Financial Markets
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Presidential Impeachment and US Equity Markets
“The gradual pace of what is fundamentally a political (as opposed to legal) action tends to result in dampened, rather than heightened, volatility. And nearly as soon as any latent uncertainties are ironed out, broader economic trends resume driving the direction of financial markets. A more profound degree of political upheaval, with a more sudden…
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Will the Fed’s “Feelgood” Medicine Cause an Economic Collapse?
“The promise of cheap money leading to perpetual asset price sunshine may seem like a reality today. Tomorrow the consequences will be like Dr. Feelgood’s needles. To avoid the worst, markets—not politicians or bureaucrats, must be free to uncover the real cost of borrowing money.” ~ Barry Brownstein
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Monetary Policy is Pushing Americans, Kicking and Screaming, Up the Risk Curve
“Gamestop is only a symptom. The size and frequency of monetary policy interventions is pushing investors further and further up the risk curve.” ~ Peter C. Earle
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Robinhood and Redditors: Who’s Robbin’ Who?
“We don’t need more regulation; we need better regulation. We need the rule of law not only in monetary institutions but in financial markets too. We need to replace the ‘regulatory leviathan’ in financial markets with ‘a regulatory constitution.'” ~ Roger Koppl
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GameStop, Bitcoin, and the Federal Debt
“The flash mobs, coordinated as they are by social media, have created disturbing and disruptive bubbles and may continue to do so. Bitcoin is probably not in a bubble. Above all, let’s not forget the ominous longer-term debt bubble.” ~ Warren C. Gibson
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How to Navigate the Stock Market Madness
“There is nothing wrong with partaking in recent fad investing trends; some of them even seem quite promising. However, just like anything else, being prepared and knowledgeable will ensure your success is long-term and not just the prelude to disaster.” ~ Ethan Yang
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Equity Performance Amid One-Party Rule in America
“If history (especially more recent history) is a guide, U.S. equity gains over the next two years of full Democratic control will be inferior, a result that is more probable given that the party is currently more anti-business, anti-profit, and anti-capitalist than at any other time since 1970.” ~ Richard M. Salsman
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Paternalism and Robinhood Revisited
“Robinhood and other self-directed apps like it have fundamentally disrupted the market in a good way. Many entrenched interests, be it private firms or the government, are not comfortable with this change. Hopefully, our leaders have seen firsthand the disruption that such abrupt and restrictive actions have on society.” ~ Ethan Yang
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Dismiss All the Populist GameStop Hype: Short Sellers Are Heroes
“Keep this in mind as pundits make their silly arguments about GameStop’s price action signaling a shift of power away from hedge funds, and back to the little guy. Such a view isn’t true, plus it ignores the heroics of short sellers. They’re in truth price givers, and the economy couldn’t function without them.” ~…
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Who’s to Blame for the Rash of Short Squeezes?
“Cantillon Effects, not overzealous short selling or swarming retail traders, are the ultimate cause of the rash of explosive short squeezes in US equity markets.” ~ Peter C. Earle
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Exit the Bond Vigilantes, Enter the Crypto Vigilantes
“With the heightened pace and expanded scope of economic intervention over the last ten or fifteen years, the avenues through which markets can respond to government policies have been blunted. But fortunately for the genius of Satoshi Nakamoto, where the bond vigilantes once stood––and may someday return––now stand the crypto vigilantes.” ~ Peter C. Earle
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From the Land of Financial Bubbles
“For the aspiring startup today, perhaps working away in the venture-cap lands of overpriced unicorns, the history of bubble allegations teaches you one thing: be right or be a bubble. Until the dust has settled, nobody can really tell.” ~ Joakim Book
