- 0:30 Today’s number is better, but not good. It still shows that the economy is losing momentum.
- 1:30 This economy has to achieve “escape velocity.” There is deleveraging and new regulation going on. We have to navigate this “new normal” of high unemployment and stagnation.
- 2:15 Part of the rush into bonds is a result of limited exposure to fixed income. But what the bond bubble suggests in low interest rates and economic low growth and low inflation, and that’s where we are at. If you believe that we’re going to get deflation, than this bond market is still cheap. But if you believe in a huge recovery and inflation, it is expensive.
- 4:30 The threat of deflation is around 25% and could be higher. It is important that at Jackson Hole they are talking about a liquidity trap, because that would be mean that they understand we need to look beyond the Fed for economic solutions.
- 6:10 Movements in the yield curve are matching Japan, but at higher pace.
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