{"id":4610,"date":"2015-01-18T09:55:26","date_gmt":"2015-01-18T14:55:26","guid":{"rendered":"http:\/\/olduvai.ca\/?p=4610"},"modified":"2015-01-18T09:55:26","modified_gmt":"2015-01-18T14:55:26","slug":"exters-pyramid-in-play-and-is-martin-armstrong-right","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=4610","title":{"rendered":"Exter\u2019s Pyramid \u201cIn Play\u201d (And Is Martin Armstrong Right?)"},"content":{"rendered":"<p><a href=\"http:\/\/www.zerohedge.com\/news\/2015-01-18\/exter\u2019s-pyramid-\u201c-play\u201d-and-martin-armstrong-right\" target=\"_blank\"><strong>Exter\u2019s Pyramid \u201cin play\u201d (and is Martin Armstrong right?)<\/strong><\/a><\/p>\n<p>In a global debt bubble, it concerns us when the benchmark debt security still looks good value, albeit on a relative basis.<\/p>\n<p>&nbsp;<\/p>\n<p>In spite of this, the consensus is (once again) calling for higher US yields and FOMC \u201clift off.\u201d The two-year Treasury yield has been pricing in the latter\u2026<\/p>\n<p>&nbsp;<\/p>\n<p>\u2026but the question is what is the long end of the Treasury curve pricing in?<\/p>\n<p>Slower growth and lower inflation, most likely. Risk of global contagion, possibly. That the FOMC makes a mistake (in raising rates)\u2026maybe that too.<\/p>\n<p>The Fed might be desperate to raise rates ahead of the next downturn (how embarrassing not to) but this analyst would be surprised to see more than 1 or 2 token 0.25% increases \u2013 and that\u2019s if things are rosy.<\/p>\n<p>As we know, the narrative from central banks can change at the slightest hint of trouble, e.g. Ballard\u2019s QE4 comment during last October\u2019s selloff. Watch the spin as the Fed portrays lower energy prices as \u201ctransitory\u201d and no reason to alter its desire to tighten, while the ECB\u2019s desire to ease only grows, even though neither is achieving its mandate on prices.<\/p>\n<p>Do what thou wilt shall be the whole of the law?<\/p>\n<p>The key point is that you can\u2019t normalise rates in the \u201cWinter\u201d phase of a long wave (Kondratieff) cycle. There is just too much debt. It\u2019s debt that drives these cycles and eventually brings them to an end.<\/p>\n<p>This is the fourth cycle since the Industrial Revolution and the longest by far. The lack of a gold standard has allowed the central banks to extend it through unprecedented credit creation.<\/p>\n<p>Here is our timing of these cycles:<\/p>\n<div>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Exter\u2019s Pyramid \u201cin play\u201d (and is Martin Armstrong right?) In a global debt bubble, it concerns us when the benchmark debt security still looks good value, albeit on a relative basis. &nbsp; In spite of this, the consensus is (once again) calling for higher US yields and FOMC \u201clift off.\u201d The two-year Treasury yield has [&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":[86,88,175,195,233,1675,2720],"class_list":["post-4610","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bond-bubble","tag-bonds","tag-credit","tag-debt","tag-ecb","tag-economic-cycles","tag-global-debt-bubble"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/4610","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=4610"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/4610\/revisions"}],"predecessor-version":[{"id":4611,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/4610\/revisions\/4611"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4610"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4610"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4610"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}