'Nowadays, global central bankers have essentially committed to pushing back against “risk off” episodes of de-risking/de-leveraging.'<blockquote>'Greenspan’s rate and yield curve manipulations, along with “asymmetrical” market support, provided a huge advantage to leveraged speculation. Post-2008 crisis bailouts, QE and market manipulations only further incentivized financial speculation. And concerted global open-ended QE in 2012 spurred destabilizing “Terminal Phase” speculative excess. When serious Bubble fragilities reemerged in 2013, Bernanke resorted to assurances that the Fed would push back against any “tightening of financial conditions.” Nowadays, global central bankers have essentially committed to pushing back against “risk off” episodes of de-risking/de-leveraging.
..
I recall similar dynamics prior to both the 1998 and 2008 crisis episodes. Friday’s payroll data reinvigorated King Dollar. Energy and commodities prices were under pressure. EM currencies stumbled. And I’m sticking with the view that the global Bubble has been pierced, though central banks have gone to incredible measures to keep pumping. The Fed at this point faces a very serious dilemma.'
- Doug Noland,
Irreversibly Broken and Dysfunctional, November 7, 2015</blockquote>
Context<blockquote>
Have Central Banks Lost Their Way?'..current valuations on similar measures already exceed those of 1929..' (October 26, 2015)'..central bankers have blown the biggest equity and junk bond market bubbles in history..''As the bubble collapsed, banks and other financial institutions plunged into insolvency..'</blockquote>