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Weekend Reading: Complacency Rules The Day

Written by Jesse Colombo | Mar, 2, 2018

Chart of the Day

Today’s chart of the day is the high-yield or “junk” bond spread, which shows the percentage difference between high-yield bond (corporate bonds that are beneath investment grade) yields and investment grade corporate bonds or U.S. Treasury bonds. In central bank-manipulated environments like we’ve had for several decades, very low high-yield bond spreads indicate the formation of a dangerous economic bubble. The high-yield spread was unusually low during the late-1990s Dot-com bubble and mid-2000s housing bubble, as well as during the current “Everything Bubble” that I have been warning about. Click here to read the full article about how high-yield bond spreads reveal dangerous investor complacency.

High Yield Spread

You can also watch my video on this topic:

 


Economy

The End of (Artificial) Stability (Daily Reckoning)

Bill Gates says it’s ‘a certainty’ that we will have another financial crisis similar to 2008 (Business Insider)

Larry Summers Warns Next U.S. Recession Could Outlast Previous One (Bloomberg)

Global Growth Narrative Stumbles As Nomura Warns “Best May Now Be Behind Us” (ZeroHedge)

Foolishness of Trump’s Steel Tariffs in One Image (Mike “Mish” Shedlock)

Trump’s Tariffs Deal a Blow to Already-Shrinking U.S. Auto Sales (Bloomberg)

A Great Big Warning Sign (Peter Schiff)

Tudor Jones says US will ‘regret’ the tax cut (CNBC.com)

Is The U.S. Losing Its Tech Edge? Trade Data Hints Yes (Forbes)

Debt Matters (Sven Henrich)

Inflation is in the Rear-View Mirror (Mike “Mish” Shedlock)

U.S. Pending Home Sales Unexpectedly Dive to Lowest Level in 3.5 Years (Mike “Mish” Shedlock)

Senate Republicans Cast Doubt on Trump’s Infrastructure Plan (Bloomberg)

US Gross National Debt Spikes $1 Trillion in Less Than 6 Months (Wolf Richter)

The Real Reason Behind The U.S. Student Debt Problem (Forbes)


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Jesse Colombo is an economic analyst and Forbes columnist who was recognized by the London Times for warning about the U.S. housing and credit bubble as a university student. Jesse continues to warn about dangerous post-2009 economic bubbles and has over 100,000 social media followers. Jesse graduated with a Bachelor of Science (cum laude) from Stony Brook University.

2018/03/02
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