"Investors should brace for... a reckoning that threatens to drag prices lower...Liquidity-driven rallies are deceptively attractive and tend to result in excessive risk-taking. "
Yesterday saw swings in the markets, some key stocks in the US in particular, and equal swings in our underlying backdrop. Let’s try and join them into a coherent whole.
"We are extremely disappointed in both our second quarter results and our intent to reduce our dividend. Our view of the length and severity of the economic downturn has deteriorated considerably from the assumptions used last quarter."
"filed its claims in reckless disregard of its own internal records, and in order to support its allegations of access to trade secrets, manufactured false evidence".
"It seems inconceivable to me that the Fed and other central bank balance sheets will do anything other than explode over the next decade and perhaps beyond." - Jim Reid
For the US, the last bit of demographic driven momentum concluded in 2018 but the US went to ZIRP a decade earlier in the demographic cycle ('09) than Japan...
