Trying to highlight as many of these takes as I can. Yields rising + dollar falling + equities falling *can* persist together under the dollar system if things are very (!!) bad. - ThreadSky

cthelala.bsky.social • 2 days ago

Trying to highlight as many of these takes as I can.

Yields rising + dollar falling + equities falling *can* persist together under the dollar system if things are very (!!) bad.

Reposted from Win Monroe

Yeah I'm reluctant to interpret it exactly as a bond vigilante story. My view is (1) macro volatility ⬆️, (2) market liquidity down ⬇️, (3) risk of run-like dynamics with large spillovers ⬆️.

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samierens.bsky.social•2 days ago

How does oneself protect your assets given these circumstances?

dogefort.bsky.social•2 days ago

Have a good long talk with your local rep/senator's office about how you see the idea of Impeachment as both very patriotic, and also the least bad option, right now?

That + lots of prayer.

lucastosborne.bsky.social•2 days ago

📌

ruoshuiresearch.bsky.social•2 days ago

Fed reaction function is a bigger part of the story than most people realize it seems

cthelala.bsky.social•2 days ago

Yup and that’s a lot of what markets are reacting to. The Fed might let a lot of this play out just as the Bank of England did under Truss, intervening only to stop significant things breaking rather than the price pressures we see now.

cthelala.bsky.social•2 days ago

Saw this from @jhweissmann.bsky.social my views are:

1) I don’t think markets are worried about safety

2) Fed’s limits aren’t externally imposed. (It’s been unwinding its balance sheet too)

3) if China sold Tsys, it would in effect just be dashing for cash to exacerbate current yield pressure.

wghwanderer.bsky.social•2 days ago

There hasn’t been a downturn before caused solely by politics. Other downturns have been caused by events which government could enact plans to counter/mitigate. In this case the downturn is caused by an incompetent, irrational government, which is not likely to become competent or rational.

timwescott.bsky.social•2 days ago

Do you have any advice for what I should do to minimize the risk to my savings?

weremensh.bsky.social•2 days ago

Or, more simply, if the rest of the world has written us off; and we're now being treated like any other lawless and corrupt third world country.

cthelala.bsky.social•2 days ago

I think with respect to dollar hegemony, there would be specific signs if the former were gone.

Such as an inability to pay for imports and existing alternatives abroad with the requisite policy changes backing them up.

weremensh.bsky.social•2 days ago

It's too early for that. De-Americanizing the world trade system and national portfolios will take years, especially if the idea is only to ruin the US and not the nations cutting us off. But the decision to go that route has pretty plainly been made.

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