{"id":474149,"date":"2017-04-20T21:49:05","date_gmt":"2017-04-20T21:49:05","guid":{"rendered":"http:\/\/juniorminingnews.com\/?p=474149"},"modified":"2017-04-20T21:49:05","modified_gmt":"2017-04-20T21:49:05","slug":"imminent-sign-of-market-collapse-2","status":"publish","type":"post","link":"https:\/\/juniorminingnews.com\/?p=474149","title":{"rendered":"Imminent Sign of Market Collapse?"},"content":{"rendered":"
<\/a><\/div>\n

By Brian Maher<\/a><\/span> <\/p>\n

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This post Imminent Sign of Market Collapse? appeared first on Daily Reckoning.<\/p>\n

We have it on high authority \u2014 Reuters \u2014 that \u201cthe \u2018reflation’ trades of 2016 that were supposed to mark a turning point in global markets are fading. Fast.\u201d<\/p>\n

And CNBC senior markets commentator Michael Santoli sees the scribbling on the wall:<\/p>\n

The question now is how it ends \u2014 with a whimper or a bang.<\/p>\n

David Stockman has his answer. And it’s of the combustible variety:<\/p>\n

The sweeping Trump tax cuts and fiscal stimulus are dead as far as the eye can see\u2026 So now comes the fiscal bloodbath and the day of monetary and fiscal reckoning.<\/p>\n

One sign that something has to give \u2014 and probably soon \u2014 is the widening chasm between stocks and bonds.<\/p>\n

Bond yields are at historical lows. Yet stock prices are at historical highs.<\/p>\n

And therein lies a tale indeed\u2026<\/p>\n

Low bond yields suggest an uncertain future\u2026 subdued growth expectations\u2026 and low inflation.<\/p>\n

High stock prices suggest faith in the future\u2026 elevated growth\u2026 \u201chealthy\u201d inflation.<\/p>\n

Since peaking at 2.6% in mid-March, yields on the bellwether 10-year Treasury bond have slipped to 2.2%.<\/p>\n

Shyam Rajan, strategist at Bank of America Merrill Lynch, says the interest rate market reflects the increasing likelihood that Trump’s tax reforms might never see dawn:<\/p>\n

The rates market is pricing in the death of tax reform and dimming 2018 economic prospects. <\/p>\n

Scott Minerd, global chief investment officer at Guggenheim, now projects that the 10-year yield could plummet to a dour 1.50% by summer.<\/p>\n

Meanwhile, stocks bounce right along, merry as a wedding bell.<\/p>\n

The Dow weighs in at 20,578 today, up another 174 points. The S&P’s also up 18 today, and the Nasdaq a cheery 54.<\/p>\n

Thus, we have two seemingly incompatible market narratives locked in a bitter combat.<\/p>\n

Stocks versus bonds.<\/p>\n

Hope versus fear.<\/p>\n

In this great tug of war, the market seems to pull on both ends of the rope\u2026 pitted against itself.<\/p>\n

It can’t last.<\/p>\n

Which side is the \u201creal\u201d economy throwing its weight behind?<\/p>\n

Bonds, apparently\u2026<\/p>\n

As most recently as Feb. 1 the Atlanta Fed’s closely watched GDPNow had first-quarter growth around 3.4%.<\/p>\n

But its latest estimate, out this week, weighed in at just 0.5%.<\/p>\n

And Gallup reports that confidence in the economy is at its lowest in five months.<\/p>\n

More rain: The March jobs report came in about 82,000 short of expectations\u2026 retail bankruptcies are rising\u2026 auto sales dropped sharply in the first quarter.<\/p>\n

Meanwhile, commercial and industrial (C&I) credit growth has slowed to 5.4%\u2026 down from 10.3% a year ago.<\/p>\n

That’s a rate of decline not seen since December 2008, according to The Telegraph’s Ambrose Evans-Pritchard \u2014 the onset of the Lehman Bros. crisis.<\/p>\n

He says that’s \u201chard to square with the exuberant view of investors that the world is on the cusp of an accelerating economic boom.\u201d<\/p>\n

We’re inclined to agree.<\/p>\n

So are Elga Bartsch and Chetan Ahya of Morgan Stanley, apparently:<\/p>\n

We have not seen such a sharp deceleration in bank lending to U.S. corporates since the Great Financial Crisis\u2026 Historically, credit downturns have led recessions.<\/p>\n

Rather disturbing \u2026read more<\/a> <\/p>\n

Source:: Daily Reckoning feed<\/a><\/p>\n

The post <\/a>Imminent Sign of Market Collapse?<\/a> appeared first on Junior Mining Analyst<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

By Brian Maher This post Imminent Sign of Market Collapse? appeared first on Daily Reckoning. We have it on high authority \u2014 Reuters \u2014 that \u201cthe \u2018reflation’ trades of 2016 that were supposed to mark a turning point in global markets are fading. Fast.\u201d And CNBC senior markets commentator Michael Santoli sees the scribbling on […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"footnotes":""},"categories":[4],"tags":[],"_links":{"self":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/474149"}],"collection":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=474149"}],"version-history":[{"count":0,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/474149\/revisions"}],"wp:attachment":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=474149"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=474149"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=474149"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}