A Culture of No Rules or Limits
I feel like I grew up in a time when there were limits. Maybe WWII taught my parents and their friends, that there are limits one can tolerate.
Today, we have a World without Economic Rules or Limits
Federal Reserve and Fiscal Policy over the last 36 years have been run as there are no rules. Fiscal debt and inequality of the populous is not something that Washington or Central bankers around the World care about.
- The value of the Dollar seems to be un-nerving traders. Since the administration switch a year ago we have seen..
- The Yuan up 7 percent..
- The Euro up 15 percent..
- The Pound up 12 percent..
- The Yen up 3 percent..
- The overall dollar is down 9 percent.. This was not supposed to happen, America was going to be “Great Again”, even the dog of the world at the moment, Japan is doing better.
- There are a lot of explanations around, many seem to think that the dollar is going to scream upward from here, but they have been saying that for some time.
- Maybe America is being shunned, what an evangelical thought, we are becoming an island nation, as storms approach.
- In the short-term, as things unwind, watch for corporate bonds to be scuttled as investors move to something safer, like long-term 20+ Yr Treasurys.
- Also keep an eye out for the re-leveraging commodity trade which started back in July 2016, it appears to be running out its string.
- The sages say 2.75 % on the ten year bond is a point of economic reaction, ie money moves from stocks to bonds, ????
- Keep in mind, for the past 14 months the economic hope build-out has been mushrooming, now is when it has reached a point on real production numbers ” to put up or shut up“.