Loading ...THE MACRO TOURIST–
M.O.A.S IS COMING
Mother Of All Stimulus is on its way!
| Kevin Muir | Feb 7 |  |
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Now one might argue they are artificially pumping financial asset prices and therefore, if you are willing to take a longer-term view, this is a great sale. I get that argument.
However, I think this monetary stimulus is just the start. It will be followed by fiscal. And then more monetary. And even more fiscal.
Remember ECB Chairman Draghi’s “whatever it takes?” That crisis was a self-inflicted financial crisis.
This is an actual real-life emergency. There will be no limits to what governments spend or Central Banks print. Full stop. There will be no worrying about the 1%’ers getting too much of the benefit. Nope. The virus does not discriminate based on wealth, and if anything, the less fortunate are probably more exposed due to the same lack of resources.
Every single government in the world will respond quickly and decisively if this situation gets worse. They will monetize the crap out of everything. Central Banks will be back to buying anything with a CUSIP.
Although I understand how a deterioration of the situation should be deflationary, that’s assuming the unit we use to measure everything stays the same. It won’t.
I was chatting with a hedge fund pal the other day and he told me, “this is the largest market mis-pricing in the history of financial markets.” Wait… what?
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The “largest mis-pricing in the history of financial markets?” I nearly spit out my water. Geez-louise. That’s even more bearish than Mark.
I showcase Mark Spiegel’s recent twitter post because he is so bearish, and I know he is a good sport who won’t mind me calling him out. He owns his forecast and is not afraid to say so in the most public fashion:
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