| Right now all the normal relationships are screwed up, due to the presence of enormous liquidity, going from on asset class to another seeking to make a quick buck. However, once interest rates really rise, this liquidity will evaporate. The Fed, of course, creates it. So, naturally, it's a bet that Mr. Market will go against the Fed. I believe, it can, because the bond market is much larger than the Fed. But longer term interest rates need to start rising sharply, again, with the dollar falling, and swap spreads expanding enormously. If there is an acute credit market problem, stocks will tank enormously. If printing worked, Argentina would be the World #1 Superpower |
