Wednesday, October 19, 2016

The Overlords Of Finance
"It was the best of times. And it still is. Intrepid investors who never dreamed they’d put all of their eggs in one full-boar risk asset basket have never had it so good. Stocks are up, bonds are up, emerging markets are up, real estate is up. Heck, it’s all up. As it should well be. It’s different this time. No, really. It is. Depositors pay banks interest to hold their hard-earned savings for the first time in written history. And, as far as investors are concerned, sustained bad news is the only true form of good news. For this warped reality, we owe a debt of gratitude to the world’s central bankers who have changed the rules of the game by dispensing with the conventional in favor of the arbitrary. There is a word for such extreme power, in both noun and verb forms: Overlord, as in a person who lords over lords .. To tap the wisdom of Jim Bianco of Bianco Research, central bank bond buying has become fungible. As long as the buying continues, it really doesn’t matter who’s picking up the QE tab. To that end, over $2 trillion in global QE purchases have taken place in the past 12 months, the fastest pace since the onset of the financial crisis. It is here that the regime shift kicks in, the one that made possible this new and improved gentlemen’s agreement between investors, politicians and central bankers. The operating assumption is not only that QE purchases continue to take place to keep the peace in the financial markets, but rather that the debt has literally disappeared, been retired, expired, matured, monetized, vanished into thin air. Governments have simply agreed to cancel the debts into the netherworld. The supply has been expunged forever. In other words, investors have seen no reason to be alarmed by the growth of debt because they are netting that growth out against central bank purchases. With an aggregate of $2 trillion of bonds wiped out on an annual basis, why worry?"
- Danielle DiMartino Booth
LINK HERE to the essay

1 comment:

Anonymous said...

Video of the Day – Watch Donna Brazile Squirm When Asked About DNC Rigging of Democratic Primary

screen-shot-2016-10-20-at-9-16-24-am

I firmly believe that denying Bernie Sanders the Democratic nomination for President in 2016 will go down as an event of pivotal historic significance. By forcing one of the most corrupt, dishonest, greedy war-mongerers upon the American public as the only alternative to Donald Trump, the DNC effectively alienated the entire youth of this country from the political process at a crucial moment, and prevented tens of millions of citizens from feeling they have a real choice.

The negative consequences of this tragedy will reverberate for many years, if not decades to come.

http://libertyblitzkrieg.com/2016/10/20/video-of-the-day-watch-donna-brazile-squirm-when-asked-about-dnc-rigging-of-democratic-primary/#more-38718