Posts made in June, 2019

Cost of extended monetary easing

Posted By Darren Winters on Jun 29, 2019

The cost of extended monetary easing is likely to be amplified as the Fed’s great pivot to a new era of monetary easing  was recently declared in June’s FOMC meeting.  Over-inflated asset prices in bonds, stocks, real estate, coined as the everything bubble, is perhaps the most talked about cost of extended monetary policy.  Stocks are no longer cheap but is that still the case with the Fed’s great pivot?  The P/E10...

Technology windfall stocks

Posted By Darren Winters on Jun 25, 2019

Technology windfall stocks will likely give investors on the hunt for growth stocks the best return for their money. The starter gun has been fired, the Fourth Industrial Revolution has started and technology windfall stocks are charging ahead in the first place. “The real work of social innovation is to fix our broken system”, wrote Cheryl Heller. Technology windfall stocks, particularly those which provide support and infrastructure...

Fed’s great pivot

Posted By Darren Winters on Jun 24, 2019

The latest Federal Open Market Committee (FOMC) meeting, June 19, could have been interpreted as the Fed’s great pivot to a new era of monetary easing from what was a brief period of “patient” normalization policy. Fed officials no longer made reference to being “patient” on rates. Instead, the tone was more dovish with talk about “uncertainties” around its outlook increasing.  The Fed’s great pivot is an admission that...

Bad is Good Logic

Posted By Darren Winters on Jun 17, 2019

The bad is good logic, where traders buy on the bad news and sell on the good news, is profitable again. Stocks continue to bounce off their support levels in a backdrop of rising geopolitical risk and deteriorating economic fundamentals. There is a negative divergence between the fundamentals and the trajectory of stock prices. Stocks are rallying into the abyss. The front-end rate trade strategy is back in vogue and it is based on a...

Recessionary fears

Posted By Darren Winters on Jun 10, 2019

Recessionary fears are looming again at a time when nearly every single asset class, except for equities, is now pricing in something of a sharp global slowdown. Investors are energizing the risk off trade with recessionary fears weighting capital flows towards safe haven assets. The rates market is now pricing in almost 4 rate cuts by the end of 2020 and long positions in Eurodollar rates futures are currently at levels last seen...