Insurance Companies

"The World's Central Banks Are Making A Big Mistake"

Debt is future consumption brought forward. Once debt is incurred, consumption that might have happened in the future won’t happen. And it should come as no surprise that at a certain debt level, growth and income begin to diminish. That is exactly what we are seeing in the real world.

With The S&P 140 Points From Its 2018 Year End Target, Goldman Is Confused

Goldman found itself in the confusing position of being far more bearish than its clients, predicting that the S&P will rise less than 150 points over the next two and a half years and has to explain the reasons behind its bearishness, as well as the reason why it expects a sharp 5-10% drawdown in the S&P in the coming months.

With "Stock Valuations At Extremes" Goldman's Clients Are Asking Just One Question

This week the S&P 500 surged to a new record high of 2164 this week while the 10-year US Treasury yield touched an all-time low of 1.37%. As a result Goldman, and especially its clients, are stumped. As chief equity strategist David Kostin admits, they have one burning question. As Kostin puts it, they "are struggling to reconcile how extreme valuations of both assets can co-exist."

Something Huge Is Coming From Japan

Pretend, for a minute, that your country responds to the bursting of a credit bubble by borrowing unprecedented amounts of money and using it to prop up banks and construction companies. This doesn’t work, so you create record amounts of new money and push interest rates into negative territory in an attempt to devalue your currency. But this - amazingly - doesn’t work either. Your currency soars and the inflation you’d hoped to generate never materializes. Now what? Is there even anything left to try, or is it simply time to stand back and let the current system melt down?

"This Is The Capitulation Phase" - Why Treasury Yields Are About To Really Plunge

For the rates market, the significance of this acceptance phase by pensions cannot be understated, in our opinion. A $3 trillion industry running a $500 billion funding gap and a significant duration gap waking up to reality is likely to have major implications for the market. In the extreme case, entire pensions could be offloaded from corporate balance sheets to insurance companies (increasingly like the UK, Exhibit 1)–generating significant demand for long-end duration during such transactions.

Price Discovery - R.I.P.!

But the destruction of price discovery in the sovereign debt market is not simply an academic curiosity to be jawed about by the few remaining fiscal scolds in the world. To the contrary, it is already having massive toxic consequences in the arenas of fiscal governance and capital markets alike.

ObamaScare Looms - Health Insurers Are Looking For A Taxpayer Bailout

Insurers helped cheerlead the creation of Obamacare, with plenty of encouragement – and pressure – from Democrats and the Obama administration. With the prospect of tens of millions of new customers forced into the market for comprehensive health-insurance plans, whether they needed that coverage or not, underwriters saw potential for a massive windfall of profits. Six years later, those dreams have failed to materialize. Now some insurers want taxpayers to provide them the profits to which they feel entitled - not through superior products and services, but through lawsuits.

"Deutsche Bank Poses The Greatest Risk To The Global Financial System": IMF

"Deutsche Bank appears to be the most important net contributor to systemic risks, followed by HSBC and Credit Suisse. The relative importance of Deutsche Bank underscores the importance of risk management, intense supervision of G-SIBs and the close monitoring of their cross-border exposures, as well as rapidly completing capacity to implement the new resolution regime."

Forget Brexit, It's The Banks Stupid!

Political instability for the EU is a significant and visible threat, but is not the immediate problem, which is financial. As a result of savings and spending imbalances, none of the core Eurozone states can stand on their own.

There Is An Alternative To Yellen's Keynesian Bubble - Stockman Rages "Abolish The Fed"

The approximate hour Janet Yellen spent wandering in circles and spewing double talk during her presser yesterday was time well spent. When the painful ordeal of her semi-coherent babbling was finally over, she had essentially proved that the Fed is attempting an impossible task. And better still, that the FOMC should be abolished. The alternative is real simple. It’s called price discovery on the free market; it’s the essence of capitalism.