What you are witnessing in the markets is a massive Exodus from equities, in an effort to price in depression. Since we never recovered from the Great recession, any economic downtick will surely result in a good olde fashioned depression. Unemployment rates will soar upwards of 15%, led by prolonged shutdowns in industrial manufacturing companies. If you think the fucktards in Brazil and China will dodge this unscathed, think again. Any and all export nations will see GDP decline far greater than western GDP’s. We are already at a standstill, while they are levitating at unsustainable levels.
When stocks like DECK get sold off for no apparent reason, other than “pricing in potential multiple compression,” you know there is a problem. So, everyone is pricing in multiple compression and everyone is long the same fucking stocks. The end result: FCX circa 2009. Remember when FCX dove lower in early 2009, due to hedge fund liquidations? Well, the same shit is about to happen now, unless the tide is turned.
The major difference between 2008 and today, believe it or not, Bush and Paulson were on top of this shit, albeit a little late. What we have now is a power vacuum, with that fucktard Obama on siesta. As for Geithner, who the fuck knows where he is camping? This is the main problem. The Fed cannot do it all and it seems to me Bernanke is sick and tired of being ridiculed by BOTH SIDES OF THE AISLE, when he is the only one enacting policy in a feeble attempt to save this country. The reality is, the Fed should not be our last savior, but they are due to congressional incompetency.
If left unchecked, we will dive into a depression, equity prices will drop 40% from current levels and trillions of dollars in economic stimulus and Federal Reserve printing will be wasted, left for the sands of time to figure out.
We attempted to avert a calamity, but due to massive malfeasance, we’ve created a fucking monster that is going to eat this country whole.
Nevertheless, as crazy as it sounds, the high probability trade is to be long. Heck, if I know the outcome, so do the asshats who are printing the money. The name of the game is reflate, not sit here and fucking die like little bitches from Carthage.
At the close of trade, my cash position stood at 47%.
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I really like the prospects of telecom services moving forward, especially integrated companies in Canada with large dividends. Regardless of “depression” I think adults and teens a like will cut many hobbies before cellphones, television, and internet are cut from the budget.
You are likely right as low beta names with divies held up well today. If the market gets sold hard they will be liquidated as well. Get your shopping list ready just in case.
Already do. It includes: VZ, T in the US. TU, RCI, BCE in Canada.
From 14X to 10X is 40%. We are already half way to worst scenario.
try 8x
Blue Blazer’s and Baseball Bats ripping
Get Long The $GPPL
Guns, Pawn, Pay Day Loans, Liquor— all in one store…..use your payday loan cash to receive 5% OFF All Liquor Purchases
I think it would be pretty tough to see an 8x multiple on the SPX with a 2% 10-year. You’d either need a bond market crash (always a possibility) for that or a perception that earnings will continue to shrink out to the horizon (also possible, but not likely, at least in inflated “nominal” terms and, of course, stocks are priced “nominally”).
Try 1974.
Dude, do you know what the Fed funds rate was in 1974? It varied between 8% and 13%!
Of course I do. I agree I should have qualified the comment properly.
The world is not coming to an end tomorrow, next week or next month. Maybe next year!. Don’t sell on dips. Only sell on rips and bounces. That is the Fly way. $DECK down 27% in 16 days. That is called oversold.
I wish Jackson Hole were this weekend rather than next.
Market will spur a bear market rally drooling like a FLY next week in anticipation. When BEARnanke doesn’t announce anything, market will crater forming a good bottom. This is 2008 all over again. Anticipation of bailouts, QEs – sell the no news.
BB’s mission in life is to prove the deflationistas wrong. He will not fail.
Jackson’s Hole? Which one? Michael, Latoya, or Janet?
How can you get thumbs down on gold like that? Amazing!
Bubbles’ ? Elephant Mans’ ? Macauleys’ ?
http://youtu.be/p4TrzWq-k9c
Listen, i haven’t read Fly’s post yet, but i’ve been thinking seriously on the following matter following my in-depth review of the China-Georgetown basketbrawl today.
Here’s the deal – we need to go ahead and go to war with the Chinese right now. First of all, they are (as a country and not a race) a population of cretins. They eat babies. But let’s leave that aside for a moment. They are a nationalistic nazi’esque force who will one day act on their views of racial dominance.
