Jim Sinclair’s Commentary
The latest from John Williams www.shadowstats.com
– Consumption/Manufacturing Downturn Driven by Consumer Liquidity Woes
– Weakening Industrial Production, Manufacturing and Capacity Utilization Were Consistent With a Pending Downside Revision to Fourth-Quarter 2018 GDP and Signaled High Odds of a First-Quarter 2019 GDP Contraction
– These Data Reinforced Similar Negative Revisions Seen With Earlier Indicators, Including: Retail Sales, Housing, Construction and Payrolls
– February Housing Starts (March 26th), January Trade Deficit (March 27th) and An Eviscerated Annual Industrial Production Benchmarking (March 27th) Are the Last Major Reports, Prior to the March 28th Final GDP Estimate; There Is Limited Chance of a Reprieve
– The Economy Is Weakening Sharply and Quickly, Due to the Overly Aggressive Federal Reserve Tightening and Rate Hikes
– Where Current U.S. Economic Activity Has Signaled a New Recession, Major Business Sectors, Such as Manufacturing and Construction, Never Recovered Fully from the Last One
– Accordingly, the March 20th FOMC Meeting Is Not Too Early to Address the Intensifying Business Collapse; Yet, the FOMC Is Expected to Sit on Its Hands
“Bullet Edition No. 3”
Bill Holter’s Commentary
Did you have any doubt this is a credit bubble?
Bonds With “Worst-Ever Covenants” Are 3x Oversubscribed
March 15, 2019
Just how much investor appetite is there for bonds? So much, that even in a week that saw the second biggest equity inflow on record (after a 13 week drought) buying of bonds continued for a 10th consecutive week, rising to $7.01bn from $2.74bn the week prior.
This flood into fixed income continues despite repeated warnings about the dangers of the corporate debt bubble from such investing icons as DoubleLine’s Jeff Gundlach and Marathon’s Bruce Richards, not to mention the IMF and BIS, who have been focusing on the growing risk of mass downgrades in the $3 trillion BBB-space, which could translate into a tsunami of fallen angels during the next recession.