{"id":34848,"date":"2018-06-06T15:40:57","date_gmt":"2018-06-06T20:40:57","guid":{"rendered":"http:\/\/olduvai.ca\/?p=34848"},"modified":"2018-06-06T15:40:57","modified_gmt":"2018-06-06T20:40:57","slug":"somethings-wrong-the-feds-creating-risks-but-the-markets-ignoring-it","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=34848","title":{"rendered":"\u2018Something\u2019s Wrong\u2019: The Fed\u2019s Creating Risks \u2013 But The Markets Ignoring It"},"content":{"rendered":"<h3><a href=\"https:\/\/palisade-research.com\/somethings-wrong-with-risk-expectations\/\">\u2018Something\u2019s Wrong\u2019: The Fed\u2019s Creating Risks \u2013 But The Markets Ignoring It<\/a><\/h3>\n<p>The other day I published an <a href=\"https:\/\/palisade-research.com\/the-smart-money-is-bailing-out\/\">article<\/a> calling out the markets denial of rising risks.<\/p>\n<p>Even with everything that\u2019s happening in Italy and with the Emerging Markets blowing up \u2013 expected volatility has actually <em>decreased<\/em>. . .<\/p>\n<p>Basically, the stock markets pricing everything in for <em>perfection<\/em> \u2013 that the economy and markets will have low-volatility, steady growth, and calming inflation.<\/p>\n<p>At least the bond market isn\u2019t as gullible as the yield curve stays relatively flat \u2013 and heading <a href=\"https:\/\/palisade-research.com\/calling-the-feds-bluff\/\">towards inversion<\/a>.<\/p>\n<p>So, is it just us handful of skeptics and contrarians that <em>don\u2019t<\/em> believe the mainstreams \u2018everything\u2019s great\u2019 story?<\/p>\n<p>Here are a couple other big names that are now doubting the \u2018<em>goldilocks\u2019<\/em> scenario. . .<\/p>\n<p>Ray Dalio and his firm<em>, <\/em>Bridgewater Associates \u2013<em> the world\u2019s largest hedge fund<\/em>, has been in the public eye lately thanks to his new, bestselling book \u2013 <em>Principles<\/em>.<\/p>\n<p>In Bridgewater\u2019s recent Daily Observations, the fund warns that, \u201c<em>2019 is setting up to be a dangerous year, as the fiscal stimulus rolls off while the Fed\u2019s tightening will be peaking\u2026<\/em>\u201d<\/p>\n<p>Bridgwater <a href=\"https:\/\/www.zerohedge.com\/news\/2018-06-05\/bridgewater-we-are-bearish-almost-all-financial-assets\">concluded with<\/a>. . .<\/p>\n<p><em>\u201cWe are bearish on financial assets as the US economy progresses toward the late cycle, liquidity <\/em><em>has been removed, and the markets are pricing in a continuation of recent conditions despite the changing backdrop\u2026\u201d<\/em><\/p>\n<p>Another added to the list of skeptics \u2013 a Morgan Stanley Top Analysts made statements on <a href=\"https:\/\/www.bloomberg.com\/news\/videos\/2018-06-04\/markets-can-t-keep-ignoring-trade-spat-morgan-stanley-says-video\">Bloomberg<\/a> that markets are \u201c<em>heading into a summer that\u2019s going to stay <strong>volatile..<\/strong>.\u201d<\/em><\/p>\n<p>The question now we must ask is: <em>what seems to be the common denominator behind all this volatility, instability in emerging markets, and liquidity problems?<\/em><\/p>\n<p>The answer:<em> The Federal Reserve\u2019s tightening<\/em>.<\/p>\n<p>The Fed has to realize what they\u2019re doing \u2013 I refuse to believe that the supposedly <em>\u2018greatest financial minds<\/em>\u2019 don\u2019t do their research about the correlation between <em>\u2018easy money booms\u2019<\/em> and \u2018<em>tight money busts\u2019<\/em>.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>\u2018Something\u2019s Wrong\u2019: The Fed\u2019s Creating Risks \u2013 But The Markets Ignoring It The other day I published an article calling out the markets denial of rising risks. Even with everything that\u2019s happening in Italy and with the Emerging Markets blowing up \u2013 expected volatility has actually decreased. . . Basically, the stock markets pricing everything [&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":[19913,303,19915,8625,690,1138,3650],"class_list":["post-34848","post","type-post","status-publish","format-standard","hentry","category-economics","tag-adem-tumerkan","tag-fed","tag-palisade-research","tag-quantitative-tightening","tag-risk","tag-stock-market","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/34848","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=34848"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/34848\/revisions"}],"predecessor-version":[{"id":34849,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/34848\/revisions\/34849"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=34848"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=34848"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=34848"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}