CapitalNotes on Nostr: As expected in yesterday's post, oil prices are breaking down and beginning to ...
As expected in yesterday's post, oil prices are breaking down and beginning to collapse (chart below). Here is a link to yesterday's post:
https://lnkd.in/e86CNtfr
I've been predicting deflation to be the primary risk markets are underestimating. This continues to be my primary view. Oil prices and other risk assets under pressure is raising the probability of this view coming to fruition. Here's a recent post where I outlined my concerns about deflation:
https://lnkd.in/esv_mvtQ
What does deflation mean for the economy? Really the only economic outcome that results in rapid dis-inflation or even outright deflation is a recession, causing negative real GDP growth, falling industrial production, declining real incomes, plummeting real retail sales, and a significantly higher unemployment rate. Here's a post from last week where I summarized the vast amount of data pointing at increasing recession probabilities:
https://lnkd.in/gzB_VyND
The stock, bond, commodity, and now currency markets all seem to be pointing toward this view as we're seeing a resumption of the stock and commodity bear markets AND finally interest rates have started to decline as the dollar catches a flight to safety bid and is powering higher this morning -- both joining stock and bond markets in pricing in the potential for recessionary conditions.
Be careful out there. Be very aware that future asset returns are determined by the price paid. It's now more important than ever to be price conscious about new investment. Remember too, crisis creates opportunity.
#oil #commodities #interestrates #stocks #stockmarket #investing #news #bonds #fixedincome #trading #investment #invest #Fed #FedPolicy #FederalReserve #recession #inflation #macro #markets #economy #macroeconomics
https://pbs.twimg.com/media/FrRHY0HWYAAC043?format=jpg&name=large
https://lnkd.in/e86CNtfr
I've been predicting deflation to be the primary risk markets are underestimating. This continues to be my primary view. Oil prices and other risk assets under pressure is raising the probability of this view coming to fruition. Here's a recent post where I outlined my concerns about deflation:
https://lnkd.in/esv_mvtQ
What does deflation mean for the economy? Really the only economic outcome that results in rapid dis-inflation or even outright deflation is a recession, causing negative real GDP growth, falling industrial production, declining real incomes, plummeting real retail sales, and a significantly higher unemployment rate. Here's a post from last week where I summarized the vast amount of data pointing at increasing recession probabilities:
https://lnkd.in/gzB_VyND
The stock, bond, commodity, and now currency markets all seem to be pointing toward this view as we're seeing a resumption of the stock and commodity bear markets AND finally interest rates have started to decline as the dollar catches a flight to safety bid and is powering higher this morning -- both joining stock and bond markets in pricing in the potential for recessionary conditions.
Be careful out there. Be very aware that future asset returns are determined by the price paid. It's now more important than ever to be price conscious about new investment. Remember too, crisis creates opportunity.
#oil #commodities #interestrates #stocks #stockmarket #investing #news #bonds #fixedincome #trading #investment #invest #Fed #FedPolicy #FederalReserve #recession #inflation #macro #markets #economy #macroeconomics
https://pbs.twimg.com/media/FrRHY0HWYAAC043?format=jpg&name=large