The objective of R&O is to provide social, political and economic commentary on developments that impact the trajectory of our society from the perspective of the marketplace. Special emphasis is given to long-term structural and systemic issues.
The Mother of All Bubbles
Global central banks have been flooding the world with liquidity in an attempt to fend off debt deflation and re-inflate the global economy…a collective action that is creating the Mother of All Bubbles. On the macro level we are presently experiencing deflationary pressure due to continuing fallout from 2008, and government attempts to reign in deficit spending. But as sure as night follows day, this cycle will run its course, politicians facing re-election will lose their enthusiasm for austerity, and then we will begin to reap the fruit of the relentless central bank money/credit creation. See the February Pimco Investment Outlook by Bill Gross entitled “Credit Supernova. ” Also, David Stockman’s March 30th New York Times op-ed, “Sundown in America. more