what I have been reading today (02 Feb 2017)
The long overdue Reality Check!
“The perception is that happy days are here again. The new Trump administration is expected to pour trillions of dollars of stimulus spending and tax cuts into the economy…Reality is another matter. I’ve been warning my readers lately that the Trump trade is levitating in thin air and is ready for a fall. Now that reality could be beginning to sink in.” – Jim Rickards
More at Daily Reckoning
The Independent Fed…for how long?
“Will the White House seek to gain control or additional oversight of the institution? Will there come a time when the President (and his people) desire to become more involved with the interest rate policy-setting mechanism? How will the relationship between the Fed and the administration fare should there be an economic or financial market disruption?” – Joshua M Brown
More at The Reformed Broker
Talking “Deep Risk” under Donald Trump
More at A Wealth of Common Sense
The Miracle called compounding
“Reverse compound interest is the most financially devastating force in the universe.We are speaking of credit card debt. This over $1 trillion time-bomb has Americans paying interest rates that can range from 20%-30%. This is a big reason why so many are barely keeping their heads above financial water.” – Anthony Isola
More at Tony Isola
Is it the End…has the Trump rally run too far?
“To be sure, expectations of stimulus, lower taxes, and deregulation could still boost the economy and the market’s performance in the short term. But, as the vacillation in financial markets since Trump’s inauguration indicates, the president’s inconsistent, erratic, and destructive policies will take their toll on domestic and global economic growth in the long run.” – Nouriel Roubini
More at Project Syndicate
VIX is low you say? It does seem odd…
“Back in the U.S., despite protests and rising uncertainty, optimism over tax cuts and deregulation are offsetting concerns regarding trade and immigration at the moment. This may continue to work, assuming Washington delivers on the aforementioned stimulus and reform. In the absence of that, today’s low volatility looks odd in the context of an increasingly uncertain backdrop.” – Russ Koesterich
More at Advisor Perspectives
The increasing premium of France over Germany
“It is one thing for the Italian or Portuguese premium to rise, but what is striking now is the surge in the French premium. The premium bottomed last year near 22 bp in Q3. It is flat on the day a little above 60 bp, which is a three-year high.” – Marc Chandler
More at Marc to Market
The bull market…how long and how far!
“Putting it all together, the U.S. stock market seems poised to resume its rally, but a valuation headwind could partially offset an earnings tailwind. Treasury yields could continue to hover around fair value with an equal emphasis on real rates and inflation expectations. And if the dollar has peaked, international stocks could benefit.” – Jurrien Timmer
More at Fidelity
Managed Futures Returns lower – blame it on lack of trends
More at Mrzepczynski
January 2017: One of the least volatile ever?
More on Bloomberg