Is it counter-productive of the Federal Reserve to lower the IOER? Or is the central bank beginning to lose or has already lost control over the short-term yield curve?
Will you get out of the stock markets before everyone else, this time?
The tremendous rise in the global stock markets over the last 9 years, has largely come about due to financial engineering, such as the ‘Quantitative Easing’ (QE) programmes undertaken by Western and Asian central banks, and suspension of Mark-to-Market rules for Western banks.
Far too often these days, we hear the claim that “the stock markets are parasitic and serve no purpose except for parasites to live off of the working class”. This claim is utter nonsense, and even an utterly immoral claim, founded in laziness, hatred and jealousy, as will be made evident in and by this article.
Let’s examine what stock markets actually are, what their purpose is, and whether or not the claim can be substantiated.
2016 has come to an end, and we’re just hours away from 2017! I wish all readers a Happy New Year!
Since July 2016, the US Treasury yields (i.e. interest rates) have been steadily climbing, with the trend gaining considerable short-term strength after the election of Donald J. Trump as the 45th US President.
While the immediate market reaction is ascribed to several factors, including market participants expecting a pickup in inflation, as well as increased profits for banks (due to a presumed steepening of the yield curve), these factors are only part of the explanation.
The latest liqudiation wave started in the evening of November the 8th (US timezones), when it started to become clear that Donald Trump was winning the Electoral Vote.
This week, let’s take a look at the Gold/USD from an Elliott Wave Theory analysis perspective. Last week, Gold/USD bounced from an important trendline. That trendline might turn out to be a 2-4 trendline, as it would be called in Elliott Wave Theory parlance.