If there was ever a perfect image of lemmings swarming toward the ocean cliffs, it was the bond managers who lined up for Argentine bonds last week. Indeed, the same can be said for the mutual fund PMs and homegamers who have piled back into the junk bond market during the last eight weeks. They were being shown the road back to safety by the early 2016 collapse, but on the hint of an interim bottom they resumed there insensible march to the sea.
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Simple Janet has already proven the end game. Money printing central bankers can’t stop. Were they to allow financial prices to normalize and trillions of bad credit to be liquidated, the whole financial house of cards they have built around the planet would blow sky high. The “soft landing” case is a null set.