In know way should we wait around for this inevitable conflict while they use their tremendous economic wealth to buildout a massive military force. Further, such a conflict right now could help tremendously with the worldwide economic situation. Lastly, we owe them quite a bit of money, and I assume that becomes moot during (and after) such a conflict.
Watch that basketball video clip and tell me i’m wrong.
So you intend to go to war with rich americans that moved their manufacturing to china? You could do that at home.
I get your intended oxymoronic point and i’ll see you with “No, i intend them to manufacture the bombs with which we shall destroy them.” While our repartee makes for a funny aside, my point is a bit different.
@Huggie – Day late & dollar short. Krugman’s got it covered. We go to war with imaginary aliens. We build all sorts of really kewl particle beam and laser weapons. Lot’s of new spacecraft and weaponry also. We build so much the aliens never attack. Depression averted.
…did you actually just say …”in know way” … ???
—
I mean REALLY ???
Too funny !!!
.
Such asinine commentary. What is this, fucktard territory. Ok, high prob trade, where is you uncle point?
Dudley speaks tomorrow morning again. Hopefully he grows a pair of testicles overnight.
so you think FCX will drown but WNR will outshine? Lol
Banned
Ok.
fact: bernanke is the only guy in the entire free world who wants and is willing to work towards a better day.
yet he is the most mocked man in our entire society.
and THAT is why we will suffer. because the angry masses have decided to crucify the one guy who really would help them…
as i said a few days ago, its not hte situation: the worlds situation is emminently managable, and in fact isn’t actually all that big of a deal. But against those realities we have
1. gross misunderstanding of economics and monetary systems
2. angry citizens (in germany and the US) railing and yelling and screaming for blood, due to their own pain, and ironically (in one of histories truly great ironies) screaming and yelling for blood… for the blood of anybody who would help, anybody who understands. Literally the populace chants and cries for its own pain. Ultimately, in their anger, they will hurt themselves. People actually believe that china owns us and we need them to buy our bonds in order to go on. That is how out of touch with reality the AVERAGE guy is. The reality is quite 180 deg from that…
3. Anger, see above
4. Anger, see above
As I said in RC’s blog the other day, the greatest threat isn’t European contagion, its the wild, flailing anger of the tea party and anybody who thinks similarly. Its ignoring centuries of economic lessons. But that anger is… past critical mass? Nothing we can do to stop the angry hoardes? The people who, furious and resigned, will vote and scream and cheer for tea party candidates arguing for austerity at a time when we need massive fiscal (not monetary) stimulus. The teeming masses arguing that QE will cause hyperinflation despite the realities…
We are in a dangerous position. I am in cash, having abandoned my combo of in the money calls and VXX short. Too much backwardation to fight, I’ll wait for a better day to put it on and the cost of the calls that covered it is … bitter in my mouth, but whats a boy to do?
As I’ve said since early 2011, still in the winter, in my stupid bullshit blog read by 100 people, sell the mega inflationary rallies, because REALITY is deflationary. Buy meaningful government interaction, because the world needs it.
Meanwhile, congress subpoenas the clam for trying to help and europe cleverly decides that nothing is wrong and everything is fine, and a -40% bear market WON’T hurt thier economies and austerity won’t make everything much worse.
ignorance -vs- reality. ig’nance is winning, and winning big.
Checklist, you make a lot of sense.
Interesting. You think that angry ignorant people are the problem. Jake thinks that feeling good and kind is the problem, from his blog post today.
I know which one I think is more of a problem to the world.
Thing is, anger is so much easier to sell to people. Everyone has frustrations. Lots of folks want someone to blame and are not too analytical about who it is they are blaming or why.
Who mocks him?
And don’t start with this “but the masses…”
Who in his right mind listens to what the masses have to say?
Politicians. They are petrified by the thought of the people actually getting angry enough to vote them out.
On the important matter of FLy’s commentary above, i would contribute the following. I work in a consumer discretionary business and IT HAS FALLEN OFF A CLIFF since July. I’m talking a drop of 30% YOY. I only saw this one other time and it was in late 2008.
