Not an economist so may be interpreting this incorrectly (in which case, like we say, fuck off) -but how do you increase the monetary base by 52% in a year and not have some kind of bizarre fiscal effect?
Not an economist so may be interpreting this incorrectly (in which case, like we say, fuck off) -but how do you increase the monetary base by 52% in a year and not have some kind of bizarre fiscal effect?
You mean like the stock market going up 20% at a time where the economy cratered because some eggheads decided it was a good idea for everyone to stay home for a year? Or cryptocurrencies going over a trillion in market cap?
Not an economist so may be interpreting this incorrectly (in which case, like we say, fuck off) -but how do you increase the monetary base by 52% in a year and not have some kind of bizarre fiscal effect?
You mean like the stock market going up 20% at a time where the economy cratered because some eggheads decided it was a good idea for everyone to stay home for a year? Or cryptocurrencies going over a trillion in market cap?
Like I said in a different thread, The Throbber was on a call with a noted contrarian yesterday. He was talking in terms of weeks/months for a total collapse. Maybe OBK is more dialed in on timing.
The logical side of my brain says it should have already happened...what idiot would actually buy a 30 year govt note thinking it would be worth anything 30 years from now? It’s like the morons buying Argentina’s 50 year notes...they do realize they go bankrupt every 5 years, right?
But I’ve been amazed by the inertia and resilience of the system to stay afloat...think it may be able to prop itself up for years. In part because who is going to tell the lazy 20somethings they can’t afford new iPhones every year? That might start a Soviet-style revolution here, except with a bunch of pronouned idiots which would be truly comical if it wasn’t happening where I lived.
Not an economist so may be interpreting this incorrectly (in which case, like we say, fuck off) -but how do you increase the monetary base by 52% in a year and not have some kind of bizarre fiscal effect?
You mean like the stock market going up 20% at a time where the economy cratered because some eggheads decided it was a good idea for everyone to stay home for a year? Or cryptocurrencies going over a trillion in market cap?
Numbers are startling. I wonder ... the Fed plays its games, but is part of the trend of the stock market running on its own track separate from any reasonable proxy of a good and healthy economy, or at least the promise of one, due in part to the Creepycoug "where you gonna go" theory? That is, to people simply behave irrationally because (1) you can only buy so much stuff and (2) most people realize burying it in coffee cans in your back yard/leaving it in a deposit account is useless and leads to no wealth building?
Said another way, are a lot of people like me and don't have a better idea so the market benefits from our continuing demand? I have a new relatively large hole burning in my pocket after annual equity vestings and a great bonus ... WTF else am I going to do with it? I don't have enough confidence to go out and dump it all in one precious metal, I don't know WTF I'm doing in crypto ... in the end, the markets are a psychological game. Part of that psychology is understanding there are finite uses for your capital. We have made investing in capital markets culturally something that a broad spectrum of people do. Most of us? don't run from the market when things look scary ... at least I don't think so.
The logical side of my brain says it should have already happened...what idiot would actually buy a 30 year govt note thinking it would be worth anything 30 years from now? It’s like the morons buying Argentina’s 50 year notes...they do realize they go bankrupt every 5 years, right?
But I’ve been amazed by the inertia and resilience of the system to stay afloat...think it may be able to prop itself up for years. In part because who is going to tell the lazy 20somethings they can’t afford new iPhones every year? That might start a Soviet-style revolution here, except with a bunch of pronouned idiots which would be truly comical if it wasn’t happening where I lived.
Not an economist so may be interpreting this incorrectly (in which case, like we say, fuck off) -but how do you increase the monetary base by 52% in a year and not have some kind of bizarre fiscal effect?
You mean like the stock market going up 20% at a time where the economy cratered because some eggheads decided it was a good idea for everyone to stay home for a year? Or cryptocurrencies going over a trillion in market cap?
Numbers are startling. I wonder ... the Fed plays its games, but is part of the trend of the stock market running on its own track separate from any reasonable proxy of a good and healthy economy, or at least the promise of one, due in part to the Creepycoug "where you gonna go" theory? That is, to people simply behave irrationally because (1) you can only buy so much stuff and (2) most people realize burying it in coffee cans in your back yard/leaving it in a deposit account is useless and leads to no wealth building?
