{"id":9328,"date":"2015-06-22T06:32:08","date_gmt":"2015-06-22T11:32:08","guid":{"rendered":"http:\/\/olduvai.ca\/?p=9328"},"modified":"2015-06-22T06:32:08","modified_gmt":"2015-06-22T11:32:08","slug":"its-time-to-hold-physical-cash-fidelity-manager-warns-ahead-of-systemic-event","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=9328","title":{"rendered":"“It’s Time To Hold Physical Cash”, Fidelity Manager Warns Ahead Of “Systemic Event”"},"content":{"rendered":"

“It’s Time To Hold Physical Cash”, Fidelity Manager Warns Ahead Of “Systemic Event”<\/a><\/h3>\n

As Jamie Dimon\u00a0recently noted<\/a>\u00a0while discussing the perils of illiquid fixed income markets, the statistics around \u201ctail events\u201d can no longer be trusted.<\/p>\n

In other words, 6, 7, or 8 standard deviation moves that in theory should only happen once every two or three billion years may now start to show up once every two to three months. Evidence of this can be found in October’s\u00a0Treasury flash crash<\/a>, January’s fantastic\u00a0franc fuss<\/a>, and last month’s\u00a0Bund VaR shock<\/a>.<\/p>\n

Why is this happening? Simple. There\u2019s no liquidity left and the idea of efficient markets facilitating reliable price discovery is an anachronism.<\/p>\n

Today\u2019s broken, \u201cmangled\u201d (to use Citi\u2019s descriptor) markets come courtesy of:\u00a01)<\/strong>frontrunning, parasitic HFTs,\u00a02)<\/strong>\u00a0the post-crisis regulatory regime which, to the extent it\u2019s well meaning, was conceived by people who never had any hope of evaluating the likely knock-on effects of their policies, and\u00a03)\u00a0<\/strong>central banks, who have commandeered sovereign debt markets, leaving a trail of illiquidity and shrunken repo in their wake.<\/p>\n

Meanwhile, equity and fixed income bubbles continue to inflate on the back on central bank largesse and the only two options for rescuing a highly leveraged world are writedowns and\/or inflating away the debt.<\/p>\n

So what is a savvy investor to do in this powderkeg environment?\u00a0Simple, says Fidelity\u2019s Ian Spreadbury: own gold, silver, and physical cash.\u00a0<\/strong><\/p>\n

Via\u00a0The Telegraph<\/a>:<\/p>\n

The manager of one of Britain\u2019s biggest bond funds has urged investors to keep cash under the mattress.<\/em><\/strong><\/p>\n

Ian Spreadbury, who invests more than \u00a34bn of investors\u2019 money across a handful of bond funds for Fidelity, including the flagship Moneybuilder Income fund, is concerned that\u00a0a \u201csystemic event\u201d could rock markets, possibly similar in magnitude to the financial crisis of 2008,\u00a0<\/strong>which began in Britain with a run on Northern Rock.<\/em><\/p><\/blockquote>\n

…click on the above link to read the rest of the article…<\/p>\n

\u00a0<\/i><\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

“It’s Time To Hold Physical Cash”, Fidelity Manager Warns Ahead Of “Systemic Event” As Jamie Dimon\u00a0recently noted\u00a0while discussing the perils of illiquid fixed income markets, the statistics around \u201ctail events\u201d can no longer be trusted. In other words, 6, 7, or 8 standard deviation moves that in theory should only happen once every two or […]<\/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":[1719,124,150,6614,6038,6615,1167,400,4714,481,1421,647,2530,690,741,4318],"class_list":["post-9328","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bond","tag-central-banks","tag-collapse","tag-equity","tag-fixed","tag-fixed-income","tag-greece","tag-hft","tag-jamie-dimon","tag-leverage","tag-libor","tag-precious-metals","tag-regulations","tag-risk","tag-sovereign-debt","tag-zerohedge"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/9328","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=9328"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/9328\/revisions"}],"predecessor-version":[{"id":9329,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/9328\/revisions\/9329"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=9328"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=9328"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=9328"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}