"The Fed will expand its balance sheet through April/May. After that, markets may once again have to confront a world with limited trade progress and no further Fed support."
In the late 1990s, policymakers made a “huge” policy mistake as they left easy money in place far too long resulting in finance racing far ahead of the economy as equity prices and corporate debt soared to record levels while operating profits were declining. The end result was the dot com bubble.
"Among the tens of thousands of platform-style institutions nationwide, if only a few publicly breach their contracts it may lead to a chain reaction."
The fact so many people are willing to risk having their savings consumed if the market breaks hard and falls away shows how complacent we have become...
Of course, if the Fed fails to “extinguish” whatever “blaze” they are currently battling, then we will begin to have a very different conversation about risk, positioning, and liquidity...
"It’s puzzling to me that if the economy is doing so well and that we’re so close to full employment, that we haven’t seen the numbers move much in people’s ability to save..."
J. Paul Getty, “Several oil stocks issued by sound, thriving companies are selling at prices well within any reasonable price-earnings ratio limits. Some of these oil companies also have tangible assets worth three, four and even more times the total value of their issued stock…the astute investor will find them and profit from them.” (1965)
With the market having evolved into an algo-driven, low volume melt-up on the heels of fake trade war news, buybacks and an accommodative Fed, the need for equity research analysts is likely to only diminish further as time goes on
