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Three Things I Think I Think – When Things Break
Here are some things I think I am thinking about: 1) Will interest rate risk transform to credit risk? One of the things I’ve been hammering on lately is that I think that Fed made a policy mistake by not being more proactive and then overreacting and raising rates very rapidly by essentially pricing in 12 rate hikes in a matter of months. I think all this stuff going on in financial markets is disinflationary at best and deflationary at worst. We’ve lost $35 TRILLION of total market value in the last 3 months. That’s 14% of all global wealth. In 2008 financial wealth fell 19%. The crazy thing is that a lot of ... (full story)