This is the time when ‘accidents’ like Enron have happened — this JPMorgan quant says yields have peaked and prefers bonds over stocks
The old expression is when the tide goes out, you get to see who’s swimming naked.
In financial markets, the tide is going out when central banks are raising interest rates and growth is slowing. That is to say, right now.
“WorldCom, Enron, Bear Stearns, Lehman’s, accounting irregularities etc. have all occurred when the cycle is slowing and the Fed is raising rates,” says Khuram Chaudhry, a European equity quantitative strategist at JPMorgan in…