News
Trading Drought Worsens in Japan’s Broken Bond Market
In a fresh sign of Japan’s dysfunctional bond market, the 10-year benchmark failed to trade for a third consecutive session Tuesday, the longest such streak since 1999. The Bank of Japan’s overwhelming presence in the JGB market where it’s the biggest buyer under its curve control policy has exacerbated liquidity issues and led to a deterioration in market functioning. A gauge of liquidity stress in the Japanese bond market has hit levels last seen over a decade ago.
Does Bank Lending by Itself Set Off Boom and Bust Cycles?
Popular thinking says that banks are the key factor in the expansion of credit. However, is this really the case? For example, take a farmer Joe that produces two kilograms of potatoes. For his own consumption, he requires one kilogram, and lends the rest for one year to a farmer Bob. The unconsumed one kilogram of potatoes that he agrees to lend is his savings.
Banking crisis — the Great Unwind
There is a growing feeling in markets that a financial crisis of some sort is now on the cards. Credit Suisse’s very public struggles to refinance itself is proving to be a wake-up call for markets, alerting investors to the parlous state of global banking. This article identifies the principal elements leading us into a global financial crisis. Behind it all is the threat from a new trend of rising interest rates, and the natural desire of commercial banks everywhere to reduce their exposure to falling financial asset values both on their balance sheets and held as loan collateral.
UK Pension Fund Selling Stokes Fear Across Bond Markets
UK pension funds are dumping assets to meet margin calls as the Bank of England confirmed it will end its emergency bond buying program, with the reverberations being felt everywhere from Sydney to Frankfurt and New York. In the US, investment-grade corporate bonds are falling, with average prices of around 86 cents on the dollar on Wednesday compared with 90 cents about three weeks ago. UK pension funds have contributed to the selling pressure in recent days, according to one Wall Street trading desk.
Paid Link
Join Me at Pacific Bitcoin
I'll be speaking at the Pacific Bitcoin conference on November 10th and 11th in Los Angeles, CA.
This is a two-day experience leading the way to a bright, orange future. This event isn't just for talking about Bitcoin, it's about BEING a bitcoiner. Learn new ways to save more, grow your stack, protect your wealth, and have a rip-roaring good time along the way.
Use my promo code "HERESY" for a huge discount on your tickets at checkout! See you there.