The world’s largest wealth manager is “very worried” about “the lack of liquidity” that could wreak havoc during the sell-off. It reduces risk “over the full spectrum of assets.”
The US economy has repeatedly failed to resume normal growth after the crash. But potentially worse is the decline in long-term growth estimates.
Yellen pokes at bubbles in momentum stocks, leveraged loans, threatens to end ZIRP sooner, more rapidly “than currently envisioned.” Fasten your seatbelts.
FICO: “That doesn’t feel like a healthy, sustainable growth situation.” Lenders fret “about the risk in mortgages” as consumers return to “reckless borrowing.”
Senior bankers are “privately warning” that the record bank lending binge “should not be seen as evidence of an economic recovery.” Instead, they’re fretting about the greatest credit bubble in history.
Many Americans spend every dime they make, and usually way beyond what they make. It’s not because they have confidence in the economy. They don’t! The gap in consumer confidence between these folks and those with higher incomes is at an all-time record!
My convo with a wealth manager at a megabank who’s been at it for 30 years, has seen three crashes while on the job, but unlike others in finance, hasn’t re-forgotten the lessons for the third time.
The smart money had a goal, which it now reached via the “multiplier effect” by which a small number of sales can have extreme consequences in price for the rest.
“Asset prices have reached stunning levels, obviously out of line with ‘fundamentals.’ The “most dangerous” are housing bubbles; when they burst, they “wreck whole economies.”
Whipped into a frenzy by the sweet smell of usury.