The fed has no bullets left. Obama is not, in reality, The Emperor. He can’t actually do anything. It takes a village. A village of idiots called congress. At this point, Obama needs it to get worse so he can turn the screws on congress in a “desperate situation”, and force them to act.
The long side might be good for a bounce, but there is a lot of downside risk here. This market is extremely sick.
if i may ask what kind of discretionary spending business?
the worst possible kind in the world…one which sells an expensive discretionary health and wellness product to middle class (and lower) consumers. A bullseye for this type of economy.
then i would think w/obama care and the new ruling overturning it, this would be bad for ur business cause they can just go to the emergency room and the gobment picks up the tab. no?
Tax and spend baby. Tax and spend. To get the goose of course you would not tax, just spend. Instant goose.
the fed has all the bullets in the world, it just has a society ready to hate it…
thast the amazing irony of this situation: anything that would help is hated, anything that would compound the problems is cheered.
just like the 30s, ig’nance is the real risk…
i tend to follow your line of thinking. While i think it is a “pick your poison” situation, I tend to agree with you.
Funny thing is, I will probably prosper like a muthafucker in a significant deflationary period. But, I think i can prosper otherwise in a situation slightly better for humanity.
there really are no good solutions…spend into oblivion but keep the game going a while, or delever and die. What is needed is a reset of US economic policy to something that actually benefits the US. Not.Holding.Breath.
Just keep your expectations really really low. Plant some berry bushes.
Huggie… You do realize that China has been planning for this for 20 years, right? They have over 100 Million men of fighting age who have absolutely no prospect for finding a wife. These men are ready and willing to die in a war since they have nothing to look forward to anyway.
If you think we could win a war against an army like that, you are sadly mistaken.
In WW3, we are Germany, and you know what happened to Germany in WW1 and WW2.
It will not be easy. But we will win. The spanish slay Indians at a ratio of 100’s to 1 with far less technological advantage during the settling of America. A bunch of chinese with poor supply lines, a weak navy and an impotent airforce pose little threat.
Fuck- we couldn’t even beat Iraq or Afghanistan. Our military SUCKS.
Rigged Game USAF Hon Dischg
Actually the rules of engagement and the politicians suck.
It’s a good thing they weren’t around in WW II when Patton was hanging Germans from light poles as a warning or else Steve The Neighbor could have been a lamp shade with a German accent.
Firebombing the entire island of Japan (even prior to the nukes) is not politically correct nowadays either.
Our military suffers setbacks in limited wars like Iraq, Afghanistan, & Vietnam.
But the US military excels in Total War. War would China would qualify as a Total war.
Would HAARP stop MAD?
US military is fine…mission creep or mission direction failure is the problem. You want a police action, hire cops and mercs…not combat divisions.
US Navy Submarine Service Vet
,…”poor supply lines, a weak navy and an impotent airforce,..”
was that not Vietnam?, just wondering (not looking to debate)
poor supply lines – check
weak navy – check
impotent airforce – check
ability to mushroom cloud any city in the world?
if we actually went to war, it’d be a 3 week war. our ability to end them is probably 1000 to 1 or better.
no way china dares to fight us…
and… the massive deficit spending of war would probably set us up for some nice times going forward…
and maybe cause someone, somewhere, who actually has some influence, to realize the realities of our highly advantaged monetary system.
i’ve spent too much time in China, and I’ve NEVER seen a shred of nationalistic tendencies on an outward basis. 99% of them are just struggling to survive, and harbor deep resentment towards towards the central government. I find that those who believe China is going to take over the world have never spent an hour outside of Beijing or Shanghai. The thought of China invading, much less defending themselves against a US attack, are laughable to me. A “gloves off” war with China would end very, very quickly. However, I also agree that we would basically be destroying our own manufacturing base.
Not to mention markets for Coca-cola and all the other multi-national corps intent on making the east just as degenerate as the west.
Ehem, regarding your comment about “…destroying our own manufacturing base…” Nothing stopped the Europeans from doing that in WW2. In fact, that destruction is ongoing. The move to China was act two. Act 3?
@ Huggiebear. Your China talk clashes with your name. Have you lost your mind?
