Offshore Yuan tumbled as Moody's cut China's credit rating to A1 from Aa3, saying that the outlook for the country’s financial strength will worsen, with debt rising and economic growth slowing. This leaves the world's hoped-for reflation engine rated below Estonia, Qatar, and South Korea and on par with Slovakia and Japan.
That's not supposed to happen...
Authored by Kevin Muir via The Macro Tourist blog,
The Eurostoxx outperformance of the past month has garnered a lot of attention, but there is another similar trade many investors are missing. Not only that, but it has a positive carry, something that is sorely lacking in this day and age of NIRP.
Since early April, the German Bund / US T-note 10 year yield spread has rallied 35 basis points, rising from negative 220 bps to 185 bps.
Billionaire investor Asher Edelman strayed into what must’ve been uncomfortable territory for CNBC during an appearance on “Smart Money” when he discussed his view that the government’s “plunge protection team" the only thing propping up the current market raly. and said he suspects that it has recently been intervening in the market to keep stocks high.
Is the plunge protection at work? Legendary investor @AsherEdelman lays out the conspiracy pic.twitter.com/A3h7QyV1EC
Authored by Chris Hamilton via Econimica blog,
Since 1971, and the disconnection of the dollar from a finite gold backing, the value of money (the dollar) has been determined by it's purchasing power versus the inflation of the assets to be purchased. Thus printing more money has not necessarily created "wealth" if the assets to be purchased are rising as fast or faster than the purchasing power of the "money". The Fed touts it's dual mandate of full employment and stable prices...but the result in prices; not so stable.