"No warning can save people determined to grow suddently rich" - Lord Overstone

  • 2 hours Experts vs Investors: Who Has It Right?
  • 4 hours The Wild World Of Celebrity Endorsed ICOs
  • 20 hours The Five Most Important Market Indicators
  • 2 days Ethereum Blockchain Tops Bitcoin's In Latest Study
  • 3 days Is Gold Only For Long-Term Investors?
  • 3 days Record Refinancing Points At Next Big Housing Bubble
  • 3 days Bitcoin Forks Explained
  • 3 days PayPal’s Latest Acquisition Has Competitors On Edge
  • 3 days The Royal Wedding Could Bring Billions Into The UK
  • 3 days Goldman’s Crypto Trading Desk Is Just The Beginning
  • 4 days The Five Most Important Blockchain Trends In 2018
  • 4 days Walmart’s E-Commerce Rebound Fails To Boost Stock Price
  • 4 days Japan Threatens U.S. With $400M In Tariffs
  • 4 days Are Markets Showing Signs of A Topping Pattern?
  • 4 days Goldman: Tesla May Need To Raise $10B By 2020
  • 4 days The ‘Wolf of Wall Street’ Is A Multi-Million-Dollar Deadbeat
  • 4 days The Key Takeaways From Blockchain's Biggest Week
  • 5 days Senate Votes To Protect Net Neutrality, But What’s Next?
  • 5 days 3 Tech Stocks With Real Upside
  • 5 days Trump's Trade Dilemma: Export Growth Or National Security
Are Markets Showing Signs of A Topping Pattern?

Are Markets Showing Signs of A Topping Pattern?

The U.S. stock market indexes…

3 Tech Stocks With Real Upside

3 Tech Stocks With Real Upside

The stock market rally has…

John Rubino

John Rubino

John Rubino edits DollarCollapse.com and has authored or co-authored five books, including The Money Bubble: What To Do Before It Pops, Clean Money: Picking Winners…

More Info

More Than $2.5 Trillion Has Been Erased Since Ben Bernanke Said...

This is why quantitative easing can never end:

Asian Stocks Slip on World Bank as Kiwi Drops; Yen Gains

Asian equities dropped, with the region's benchmark index headed toward a correction, and the yen rose to the strongest in two months against the dollar after the World Bank cut its global growth forecast amid concern central banks may pare monetary stimulus. New Zealand's currency weakened.

The MSCI Asia Pacific Index tumbled 2.6 percent at 11:16 a.m. in Tokyo, erasing this year's gains. Japan's Topix Index sank 4.1 percent and the Shanghai Composite Index declined 3.1 percent after a three-day break. Standard & Poor's 500 Index futures slid 0.4 percent after the gauge retreated for a third day in New York. The yen gained at least 1.1 percent against its 16 major peers, reaching 94.45 per dollar, the strongest since April. The so-called kiwi weakened 0.8 percent. Wheat and rubber dropped, while metals rose. Bond risk in Asia climbed.

The global economy will expand 2.2 percent in 2013, the World Bank said yesterday, paring a January forecast of 2.4 percent. The Federal Open Market Committee meets next week after the Bank of Japan this week left its lending program unchanged. Global stocks have plunged 5.2 percent from their May 21 peak this year on speculation the Fed may ease stimulus.

"People are still trying to assess the prospects, likelihood, and timing of tapering from the Federal Reserve," Chris Green, an Auckland-based strategist at First NZ Capital Ltd., a brokerage and wealth management firm, said. "Markets want stability in the economy but they also want unlimited stimulus. The two can't continue to exist together."

Trillions Erased

More than $2.5 trillion has been erased from the value of global equities since Federal Reserve Chairman Ben S. Bernanke said May 22 the Fed could scale back stimulus efforts should employment show "sustainable improvement." The Bank of Japan left its lending program unchanged this week, adding to concern central-bank support will be pared back. The Nikkei's volatility index rose for the first time this week today.

Australia's S&P/ASX 200 index slid 1 percent, declining for a second day. Hong Kong's Hang Seng Index tumbled 3.8 percent after being closed for a public holiday yesterday.

To summarize: after three years of the most aggressive deficit spending and monetary ease in human history, the global economy is...slowing down. Meanwhile, central bankers, finally realizing that their random lever-pulling has created asset bubbles without any actual new wealth, and that the likely (very ugly) aftermath might make them unpopular in retirement, are trying to untangle the mess they've created.

But even hinting that they might, at some point in the distant future, consider planning to discuss a timetable for eventually gradually phasing in a slightly lower heroin dosage has sent the global financial junkie into a fit of anticipatory withdrawal. Like any good enabler, the bankers will of course respond that they were misquoted and that easy money is now a permanent feature of the modern world. So relax, everything's going to be okay. Go back to your derivatives trading, and have a little more leverage on us.

Now, there's no way to know if this is that time, but a time is coming when things are so complex and the moving parts are moving so quickly and erratically that no policy response will make a difference. When that time finally comes it will look a lot like tonight's Asian markets.

 

Back to homepage

Leave a comment

Leave a comment