Financial topics

[Higgenbotham]

Wall Street is going into convulsions as the S&P drops further. It's now down on the day after being up on promises this morning from Powell of more counterfeit money. Powell will need to update his testimony to promise even more counterfeit money than he promised just a few hours ago.

[Cool Breeze]

Yes, the Fib guys I know do not trust the S&P at all right now. I'm mostly in BTC and cash. I said earlier in the year I might sit it all out come Fall.

What do you think? The next backstop is coming but I don't see it lasting more than 1 year, especially with 2022 chaos coming politically.

[Cool Breeze]

On the data front, companies paid much higher prices to producers in June with the producer price index rising 7.3% year over year, versus an estimate of 6.7%.

This is "transitory". That's a fancy way for The 97th Percentile to say we have a number today and we don't really know where we got it, but it'll be a different number tomorrow and we won't know where we got that. But the constant is they'll be counterfeiting money faster and faster. That's the part that's not transitory.

Yes, it's laughable at this point.

I wonder how many months of inflation the deflation guys get a mulligan on until they say I told you so, lol

[John]

** 14-Jul-2021 World View: Fed and the stock market

> Emergency Alert. The S&P is on its low of the day. Better call
> in the cavalry to counterfeit several more trillion and throw it
> into the stock market.

> Cities can burn and people can go hungry but the stock market must
> go higher and higher.

Vince makes an interesting point here.

> Many people think there is another two years before the Fed
> changes policy. If you look at the graph in the link below you
> can see that whenever inflation is above 3% and going up fast it
> suddenly goes down and there is a recession. This is the Fed
> taking away the punch bowl. It can not wait 2 years.

> https://howfiatdies.blogspot.com/2021/0 ... -bowl.html

• CPI, 1970 to present

Vince points out that there's a correlation between falling CPIs and
recessions. However, once the correlation has been identified,
identifying causation is more complicated.

The easiest, knee-jerk thing to say it's that it's all the Fed.
The Fed's money policy controls the level of CPI and controls
whether we have recessions.

I've been saying that the Fed has nothing to do with it in America
in the current era. Maybe the money supply mattered in the Weimar
Republic, and in Zimbabwe, and in Venezuela -- and we could discuss
why those situations are different from ours -- but not America
in the current era.

What I'm saying is that inflation is correlated not to the money
supply but to people's willingness to go (further) into debt. In the
1970s, when national debt was low, people were willing to go into
debt, and that resulted in high inflation. Today, people are already
deeply in debt and afraid to go deeper, and so the inflation rate is
lower. All it would take is one more adverse financial event to
trigger an even further pullback in debt, and an increase in savings
(i.e., decrease in velocity of money).

So Vince argues that the high rate of inflation means that the
Fed has to "take away the punch bowl" -- i.e., end massive
bond purchases to decrease the money supply. But the Fed is saying
that the inflation is transitory, and anyway, increasing the
money supply has nothing to do with inflation.

So I think that the sequence of events in each of these events is
the following:

• There's a spike in inflation, due to shortages. This causes
  economic growth, since it's probably correlated with a spike in
  borrowing.
• There's a pullback in borrowing, which causes lower inflation
  and a recession.
• The Fed panics and increases bond purchases to "print" money.
  This money goes into the stock market, so stock prices go up,
  even though there's a recession.

I'm not sure that entirely makes sense, but I think it's a good
starting point. It's certain a lot better than "more dollars chasing
fewer goods," which never works.

But if this analysis is correct, then inflation will fall (Law of
Reversion of the Mean), there will be a recession, and the Fed won't
dare "take away the punch bowl," meaning that printed money will
continue to pour into the stock market. This is the way it's been
for over a decade -- the Fed promises to reduce bond buying "soon,"
but can't or won't risk the negative consequences ("taper tantrum").

So if this is correct, then the Fed will NOT reduce bond purchases
this year, or in 2022 or 2023. This is an endless cycle that will be
broken in only one way -- global financial crisis and world war.

"If something can't go on forever, then it won't."

[vincecate]

But if this analysis is correct, then inflation will fall (Law of
Reversion of the Mean),

In this case, maybe the more important reversion to the mean is:

"Paper money eventually returns to its intrinsic value: zero." - Voltaire

https://quotesonfinance.com/quote/38/vo ... aper-money

[aeden]

37% of US GDP is in 4 Company's. As we see in South Afrika as in another month what intrinsic value will mean.
As we seen before what was buried survived as currency. The genius business plan we read was destroy producers
so we all die. Of course that minority opinion will dwindle faster and match our current demsheviks retards here also.
The revision to the mean in real time in one zone at a time.

As for Voltaire’s skepticism it descended directly from the neo-Pyrrhonians bent of mind.
Heiser is much better on eliciting reality as was Sismondi.
The period in and of the miry clay will be evident.
A Pastor was cut down on citizen patrol in His zone.
Unclear other than the obvious He was unarmed and meant well for His People.
The current issue is outside agitator's on ideological bent of mind clearly seen
fomenting further violence now also. The message received is much more dire.
Usual suspects.

Fire is seen burning bodies & gun shots ring out.
We will not know How many have already perished.

[aeden]

Treasury shorts never learn. Bz

[aeden]

Meanwhile, what we saw happening over the past few days is probably the greatest international proof of concept for the need for private firearm ownership in a century. It provided conclusive proof that there are occasions on which the armed and police forces of a country cannot and will not protect its citizens .. S

The call for moving from three days to three weeks to three months was ignored by the majority in that bloody zone.
Two million just ran out of food in one zone and the infrastructure nearby is hanging by a proverbial thread.
One of the lase sane opposition group did mention it is the last Elephant to survive and conveyed he will target
whom ever now to try and protect no matter what owns it.

[John]

** 15-Jul-2021 World View: Guns

> Meanwhile, what we saw happening over the past few days is
> probably the greatest international proof of concept for the need
> for private firearm ownership in a century. It provided conclusive
> proof that there are occasions on which the armed and police
> forces of a country cannot and will not protect its
> citizens .. S

This is true. It used to be that Barack Obama was called the greatest
gun salesman in the world, but Biden is like Obama on steroids. As I
understand it, gun sales are soaring, and even liberals are buying
guns, because they need them to defend themselves with the leftists
defunding police.

[aeden]

https://www.dailymaverick.co.za/

As we know it takes over a year planning in evil for this Ponerology in total depravity.
S found a link and I have not had time to unpack it.