Could a rising risk of stagflation, which is defined as a troubling combination of high inflation, declining consumer demand and high unemployment (or decline workforce participation rate) be real? If last week’s official economic data from the US is more than a temporary blip and a growing trend then the worse type of inflation, stagflation could be dead ahead. The official narrative goes something like this. The world’s...
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Could the current nosedive in risk asset prices be similar to the story of Icarus? There is sound logic to believe that last week’s rout in stocks is more than just a healthy correction and that prominent traders are positioning themselves for the Icarus trade. Indeed, Ray Dalio’s big short $13 billion in stocks, particularly Italian financial stocks confirms that heavyweight players are betting on the Icarus trade, a bear...
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I picture an oracle sitting on a mountaintop pondering over what the Fed’s next move will be. Buckle up for some volatility because the stock market is at a crossroad-it could get dicey going forward. Whether this recent financial smash up is the end of this secular bull market in stocks and the beginning of a new secular bear market, or perhaps this recent sell-off is a healthy bull market correcting itself and then will go on...
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