Russell Napier: “Central Banks Are Now Powerless To Prevent A Steep Rise In Real Rates”
by Tyler Durden
ZeroHedge.com
01/23/2015
Central bank policy is creating liquidity. Wrong — the growth in broad money is slowing across the world.
Central bank policy is allowing a frictionless de-gearing. Wrong — debt to GDP levels of almost every country in the world are rising.
Central bank policy is creating inflation. Wrong — inflation in most jurisdictions is now back to, or below, the levels recorded in late 2009.
Central bank policy is fixing key exchange rates and securing growth. Wrong — in numerous jurisdictions this exchange rate intervention is slowing the growth in liquidity and thus the growth in the economy.
Central bank policy is keeping real interest rates low and stimulating demand. Wrong — the decline in inflation from peak levels in 2011 means that real rates of interest are rising.
Central bank policy is driving up asset prices and creating a positive wealth impact which is bolstering consumption. Wrong — savings rates have not declined materially.
Central bank policy is creating greater financial stability. Wrong — whatever positives impact central banks are having on bank capital etc they have failed to prevent the biggest emerging market debt boom in history.
The Rest…HERE
