The Migration of Delusion and the Epidemic of Irrationality
The markets were rattled in the last few days. Let’s review what the conventional wisdom underwrote as the main causes (we use the plural causes, since the explanation was changing almost on a daily basis, as heuristics – the hard wired tendency of humans to perform...The Unbearable Lightness of Complacency: The Voyage for Returns in the Midst of Strategic Disintegration
The risks in the global economy remain due to Europe’s problems in the banking and fiscal spheres as well as due to the hundreds of trillions of dollars in toxic derivatives that freely flow in the seas of finance. The complacency seen is truly unbearable given the...A Tale of Two Doors: Energy, the Dollar, and the ECB
A friend was telling me lately that it seems that there are two kinds of people: Those who chose the door that leads to paradise and those who choose the door that leads into a discussion group about the paradise. His point was that several times in our lives we miss...Signs of Controlled Disintegration: The Market for Debt, Financial Stability & Prospects for Growth
It has long been our position that the debt market should be viewed as a market for third-party liabilities. Its growth advances leverage and brings with it diminishing returns since more and more funds are needed to produce a dollar of profits and of GDP. The growth...From the Cacophony of the Fall to the Rhapsody of the Spring: Sovereigns, Risks, and Returns
We just want to erase from our memories the happenings of last fall, when the markets were dropping nervously while searching for signs of life. The swap lines announced by the Fed last November infused hope and allowed the ECB to start the cheapening of collateral...Sign Up for Our Publications
