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Tuesday June 27, 2017

Quote of the Day

"A cup that is already full cannot have more added to it. In order to receive the further good, we must give of that which we have." - Margaret Becker

Random Ramblings

by Jon S. Strebler


This week Britain’s Sunday Times offered the view that stock markets, especially in the US, are “set to fall after years of artificial support.” The artificial support they refer to, of course, is years of central banks buying fixed income assets, thus flooding world economies with cash and pushing interest rates near to and even below zero. High bond (and stock) prices have been accompanied by historically low volatility levels – a situation that cannot last forever and carries huge risks when reversed. Such as the US Fed is now doing in an economy that may not be inflating (the desired background for such a move) and remains at risk of deflating.