Priced For Perfection

By Michael Pento – Re-Blogged From Silver Phoenix

The stock market has now priced in a perfect resolution for all of its erstwhile perils. Wall Street Shills would have you believe that since the Fed has turned dovish it will always be able to push stocks higher. The trade war is about to reach a peaceful conclusion and that will be enough to fix all that ails the global economy. A no-deal Brexit is off the table and a smooth transition out of the EU will occur. Peace will soon break out in Hong Kong and its troubled economy will have no contagious global economic effects. And, there will be a sharp rebound in EPS growth from the current earnings recession because…well…just because we need one.

However, beneath the surface of this economic charade the carcass is rotting and the stink can be smelled by anyone who isn’t willingly holding their nose. To this point, the leveraged loan market, which consists of loans made to highly indebted and barely solvent entities, has seen an increase of 100% since 2007, according to the Bank for International Settlements.

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US Regulators Mandate Next Stage Of Textbook Financial Repression

By Daniel Amerman – Re-Blogged From http://danielamerman.com

With comparatively little fanfare, Fidelity Investments has announced that 100% of their $115 billion Cash Reserves fund, the world’s largest money fund, will be invested in US government debt by December 1st of 2015. It is expected that many other money fund companies will also change their policies and invest only in US government and agency securities, because of a change in regulations that will occur in 2016.

Since 2010 the US government has been implementing a textbook example of Financial Repression, when it comes to using private savings to control and even effectively pay down the size of the national debt. Far from slowing down or ending this process, these new policies will expand by many millions the number of people who will effectively be forced to fund the purchase of government debt at artificially low interest rates.

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