Said another way, are a lot of people like me and don't have a better idea so the market benefits from our continuing demand? I have a new relatively large hole burning in my pocket after annual equity vestings and a great bonus ... WTF else am I going to do with it? I don't have enough confidence to go out and dump it all in one precious metal, I don't know WTF I'm doing in crypto ... in the end, the markets are a psychological game. Part of that psychology is understanding there are finite uses for your capital. We have made investing in capital markets culturally something that a broad spectrum of people do. Most of us? don't run from the market when things look scary ... at least I don't think so.
There will be a time to move out... the eventual downturn has a chance to be one of the bigger ones in history, but it might be a while before it actually occurs. In the short term inventory levels are at an astounding low and the buildup to normalized just in time delivery schedules will power a significant part of the S&P. And the fed is powerful, until they decide to stop buying corporate bond crap, this market still has oxygen. or not. At some point the trajectory of the market will reflect actual earnings, revenue, net income and debt. But since debt is free right now, there has been no reckoning. At this point, unless you have a reflexive exit strategy in place and the methodology to support it, I think it may be wise to take 1/3 to 40% off of the table in favor of living for another day. Just my 2 cents.
Not an economist so may be interpreting this incorrectly (in which case, like we say, fuck off) -but how do you increase the monetary base by 52% in a year and not have some kind of bizarre fiscal effect?
You mean like the stock market going up 20% at a time where the economy cratered because some eggheads decided it was a good idea for everyone to stay home for a year? Or cryptocurrencies going over a trillion in market cap?
Numbers are startling. I wonder ... the Fed plays its games, but is part of the trend of the stock market running on its own track separate from any reasonable proxy of a good and healthy economy, or at least the promise of one, due in part to the Creepycoug "where you gonna go" theory? That is, to people simply behave irrationally because (1) you can only buy so much stuff and (2) most people realize burying it in coffee cans in your back yard/leaving it in a deposit account is useless and leads to no wealth building?
Said another way, are a lot of people like me and don't have a better idea so the market benefits from our continuing demand? I have a new relatively large hole burning in my pocket after annual equity vestings and a great bonus ... WTF else am I going to do with it? I don't have enough confidence to go out and dump it all in one precious metal, I don't know WTF I'm doing in crypto ... in the end, the markets are a psychological game. Part of that psychology is understanding there are finite uses for your capital. We have made investing in capital markets culturally something that a broad spectrum of people do. Most of us? don't run from the market when things look scary ... at least I don't think so.
There will be a time to move out... the eventual downturn has a chance to be one of the bigger ones in history, but it might be a while before it actually occurs. In the short term inventory levels are at an astounding low and the buildup to normalized just in time delivery schedules will power a significant part of the S&P. And the fed is powerful, until they decide to stop buying corporate bond crap, this market still has oxygen. or not. At some point the trajectory of the market will reflect actual earnings, revenue, net income and debt. But since debt is free right now, there has been no reckoning. At this point, unless you have a reflexive exit strategy in place and the methodology to support it, I think it may be wise to take 1/3 to 40% off of the table in favor of living for another day. Just my 2 cents.
Take it off the table and placed ... where? I suppose if a guy had some good private equity plays that might make sense ... that is, in @HoustonHusky vernacular, own something tangible and productive.
Then again, in your scenarios, if the Fed pulls out of the money game, the bond markets might become attractive again.
The last several public bond deals I've done have all been in the 3s. Great for the company; shitty for bond investors. Who wants a 3 and 7/8s 10-year note?
Not an economist so may be interpreting this incorrectly (in which case, like we say, fuck off) -but how do you increase the monetary base by 52% in a year and not have some kind of bizarre fiscal effect?
You mean like the stock market going up 20% at a time where the economy cratered because some eggheads decided it was a good idea for everyone to stay home for a year? Or cryptocurrencies going over a trillion in market cap?
