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The US is insolvent. There is no way to pay back its foreign debt or private debt. The rest of the world keeps accumulating IOU's. A credit deflation or a hyperinflation is going to result.

Not a lot of size trading in ES on the offer

inflate or die.

Right.

Anyone here that? Our balance sheet can certainly take more leverage!

until something scares foreign cbs out of bonds there is telling how high stuff can go

Whats he supposed to do? He is doing all he can do to return any kind of extra alpha that has been ruined by the refusal of the rest of the world to allow global imbalances to be sorted out by the private sector.

Really interesting story. Thanks for posting.

contrarian indicator?

Just one of the problems living in a world with constant and limitless credit creation. its all very inflationary and no one wants to cool down this system.

Its starting to look like a blow off top in the next month and then a real sell off. China's economy is going to collapse at some point and cause real problems for the global financial sytem.

You cant sell bonds. Not when the world supply of fx reserves is ballooning too almost a trillion dollars a year. Its simply impossible. When they move we can move. The official sector is begining to overrun private capital flows.

The private sector is no longer running the interest rate or currency show any longer. Thats why stocks and PE are getting so much love. China. On track to add $500b to its reserves in 2007, heading toward $2 trillion fast … Brad Setser | Apr 13, 2007 Please allow me a bit of latitude...

Everytime I would like to short 200 bonds I am reminded of this China On track to add $500b to its reserves in 2007, heading toward $2 trillion fast … Brad Setser | Apr 13, 2007 Please allow me a bit of latitude. China won’t add $500b to its reserves in 2007 for the simple reason...

What was one of the main problems of the Great Depression? There were plenty of wealthy people, but they already had eveything and couldn't spend enough to lift enough economy up. I'm not suggesting we are coming anywhere near that, but a serious recession is going to happen at some point. We...

Its amazing that the country still puts up with people making those amounts of dollars and providing very little to help the general quality of life. Finance is finance. nothing more.

yep. and thats a real sad statement about the US

Curtis Faith makes a good observation in The Big Picture comment section about price curves.

Read all of Dr. Bretts blog. Every post. traderfeed blogspot

The fed isnt going to cut until there is a real liquidty crisis. That doesn't seem to be the case. They made a huge mistake stopping rate hikes in May of last year.