Central Banks

The Good, The Bad, & The Ugly

The OPEX game is back in full swing and brought back hope amongst signs of bullish capitulation everywhere.... but there is plenty of bad (and even ugly) to consider.

More "Ivory Tower" Lunacy

"Keep in mind for historical perspective the United States had negative rates in the 1930’s, OK. That was the best time to buy stocks, OK...."

Panic Below The Surface: "Banks Are Selling Energy Loans At Cents On The Dollar To Ensure Their Own Survival"

"It is estimated that ~250,000 people have lost their jobs in the industry in the last 18 months. People who had been saying that this is the worst downturn since the 1980’s are now thinking that this is a return to the 1980’s. There are reports of banks selling loans at cents on the dollar to try and ensure their own survival and bankruptcy courts and workout specialists are seeing their best market in decades."

"Reversal Risk": Goldman Documents The History Of Central Bank Backpedaling

Things got off to a rather inauspicious start this year in the wake of the Fed's move to hike rates in December. Now, with policy divergence between the Fed and its DM counterparts set to support the dollar at the expense of both EM stability and US corporate profits and with the continual weakness in crude set to trigger a default cycle, the FOMC faces a rather vexing question: “is it better to admit to a policy mistake and reverse course at the risk of destroying credibility or is it preferable to cling to the narrative so as not to completely destroy the notion that all is well and the US recovery is on track?”  

Silver Linings: Keynesian Central Banking Is Heading For A Massive Repudiation

Inflation targeting has been a giant cover story for a monumental power grab. The academics who grabbed the power had no idea what they were doing in the financial markets that they have now saturated with financial time bombs. When these FEDs (financial explosive devices) erupt in the months and years ahead, the central bankers will face a day of reckoning. And they will surely be found wanting. The immense social damage from the imploding bubbles dead ahead will be squarely on them.

This Crash Will Be Bigger Than 2008 - Here's Why

"The world has never seen this and there is no one that knows the eventual consequences of this... This is desperation! The central banks have run out of ammunition and tools...all they have now is just talk."

The World Is Red

There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.

The Silver Age Of The Central Banker (Ends Badly)

The Golden Age, per the original Greek myth, was an era of unblemished cooperation and great deeds. The Silver Age, on the other hand, was a pretty miserable time to be alive. Not as warlike as the Bronze Age, and not the war of all against all as in the Iron Age, but the spirit of the age was one of strife and competition. It ends badly. What’s required is seeing the world for what it is, not what we might wish it to be. That’s not easy, whether you’re a central banker or a small investor, but it’s never been more important.

The Chilling Ways The Current Global Economy Echoes The 1930s Depression Era

The imbalances that low rates and elasticity produce may “return us to the modern-day equivalent of the divisive competitive devaluations of the interwar years; and, ultimately, [trigger] an epoch-defining seismic rupture in policy regimes, back to an era of trade and financial protectionism and, possibly, stagnation combined with inflation.”