Numbers are startling. I wonder ... the Fed plays its games, but is part of the trend of the stock market running on its own track separate from any reasonable proxy of a good and healthy economy, or at least the promise of one, due in part to the Creepycoug "where you gonna go" theory? That is, to people simply behave irrationally because (1) you can only buy so much stuff and (2) most people realize burying it in coffee cans in your back yard/leaving it in a deposit account is useless and leads to no wealth building?
Said another way, are a lot of people like me and don't have a better idea so the market benefits from our continuing demand? I have a new relatively large hole burning in my pocket after annual equity vestings and a great bonus ... WTF else am I going to do with it? I don't have enough confidence to go out and dump it all in one precious metal, I don't know WTF I'm doing in crypto ... in the end, the markets are a psychological game. Part of that psychology is understanding there are finite uses for your capital. We have made investing in capital markets culturally something that a broad spectrum of people do. Most of us? don't run from the market when things look scary ... at least I don't think so.
There will be a time to move out... the eventual downturn has a chance to be one of the bigger ones in history, but it might be a while before it actually occurs. In the short term inventory levels are at an astounding low and the buildup to normalized just in time delivery schedules will power a significant part of the S&P. And the fed is powerful, until they decide to stop buying corporate bond crap, this market still has oxygen. or not. At some point the trajectory of the market will reflect actual earnings, revenue, net income and debt. But since debt is free right now, there has been no reckoning. At this point, unless you have a reflexive exit strategy in place and the methodology to support it, I think it may be wise to take 1/3 to 40% off of the table in favor of living for another day. Just my 2 cents.
For this strategy to work, your “cash” needs to be accessible to deploy upon Your demand. It can’t be “frozen” in a mma until “the Market stabilizes” and all the little regulators protecting the Whales feel it’s “safe” for you to jump back into the water. (meaning, the Whales have rebalanced so now it’s Your turn)
Well short term treasuries SHY etf is one place... they barely move, and if that and other short term Treasuries ETF's have interrupted liquidity we are all in big trouble. I do remember when some money market funds either broke the buck and / or the discussion was happening but so far etf treasuries seem to be a haven. If treasuries seem to be the issue because of govt default then the Yen / US currency ETF would be the way to go because the YEN is the number 2 currency and would be the go to safe currency in the world at that moment. A sacred stash of crucifixes, worry beads, beenie babies and mood rings also make a fine investment at those moments.
If doomsday scenarios prevail then your giant warehouse of food, alcohol, toilet paper, tooth paste, gasoline and guns and ammunition become the new currency. I personally recommend 1,000 bottles of bourbon as the preferred currency at those moments.
HoustonHusky
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Not an economist so may be interpreting this incorrectly (in which case, like we say, fuck off) -but how do you increase the monetary base by 52% in a year and not have some kind of bizarre fiscal effect?
The ruse, oh excuse me. The “wryot” was just clumsy cover to get us there.
But I’ve been amazed by the inertia and resilience of the system to stay afloat...think it may be able to prop itself up for years. In part because who is going to tell the lazy 20somethings they can’t afford new iPhones every year? That might start a Soviet-style revolution here, except with a bunch of pronouned idiots which would be truly comical if it wasn’t happening where I lived.
Said another way, are a lot of people like me and don't have a better idea so the market benefits from our continuing demand? I have a new relatively large hole burning in my pocket after annual equity vestings and a great bonus ... WTF else am I going to do with it? I don't have enough confidence to go out and dump it all in one precious metal, I don't know WTF I'm doing in crypto ... in the end, the markets are a psychological game. Part of that psychology is understanding there are finite uses for your capital. We have made investing in capital markets culturally something that a broad spectrum of people do. Most of us? don't run from the market when things look scary ... at least I don't think so.
Then again, in your scenarios, if the Fed pulls out of the money game, the bond markets might become attractive again.
The last several public bond deals I've done have all been in the 3s. Great for the company; shitty for bond investors. Who wants a 3 and 7/8s 10-year note?
If doomsday scenarios prevail then your giant warehouse of food, alcohol, toilet paper, tooth paste, gasoline and guns and ammunition become the new currency. I personally recommend 1,000 bottles of bourbon as the preferred currency at those moments.