ITS CALLED THE PACIFIC OCEAN. GOOD LUCK WITH GETTING THOSE “100 MILLION MEN” OVER FOR A BEACH LANDING ON CALI. LMFAO
You people are Hitler mad, craving a war with China.
If anyone other than Ron Paul is elected in 2012, and they will be, then war with China is inevitable. The nutbags are in control and they have no intention of letting anyone out unharmed.
There will be no rationality in Congress until we vote the tea baggers out.
There will be no rationality in the White House until the current office holder resigns and all the re-pubes abdicate their candidacies. There is no competent executive leadership currently in sight.
auntie emm auntie emm,,,lol
Scott has it nailed.
The debt has always ben the problem and nonone wanted to take a hit.
we need stimulus to stick so that people start borrowing again.
unfortuantely, the masses are deleveraging and the governements cant afford to do so at this juncture, so their only solution is to print.
Again, where max pain is who klnows, maybe the market will crater enough for a J-hole annoucement, but it just seems too obvious at this time.
being hedged or heavy cash is they way to go.
final thought with market cratering what better way to get everyone into treasuries before the next leg up in the market.
logic is something congress got the memo on, but as usual didnt read,
/ES now off another 6.25. This better be a head fake, or we are headed to new lows.
no one is going to buy with the bank situation in europe. I was reading an excellent book last night in which the author stated “risk gets priced appropriately, but uncertainty gets murdered.” I paraphrase, but the gist of it was that during “uncertain times” multiples are typically severely compressed.
Banned for user name
he axed for it. he really did.
LOL
Spelling or content?
Nevermind.
Looser should be banned because a Looser WNR should be secured.
Just so you little bastards know, I am bannig people at will tonight. Any comment that is smug or snide will be met with full site ban. I warned you yesterday.
If you cannot spell loser correctly here, you are banned, no sorry or second chances. Just banned.
…what about know … for no ???
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That HAS TO BE a “bannable” (as it were) offense !!!
.
My idea to turn around the economy? With a stroke of the pen?
Executive order or Congressional Bill that mandates consumer interest rates can not exceed say 8% over the Fed Funds rate. Anything over that will be considered “usury”.
Exorbitant interest rates on existing debt is the unproductive drain on the finances of “the masses”.
So Citi has to drop the 29.9% credit card rate on Bob 12-pack to under 10%. Car loans? Drop em to 12%. Home loans, hell refi owner occupied mortgages at 2% for 40 years and let em skip the first 6 months of payments. All consumer interest rates need to be dropped ot the “next to nothing” Wall Street rates.
How in the hell can the “institutions” borrow money for free but “you the people” have to pay 30% interest on a meal you had last year?
Point is that the economy will never turn around until the “citizens” are recapitalized and the easiest way to do that is to drop the interest rates on all their existing debt and hey, maybe then they can actually pay it back and have a little extra cash flow.
Also, WTF isn’t “Buy American” the National Slogan?
what is iy we make here?
That’s called communism. Bob 12-pack pays 29.9% so that people with good credit can pay 5%. There is no such thing as a free lunch. You artificially knock Bob 12-packs rate to 10% (even though his credit rating warrants a 29.9% rate) and then everyone else’s rates will have to rise to make up for it.
Good think comrade. We like peasant with smart soviet brain.
Extra rice cake for you at soviet harvest inventory.
Wall street has never been the answer…Dow at 6500 was about right in 08. Our leaders indebted our children for QE 1/2 just to put money back in the hands of the pricks that lead an immoral shackling on irresponsible policy makers. Our best economists are products of indoctrinated fools. Fuck you Wall Street…Go create something or die trying…
Why blame us? That sucks.
I’m not blaming the pie or the pieces. I’m blaming the Baker…
Not the Butcher or the Candlestick maker either?
I am the Butcher Mother Fucker!
Who created the fucking debt and insane economics that gutted the US industrial base? Who created the plan for a Ponzi real estate market via Fannie & Freddie Kruger? Godam morons in DC did pandering to their benefactors and/or welfare addicts (voters). Fuck them all.
