Good morning. Everything screams liquidation of losers and adding to winners. Which happens a lot at end of bad quarters. The dollar is up 66. Bonds are stronger. Stocks were weaker and are now struggling back to unchanged. Gold is down $13 presently. Silver is down an eye opening 84 cents. Copper is down 10 cents. Oil is stronger ( add to winners). Grains are mixed to down. Bitcoin is down once again.
We did a very long detailed GoldFix podcast this morning with special emphasis on why markets are doing what they are. Special emphasis on Silver and why it is cratering. There is profanity. Works as a listen only piece. Link here
Today Nomura, which has been much more forthright with its recessionary bias (perhaps because they aren’t being told what to say by the US Fed) has come out and said it. We are in a recession, and its a big one.
Months after GoldFix alerted to the possiblilty of recession as a byproduct of an inverted yield curve, and a subsequent explanation of why that was likely, Zoltan Pozsar telling us that was their plan, and finally stating it was a done deal.. a bank admits it. And not just any bank.. a NON US bank, which is not beholden to Fed bailouts.
Economics 101 teaches when a yield curve inverts you almost always get a recession. We were taught this by one of the leading economists (wait for it)… at a major Wall Street Bank who ran the eocnomics department at more than one of these firms.So what happened, did they get stupid all of a sudden?
Related posts. These will help you make your own decisions the next time it happens. Because it will.
Initial conditions are strong, limiting the pace of contraction Heading into an expected recession, consumer fundamentals remain on historically solid footing. Compared to the significant deleveraging that occurred after the Global Financial Crisis (GFC), we do not see clear signs of a consumer “accelerant” for this recession. Considering major banks are well capitalized, financial stability risks remains moderate, suggesting another financial crisis is unlikely.
The bad news:
Policymakers are likely to remain on the sidelines One of the most significant differences between our expectation for this recession and prior episodes involves the response from policymakers. In the current high-inflation environment, both monetary and fiscal policy are likely to be much more restrained in their response relative to previous recessions. Fed officials have been clear they will prioritize restoring price stability above all else. Similar to monetary policy, we believe fiscal policy will largely remain on the sidelines for the expected recession
