2017 has just started but some longer-term trend changes already seem to develop. It is interesting how a new year combined with a new US president act as a catalyst for what will be the start of monumental events in the world economy. Not that many of these will come as a surprise to the readers of my articles but for the rest of the world, there will be one shock after the next which will create real panic.
We are now seeing the beginning of reversals in many markets. Some of these new trends will take longer to develop and some could happen surprisingly quickly. Most major markets will be affected namely: Bond & Credit Markets, Currencies, Stocks, Metals, Precious Metals Mining stocks and Property.
The law of diminishing returns
Let's first look at the biggest bubble of all bubbles ever in history – the Global Bond Market.
This is a market which has virtually exploded from $10 trillion in 1990 to $100 trillion today. And if we look at the debt expansion in the last 10 years since the Great Financial crisis started in 2006, the global bond market has gone up by 70%.