As someone once famously said, “Man does not live by bread alone.” The best arguments against free trade lead us away from economics toward the question of national sovereignty.
They aren't currency wars, they're "currency tensions." -Mohamed El-Erian. Either way, Japan is ruffling a lot of feathers as it exports deflation.
While we tend to focus more on the short and intermediate term, we notice that there is a lot going on in the long term time frame. Most obvious is the breakout above the top of a long-term trading range.
The gloom and doom 'big-picture' theorists swarmed out of the woodwork during the 2008 financial meltdown in reaction to the massive government bailout programs and stimulus efforts taken to prevent the collapse from worsening into a 2nd Great Depression.
Everyone knows the odds of winning in a casino are worse than 50% (often much worse depending on the game played). So who wouldn't rush to a casino where, instead, the odds were overwhelmingly in the gambler's favor?
Central banks have gone from purchasing bonds to buying stocks. The results have been shocking.
Japan continues to be the world’s biggest financial story. The consensus seems to be that the country’s extraordinary economic measures are good for both itself and the world.
Gold bugs have done a lot of crying, rending of clothing, and gnashing of teeth in recent weeks as gold has swooned. It’s worse this morning as gold's price sinks even a little below the levels on these charts. At the same time there’s been lots of gloating and cheering among mainstream media types who hold the yellow metal in low regard.
While the equity markets continued to march higher, other "risk-on" asset classes such as currencies and commodities have stumbled.
There have been quite a few bold predictions, since the beginning of the year, that the dollar was set to soar and that the great "bond bull market" was dead.
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