Author Archives

  • Doug Noland: Losing Capacity to Stabilize

    I can’t see how this adjustment proceeds smoothly. A panicked run – similar to what was materializing in March 2020 – is a distinct possibility. Credit is inherently unstable. This has been a deeply-flawed multi-decade experiment.

  • TSP Smart: Stumbling into a New Cycle

    This implies a major cycle inflection point for the bond market, now faced both with a secular upturn in inflation and diminished QE prospects. And a secular jump in Treasury yields would demand a long overdue downward valuation adjustment for stocks, corporate Credit and other financial assets.

  • TSP Smart: Inverted Tail Spin

    The previous cycle enjoyed incredible staying power, and it will be difficult for most to accept that such a rewarding era has run its course.

  • TSP Smart: New World Dis-Order

    The US stock market is always last to know…

  • TSP Smart: Lesson Never Learned

    Excellent run down of how each bubble became larger and more dangerous. And how perceived financial wealth will have an unavoidable reckoning soon.

  • Doug Noland: Inklings of Secular Change

    At this point, the Fed would have to dramatically tighten financial conditions to reset inflation expectations. But such a move would collapse fragile Bubbles. Going forward, de-risking will require more selling of securities holdings, rather than simply buying cheap hedges.

  • TSP Smart: The US UnBalanced Sheet

    hear no, speak no, say no

    Returning to 2000/07 valuations requires a 40% drop in the US stock index; returning to above mean value 100% of GDP would require a 70% drop

  • Doug Noland: Day Nine [since WWIII went hot]

    In simple terms, it doesn’t work in reverse. The current financial structure is viable only so long as the Bubble is inflating – only while credit, leverage and speculative flows are expanding. In the event of serious de-risking and deleveraging, markets are prone to illiquidity, dislocation and panic.

  • Doug Noland: Honor

    And if I were selling subscriptions or using an email list, this is where the cancellations come. Here it goes: I guess I’m a traditionalist. As Americans, during a crisis we would rally around the President. This is not the time – the era – to crave – to strive – for his failure. There’s no Honor in that. Most regrettably, we today have our own domestic “iron curtain” and “cold war” mentality. It will not serve us well.

  • TSP Smart: Principles of Financial Bubbles & Today

    I’m deeply concerned, and part of my anxiety comes from knowing people haven’t been paying attention. A Russian invasion of Ukraine has potential to be a highly destabilizing catalyst, slamming fragile global markets, exacerbating inflationary pressures, accelerating financial asset Bubble deflation…