniversary of the 1987 stock market crash. I spent \u201cBlack Monday\u201d staring at a Telerate monitor as a treasury analyst at Toyota\u2019s US headquarters in Southern California. If I wasn\u2019t completely in love with the markets and macro analysis by that morning, there was no doubt about it by bedtime. Enthralling.<\/p>\n<p>As writers noted this week, there were post-\u201987 crash economic depression worries. In hindsight, those fears were misplaced. Excesses had not progressed over years to the point of causing deep financial and economic structural maladjustment. Looking back today, 1987 was much more the beginning of a secular financial boom rather than the end. The crash offered a signal \u2013 a warning that went unheeded. Disregarding warnings has been in a stable trend now for three decades.<\/p>\n<p>Alan Greenspan\u2019s assurances of ample liquidity \u2013 and the Fed and global central bankers\u2019 crisis-prevention efforts for some time following the crash \u2013 ensured fledgling financial excesses bounced right back and various Bubbles hardly missed a beat. Importantly, financial innovation and speculation accelerated momentously. Wall Street had been emboldened \u2013 and would be repeatedly.<\/p>\n<p>The crash also marked the genesis of government intervention in the markets that would evolve into the previously unimaginable: negative short-term rates, manipulated bond yields, central bank support throughout the securities markets, Trillions upon Trillions of central bank monetization and the perception of open-ended securities market liquidity backstops around the globe. Greenspan was the forefather of the powerful trifecta: Team Bernanke, Kuroda and Draghi. Ask the bond market back in 1987 to contemplate massive government deficit spending concurrent with near zero global sovereign yields \u2013 the response would have been \u201cinconceivable.\u201d<\/p><\/div>\n<div><\/div>\n<div class=\"post-body entry-content\">&#8230;click on the above link to read the rest of the article&#8230;<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Weekly Commentary: Arms Race in Bubbles\u00a0 The week left me with an uneasy feeling. There were a number of articles noting the 30-year anniversary of the 1987 stock market crash. I spent \u201cBlack Monday\u201d staring at a Telerate monitor as a treasury analyst at Toyota\u2019s US headquarters in Southern California. If I wasn\u2019t completely in [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[13166,952,68,8405,1799,124,7756,303,379,2854,1044,2731,3650,860],"class_list":["post-27078","post","type-post","status-publish","format-standard","hentry","category-economics","tag-13166","tag-alan-greenspan","tag-ben-bernanke","tag-black-monday","tag-bubbles","tag-central-banks","tag-credit-bubble-bulletin","tag-fed","tag-government","tag-haruhiko-kuroda","tag-mario-draghi","tag-stock-market-crash","tag-us-federal-reserve","tag-wall-street"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/27078","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=27078"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/27078\/revisions"}],"predecessor-version":[{"id":27079,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/27078\/revisions\/27079"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=27078"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=27078"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=27078"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}