Graphics: The Risk On Environment

Rampaging bulls set some milestones last night…

The US S&P 500 hits the highest level since 2007

Nasdaq at an 11 year

Volatility Index at 5-year lows

Cost to insure debts has fallen on a global scale

Bespoke Invest writes, (chart theirs too)

The average country on the list has seen default risk drop by 16% this year. As shown, Norway currently has the lowest default risk at 27.74 bps, followed by the US at 33.18 bps. Switzerland, Sweden and the UK round out the top five in terms of the lowest CDS prices. All five of these countries have seen default risk drop by more than 30% so far in 2012.

This is certainly not about a Goldilocks economy (not to hot, not too cold, but moderating growth)…

Chart from Zero Hedge

…but of markets being manipulated by central banks.

This represents the salient opiating impact from the initial round of money printing by global central banks. Put differently, this is the boom phase of a boom bust cycle. These has also been the partial fulfillment of my expectations