Friday, May 29, 2015

Nomi Prins Warns About Increasing Market Volatility

Nomi Prins is apparently taking on a new role writing articles for Chris Martenson's Peak Prosperity site. This is a site dedicated to investors. In this new article, Nomi Prins explains why we are seeing increasing market volatility and why everyone should be on guard for what this means. She also gives a possible time frame for when all this volatility might lead to another big crisis (she says by mid 2016 is her guess). Below are a few key quotes from the article (also posted on her blog here) which talks about Four Factors Signaling Volatility Will Return.


"No one could have predicted the sheer scope of global monetary policy bolstering the private banking and trading system. Yet, here we were - ensconced in the seventh year of capital markets being buoyed by coordinated government and central bank strategies. It’s Keynesianism for Wall Street. The unprecedented nature of this international effort has provided an illusion of stability, albeit reliant on artificial stimulus to the private sector in the form of cheap money, tempered currency rates (except the dollar - so far) and multi-trillion dollar bond buying programs. It is the most expensive, blatant aid for major financial players ever conceived and executed. But the facade is fading. Even those sustaining this madness, like the IMF, are issuing warnings about increasing volatility."

. . . . .
"When cheap funds stop flowing, and “hot” money shifts its attentions, as it invariably and inevitably does, volatility escalates as it is doing now. This usually signals a downturn, but not before nail-biting ups and downs in the process.
These four risk factors individually, or collectively, drive rapid price fluctuations. Individually, they fuel market volatility. Concurrently, they can wreak far greater havoc:
  1. Central Bank Policies
  2. Credit Default Risk
  3. Geo-Political Maneuvering
  4. Financial Industry Manipulation And Crime
Events that in isolation don’t impact markets severely can coalesce with more negative results. This is important to understand when prioritizing personal investment decisions. In this two-part report, I will outline driving forces behind today’s volatility and provide suggestions as to what you can do to protect yourself, and even thrive, going forward."
. . .  .
"Subsidization for the elite banking class can’t last forever. But it has already overstayed its welcome many times over, so predicting a specific end date is not easy (though I’m going with mid-2016, when the ECB will be done with this round of bond-buying.) In the interim, rising volatility signals an unraveling of current polices that can’t be ignored."

Click here to read the full article

Added note 5-30-2015: Nomi Prins announces on her twitter page that she is invited to speak at an IMF/Fed/World Bank sponsored conference in June. We will cover anything she makes public here on the blog regarding this presentation.

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