Sour Note.

Well, an eventful week ended on a sour note, which is a shame for the bulls because Thursday was a barnburner. 


‘Pigs Just Might Fly’ In A World Where Spreads Are This Out Of Touch With Leverage

“However, by 2008’s final quarter, corporate debt reached 523% of internal funds and the high-yield EDF soared to 10.33%. At the same time, a mild recession was turning into a global calamity.”

‘Listen Up!’ Albert Edwards Wants To Talk To You About Bubbles

“The Fed and BoE are once again presiding over a credit bubble, with the BoE in particular suffering a painful episode of cognitive dissonance in an effort to shift the blame elsewhere – the credit bubble is everyone’s fault but theirs.”

I’m Out Of Bullets, How About You?

Can I borrow your double-edged sword?

Holiday Road.

“Well, that’s nothing to be proud of, Rusty…. 50 yaaaards.”

With Corporate Debt-To-GDP At An All-Time High, The Defaults Are Coming…

I have absolutely no idea how any of that is sustainable and/or realistic. 

NIRP-Finity? Negative-Yielding Debt Is Back Above $8.5 Trillion

Have we passed the point of no return in terms of escaping from NIRP?

UBS Asks Borrowers Why They Might Default, Gets Hilarious Answer…

To be fair, “beauty is in the eye of the beholder,” so in that regard, if Ray wants to call a given “deleveraging” “beautiful” well then that’s his prerogative. 

BIS: “The End Will Resemble A Financial Boom Gone Wrong – With A Vengeance”

If those deep forces have not yet fully run their course, the end of the current expansion may be different. That end may come to resemble more closely a financial boom gone wrong, just as the latest recession showed, with a vengeance.”

Guest Post: The Reverse Tepper Moment

“In the current environment, we have the opposite situation. Either the economy rolls over (which should be bad for stocks), or it bounces, at which point the Federal Reserve continues on its tightening path (which could also be bad for stocks).”

Guest Post: It’s Always Just A Question Of Price

“Throw enough cheap money at the problem, and people will find a way. I can’t tell you where. I can’t tell you when. But I am confident that eventually, people will borrow.”

Guest Post: No Debt Will Ever Be Repaid

“Borrow today and repay later” logic carries an implicit bet on the future. Without an optimistic outlook on the future, there is no lending or borrowing. Debt links the present and the future in a circular way: A prosperous future cannot happen without the present, and the present cannot take off without a belief in (better) future. In this way, the very concept of the future undergoes a transformation in capitalism: It no longer represents a timeline we experience, but a concept we envision.”

Guest Post: Guess What? Not All Government Borrowing Is Bad

“Pundits constantly shout about the dangers of governments borrowing too much. They make all sorts of scary charts, and, uniformly, put all borrowing in the same pile. Debt is bad. It will be our downfall. Stop borrowing immediately. Yadadada.”

One Bank Asks: “Who Will Burst This Bubble?”

“We have no political expertise but nonetheless recognise the palpable relief but we also understand the real problem for equities worldwide is one of high valuations, high expectations, yet still lacklustre growth and ever worrying and mounting levels of leverage.”

Guest Post: The End Game

“We have too much debt. It’s simple math. We are screwed. Full stop.”