Despite the Politburo’s best efforts (which now include the imposition of what amount to new capital controls), capital continues to flow out of China. Put simply: all signs point to further RMB depreciation and no one wants to stick around to see how low the yuan will ultimately go before the PBoC finally throws in the towel…
Expect this to get plenty of attention.
“HFTs know the price of everything and the value of nothing.”
“It was an innocent comment.”
Again, please: “We’re not in Kansas anymore.”
Mind the “how”.
“For the past 30 years fiscal deficits have been a big financial nothingburger because the Fed and other central banks gutted their sting.”
This is not going to be for the faint of heart.
So basically, Ben just said that the only thing he can think of off the top of his head that would be worse for financial markets than Trump starting a trade war would be if the plot of “Seeking A Friend For The End Of The World” became reality.
I guess you can’t blame investors being a bit shell-shocked.
Why yes, the stock market is “an important place for investors to invest.”
Is this it?
…that was a 23-standard deviation event. I’m not sure what color swan that is – maybe psychedelic?
“I was up until the wee hours, checking my phone to see where VIX futures were trading.”
And so, legions of retail investors, hordes of previously cock-sure newly-minted “money managers”, and scores of popular pundits who swore to you they knew what they were talking about, are left to ponder the stark reality of a market structure-driven nightmare scenario.
“…never in modern financial history has a Central Bank expanded its balance sheet through quantitative easing and then successfully shrunk it back down.”