Credit Crisis

Scientific Proof ETFs Make Markets Dumber

"Our evidence suggests the growth of ETFs may have (unintended) long-run consequences for the pricing efficiency of the underlying securities."

"The Fed Is Once Again Making A Policy Error"

"I must admit, I am a little surprised the Fed's goal of withdrawing accommodation without having the whole financial system come crashing down has gone so smoothly. But I wonder if the Federal Reserve isn’t pushing their luck..."

The End Game

"..the debt problem is so pervasive, there is only way one forward - inflate... They will do anything (and everything) to ensure the financial system doesn’t implode on itself... They will keep printing until the bond market takes the keys away."

Gary Cohn Backs Reinstating Glass-Steagal, Breaking Up Big Banks

The former Goldman Sachs Group Inc. executive who is the top White House economic adviser told lawmakers he could support legislation breaking up the largest U.S. banks, according to people familiar with the matter, a development that bolsters congressional efforts to reinstate the Depression-era Glass-Steagall law.

LIBOR Pains

LIBOR is a benchmark reference rate (which explains why some banks were so eager to manipulate it). The pricing of all kinds of floating-rate debt is tied to it (corporate loans, mortgages, student loans, credit card debt, and assorted derivatives, such as currency and interest rate swaps, etc.). That has now become a problem.

"2017 Will Be A Tipping Point" - Why Some Think This Is The Next "Big Short"

"These malls are dying, and we see very limited prospect of a turnaround in performance" according to a January report from Alder Hill, which began shorting the securities. "We expect 2017 to be a tipping point." Indeed, cracks have appeared: prices on the BBB- pool of CMBS have tumbled from 96 cents on the dollar in late January to 87 cents last week

The Beginning Of The End Of Calm Bond Markets

Although the market is convinced the Federal Reserve will get aggressive with their rate hikes, I am not sure market participants have thought this through. Let’s not forget the Federal Reserve is sitting on the largest balance sheet in history.

The Most Un-Fun Bubble Ever

"...although it might be fashionable to claim equities are in a bubble, be aware this “bubble” is completely different. It is not driven by speculation, but instead might be the most gigantic short squeeze of all time."

Guess 'Who' Just Figured Out The Fed Is Behind The Curve

"It’s like the Federal Reserve is Wayne Gretzky’s poorly coordinated older brother. Instead of skating to where the puck is going, the Fed can’t even skate to where the puck is, and is instead busy skating to where it has been."

Blind Faith Everywhere

Beware of academics bearing models. Knowing prices are wrong and knowing when they are going to correct are two very different things - being able to survive until and through the correction is vital.