VGLT - Liquidity Trumps Fundamentals
The market has been back in risk-on mode but with some strange internals as well as an ongoing disconnect with fundamentals. It has priced in a joyous cornucopia of Goldilocks assumptions:
- A return to global central bank liquidity and price supports
- A reversal of China's deleveraging campaign with an abundance of stimulus measures
- A peaceful and prosperous end to global trade wars
- An elegant resolution to Brexit
- Never mind India and Pakistan
The Party is Back On, But the Music Sounds Off
Heading into the last month of the quarter, let's review what we've seen