Music to the market
“From a conventional ‘financial stability’ standpoint, this Credit cycle may appear virtually pristine. Yet Credit Bubbles survive only with unrelenting debt growth. Today’s mirage of ‘financial stability’ depends on ongoing massive federal deficits coupled with aggressive monetary stimulus. A further rebuttal to Powell’s sanguine commentary on leverage and funding risks is appropriate. Is not recent ‘repo’ market upheaval testament both to problematic leverage and funding issues? And have we already forgotten acute market fragilities unmasked less than a year ago?”
USAGOLD note: In a nutshell, all’s well until it isn’t. . . In the meanwhile, Wall Street dances to the music.
Repost from 11-2-2019