Crazy, right? Perhaps not. For the first time since the financial crisis credit conditions have tightened for two consecutive quarters, something which have never happened without preceding a recession. That's all well and good, however, most problematic is its extremely tight correlation to nonfarm payrolls through the cycle… and that is flashing the 'reddest' since 2009.
We have seen this pattern of last ditch desperation hiring before – at the peak in 2007…
As we noted earlier, two consecutive quarters of tightening standards "has never happened before without it signalling an eventual move into recession and a notable default cycle. Once we have 2 such quarters lending standards don't net loosen again until the start of the next cycle."
Still think a zero print is crazy? Sonner rather than later it's coming… and the question is – will the market see that dismal news as good news (no Fed) and buy stocks? Or does it confirm the utter impotence of central banks?
via Zero Hedge http://ift.tt/1nQvzNk Tyler Durden