Welcome to the Hardcore Husky Forums. Folks who are well-known in Cyberland and not that dumb.
Apparently 30% of existing US dollars were created in 2020...
Per Tim Pool.
At what point do we risk seeing hyperinflation?
Curious of everyone's point of view, but in particular
@UW_Doog_Bot
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a) take out any metric that is inflationary to show that there is none keeping the "core rate" low. They will also "encourage" the banks to keep interest rates low as well
b) At some point declare the debt null and void and the treasuries you bought (hi China) will be worthless (or you will get 5-10% on the dollar) and your just sol
You will see inflation in assets and equities since that's where the lions share of bail out and stimulus went.
Good time to own a house in a desirable area and have a 401k diversified in the market.
I WOULD divest of Chinese exposure both in China and those listed in the US sometime in the near future. Biden will extend their bubble but it's going to pop none the less at some point.
The only things valuable if US treasuries fail are guns and ammo. That said they are a shit investment atm bc of rates. Lots of other opportunities as well in all the chaos.
We are also sitting on the lowest short selling position since the data has been available [2003?], interest rates are low, the Fed is aggressively buying corporate bonds [even junk bonds] to maintain the borrowing ability of corporations, business re-investment % growth rate had cratered to below 2008 levels in the second quarter and is now rising again, and the face to face service economy which represents about 30% of sales has experienced an unprecedented hit to EPS, Rev and debt such that the economics of a sustainable model now are questionable for a percentage of businesses.
In the face of that, widespread inflationary pressures would seem to be "impossible" in the fed's near term view. We have seen price spikes for commodities and products on the basis of demand vs supply given the supply disruptions but the longer view on inflationary pressures for goods and raw materials will take time to materialize. No one knows yet what the new normal will be for a sizeable portion of the previous makeup of the US economy.
What we do have at this point [and which is fortunate given the circumstances] is a whale of a bubble in financial assets [and retirement plans which form a lot of the liquidity that backstops the public's stability along with the equity in real estate] as Doog Bot has stated ~ and real estate in many markets has done well, although we are seeing a powerful migration aways from a lot of major US cities in favor or more remote smaller town locations. The unseen hand of the high rate of pending defaults which approaches the same 20% failure rate in major metropolitan areas as we experienced in 2008 has yet to play out.
In spite of the current probable over valuation, periods of over valuation can persist well past the rational explanation time-period and often do. These are clearly weird times that will require flexibility and at times decisive decision making and a willingness to increase and reduce exposure as events unfold and evaluate market rotation trends in order to keep powder dry and still have a chance to participate in what has been a sustained upward move across all categories almost without exception.
This is just my 2 cents and these are the kinds of things I'm looking at ~ my perspective is that I'm a Fintec analyst and a managed money model portfolio provider in the financial marketplace.
I plan to spend more tim here. We? really do have some financial talent among this band of degenerates. We? also have some smart folks in the political economy and history spaces.
In reality, China has its wealth concentrated on the coast but 80-90% of its population is living in abject third world poverty. China's investments have been wasteful and unproductive, and as of five years ago it was 1 out of 7 shipments leaving China was bound for Wal-Mart. So they are massively dependent on the American consumer. They don't have the ability to produce items that their own citizens will buy on a similar scale. So if the USA's economy contracts, the effects on Chinese business would be staggering.
When you see Kim Grinolds feeling threatened or insecure, what does he do? He begins threatening posters, issuing time outs and banning people out of existence. That's the equivalent of what China is doing. This includes the desperate power grabs with Hong Kong and bullying they've done of late with some smaller SE Asian countries.
Militarily, the Chinese don't even control the South China Sea, the USA holds the greatest influence there. The Chinese don't even have aircraft carriers I believe. They are a long ways away from being militarily dominant.
My biggest concern about China is the degree to which they have infiltrated and influence American institutions.
Eventually even for Countries, budgets matter.
What happens when the US Govt finally has to admit they can/never be able to payback the 2-3 T in treasuries China owns?
If public what is your main concern? Pirating of technology?
Where is China's market? Where do they dump on the shit they make if not here? Europe?
I'm not being rhetorical here. I'm asking.
I also believe that the world's currency when only paying out 1% for 10 years and every 1% rise in interest rate adds another nearly 1T dollars more to the debt is not sustainable and there will be another country to fill that void.
Trained in econometrics/computational finance at UW, BS in Economics(BA in Philo). Had planned on being an analyst and was already doing interesting work in that regard. Graduated in 2009 soooooooo senior Prof walked in and told us that he hoped we all had a plan B for after graduation.
Spent time globe trotting as a jr. consultant monkey since the US labor market was shit. I got to put in my edits for a major white paper on the global mining market once upon a tim. Came back after getting kicked out of Chile(shady politics) and did a lot of Business certification; Pmp, Six Sigma, Lean, etc. Started prepping for econ grad school or an MBA. Got so far as to do sit down interviews and tours of campus with some swinging dicks. Ended up hired into a major consulting firm as a PM instead and started making so much money it made no sense to go back to school. Work as a program manager doing capital construction now and pretend to be an engineer a lot.
Love economics, was exposed to it through academic decathlon at a much higher and earlier level than most. I've been watching youtube interviews with Hayek and friends since they were uploaded and still do just for fun. I follow, listen, and read the work of a lot of much smarter people than me. Still invest, though mostly in aggregate and passive index stuff. It's hard to beat the market long term if you believe in market efficiency *shrug.
Also, if you are going to go on about budgets mattering it's best not to compare a country with a debt/gdp ratio estimated to be around 300%. That's also if you are generously accepting the CCP's GDP numbers which they themselves admit are inaccurate.
The world's currency is the world's currency because it's the only government in the world that hasn't ever defaulted on it's debts. It's got a low return because it's inherent risk is essentially zero.
The EU is in shambles, Russia is hilariously unreliable, the CCP won't let you transfer capital out of China, so who exactly are you going to call Daddy? Go buy more yellow bricks I guess.
Any other CCP talking points?