Markets are complex, but there’s never been a moment where the lay person could more easily understand what’s happening.
We signaled to the world, including our own businesses, that America is no longer a safe place to do business, and the world is acting on that information.
Investors and market commentators are reading too much into short-term market movements in rates, currencies and equities.
I believe that it is much more likely that recent sharp moves in these asset classes is due to highly leveraged market participants being forced out of positions than due to fundamentals.
In other words, technical factors are driving the dramatic market moves. As a result, markets have become increasingly unreliable as short-term indicators of the impact of policy changes.
I don’t understand how it is good for the world to allow investors in equities to operate with 10-1 leverage and investors in Treasurys and currencies to operate with 100-1 leverage.
When did we decide as a society to abandon the margin rules that were put in place to protect markets from this kind of volatility?