Business

Two weeks after BofA's Michael Hartnett previewed (and timed) not only the "Great Fall" of stocks, but also explained that the Fed and global central banks are now in the business of making the "rich poorer", he is out with a new note which looks at the Fed's latest U-turn, which has unleashed the latest market buying spree, warning that "further upside in risk assets will create problems later in the year" (for three reasons he lists out), and concludes that "ultimately, we believe the extremely strong performance by equities and bonds in H1 is very unlikely to be repeated

Yesterday, Janet Yellen surprised markets again, when after weeks of a hawkish setup, she suggested that the Fed is not only uncertain "about when - and how much - inflation will respond to tightening resource utilization”, warning that the federal funds rate may "not have to rise all that much further to get to a neutral policy stance." The market was delighted by this dovish turn, and sent the DJIA to new all time highs, while global stocks hit fresh record highs.

Authored by Mike Shedlock via MishTalk.com,

Illinois now has a budget, the first in three fiscal years. An excellent writeup on The Stump entitled Illinois Financial Disaster: Even More Reactions to the Budget explains what passage of the budget does and does not do.

Here are some links mentioned by The Stump and a few additional links and comments by me.

The Budget Fixes Nothing

Mark Glennon at Wirepoints comments on the Many Ways Illinoisans Won’t Pay Higher Taxes

While, inexplicably, Bill Ackman's Pershing Square remains immune (according to Ackman at least) to redemptions despite posting a terrible return in the past two years, another hedge fund from the "glory days" is having less success in keeping LPs: the WSJ reports that Einhorn was "forced to pay back more than $400 million in clients withdrawals at midyear, as more than 15% of eligible investors chose to redeem their money" which again is surprising because unlike some other hedge funds, mostly on the macro side, which continue to post double digits losses, Greenlight was down only 2% in th

With The Fed convinced any downturn in inflation is 'transitory' - due to wireless carrier discounting, or oil ups and downs - today's Core PPI fell back below the 'mandated' 2.0% level after one brief shining month above it. Producer prices ex food and fuel rose just 1.9% YoY, slowing from last month's 2.1% rise.

This is the 3rd time in5 years that Core PPI has managed just one month above The Fed's mandate and faded...

Under the covers shows some interesting standouts...