Every man and his dog are doing The Hugh and also The Gint. Next America’s Idol will decide which dance will win America’s heart. The Senor Tropicana is now out of favour[sic]
I row wat gint is but for prease wtf ris da hugh? for to prease post rink or expranation
Other than the coming Depression how were the fish tacos (mahi, mahi, snapper?) and did the snorkeling go well?
I can’t find good fish anywhere nearby any more. The local supermarket got bought out and shutdown. They had an excellent fish monger woman. Now it’s hit or miss, and all of our Connecticut fresh waterways are polluted with Mercury from you know where, so it’s not a good idea to eat the fish.
Stonington Village…back when I lived there, we had a fish market. Of course that was replaced with godam antique shops…rousted out the portugese fishing bars also. Yuppie fucks from NYC and Fairfield County. Another reason to hate on NYC.
Yeah, excellent idea but it’s too far away. It takes about 90 minutes to 2 hours to get there (one way) depending on traffic on 95.
Don’t worry about mercury comrade. Our finest analysts have determined that you will be a happier communitarian if your population growth is kept in check with mercury-filled “energy efficient” light bulbs.
Eat fish, comrade. Eat much fish. You will be rewarded with extra rice cake at end of soviet harvest inventory.
Long live USSA!
P.S. Don’t forget your fluoride supplements for stronger teeth!
I’m extremely confused about monetary policy. Deflation here, money printing there. My gut tells me that monetary policy can’t do a dam thing about a deleveraging economy. Shit I think the only logical portfolio is 1/2 gold 1/dollars cover your bases.
There’s monetary stuff that can be done when you’re up against the Zero Interest Rate Boundary. Not happy stuff, but stuff. It still doesn’t solve the aggregate demand problem. That requires employment. Private enterprises won’t hire without demand, therefore bring in government workers. Have them do things, pick up trash, clean parks, dig ditches, fill in ditches. They spend their paychecks on big TV’s made in Chiner. Oh wait, not that ending.
They spend their paychecks on food like twinkies, grass fed local beefalo and local Zucchini, and American Apparel Tee Shirts. Then they save up a few bucks and buy a new Ford focus. They get tired of picking up trash or digging ditches, and apply for the engineer job at Ford Motor Company. Problem solved. Government collects more taxes, stops hiring workers it does not need, pays off debt, begins to run a surplus, and everyone lives happily ever after.
Actually, our government could end this tomorrow through stimulus spending, combined, of course, with free money from the fed.
Check this —
1) Congress pass a GI-FUCKING-NORMOUS stimulous bill (filled with 50% waste, of course)
2) The Fed BUYS BONDS from america, funding congresses shit
3) Aggregate demand skyrockets, everything goes up
its not that complicated.
Alternate scenario:
1) Gov cuts spending
2) Congress frightens every last consumer
3) All demand ceases
4) All hell breaks loose
correct…
Who would benefit in this all help breaks lose scenario. The fed? Under what circumstances does the fed lose?
….and then you will need wheel-barrows of money just to buy a gallon of milk. I like it!
but paying people to ferry around our wheelbarrows of money will be economic stimulus! Brilliant!
Paying them with more wheelbarrows of money… Gotta hire more wheelbarrow guys to pay the other ones.
If we continue spiralling lower the HFT’s are going to take the blame. You could hear the war mongering heating up around these fucking Ponzi machines all over the financial news networks.
We need to bring back the uptick rule and stop the casino gambling in the stock market. Confidence is lost because people are scared to death to invest in something that acts like fucking Sybil on steroids.
I can’t wait until these comuter nerds get taken down and are sent back to the engineering field where they can start making space rockets for our first trip to MArs.
The days of NERDS on Wall St are OVER!!!
You can always stop a commuter nerd by putting milk crates under his car, deflating the tires and stealing his wheels. It ALWAYS works.
I think this is a little bit more than just nerds with algorithms, just saying. I hate that shit to cuz I’m not part of it!!!ha
+1
Cream Rises to the top, but Scum floats on the Cream.
Dairy farmers know this.
IF we’re relying on DC Fucktards – well we’re fucked. Most of you know this already….
Dairy farms ALWAYS smell funny. If it’s not the fermenting silage in the summer, then it’s the big ponds of poop that start out gassing. It’s really bad when you get stuck behind a liquid shit flicker that’s leaking all over the road. Just make sure you’re not going to an important meeting right afterwards. Takes about 10 car washes to get that smell off.
