As the household net worth (purely debt) as a % of disposable income (“wealth effect”) gets above 600%, savings rates seem to drop sub-5% in unison; then net worth dissipates rapidly. 2018 has the largest divergence in modern history.
h/t @OccupyWisdom
Just looking over some 2008 financial crisis data….
The drop in the #DowJones to bear market territory that everyone remembers took 8 MONTHS. Oct 2007 – June 2008.
The latest drop in the Dow, that nobody is worried about was > 10%, in 14 DAYS.
It’s coming faster this time.
https://twitter.com/OccupyWisdom/status/964678628641591296
Phrase of the week: Don't panic pic.twitter.com/pF3xbuhpIp
— Mark Constantine (@vexmark) February 11, 2018
US Internank loans almost dried up!
Banks dont trust & loan to each other
Interbank loans suddenly fell to 10 bln$ from 80 bln$ in Jan, one month before the Feb bonds-stocks-vol crash
This significantly indicates that markets really fear of a new financial turmoil! pic.twitter.com/N6sivkxp6R
— MOON Consultancy (@MoonConsultant) February 12, 2018
Why is there hardly anyone mentioning this?
The US ten year #Treasury has broken a major trend line. pic.twitter.com/PdWyo7BRa4
— OW (@OccupyWisdom) February 18, 2018
WHO IS BUYING THESE? Only three trillion worth mature this year, as the Fed is selling. Should be fine. pic.twitter.com/VVBB0RYTCw
— OW (@OccupyWisdom) February 19, 2018
As reported by @stlouisfed the financial stress index spikes vertical to highest level in over a year. pic.twitter.com/Z8JyxbKqnR
— OW (@OccupyWisdom) February 18, 2018
Money is no longer free for the federal government, and interest payments are going to start squeezing the budget again
For most of the past decade, fixed-income investors have effectively been telling the U.S. government: Borrow more money! Please!A simple quantitative measure of this sentiment has been the yield on inflation-indexed five-year Treasury bonds (aka Treasury Inflation-Protected Securities, or TIPS), which has been below 1 percent since September 2009 and spent much of the time since then in negative territory. Yes, investors have been paying the U.S. government to take their money.