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Tuesday, September 10, 2019

Irreversible Trends:


Debt owed by governments, businesses and households around the globe is up nearly 50% since before the financial crisis to $246.6 trillion at the beginning of March, according to the Institute of International Finance, an association of global financial firms. And the high debt levels are weighing heavily on economies

The consumer is holding up though!!  How so:

For the month of July, consumer credit increased at a seasonally adjusted annual rate of 6.75%. Revolving credit, which are credit cards increased at an annual rate of 11.25% while non-revolving credit increased at an annual rate of 5.25%.

That’s over 11% increase in July from June in credit card debt…. 

Therefor: Rates must continue to fall, negative yielding debt continues to grow, which means the global economy continues to stall

Image result for Global interest rate chart

The Unstoppable Surge in Negative
Yields Reaches $17 Trillion

August 30, 2019

The global stock of negative-yielding debt is now in excess of $17 trillion as rising market volatility lends extra force to this year’s unprecedented bond rally.
Thirty percent of all investment-grade securities now bear sub-zero yields, meaning that investors who acquire the debt and hold it to maturity are guaranteed to make a loss. Yet buyers are still piling in, seeking to benefit from further increases in bond prices and favorable cross-currency hedging rates—or at least to avoid greater losses elsewhere.