Bubble Fortunes
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Wynn Bullock Child on a Forest Road 1958 A few days ago, former Reagan Budget Director and -apparently- permabear (aka perennial bear) David St
[See the full post at: Bubble Fortunes]100M not in workforce and 100M don’t have even $500. How’s that economy doing? Green Shoots! Fully recovered!
In a way, be careful about being “in” and “out” of assets: you’re always “in” assets, just trading between types. Stocks to cash, cash to bonds, bonds to real estate, real estate to gold, gold to yen, yen to cryptos, cryptos to pork-n-beans. They are all “assets”. As many (Mish, Hussman) point out, there is no “cash on the sidelines” (well, not exactly), because cash and stocks are just traded back and forth between the same trading population. There’s never been less cash than today, as it’s all been borrowed into existence at interest, largely by MNCs.
So what are we talking about here? Well, it would seem the “bubble” in loosely, “debt”, means the price of things you buy on margin have risen, along with the assets debt-bubble-money-margin-traders like to buy: stocks, bonds, real estate, but also cars, art, metro trophy properties, submarines, yachts, private islands, buying all of Greece by enslaving the Greeks to death — you know, that kind of thing. So what on planet earth HASN’T been bid up? The real world. Things that are real, useful, hard to store and financialize. You know, like food, water, raw materials. But…?
But every stock bull ever has raised these same paper assets, and every bear market has savaged paper and sparked a commodity boom that’s savage but lasts 1/3 as long? That is, a whole bunch of promises go hollow and default, raising the relative price of the real things you would buy with those (pension, bond, stock earnings, crypto, speculative) promises? Yeah, something like that. Lies can only persist so long, and although this may be the greatest expansion of lies, murder, and self-delusion in human history, anyone can see that the U.S. is not paying back $20T in like kind, nor Europe, nor China, nor the suspected $4 quadrillion in derivative bets. Although copper or wheat may not “rise” in a sense, sitting on the ground it can certainly stay stuck at $4/bu. and $3/lb while Van Gogh falls 99% and UST’s fall 99 & 44/100%. Ironically, that makes them stronger, but it won’t be a picnic.
It’s just a rotation of assets. Same as evermore.
Wonderful photo!
Most of the Zioglobalist-financiers are so unimaginably wealthy that they could lose 99.9% of their wealth and still live lives of luxury. Worries about popping bubbles are for the little people, especially those who depend upon eventuation of actuarial projections for pension funds and those who fantasize that they are “investors.” And we all have been perceptually conditioned that major stock corrections only last a year or two and then resume their inevitable upward trajectory, like trees growing to the Moon, right? Maybe the ZOG thinks that if the dollar stranglehold is seriously threatened that there will be enough fear to justify setting the nukes in motion. Just imagine how much easier it would be to control only 2 or 3 billion people? And all of the financial opportunities in the face of all that mayhem?Then again, the Fed can likely guarantee it can provide how ever much money (Liquidity) it takes to keep this “Bubble” inflated for a very long time. They just can’t guarantee its future purchasing power.
Another way of looking at it is, hey, you doubled the nominal dollar value of your stock, bond and Real Estate portfolios? Congratulations for having the foresight to not fight the Fed.
However, given the books must ultimately balance, better figure on a 50% devaluation of those “nominal” bucks by the time the reset is complete, putting you back to square one. Of course, that’s still a better place to be than that of those who were too timid to drop their blind faith in the Fed maintaining any semblance of value in their Federal Reserve Note debt instruments, maybe?
Unless, maybe one thinks it’s different this time, and somehow these maniacal money changers will find ethics? Good luck with that.
Look, the buck lost 44% of its purchasing power when Stockman and pals were at the helm of this Wurlitzer, from 1980 to 1988. So, who ya gonna call?
When the next market liquidity crisis hits or seems likely to I see no reason why the Fed cannot usher in another round of QE and successfully reflate the financial markets. I am not saying it will succeed. What I am saying is that it could succeed.
Well, Ilargi; got to eat some crow re: Max and Rickards.
Max interviewed Rickards and didn’t go all hyperbolic and Rickards isn’t stupid; a very good interview.
Smart guys both, my stupid…
But, I still think we will not attack the DPRK.So what is the next game? Or, what are the next competing games? That’s a game, isn’t it?
History gets very real periodically. Not a game. Live or die together. There’s no making-the-jump-to-lightspeed. You snap to awareness in a snail body, with the beak of a raven about to snap you up.
Get ready. Plant your fall garden. https://www.johndayblog.com/2016/07/liberty-garden-central-texas-climate.html
Save the last bullet, too…John Day
Save the last bullet, too…Now that’s interesting, coming from you.
What’s up?
Anything change?“Stockman at one point suggests people should hold on to Microsoft, but does he really believe that Bill Gates will remain standing when everyone around him crashes? That tech stocks are immune to the impending crash for some reason?”
This is not how I interpreted Stockman’s comments. David often comments on the FANGs — Facebook, Amazon, Netflix, Google, regularly in his Daily Reckoning blog, and how their stock values are seriously bloated by ‘bubble finance’, and after the coming crash their stock prices will be … not worth very much, if anything. Microsoft stocks will still fall, but not in the same league as the FANGs.@V.Arnold
I perceive the average TAE participant to be a baby boomer, as I am. Considering one’s own passage out of life, in a sustained Limits To Growth economic decline, is an important part of planning.
“Last bullet”, or “hemlock” could both be shorthand for that. We don’t contribute actual production in our last 15 years of life. The retired elderly are a group that gets culled early, and with a lot of mechanisms which are less visible, like just turning off the AC in summer for a couple of weeks.
My comment was made to readers who appear caught in the doldrums of abstract consideration of whether a tsunami 15 feet high will be in the spot where we stand, in a few minutes.“Please allow me to insert a graph. This one is from Tyler Durden the other day, and it paints a clear picture as much as it raises a big question. …”
Could you link to the original article, please? I spent about an hour looking at Zerohedge, trying to find it. Just curious what “hard economic data” is.
thanks
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