I have adamantly urged readers to pay close attention to Paul Elliott Singer. Unlike other overblown and over-rated members of the Tribe who we need to tune out, (((Singer))) is the opposite and a genuine heavyweight. When he speaks, we need to listen. My reference and background to him is here. Tattoo this on your forehead.
“Today’s environment marks the biggest bond bubble in world history, the global bond market is broken.”
“Everyone is in the dark,” Elliott notes. “Experience doesn’t count for much.”
“The ultimate breakdown (or series of breakdowns) from this environment is likely to be surprising, sudden, intense, and large.”
I categorically believe that extreme complacency about the broken global bond market will be the fault line quake. I don’t get the inside memos about the day or hour, but the kill zone breakdown feels like it will come between now and the end of September.
The trigger is that the “market” is wrong in its religious moral-hazard belief that the central banks — and in particular the Fed — is forever friendly toward the bulls. In reality, the privately held Fed represents the interests of the Parasite Guild and players like Singer. Indeed these players are the central bank owners. There is NO public interest involved and bullish Beavis and Butthead are about to learn one of life’s lessons.
Still the Fed mucky mucks are going through the motions of trying to talk the crazies down from their ledges. But it hasn’t worked. On Thursday after the market ignored (see: Yellen Wolfers Warn Again But Algos Don’t Surf) what had to be described as hawkish Fed minutes, the yellen wolfers immediately sent out William Dudley and SF Fed muck mucky John Williams to cry wolf and reinforce the September rate hike message. No impact though, after this cry wolf followup the odds for FOMC action still stands at 15% and the ten year T-note yields 1.54%. FOMC odds can be tracked here.
The cause of this is the circular yellen wolf or cry wolf syndrome. In fact I am rather shocked at the low read through of my recent yellen wolf posts here at TNN. This indicates that even my more loyal readers are asleep. Snooze you lose, but take it from Paul Singer et al if you choose to dismiss me.