More than six weeks after the governing council of the European Central Bank has met in Frankfurt, the ECB has finally published the minutes of the meeting which paved the way for a disappointing action from the ECB. The expectations before the meeting and monthly decisions were set very high, and the market was clearly disappointed with a deposit rate cut that was just 0.10%, resulting in a new deposit rate of -0.30%.
According to Citigroup's Matt King, it is now officially too late to save junk debt, which has entered the final stage of the credit cycle, the one where defaults for high yield bonds rise with every passing month.
Both what about investment grade, which according to Citi is still just ahead of the "bubble bursting phase"? Here is UBS' credit strategist Matthew Mish with one take on what happens to IG debt over the coming 12 months.
How The Dominos Will Fall?
Submitted by Mac Slavo via SHTFPlan.com,
Forget for a moment that U.S. stock markets have seen their worst start to a new year since the Great Depression or that some $2.5 trillion in wealth has been evaporated in less than two weeks.
CNN says it’s hardly the time to panic:
Time to panic? Hardly.
There are plenty of reasons to relax, especially if you are a U.S investor. Here are the top two:
1. America’s economy is still in good shape.
JPMorgan shifts to the dark-side...
It would be hard for a year to start any worse than 2016 has.
The economy was supposed to fire on all cylinders in 2015. Sufficient time had passed for the often-mentioned lags in monetary and fiscal policy to finally work their way through the system according to many pundits inside and outside the Fed. Surely the economy would be kick-started by: three rounds of quantitative easing and forward guidance; a record Federal Reserve balance sheet; and an unprecedented increase in federal debt from $9.99 trillion in 2008 to $18.63 trillion in 2015, a jump of 86%.