Trouble in Paradise

Published on: February 14th, 2018

Markets are now reassessing the seemingly endless period of low rates, high stock returns, and low volatility. This brings danger and opportunity.


  • DB
    David B.
    14 February 2018 @ 11:44
    I find it interesting that some of the JPY crosses are also breaking down, some out of long term chart patterns (1.5 yr+) eg. USDJPY, AUDJPY. The break outs, coincidentally occurred 2 days prior to the market top in SP500. Similar patterns emerged in 08 in JPY, so I am a little concerned what this means for the markets. Time to batten down the hatches... Feedback for Julian and Raoul - it would be great if we could post charts in the comments.
  • AG
    Abhimanyu G.
    14 February 2018 @ 14:07
    10 pages, not 20 :(
  • JL
    J L.
    14 February 2018 @ 17:58
    Solid report. I am curious to know how you see JPY reacting in a deleveraging risk-off environment plus higher rates, as it has been following rates a lot but this may have changed.
  • CY
    C Y.
    15 February 2018 @ 03:35
    brilliant. Succinct, to the point, with clear action points. Very well done.
  • DB
    David B.
    18 February 2018 @ 11:40
    The narrative should consider these FACTS: 1. The US has at least 100 trillion dollars in unfunded liabilities. 2. China, Russia and Japan jave dramatically reduced purchases of US Treasuries in last 3 years. 3. China and Russia have increased purchases of gold. 4. US fiscal deficits are estimated at over 1 trillin $ the next 5 yesrs and closes to 10 trilliion over the next 10 years. 5. The US will have to sell trillions of US Treasuries to fund the deficits. Opinions——- 1.The internet rates on long dated Treasuries are rising due to perceived increased default risk. 2. The US $ is falling for the same reason as 1. 3. If one looked at the US fiscal situation without knowing it was the US, it would look like a third world country. 4. US financial institutions will be made to purchase Treasuries or the Fed will have to buy them because China and Russia are much more interested in developing gold backed currencies or commodities (yuan oil futures market with yuan convertible into gold). 5. 10,000 US Baby Boomers retire daily placing even more stress on the US fiscal situation (Medicare & SS). (Typed from my iPhone)
  • bb
    brian b.
    18 February 2018 @ 11:42
    are you saying get out of any SP500 etf or index fund if it gets back to 2700?
    • DW
      Daniel W.
      19 February 2018 @ 18:29
      That's what he said.
  • bb
    brian b.
    18 February 2018 @ 11:45
    and get out of European equities when? cant you guys send subscribers email alerts when trend lines are broken that make you think its time to get in or out of a trade?