Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

What Stagflation? Bullard Being Bullard, Bitcoin Rallies

Published 03/23/2022, 12:30 AM
Updated 07/09/2023, 06:31 AM

Equity traders are looking at surging global bond yields and are saying, "What, me worry?"

The global bond market selloff is not easing at all and that should raise some red flags. Mad Magazine’s Alfred E. Neuman is what many stock traders are starting to look like when they buy every dip.

Fed policy is about to become restrictive and commodity market tightness will still remain even if there is a quick resolution to the crisis in Ukraine. The bar is set high for the NATO summit to produce some coordinated effort that could bring us closer to an end to this war.

It seems whatever economic weakness that is starting to arise is being shrugged off as hope grows that Russia has lost momentum in the war in Ukraine. Russian troops are not progressing deeper into Ukraine and Russia’s oligarchs and billionaires may find the upcoming round of sanctions from the US and EU to pose a great risk for their wealth.

The impact from this war is anyone’s guess, but what we do know is that the longer it lasts, the greater the stagflation risk will be for the global economy.

More from the Fed

Fed’s Bullard reiterated that the Fed needs to move aggressively to get to a neutral rate. He added that they can’t wait for geopolitical tensions to ease and that they should get going on the balance sheet runoff.

After Monday's hawkish encore performance by Fed Chair Powell and another round of Fed’s Bullard, it looks like Wall Street is mostly convinced that the Fed will raise rates by a half point and announce the balance sheet runoff at the next policy meeting in May. Normally Bullard’s expectations for Fed policy is the most aggressive, but it seems he may be spot on for the May meeting.

Bitcoin

Bitcoin is a risky asset and is enjoying the green across Wall Street. Risk appetite is here as economic/military pressure grows on Russia, which raises prospects this won’t be a long war, Nike (NYSE:NKE) gave a strong outlook, as surging Treasury yields have yet to deter investor appetite for risk.

Crypto headlines were limited but did include ECB’s Panetta's comment that they need to be mindful of increased threat of cyberattacks and that crypto assets must not become a sanctions loophole. Bitcoin is once again nearing the upper boundaries of its USD 37,000 to USD 45,000 zone, but still doesn’t have a clear catalyst to break it.

Original Post

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.