The Bond Market Calls Draghi's Bluff. What's Next?
ECB President Mario Draghi is now walking back QE.
This is not a surprise to our readers. I’ve been forecasting this exact development, (as well as the Euro's spike to 120) since August 2016 (by the way, the Euro was at 109 back then everyone thought it would soon reach parity with the $USD as it collapsed).
Still, why is Draghi doing this?
Because the bond market was in revolt, with yields beginning to rise. Rising yields= falling bonds prices. Falling bond prices over time= bear market in bonds. Bear market in bonds = SYSTEMIC reset.