“The problems originate from the culture of the firms, and this culture is largely shaped by the firms’ leadership.”
Dudley’s main message was a warning: If nothing changed, regulators would have to conclude that large financial institutions are too big to manage, and “that your firms need to be dramatically downsized and simplified so they can be managed effectively.” Continue reading
Warren Buffett believes “that bonds are very overvalued“, and a recent survey of fund managers found that 80 percent of them are convinced that bonds have become “badly overvalued“. The most famous bond expert on the planet, Bill Gross, recently confessed that he has a sense that the 35 year bull market in bonds is “ending” and he admitted that he is feeling “great unrest”. Nobel Prize–winning economist Robert Shiller has added a new chapter to his bestselling book in which he argues that bond prices are “irrationally high”. The global bond bubble has ballooned to more than 76 trillion dollars, and interest rates have never been lower in modern history. In fact, 25 percent of all government bonds in Europe actually have a negative rate of return at this point. There is literally nowhere for the bond market to go except for the other direction, and when this bull market turns into a bear it will create chaos and financial devastation all over the planet. Continue reading
There is an unmistakeable sense among Western decision-makers of power slipping away.
It’s not an argument about American abstention or decline, although that plays into it for some critics of the Obama administration.
It is more to do with the exhaustion – moral, political and economic – of nations that have been in the forefront of the international security business, and the vibrant ascendancy of some other players. Continue reading