Loading ...The alibi today is maybe the FED WON’T cut rates…but they may have to…so we won’t call gold totally out of the picture=
It’s shaping up to be Albert Edwards‘ year, if not decade and century.
Three years after the stock of global debt with negative yields hit an all time high just above $12 trillion, the NIRP trap is back, and the amount of sovereign debt sporting a negative yield is just shy of all time highs, hitting $11.7 trillion today according to Bloomberg, nearly double where where it was just last September.
Of course, that this is taking place with the S&P500 just a few percent off all time highs is the reason why traders are having nightmares – this does not happen when everything is hunky dory in the economy, and in fact it is an indication that risk assets are overinflated only for one reason: expectations that the Fed will step in and “rescue” risk assets.
today we learned that Morgan Stanley’s Business Conditions Index has fallen dramatically. In fact, according to CNBC the sudden drop in the index was “the largest one-month decline on record”…
A reading of the economy from Morgan Stanley is signaling “June gloom.”Morgan Stanley’s Business Conditions Index, which captures turning points in the economy, fell by 32 points in June, to a level of 13 from a level of 45 in May. This drop is the largest one-month decline on record and the lowest level since December 2008 during the financial crisis, according to the firm.Not even during the last recession did we witness a monthly decline of that magnitude.The speed at which the global economy is now deteriorating is breathtaking, and the crisis that so many thought had passed us by could actually be right on the doorstep.