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Fed's Bond Market Tragedy Was Predictable and Predicted 9/28/22

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Let's be frank.

Some of the planet's wealthiest and best-compensated people asked a central bank overnight to intervene to backstop their livelihood, and the central bank did their bidding.

These wealthiest-and-best-compensated people had put on trades that were short-sighted, and they were losing money because of those trades.

They floated whispers in a pliant financial press intimating that the worst-case was the most-probable-case, which is the Paulson Playbook.

Lastly, these same SOBs no doubt pointed & cried "Foul!" when the Big Nickel Whale made the clearinghouse break trades.

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7 minutes ago, Jimi said:

Let's be frank.

Some of the planet's wealthiest and best-compensated people asked a central bank overnight to intervene to backstop their livelihood, and the central bank did their bidding.

These wealthiest-and-best-compensated people had put on trades that were short-sighted, and they were losing money because of those trades.

They floated whispers in a pliant financial press intimating that the worst-case was the most-probable-case, which is the Paulson Playbook.

Lastly, these same SOBs no doubt pointed & cried "Foul!" when the Big Nickel Whale made the clearinghouse break trades.

Moral hazard never dies.

But isn‘t it moral hazard too when 93% of those cute Portugese finance their new houses via ARM‘s although they knew exactly how catastrophic the consequences can be? They play with fire and know that the state, the ECB or the Germans will bail them out.

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Turkey’s central bank makes big rate cut amid 80% inflation

“Inflation is not a crippling economic threat,” Erdogan said in an interview with PBS NewsHour this week. “There are currently countries threatened by inflation rates of 8% and 9%. This rate is 80% in our country.”

https://apnews.com/article/inflation-middle-east-recep-tayyip-erdogan-4184af38885e4195d1a1818f11d13a8b

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Bank of England launches £65bn move to calm markets

Central bank to spend £5bn a day for 13 days as it warns of ‘material risk to UK financial stability’
 

“At some point this morning I was worried this was the beginning of the end,” said a senior London-based banker, adding that at one point on Wednesday morning there were no buyers of long-dated UK gilts. “It was not quite a Lehman moment. But it got close.” The most directly affected groups were final salary pension schemes that have hedged to ensure their ability to make future payments — so-called liability-driven investment strategies that are very sensitive to fast-moving gilt yields. “It appears that some players in the market ran out of collateral and dumped gilts,” said Peter Harrison, chief executive of Schroders, which has $55bn in global LDI business.

 

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8 minutes ago, sandy beach said:

Bank of England launches £65bn move to calm markets

Central bank to spend £5bn a day for 13 days as it warns of ‘material risk to UK financial stability’
 

“At some point this morning I was worried this was the beginning of the end,” said a senior London-based banker, adding that at one point on Wednesday morning there were no buyers of long-dated UK gilts. “It was not quite a Lehman moment. But it got close.” The most directly affected groups were final salary pension schemes that have hedged to ensure their ability to make future payments — so-called liability-driven investment strategies that are very sensitive to fast-moving gilt yields. “It appears that some players in the market ran out of collateral and dumped gilts,” said Peter Harrison, chief executive of Schroders, which has $55bn in global LDI business.

 

“It appears that some players in the market ran out of collateral and dumped gilts.”

All those bankers involved are returning their past three years’ bonuses, right? 

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I'm going to post these periodically as a side note, just because it's sort of an interesting "local" commercial thematic.

Listed 5 hours ago.

40 acres, no structure, tall hoops, solar-powered well, 3 greenhouses, "very private setting."

https://www.redfin.com/CA/Unknown/13945-Old-Boy-Scout-Rd-95490/home/182010015

Just tomatoes, I'm sure... 🙄

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35 minutes ago, Jimi said:

I'm going to post these periodically as a side note, just because it's sort of an interesting "local" commercial thematic.

Listed 5 hours ago.

40 acres, no structure, tall hoops, solar-powered well, 3 greenhouses, "very private setting."

https://www.redfin.com/CA/Unknown/13945-Old-Boy-Scout-Rd-95490/home/182010015

Just tomatoes, I'm sure... 🙄

Thanks! I find these very interesting! I may buy one some day :)

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