Great weekend reading.

Repo, QE. rate reductions FED asset etc….

Technical based market projection.

“No, 2019 was a giant system failure. Central banks can’t reduce liquidity or markets fall apart and the process of never letting markets correct is producing valuations across the entire economic spectrum worse than even 2000 as household wealth (concentrated among the top 10%) relative to GDP has reached never before seen levels:”…

“All new highs are coming on negative divergences. $SPX has reached its trend line apex. The yield curve went from inversion to steepening a process that has preceded recessions every time in the past 50 years. And when these conditions take place we can see that the geometric value line index ($XVG) shows significantly lower readings compared with previous highs as we do now as $XVG, despite new market highs, remains far below the readings of 2018.”….

“To summarize: We went from “normalization” in the summer for 2018, to the Fed becoming the most interventionist central bank in the world in net liquidity additions with its balance sheet looking to reach record highs in 2020. Temporary repo has become permanent and so have balance sheet expansions and low to negative rates across the globe.” …

“And that is the system failure in a nutshell and it has produced historic distortions in markets. For now investors can party like it’s 1999, but have a plan for when the music stops for, as history suggests, it can stop suddenly. In 2000 it stopped in March”.

System Failure

Charts Yield curve: