DXY was down again last night:
The Australian dollar was bashed anyway:
Gold is having another crack:
Oil was soft but the dip bought:
Dirt was mixed:
Miners soft:
EM stocks tried and failed to fall:
Junk jeez:
Bonds were bid as markets concluded Fed yield curve control was necessary to prevent a stock crash:
Nasdaq ploughed through 10k but SPX fell:
And here’s the only chart of the fourteen that actually matters to the AUD for now:
Data is still disastrous on both virus and economy. Not much point showing it all. It’s still irrelevant amid fantasyflation. Instead, here’s a chart on what the “v-shaped recovery” will most likely look like, from Pantheon:
That’s for Europe but the shape and trajectory looks about right for everywhere, if a little steeper in the US.
It’s a v-shaped recovery to something like 90% of the former economy and all structural damage, output gaps, weak wages, no pricing power and squashed margins after that.
My base case is earnings have three-to-five years to run before they recapture 2019 levels.
The current stock/AUD bubble could end in five minutes or five months but, at some point, it has to reckon with this reality.