LOL…I didn’t grow up on one as a kid went to grandparents that were. I still remember that damn cow that got out of the barn and chased me over a barbed wire fence and into a bees nest. Youch! Felt like I was under attack from Bearshitters!
No way will I borrow money to buy a home at the insanely high interest rate of 3%, but at 2.5% I will borrow hand over fist! *eye roll*. The reality is Bernanke is completely out of bullets–the shenanigans started by Greenspan in the ’90s of frantically cutting interest rates every time we went through a natural business cycle slowdown has finally caught up to us. Bernanke can initiate QE3, QE4, and QE5 all at the same time and take long-term rates down to ZERO, but it still won’t make a lick of difference when there is simply NO DEMAND FOR CREDIT BECAUSE PEOPLE ARE OVER-LEVERAGED AS IT IS. The economy is now making up for the past 4-5 normal recessions we *should* have endured but which were cut short by Greenspan and Bernanke’s foolish policies.
I will partially Agree
FIFG =
Fly Is a Fuggin Genius
Actually, all hell breaking lose is exactly what we need.
Personally, I would much rather live in a “Mad Max” world.
Hell, it would get most of you clowns out of your cubicles and back to “hunting and gathering”.
Like men with COCKS used to do.
Don’t be afraid of it. Reclaim it.
Ah you are ripe with fear. Now you will vote exactly as planned. Thanks for your support of the central banker agenda. You will receive an extra rice ration each year, during your annual soviet harvest inventory week.
Be well comrade.
stfu.
Then men will come out of the cubicles and go back to “hunting”–but it will be their own heads they will gathering either your families or their own heads, you dip!
You guys really want to know how to fix America and our economy? Mushroom cloud China–send them back to the stone ages–then we Americans can get back those manufacturing jobs we’ve lost over the years and we will once again be the World’s undisputed superpower. Plus, we will sell them rebuilding materials.
That will cause a lot of missed earnings and lower revisions of revenue guidance from the many american companies that have operations overseas. That would hurt stocks, not help them.
QE 3 is coming, Euro banks need more dollars.
QE will Fail just like QE1&2 We need jobs, Uncle Sam can’t create jobs
http://www.youtube.com/watch?v=4uxL5PUM6NI&feature=player_embedded#!
Bernanke is the source of the problem. By setting interest rates at ZERO for the next 2+ years, he is doing nothing more than continuing to rob responsible savers who kept their money in low-risk CDs and other fixed income instruments and USED to be able to live off of that income..all so he can help out the irresponsible losers who took on too much debt and need to refinance loans they cannot pay back anyway. It is an OUTRAGE and nothing short of HIGHWAY ROBBERY. Bernanke is a fucking shill.
Egggsactly. The depression ended because of WW2.
America became the defacto manufacturing giant because every factory in Europe and Japan was leveled.
We were the only society that had an infrastructure in tact to make and then sell anything.
I hope this shit ends in war.
Starting with congress.
But who do we fight? ” We have met the enemy and he is us…”
You want war? Easy to say sitting in your grandma’s couch. Go fight on the frontline and tell us you want war. Asshole.
hey don’t reply to me telling me i’m pro-war. I was actually in the military…
Such drama and theater. These events were planned by central bankers. Fear-mongering will ultimately result in people voting for whatever the central bankers put in front of them… such as, UN Agenda 21.
The BIS is already in place as our world bank. All we need now is world acceptance of communitarianism and the CO2-backed world reserve currency. The USD go bye bye.
Not a depression. Just a change of power. No more muddlesome middle class to worry about. Their rights will be squashed most effectively. Anyone caught with debt will be fucked royale.
Bernanke is sure to be taking names of all you haters. When Ben starts buying shares of SPY in $10 billion dollar daily tranches… You will all be screwed.
True but this will not likely happen soon. Perhaps first the market has to drop far enough that even Tea Partiers will fall on their knees and kiss Bernanke’s feet and ask him to save them.
When Fly goes to around 50% cash, I go all in cash. Because I am not as quick as he is.
