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Off The Cuff: Moral Hazard

The culprits (banks & corps) are protected from their crimes
Friday, July 20, 2018, 12:43 PM

In this week's Off The Cuff podcast, Chris and John Rubino discuss:

  • Moral Hazard
    • We've unwisely insulated the banks from the repercussions of their actions
  • The Protected Class & Rising Populist Anger
    • In many ways, the elite today are above the law. And public resentment is brewing.
  • Global Debt Is Accelerating
    • Wherever the breaking point is, we're now going to hit it sooner
  • The Coming Tech Wreck
    • Faith in the FAANGs is higher than ever. That's dangerous.

By insulating the players from the consequences of their actions, we've created the incentive to take extreme risk in the puruit of extreme profit. Why shouldn't the banks manipulate the system if their worst punishment is a weak slap on the wrist?

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Insider

Off The Cuff: Yes, The Central Banks Really Are Starting To Tighten

Expect EVERYTHING you know about the markets to change
Tuesday, July 10, 2018, 10:40 AM

In this week's Off The Cuff podcast, Chris and Wolf Richter discuss:

  • Tesla As A Symbol Of Silicon Valley
    • Way more hype than substance right now
  • Are Central Banks Really Starting To Tighten?
    • It's looking like indeed so
  • How The Rising Dollar Is Killing Emerging Markets
    • It's just math. Really cruel math.
  • Popping Of The Global Housing Bubble?
    • Australia may be leading the way down

The Fed has reduced its balance sheet so far this year to the tune of $100 billion, and is hoping to be reducing at the rate of $50 billion per month by October. The ECB has announced it will stop making purchases by the end of the year. And, surpringly, even the profligate Bank of Japan is showing signs of reducing its balance sheet.

Click to listen to a sample of this Off the Cuff Podcast or Enroll today to access the full audio as well as all of PeakProsperity.com's other premium content.
Podcast

Dreamstime

Wolf Richter: The Era Of The Fed "Put" Is Over

It now wants lower asset prices (just not too fast)
Monday, April 2, 2018, 3:39 PM

To all those investors expecting the Fed to step in to backstop the recent weakness seen in the stock market, Wolf Richter warns: The cavalry isn't coming.

After years of force-feeding too much liquidity into world markets, the central banking cartel is now aware of the Franken-markets it has created. And now with a new head at the US Federal Reserve, and soon at the ECB, central bankers have shifted their priority from supporting asset prices to now actively engineering lower prices. » Read more

Insider

Off The Cuff: The Bond Market Will Have A Rude Awakening Soon

Higher interest rates will unleash a world of trouble
Thursday, February 22, 2018, 8:54 PM

In this week's Off The Cuff podcast, Chris and Wolf Richter discuss:

  • The Coming Rude Awakening For Bonds
    • Spiking yields are about to crash prices
  • Multi-TrillIon Dollar Deficits
    • The US is spending much more than it admits to
  • Kryptonite For The Housing Market
    • Higher interest rates & unfavorable tax code changes
  • Pension Woes
    • Most pension plans will soon be in a world of pain

Chris and Wolf marvel at the bond market's apparent indifference so far to rising rates. Rising rates, of course, mathematically mean bond prices should lower -- but that hasn't happened much yet. With the 10-year Treasury nearly at 3% now, that resistance can't last for long. Especially if the Fed proceeds with its declared program of quantitative tightening this year.

Wolf explains the ticking time bond in the bond market thusly...

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Daily Digest

Image by pallaea, Flickr Creative Commons

Daily Digest 4/21 - General Electric Motors, Giant Snails Attack Florida

Sunday, April 21, 2013, 1:29 PM
  • Financial transactions tax: UK launches legal challenge
  • Alchemists of Wall Street at it again: Arcane-sounding names hide big risks
  • ‘Sorry, officer, I’ll watch my speed next time’: Dubai adds Lamborghini and Ferrari to police fleet
  • To Central Bankers: You Are Golden Toast On A Silver Spoon
  • Robert Hirsch: Peak Oil as seen through the eyes of Arab oil producers
  • Tesla: General Electric Motors
  • Depleted North Atlantic cod stocks are unlikely to recover, according to study
  • Giant Snails Advance On Florida