With the Fed raising by 75 bps yesterday I have to believe we've reached a major turning point in the War Against Davos. The deflation of asset prices and, most especially the Eurodollar markets is putting many other, over-leveraged central banks on a path towards bankruptcy.

There are a ton of moving parts, a lot of factions now warring against each other. When cartels break, the former members of the cartel always turn on each other. It was always going to be this way. Davos turned on its allies in the US commercial banking sector and they fought back.

Hard.

Everything I wrote about in my last post — SOFR/LIBOR spreads, US/German 10 year Spreads, Lagarde's incompetence — were proven correct in the response yesterday by the markets to Powell's hawkishness.

Davos has spent so long and so much money trying to convince us to 'abandon all hope' but it is they who now can do nothing but 'enter here' into our dragon's den of asset deflation. The adjustment will be biblical. It will be painful.

And it didn't have to be this way, but the solipsism and arrogance of evil people who have always known power and feel entitled to wield it in perpetuity is boundless.