In order to achieve any real economic and financial normalisation the regulatory distortion of bank credit must be eliminated.

Sir, Mohamed El-Erian holds that: “the move up in US interest rates has attracted lots of attention. It’s been blamed for a violent sell-off in stocks, and fuelled warnings not just of an end to the bull market in bonds but, perhaps, also equities. That, in turn, can engender concerns about the housing market, corporate funding, financial stability and economic growth. Yet the causes behind the rise in bond yields suggest that this is more likely to be part of a larger — and healthier — economic and financial normalisation.” “Don’t forget the good news behind higher bond yields” February 6

Let me be absolutely clear, before the credit distorting and danger enhancing risk weighted capital requirements for banks are eliminated, and the difficult and very delicate task of recapitalizing these completed, there will be no real economic and financial normalization.

http://perkurowski.blogspot.com/2016/04/here-are-17-reasons-for-why-i-believe.html

@PerKurowski