Submitted by David Stockman via Contra Corner blog,
This week brought another reason to get out of the casino, and to sell it short if you can tolerate some volatility.
On Friday the Japanese stock market ripped 6% higher and the European bourses were up 5% because their respective central bankers emitted some hints of more easing just ahead. Even the US market managed to find green for the week.
Norway’s largest bank, DNB says that banking is now outdated and cash should be completely phased out. Citing the “dangers and disadvantages” of cash, an executive from the bank said that Norway should start the process of becoming cashless straight away. The Local.no reports: Norway’s largest bank, DNB, has said that cash has fallen out of favour with everyday Norwegians and is instead primarily used on the black market and in laundering schemes. “Today, there is approximately 50 billion kroner in circulation and [central bank] Norges Bank can only account for 40 percent of its use.
Unlike Goldman's cross asset strategists, whose six Top Trade recommendations for 2016 have gotten destroyed three weeks into the year, with half of them already stopped out as we showed yesterday, the bank's chief equity strategist David Kostin has been notably more accurate in his predictions, with his conservative 2015 year end target of 2000 on the S&P almost exactly where the stock market ended.
Since then stocks have taken a sharp leg lower, with the S&P dropping as much as 15% from its all time high, half the average post-war recession drawdown.
Earlier this month, we documented the surging price of fresh produce in Canada, where the plunging loonie is creating a nightmare for shoppers in grocery aisles across the country.
Because Canada imports more than three quarters of its fresh fruits and vegetables, the inexorable decline of the Canadian dollar has driven up prices on everything from cucumbers to cauliflower to tomatoes, and as we showed via a series of tweets from incredulous supermarket shoppers, Canadians are not pleased.
“Three bucks. For a cucumber,” one shopper wrote.
As we outlined last week, the bursting of the bond bubble has begun.
CNBC and the financial media may spend 99% of their time talking about stocks, but bonds are the single most important issue for Central Banks.
When you consider everything in the context of the bond bubble, every Central Bank policy begins to make sense.
1) Central Banks cut interest rates to zero to make bond payments smaller.