But I expect the bond market to push back against “risk on.” With $2 TN annual deficits as far as the eye can see, it’s either begin imposing discipline or watch inflation and supply eat away at system stability.
Excerpts The old Hyman Minsky “stability can be destabilizing” comes to mind. There is evidence that speculative leverage today surpasses even March 2020 levels. I would argue there is more speculative leverage, “Crowded Trades,” and potentially crash-inducing derivative exposures. Potential… Read More ›