Red is the New Green

16.12.2016 • Central Banks

By Simone Wapler – Strategy of Simone Wapler (France) – Janet Yellen, head of the Fed, has finally raised its key rates. It didn’t surprise many. However, hints about more rate increases in the future – three potential increases in 2017 – surprised many.

After hearing the news, we saw:

  • The euro plunge;
  • European shares to go up – the fall in the euro is supposed to favor euro area exports of European companies;
  • Gold and silver plunge (as the dollar strengthens and stocks attract investors);
  • Long bond yields continue to rise

These massive swings in the currency markets are really a red herring, designed to divert our attention.

The bottom line is that in a world of over-indebtedness, a return to normal is never on the agenda, regardless of what the Fed suggests.

-Subscribe and learn more here (Paywall) (French)-

Related Posts

Comments are closed.

« »