Making Sense Of The Sudden Market Plunge

The global deflationary wave we have been tracking since last fall is picking up steam.  This is the natural and unavoidable aftereffect of a global liquidity bubble brought to you courtesy of the world’s main central banks.  What goes up must come down -- and that's especially true for the world's many poorly-constructed financial bubbles, built out of nothing more than gauzy narratives and inflated with hopium. 

Which bubbles you ask?  There are almost too many to track. But here are the main ones: 

• Corporate bond bubble

• Corporate earnings bubble

• Junk bond bubble

• Sovereign debt bubble

• Equity bubbles in various markets (US, China) and sectors (Tech, Biotech, Energy)

• Real estate bubbles, especially in the commodity exporting countries

• Central bank credibility bubble (perhaps the largest and most dangerous of them all) 

What’s the one thing that binds all of these bubbles together?  Central bank money printing.

Half Of Emerging Market Stocks Are Now In Bear Territory: The Map

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