I was put on positive outlook today
http://www.youtube.com/watch?v=IKJBbTtrUSo&feature=related
Checklist, I don’t know if U R still here, but your comments at 8:19 p.m. on the economy are excellent.
It takes monetary and fiscal policy but it is easier to point the finger and shoot the messenger.
They are scapegoating and are just as guilty as they structurally just did what lobbyists wanted them to. Glass Steagall, HFT, Unlit Dark Pools, NAFTA/CAFTA, and captured regulators have destroyed jobs and markets. The latest on the SEC shredding documents for the banks tells everyone that the cops are on the take. The corruption is being exposed but nobody is doing anything about it or slapping on the wrists (steal $1 billion and pay a $50 million fine) so it is destroying confidence in the markets (crisis of confidence).
Pensions and 401Ks are going to go into private equity as the market game is rigged with the exception of IPO’s for raising new capital. Take a look at the actual cash flows of the market over the last thirteen years and you will see no returns, negative real returns, and trillions going in with nobody benefiting but banks and financial service companies extracting trillions by bribing regulators and rigging the game. Companies are starting to wise up (Ratigan rant).
The great Danish physicist Neils Bohr once said the opposite of a great truth is also another great truth.
Faber said today that the fed is evil because it rewards spendthrifts at the expense of savers that are forced to speculate with their life savings and are ill equipped to deal with volatility in stocks and bonds. Easy for collusion when some exchanges, central banks, and market makers are owned by same family trusts. What is going on is that surplus labor (savings) is looking for yield and has to risk it in the market or have a negative real return – much of which is ending up in a few hands – it is basically just like wealth transfer from a tax perspective (extraction).
So we spent trillions and gave that to banks when we could have paid off all home and car loans with the same money. We will have to pay taxes on that money in the form of interest payments to the fed, and we have no jobs and no asset inflation value to show from it because it went into a few pockets and never made it to main street. Investors are fleeing, and all of these computer HFTs and other wealth extractors are now turning on each other with little long term investors left, generating the volatility we see. The banks sat on the money and are getting a risk free return by borrowing with the fed and depositing surplus at the fed.
Politics is a clash of self interests dressed up as something more so I understand everyone is talking their own book. The private fed now owns more homes than any other entity while more than 11 million homes are vacant. Whatever the next program is, they can’t just print money then hand it back to the banks that own the fed so they can get a risk free return and not loan it. We are in a classic “death spiral” in economics and we need to restore long term confidence so that companies feel confident in reinvesting in capital and jobs. Because of poor balance sheets, the banks are a bottleneck to trickle down top down economics right now. Scott’s right we either need new US Banks (.gov like freddie/frannie) starting from scratch, or we need to tackle the existing debt issues so that the current banks can re-lend.
In the Year 2000, Mr. T. Edition Prediction:
For one, people will wear their wealth again around their neck.
It looks like Fly is mentioned, “Good hearted aliens will land on earth intending to help us but instead destroy the earth…”
http://www.youtube.com/watch?v=4W52CFVoivk&feature=related
… could we all just get along … and maybe … well … exchange …
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uhhh …
Fish Taco Recipes
Just sayin’ !!!
.
… call me crazy … but I like my fish “grilled” … NOT … “seared/fried” !!!
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That’s just me !!! fwiw
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FLY,
you said you will go short if Fed doesn’t start QE3 or EU doesn’t have creditible debt solution. Neither is here. So why do you still sound bullish? Is it just too main stream?
It takes monetary and fiscal policy but it is easier to point the finger and shoot the messenger.
They are scapegoating and are just as guilty as they structurally just did what lobbyists wanted them to. Glass Steagall, HFT, Unlit Dark Pools, NAFTA/CAFTA, and captured regulators have destroyed jobs and markets. The latest on the SEC shredding documents for the banks tells everyone that the cops are on the take. The corruption is being exposed but nobody is doing anything about it or slapping on the wrists (steal $1 billion and pay a $50 million fine) so it is destroying confidence in the markets (crisis of confidence).
Pensions and 401Ks are going to go into private equity as the market game is rigged with the exception of IPO’s for raising new capital. Take a look at the actual cash flows of the market over the last thirteen years and you will see no returns, negative real returns, and trillions going in with nobody benefiting but banks and financial service companies extracting trillions by bribing regulators and rigging the game. Companies are starting to wise up (Ratigan rant).
