Quantitative Easing

Brexit Proved It's All A Central Bank Funded Mirage

Why can’t the markets proceed any higher than when QE ended in Oct/Nov of 2014? You know, if this is truly: a fundamentally based bull market that is. Or, is it that – its fundamentally full of bull? I believe it’s a big-ole-pile of the latter, and little to none of the former. Put a different way: Explain why does it take more central banker intervention, or the promise thereof, to stop these falls? If it were all “fundamentally” based on market principles, again, why is there a need or call for even more monetary interventionism? (i.e., negative interest rates, “helicopter” styled moves, etc., etc.)

Kyle Bass Shares The "Stunning" Thing A Central Banker Once Told Him

"I had a fascinating out of body experience meeting with one of the world's top central bankers in a private meeting about three years ago. it was one of those moments where I...it was one of those epiphanies almost, where it's something you and I knew, but hearing him say it, call it one of the four top central bankers in the world, it was a jarring experience for me..." - Kyle Bass

Frontrunning: July 1

  • Bond yields sink as central banks head for easier policy (Reuters)
  • PM hopeful Gove says UK leader must believe in Brexit (AP)
  • U.K. Can’t Bank on EU’s Rationality in Talks (WSJ)
  • Gove Makes Case for U.K. Premiership After Johnson Betrayal (BBG)
  • ECB not debating abandoning capital key in QE buys (Reuters)

US Treasury Yields Hit New Record Lows

Finally. With bond yields across the rest of the developed world already making new record lows every day, only the US had so far refused to take out all time lows set back in 2012. That finally changed overnight when the 10Y Treasury dropped -9 bps to 1.3784%, while the 30Y declined by the same amount, sliding as low as to 2.1914%.

Peter Schiff: "Brexit Is Just What The Doctor Ordered"

British voters may not know what they will get with an independent Britain, but they knew that something was rotten, not just in Denmark, but all over the European Union. The same holds true in the United States. Until our leaders can paint more realistic pictures of where we are and where we are going, we should expect more “surprises” like the one we got yesterday.

Is The Market Looking At It Wrong: "Buy US Assets In Case Of Brexit" Says Greg Peters

Nmerous traders have suggested, that Brexit - should Remain indeed be victorious - could be one of the more significant "sell the news" events in recent years. However, an even more interesting hypothesis was proposed by Gregory Peters, senior investment officer at Prudential Fixed Income, who told Reuters on Tuesday that he thinks U.S. stocks and bonds are a "great" buying opportunity if Britain votes to exit the European Union.

Voting Begin: Stocks Surge, Sterling Hits 2016 Highs, Futures Flirt With 2100

On the day voting for the UK referendum finally began, what started off as a trading session with a modest upward bias, promptly turned into a buying orgy in painfully illiquid markets shortly after Europe opened as an influx of buy orders pushed European stocks 2% higher, propelled by cable which was above 1.49 for the first time since December and USDJPY climbing over 1.05 in sympathy, following the release of the final Ipsos Mori poll which showed Remain at 52% to 48% for leave.

Who Is The "European Movement" And Why The Answer May Change How You Vote On "Brexit"

The revelation that the EU is the result of a major US secret service operation – effectively just yet another secret creature of deception launched by the CIA (taking seat of honour in the hall of infamy that includes false flag operations, invasions, coup-detats, and the establishment of organisations such as Al Qaida and ISIS) solves the third mystery, namely how on earth the allegedly democratic European nations could design such an undemocratic, virtually dictatorial structure.

German Top Court "Reluctantly" Rejects Challenges To ECB's OMT Program, Lists 6 Conditions

With traders already on edge in illiquid markets ahead of the Breferendum, one potential risk to sentiment today was the long-awaited decision by Germany’s powerful constitutional court whether Mario Draghi's OMT, or Outright Monetary Transactions, was constitutional. However, any lingering concerns were swept away when the Kardinals of Karlsruhe "reluctantly" ruled in favor of the one of the European Central Bank’s most important tools to fight financial crises, which however was caveated with six specific conditions.

Imagine...

Now imagine what might happen next...

Morgan Stanley Asks If This Is Just A "1937 Redux"

"Premature tightening of macro policies means risks of a relapse. In 1936, the Fed doubled the reserve requirements for banks and the Treasury began to sterilise gold inflows, slowing the growth of high-powered money. Fiscal policy was tightened, with the fiscal deficit narrowing significantly from 5.1% of GDP in 1936 to 0.1% in 1938. The premature and sharp pace of tightening of policies led to a double-dip in the economy, resulting in a relapse into recession and deflation in 1938."