White Knights in a Festival of Fools: The Tale of a Dangerous Encounter
Around the globe fundamentals are being ignored. Unsustainable debt keeps rising, the equity markets of dysfunctional economic unions seem to “thrive”, unprecedented monetary measures are implemented and a Leviathan state is emerging where “white knights,” in the form...
Weekly Market Update
Market Action U.S. equities started the week strong, recovering from losses last week and were able to withstand pullbacks in the following trading days to end the week positive. Earnings estimates for the first quarter have been revised down and are expected to show...
Monthly Barometer’s Forward-Looking Monthly Review: An Interdisciplinary View of our Complex Global Economy
As much of the world flirts with deflation or “lowflation”, some pundits turn to Japan to claim “we can happily live with it”. Their rationale: since 2009, Japan has grown by 3% per year in terms of real GDP per capita - faster than the US. Also, despite stasis and...
Lorca on Headwinds and Tail Risks: It’s Five O’clock at the Crossroads of Liquidity and Volatility
Could the markets suddenly unravel? Of course they could. The fiat monetary system is like a mirage, it can tumble because of underestimated circumstances. Imagine for example Greece abruptly leaving the Eurozone, defaulting on its EFSF loans of €240 billion, its...
Weekly Market Update
Market Action Volatility continues to manifest in financial markets. Triple digit losses and large intra-day swings characterized much of the week as all sectors and major indices in the U.S. posted losses. Money continues to flow overseas, particularly Europe where...
Weekly Market Update
Market Action Markets recovered from last week’s sell off but still saw volatility continue with the Dow alternating triple digits moves throughout the week. The most apparent catalyst was the Federal Reserve’s published statement, which removed the word “patient”...
Weekly Market Update
Market Action Disappointing economic data and bouts with volatility kept U.S. markets down this week. Analysts cast a theme of blaming the dollar’s rise for keeping corporate profitability low for the foreseeable future. Stocks gave up their gains for the years except...
Drying Up The Collateral Base
Since 1873 the world has suffered two periods of great deflationary pressures: the first one from 1873-1893, and the second during the Great Depression in the 1930s. We may be facing a third one (at least according to several analysts), which has been forcing the...
Portugal’s Successful Turnaround? A Fairy Tale
Even a brief glance at the facts suffices. Portugal is no less bankrupt than Greece. The country’s government debt, at 124% of GDP, might be lower than in Greece. However, government debt is just one – even though important – part of the full debt picture. On an...
Weekly Market Update
Market Action A surprising and sterling jobs number on Friday did not enthuse U.S. equities as a near 300-point fall in the Dow closed out the week. Utilities led the selloff on Friday, moving in tandem with bond yields, which also saw their highest point in 2015....
