Friday, June 12, 2015

End of Deflation, or Just Volatility?

I think volatility, but Ambrose Pierce says Keynesianism worked:
The bond crash has been an accident waiting to happen for months. Money supply aggregates have been surging all this year in Europe and the US, setting a trap for a small army of hedge funds and 'prop desks' trying to squeeze a few last drops out of a spent deflation trade. "We we're too dogmatic," confessed one bond trader at RBS.
I don't think volatility, especially when there are shorts to be squeezed, can overcome the organic problems, or at least there are no policies in play, nor actors offering solutions, to the mess we are in.

I've been wrong before, but so has Ambrose Pierce.

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