Financial Repression: The Modern Equivalent of Currency Debasement
We live in an era of financial repression where savings are penalized due to low interest rates. The latter is the outcome of the financial crisis. This in turn was caused by collateralizing questionable assets, derivatives’ volume explosion, securitizing...A Temporary Lapse in Markets’ Trend: Truncation Bias and Shortsightedness
Understanding market trends is more than merely intellectual gymnastics on financial and economic themes. Every market era emphasizes different aspects of its inheritance depending on its own problems. Our challenge nowadays – where a market theme is absent – is...On Spendthrift Lords, Rays of Hope, and Market Developments: Pyrrhic Victories and the Fable of Stability
The developed world’s crisis of 2008 was the result of credit over-extension fed by international imbalances and a finance sector that was issuing instruments whose collateral base was questionable. Developing economies such as the Chinese resorted in avoiding severe...Credit Orphans on the Street Called “Money for Nothing”
For a crisis to culminate and show its true face, time is critical in the sense that it should enter a saturation phase which in turn will signify that the downturn is inevitable. It is my opinion that the next two years will be that saturation phase that may produce...Momentum and Retrenchment: Market Outlook Amidst Geopolitical Turmoil
The current market record-setting highs may signify an upward bias carried by momentum and liquidity. The first graph below shows the performance of the S&P 500 over the last month, while the second graph portrays its performance in the last twelve months. Two...Sign Up for Our Publications
