Elections are a wonderful way to unravel the risks of political incompetency by letting the people, rather than politicians, decide. Meanwhile, the collapse of another thing in Crypto comes as no surprise. If it did, consider a career change.
In Bonds There is Truth – but until Real bond yields turn positive they remain financially repressive. If Central Banks “pivot” from tightening rates to address inflation too early, markets will remain fundamentally distorted.
The Bank of England averted a run on the UK’s investment institutions yesterday. Chancellor Kwarteng is unlikely to thank them for their calm competency and credibility. The Bank’s intervention has triggered a global rally as the market now expects more central bank support.
It wasn’t Kwasi’s fault. It was the pinko Media that crushed sterling, The Bank of England and these nasty Remoaners murdered Gilts – says the man shorting sterling… If it wasn’t so serious it would make a brilliant comedy. Perhaps it will.
What a mess. Kwasi Kwarteng’s Special Fiscal Operation failed to stabilise UK markets and has zero prospect of driving growth. The new government stumbled at the first jump. How bad will it get? What are the implications? Who is next for the Chancellor’s job?
The UK is at risk of breaking its “Virtuous Sovereign Trinity” of stable politics, currency and bond markets. Collapsing confidence in politics to stem the slide in sterling and thus Gilts, could see the UK stumble into a crippling Sovereign Financial crisis sooner than we think possible.
Harry Hindsight is the world’s greatest market trader – he’s circling round the opportunities presented by inflation and the risks its presents. He’s short bonds, credit, stocks, Brexit and the UK.