The relentless march to more Fed cuts and record low bond yields continues its merry way.
Yields are down again today.
Line in the Sand
I seem to recall a "line in the sand".
Where was it? Wait, I remember.
Flashback May 28, 2018
My Comment at the Time
Note to Bill Gross, MarketWatch, the Edelson Institute, the Financial Times, Jeffrey Gundlach, Heritage Capital, and numerous other forecasters not caught up in that precise search: The is no such thing such as a line in the sand that when breached cannot be crossed back.
Technical lines in the sand are one thing and fundamentals another. This is not like nuclear war which cannot be reversed.
The same people have been calling for the the end of the bond bull market for a decade. Perhaps they have it right, but the fundamentals suggest otherwise.
The economy is slowing and the Fed is hiking. The stock market is likely headed for another bust. There is a new worry in Europe. China is slowing.
Yes, we have late stage inflation, but so what?
There is no magic line in the sand. Neither the economy nor the bond market work that way.
Treasury Bears Take Note
Pimping the Mid-Cycle Adjustment Thesis
Yesterday, in a speech called "Sea of Change", St Louis Fed President James Bullard pimped the "Mid-Cycle Adjustment" Thesis in which supposedly there may not be any more rate cuts this year.
The Bond market vehemently as do I.
Trump's Reckless Tariffs Worsened the Global Problems
Yesterday, I noted Trump's Ignores Advisors, Doubles Down on Failed Policies, Kudlow Won't Comment.
The situation came to a head when the US Treasury Declares China a Currency Manipulator Under Orders From Trump
Hello Treasury Bears
Let me make it simple: It's the debt, stupid!
The global economy is choking on debt as central banks are determined to have more of it.
Inflation? Forget about it. The bubbles are proof we "had" inflation. The Bond markets says something else is coming up.
Mike "Mish" Shedlock