The great Danish physicist Neils Bohr once said the opposite of a great truth is also another great truth.
Faber said today that the fed is evil because it rewards spendthrifts at the expense of savers that are forced to speculate with their life savings and are ill equipped to deal with volatility in stocks and bonds. Easy for collusion when some exchanges, central banks, and market makers are owned by same family trusts. What is going on is that surplus labor (savings) is looking for yield and has to risk it in the market or have a negative real return – much of which is ending up in a few hands – it is basically just like wealth transfer from a tax perspective (extraction).
So we spent trillions and gave that to banks when we could have paid off all home and car loans with the same money. We will have to pay taxes on that money in the form of interest payments to the fed, and we have no jobs and no asset inflation value to show from it because it went into a few pockets and never made it to main street. Investors are fleeing, and all of these computer HFTs and other wealth extractors are now turning on each other with little long term investors left, generating the volatility we see. The banks sat on the money and are getting a risk free return by borrowing with the fed and depositing surplus at the fed.
Politics is a clash of self interests dressed up as something more so I understand everyone is talking their own book. The private fed now owns more homes than any other entity while more than 11 million homes are vacant. Whatever the next program is, they can’t just print money then hand it back to the banks that own the fed so they can get a risk free return and not loan it. We are in a classic “death spiral” in economics and we need to restore long term confidence so that companies feel confident in reinvesting in capital and jobs. Because of poor balance sheets, the banks are a bottleneck to trickle down top down economics right now. Scott’s right we either need new US Banks (.gov like freddie/frannie) starting from scratch, or we need to tackle the existing debt issues so that the current banks can re-lend.
Fly just started a new thread. You should cut and paste this and repost it there, so that more folks get the chance to read it. It is great. Very good thinking there, Won.
Michael Burry
http://www.bloomberg.com/video/72756316/
Come on guys, don’t you remember the guy who came here and said how to fix all the problems? Just send people out into the wilderness to plant trees on goverment dime. Duh. That solves everything. Govt tree-planting jobs. I’m not sure but I think they might be slightly above minimum wage!
… my beloved “Fly” …
I don’t know what tomorrow brings … I’m pretty sure … YOU don’t know “what tomorrow brings” … either!!!
WHO FUCKIN’ KNOWS … IN THIS SHITSTORM ! ? !
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That said …
WHY in GAWD”S NAME … would you lift your ENTIRE</u. … TZA "Hedge" ???
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You preach "Risk Management" … and yet … well … sadly …you exhibit the contrary !!!
SIGH !!!
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Well … uhhh … SIGH !!!
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Because I made 80% in a day. My risk management, fuckface, lies in my 47% cash position.
WELL FUCK !!!
I had a follow up post that just … well … fuckin’ disappeared !
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Suffice it to say … luv ya, Fly ! … for gawd’s sake … put a “hedge” on …don’t think you gotta be a hero !!!
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SIGH !!!
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I tried !!!
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I’d be laughing harder at the commentary and bannery if Fly’s post was even a little bit hyperbolic.
But it’s a fact.
China’s GDP is 50% infrastructure spending and completely unsustainable, if I understood what Nouriel Roubini said the other day through that Zsa Zsa Dracula accent. Brazil couldn’t even figure out what to do with their money when times were good. Though who cares when your national pastimes are fucking and going to the beach? And the US has done its best for the past 10+ years to show the world that Western-style democracy and American-style “free markets” are a fucking joke.
Hard to see how deflation and depression are not around the corner.
There is nothing like a spate of revolutions and civil war to get the blood going.
The current state of political and economic affairs (the politiconomy) is complete mayhem. If truth be told, this gloom and doom period found me smoking crack and sipping Colt 45. Caring about things that are headlines but not really important. Sucked into the trap of information overload where everything is both urgent and sensational. 310 million Americans and a line up of sociopath politicians. All rearranging the DECK chairs on the titanic.
The Fed, Treasury, and foreign central banks keep creating unprecedented “solutions” to one crisis after another. However, each crisis seems to be getting more serious than the previous, and eventually there will be no “solution.”