Euro Pacific Capital – Peter Schiff: Fed’s Rocket Ship Turns Hoverboard The real problem for the Fed will be how foolish it will look if it does raise by 25 basis points and is then forced by a slowing economy to lower rates back to zero soon after liftoff. At that point, the markets should… Continue reading The Fed’s Rate Dilemma
<Click on chart for larger image> Zero Hedge – The One Chart The Proves How The Fed Singlehandedly Doubled The Stock Market Since 1997 Talk of a “secular bull market” should not dismiss the way in which Fed policy helped “create” higher stock prices since the 1990s. There is a ~1,000 point gap between the… Continue reading The Fed And Stocks Since 1997
Bloomberg Business – Who’s the Bear Driving Up the Price of U.S. Stock Options? Banks For more than a year, dealers in the U.S. equity derivatives market have noted a widening gap in the price of certain options. If you want to buy a put to protect against losses in the Standard & Poor’s 500… Continue reading U.S. Stock Options
Bloomberg Business – Andrew Mayeda: Emerging Markets Warned of Capital Drought as Fed Nears Liftoff A sudden capital drought in emerging markets could undermine the fragile global expansion, World Bank economists said in a report Tuesday that questions whether the international lender’s main poverty-reduction target is achievable given the bleaker outlook. Now in its sixth… Continue reading How The Fed Affects Emerging Markets
<Click on graphic for larger image> Bloomberg Business – Alexandra Scagg & Liz McCormick: JPMorgan, Goldman See Bond Traders’ Hubris Ending in Tears For years, one of the easiest ways for bond traders to make money has come from being skeptical of the Federal Reserve’s view on interest rates. Now, some of Wall Street’s most… Continue reading Is The Market Too Complacent About Fed Rate Hikes?
<Click on chart for larger image> The Wall Street Journal – Investors Place Record Bets on Rising U.S. Interest Rates Net wagers that prices of five-year Treasury notes will fall hit $26.6 billion Wagers on rising interest rates are highlighting the scramble by investors to prepare for the first Federal Reserve policy tightening in nine… Continue reading Betting On A Rate Hike
<Click on chart for larger image> Comment We believe the blue line in the chart above is the key to crude prices. Inventories have increased by 130 million barrels since the peak in crude oil in July 2014. Why? As the red line above shows, we produce too much oil. Despite crashing prices, production has… Continue reading We Produce Too Much Oil
<Click on chart for larger image> Financial Times – Hedge funds lick wounds after tough year What was meant to be the big comeback year for the beleaguered hedge fund industry has instead been one of its toughest since the financial crisis. Wrongfooted by central banks and sudden bouts of market volatility, some of the… Continue reading That Distant Scream Of Hedge Fund Returns Continues
The Washington Post – Lawrence Summers: Preparing for the next recession All of this leaves me far from confident that there is substantial scope for tightening interest rates in the United States — and probably even less scope in other parts of the industrialized world. The fact that central banks in Europe, Sweden, Israel and… Continue reading Calls For The Fed Not To Hike
<Click on chart for larger image> The Financial Times – Direction of capital flows crucial for global asset markets Sovereign wealth funds and decline in China’s reserves are significant forces Not for the first time sovereign wealth funds have sprung a leak. The dramatic decline in the price of oil has caused oil producers’ budgets… Continue reading EM Capital Flows
<Click on graphic for larger image> Zero Hedge – Chain Store Sales Collapse Following Already Disappointing Black Friday Following disappointing sales over the Black Friday to Cyber Monday weekend, there has been absolutely no follow-through momentum as is usually seen. Chain Store same-store-sales crashed 6.3% week-over-week. As Stone McCarthy details, The Retail Economist-Goldman Sachs Chain… Continue reading Chain Store Sales Disappoint