Wednesday, June 3, 2015

Be Ready For The Next Global Recession Soon


Please look into following,

Assets are mispriced, underlying conditions in the economy have not improved.
QE and zero rates have skewed pricing and mis allocated investments for almost 8 years now.
Despite growth of debt and leverage, productivity and investment has not followed.
We are now in a more tangled and precarious situation than at the brink of the subprime crisis; however, the tool box to fix it hasn't changed.
There is one way down from this ledge, and it is quickly. 
Dislocation will be painful and consequences far reaching.
This is not new news nor is it something that only a seasoned Economist could pick up on. Recently, there has been a handful of research reports and statements that highlight the economy's narrowing distance from the edge. Research out of HSBC has likened the economy to an "ocean liner without lifeboats." Premature rate rises by the FED alone could trigger the next global crisis.

If it isn't already apparent, some assets are heavily mispriced. Equities are still hitting all time highs after a bull run that has lasted in some respects almost six years. The market valuation of liquid rates has garnered responses from the likes of Warren Buffett and Bill Gross. Quoting Gross, the German Bund is the "short of a lifetime." The combination of flat-lining rates with massive QE programs has had dire consequences in investment allocation, as seen in the investor flight for yield. Debt has soared and deleveraging has not occurred. We are now officially 40% 'more indebted' as an economy than we were in 2008.

Few World News 

Joe Hockey: Recession Predictions coming from 'clowns', as Treasurer delivers national accounts

Russia in Full 'Crisis' to Kudrin Forecasting Longer Recession

Is the Economy Headed into a Recession and Will Hillary Get Caught in the Undertow ?





Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. 


1 comment:

  1. Hi Samira,

    Please refrain from directly plagiarising work, it affects my relationship with SeekingAlpha if my work is reposted.If you wish to paraphrase at least provide a link to my original article: http://seekingalpha.com/article/3232476-prepare-for-the-next-recession


    Kind regards,

    Marcus

    ReplyDelete