Submitted by David Stockman via Contra Corner blog,
The cowardly dithering in the Eccles Building is sucking Wall Street punters into a vortex. And it promises to be the mother of all bubble implosions.
There is no other possible outcome for a stock market that is trading at 24X reported earnings in the teeth of the most enormous headwinds ever accumulated.
In his latest market commentary, presented by Reuters on Tuesday night, Gundlach remained skeptical on the stock market. Specifically, he said that the rally in U.S. stocks, which began on Monday, feels like a short squeeze and characterized U.S. stocks as "dead money."
Inflation is out of control. Now, we mostly agree that the Fed's official inflation numbers are just - ridiculous. But the real inflation, is even harder to quantify, and more subtle - as we explain in Splitting Pennies - Understanding Forex. What drives inflation is NOT Adam Smith's "Supply and Demand" - an interesting idea but completely static, and completely irrelevant for practical applications - and certainly not useful for business, or economic forcasting. Inflation is a simple function of monetary policy, multiplied by FX.
Submitted by Danielle DiMartino Booth via DiMartinoBooth.com,
Back in the middle of February - during the height of the financial-market turmoil, the market was pricing in a shockingly policy-error-ish 36.5% chance of a rate cut in 2016. Since then The Fed has done everything it can to try and regain credibility - attempting to be hawkish in the face of dismal data, baffling everone with bullshit, and droning on about data-dependence.