Was Last Month’s Fedwire A Coincidence?

I wrote on February 26:

Problems show up all the time; that’s the messy nature of just plain existing on our chaotic plane. Which ones become something more than the others, in the case of interbank issues, has to do, as discussed in detail last week, with systemic behavior.

Even safe assets exhibit serious price volatility. By itself, that’s also just how things go. Interpreting that volatility requires at the very least some acknowledgement of the systemic condition underneath, especially during times when there might not seem any need to go looking.

Sometimes Fedwire on fire is just a fire. Since August 9, 2007, acknowledging regular volatility, the global economy just hasn’t been that “lucky.”

In other words, problems in the “plumbing” (and we still don’t specifically know what really happened that day last month) aren’t by themselves game-changers; they’ve only become more likely to blow up into major issues since August 2007 because no matter what any Fed Chairman says they never provide the world with anything monetary; the only flood is illusion and, in Jay’s case, self-selected self-delusion.

As of right now, without more information, Fedwire and the charts is coincidental. It is, however, more than enough to raise suspicion especially as, flood myth aside, more and more of 2018 (or 2014) creeps back into view.

Every time we go through these things, including last year, the word which keeps coming up is fragile. Flood of dollars? Not a chance. Flood of fragile. With that, a very different set of boats will be needed for a rescue.

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Disclosure: This material has been distributed for informational purposes only. It is the opinion of the author and should not be considered as investment advice or a recommendation of any ...

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