It’s a fun conceit of science fiction to contemplate the existence of alternative universes.
As Bloomberg's Richard Breslow points out, when you think they exist in the same time and place, it leaves the realm of the paperback section of the airport newsstand and is better discussed in the Diagnostic and Statistical Manual of Mental Disorders.
This is his full lament:
If you need yet another stark example of the fantasy storytelling we amuse ourselves with, juxtapose today’s Monetary Authority of Singapore policy statement with the storyline that the Asian stock market rally intensified on renewed optimism over the global economy. Singapore is a proxy for trade and "economic growth ground to a halt last quarter."
We all know why equity markets are zooming. The Bernanke put is standard operating procedure: globally. Whatever is out there’s got central bankers spooked. To use the cliche, they’ve decided we can’t handle the truth. But it’s impossible to fight a manticore you can’t see.
The IMF just portrayed the global economy in decidedly downbeat fashion. Things really are looking much better in Canada, but Governor Poloz took the glass half-empty approach. For G-20 watchers, he also bemoaned the strengthening currency.
Back at the ranch, Fed speakers keep talking about the rate hike pipeline. It’s easy to talk tough when you’re standing behind your mother. And they wonder why futures traders just can’t believe
them.
A 10-year Treasury bond yielding 1.76% is not normal. Should you take advice from bond bears or the blowout auction?
Appreciating currencies of negative interest rate economies that are threatening to do more, may be explained by the unintended consequence factor, but represent policy failure.
I’m the optimist. I think we can find a way to solve our problems. But it’ll never happen while we continue to dissemble and implement policies that aren’t working.
Source: Bloomberg
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