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Strategies & Market Trends : Zman Market Timing -- Ignore unavailable to you. Want to Upgrade?

To: Fintas who wrote (14967)	10/25/2017 1:31:18 AM
From: John Pitera	Read Replies (1) \| Respond to of 15903

Hi Fintas, we have a number of global central banks taking steps to normalize interest rates, which means to raise them and since we have had 8 years of global Zero interest rate policy, on short rates in the US, the ECB, the BOJ, the SNB - swiss national bank, the swedish Riskbank, the BOE was very accomodative... and so it's a brave new world of the reduction of monetary stimulus and we have already had 3 or 3 Fed Fund increases here in the US.... are we up to 4 already? We have another coming in Dec. and we have never seen the global central banks in this position, as they have never been in this position and in central banking land.... mistakes in the movement of the short term borrowing rates can occur, especially when you have multiple countries doing the same thing... It sets up uncertaintly in the Long dated FX market.... creates uncertainty for Banking, Insurance, Reinsurance companies as to how to hedge and value their long dated commitments. Endowments, pension funds , soverign wealth funds are also all impacted by this grand experiment. as Hyman Minsky famously said "stability is Destabilizing" that has always been the case and will always be the case...we have been through a long period of stability which has let lots of all of the above market participants, companies, hedge funds.... take advantage of very cheap credit by issuing a vast ocean of it.... we shall find out who is over levered..... and then their are exogenous shocks and black swan events. John