All is quiet on the Western Front...

The novel by Erich Maria Remarque serves as a good title for today's column...this is a fairly mystical post today.

Risk spreads continue to compress. The dollar demonstrates its wonderful reslience in the face of a surprise interest rate rise by the Bank of England (which heretofore has been extremely transparent...inflation targeting means no surprises, right?). The Recapitulator is bullish on the dollar...and the recent announcement that China will purchase U.S. financial assets comes as no surprise on this view.

The Recapitulator is not a permabull, permabear or any subspecies therein. There is a time for all seasons (there, I have now exhausted my quota of silly analogies to describe an economic system).

We have already stated volatility will spike...we have seen some of that happen already, but the probabilities are clustering around February.

Venezuela, Russia, Somalia, Iraq, etc. All problems, and the relative calm on the political front, a situation that will not continue.