...yet the media keep banging on about the two year 10 year inversion which has picked recessions (not all of them) in the past.
The inversion may prove useless in proving anything if the Canadian CB governor is right. He seems to think that indicator will not apply now due to the interest rate environment. Invariably a tariff war is recessionary. What I believe in happening in the US is a momentum created by 8 years of QE and loose monetary policy.
The Fed's paranoia about inflation repeating like the 1990s has been proved irrelevant. The inflation beast has been prodded so many times and remains quelled by a mighty deflationary force.
Chasing any sort of return in a financial environment like this will be much like a herd of wild buffalo constantly changing direction. Capital gain seems the most obvious form of income.
How will our market react over a 2 year period should the RBA go into NIRP? Look at the US market for clues relating to QE introduction. in 2009. SP500 low was 784 and now 28500. 400% increase. I would attribute a substancial part of that 400% to share buybacks and who can reasonably say that won't happen here? Could our XJO get to 32,000?
I think our hungry superfunds will really go for big capital gains to improve their returns. Maybe our 'golden unsustainable era of market blue sky' is upon us.
