Major bond markets sold off last week, led by the UK and Japan. Goldman Sachs expects the increase in long-dated yields to extend into Q4, with US Treasuries reaching 2% by year-end. Their views are based on three considerations...
(1) Goldman's Sentiment Indicator shows an extreme bullish reading of 95 which suggests the index will decline during the next four weeks; (2) Political uncertainty will rise as the election approaches leading to a lower P/E multiple; (3) Recent economic data has disappointed; (4) Downside risk to EPS forecasts; (5) Equity valuation remains extended.
"Despite Norwegian mainstream media and political establishment support for Hillary Clinton (They also supported Mark Rubio and Bernie Sanders when they were running), I would like to apologize for our politicians and voice my support for Trump. I believe that Americans need to think about what is at stake from lifelong socialists’ perspective. Despite what people read about Norway being the best place to live, it comes with a price."
The physical holdings of Chinese gold ETFs have surged five-fold from 7 tonnes at the end of January, to 35 tonnes at end of August. The Huaán Yifu Gold ETF, which was holding 23 tonnes in August, entered the global top 15 list.
"The impact of the BOJ’s stimulus is that the bond markets worldwide are becoming one market. If there’s a reversal of policy, you can’t rule out that it would roil global debt" said SMBC Nikko Securities. "It would definitely see some pain" added Old Mutual Global.
Overnight the Chinese Central bank unleashed one of the most furious attacks on currency Yuan shorts since the January devaluation scare when the cost of borrowing yuan in Hong Kong soared to a seven-month high amid. In doing so, however, it unleashed the latest buying spree of bitcoin.
Wall Street is an industry that should have been allowed to go down in flames back in 2008. Bailing out these career criminals and sociopaths was one of the gravest errors in American history. An error that we as a nation continue to suffer from to this day. As an example, yesterday’s Wall Street Journal reported on the industry’s latest scheme to pocket the hard earned savings of those dwindling Americans who still have a few pennies left — structured CDs.
With the ECB running dangerously low on bonds to monetize even as its QE program has failed to spur inflation, Mario Draghi may have no choice but to unveil drastic changes to the central bank's QE programm tomorrow. Here are the options available to the central banker, and some ideas of how markets may react.
As of this moment, Goldman's partners are "prohibited from engaging in political activities and/or making campaign contributions to candidates running for state and local offices, as well as sitting state and local officials running for federal office", and specifically donating to the Donald Trump campaign, in order to "minimize potential reputational damage."
One of the more disturbing revelations from this year’s U.S. presidential election, has been Hillary Clinton’s compulsive propensity to hide all sorts of things from the American public. While we appreciate one’s right to privacy as much as the next person, if you want to run for President of these United States, transparency and engagement with the public should be a top priority and requirement.
Obama wants to placate public discontent and Turnbull wants to “civilize capitalism." Instead of trying to “civilize capitalism”, we suggest we try capitalism and free marketsinstead of massive amounts of QE, central bank sponsored wealth inequality schemes, bank bailouts, and manipulations of every asset class on the planet, coupled with free handouts to millions of refugees at the expense of everyone else.