Phoenix Capital Research's blog

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The market is extremely tired and the systemic risks underlying the Financial Crisis are in no way resolved. With investor complacency (as measured by the VIX) at record lows, the Fed withdrawing several of its more significant market props, and low participation coming from the larger institutions, this market is ripe for a serious correction.

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The Fed wants asset bubbles because they hide the rot within the US economy. If the Fed didn’t raise stock or housing prices, people might actually start to wonder… “hey, why is my life getting more and more difficult despite the fact that I’m working all the time?”

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Central Banks, Bank CEOs, politicians… all of these people are focused primarily on maintaining CONFIDENCE in the system, NOT on fixing the system’s problems. Indeed, they cannot even openly discuss the system’s problems because it would quickly reveal that they are a primary cause of them.

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History is replete with the total failure of Central Planning. Whether one look to China or the USSR or the US today, Central Planning has never successfully worked.  It creates the illusion of stability in the short-term, but eventually the truth comes out: that it is a TERRIBLE means of deploying capital (both human or monetary).

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So not only are we dealing with an investment landscape in which virtually no working fund manager has experienced a bear market in bonds… we’ve actually got an entire generation of investment professionals who have experienced only one increase in interest rates in 14 years.

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So… just WHO actually has a CLUE about the true state of the banks in Europe? More importantly, who will actually bother WARNING investors about the risks therein?