investmentwatchblog--2020-08-27--Tucker Carlson Goes Off on Lawless Political Leaders Including Nikki Haley for Encouraging Violence…

Tucker Carlson Goes Off on Lawless Political Leaders Including Nikki Haley for Encouraging Violence…   Jim Jordan: “Democrats Want ‘Chaos’ Because They Want To Count Ballots After Election Day”

Democrats want ‘ chaos ’ because they want to count ballots after election day : Rep. Jim Jordan t.co/NAnWMARyZd @ @ @ @

Tucker aired the important footage nationally—good.
Haley should change parties.
Democrats want ‘chaos’ because they want to count ballots after election day: Rep. Jim Jordan t.co/NAnWMARyZd @MorningsMaria @FoxBusiness
— Maria Bartiromo (@MariaBartiromo) August 25, 2020


investmentwatchblog--2020-08-27--ECONOMIC & SOCIAL CHAOS IN A WORLD ON THE BRINK

The violence from Antifa & BLM is out of control , and so is the Federal Reserve ’ s Dollar @ @ @ @ @ hits a new all time high while consumer confidence plummets to a six year low @ @ @ @ @ economic and social chaos in a world on the brink .

Bob Kudla with Sean on SGTreport
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The violence from Antifa & BLM is out of control, and so is the Federal Reserve’s Dollar printing, as the NASDAQ hits a new all time high while consumer confidence plummets to a six year low. It’s manufactured economic and social chaos in a world on the brink.


investmentwatchblog--2020-08-27--Who Is Telling The Truth, Doc Copper Or The Bond Market???

A good deal of the time , Doc Copper and Yields tend to move in the same direction .
Of late , something strange is taking place !
This chart looks at Doc Copper ( Green ) and the Yield on the 10-year note ( Red ) .
Both headed sharply lower and bottomed together in March of this year .
Since then , Doc Copper has experienced a very sharp rally ( up over 40 % off the lows ) and yet yields are near all-time lows .
This price action has created one of the largest spreads in @ @ @ @ @ @ @ is telling the truth ?
Is ole Doc Copper suggesting that the economies around the world are improving and the likelihood of inflation is increasing ?
Are flat to falling yields suggesting that the economy will not improve and inflation should be of no concern to the Fed ?
The takeaway from this chart ; One asset is likely to be very misleading/not telling the truth currently and a giant game of “ catch-up ” will take place .
This mispricing in time will lead to a wonderful trading opportunity in my humble @ @

by Chris Kimble
A good deal of the time, Doc Copper and Yields tend to move in the same direction. Of late, something strange is taking place!
This chart looks at Doc Copper (Green) and the Yield on the 10-year note (Red).
Both headed sharply lower and bottomed together in March of this year. Since then, Doc Copper has experienced a very sharp rally (up over 40% off the lows) and yet yields are near all-time lows.
We are primarily funded by readers. Please subscribe and donate to support us!
This price action has created one of the largest spreads in years over the past 5-months.
Who is telling the truth?
Is ole Doc Copper suggesting that the economies around the world are improving and the likelihood of inflation is increasing?
Are flat to falling yields suggesting that the economy will not improve and inflation should be of no concern to the Fed?
The takeaway from this chart; One asset is likely to be very misleading/not telling the truth currently and a giant game of “catch-up” will take place. This mispricing in time will lead to a wonderful trading opportunity in my humble opinion.


Is California Over?

By now it ’ s painfully obvious that we humans tend to ruin our favorite places by overrunning them .
And no place makes this point better than California .
An absolute paradise 25 million people ago , parts of it are now a hellscape of Mad Maxian proportions .
Consider : Rolling blackouts due in part to bad planning and in part to overpopulation are disrupting businesses and making homes unbearable in 100-degree summer heat .
Wildfires , due in part to excess people being shunted into “ suburbs ” surrounded by brushland , are burning thousands of houses @ @ @ @ @ @ @ to call those canyons and hillsides home .
See Sanctuary for endangered condors burns in California wildfire .
As for California ’ s cities , well , here ’ s podcaster Joe Rogan ’ s brutal discussion of LA ’ s homeless situation : And the above is just the physical manifestation of an unsustainable development model .
The financial side of things is even uglier .
Public-sector unions now control state politics and have engineered pension plans that are both wildly overgenerous and catastrophically unfunded .
So even in the absence of @ @ @ @ @ @ @ the state would be careening towards bankruptcy .
What is California ’ s solution ?
Retroactive wealth taxes that reach out and pick the pockets of people who have already left .
Now even the New York Times , which generally sympathizes with California ’ s political model , acknowledges that the left coast is sliding into the abyss .
A snippet from NYT columnist Farhad Manjoo : California , We Can ’ t Go On Like This Across much of California in the last two weeks , many of my friends and @ @ @ @ @ @ @ Is it safer to conduct your life outdoors and avoid the coronavirus , or should you rush inside , the better to escape the choking heat , toxic smoke and raining ash ?
Such has been the gagging unwinnability of life in the nation ’ s most populous state in the sweltering summer of 2020 , in what I have been assured is the greatest country ever to have existed .
The virus begs you to open a window ; the inferno forces you to keep it shut .
When the coronavirus first @ @ @ @ @ @ @ lawmakers responded quickly and effectively , becoming a model for the rest of the nation .
But as the early wins faded and the cases spiked , each day this summer has felt like another slide down an inevitable spiral of failure .
The virus keeps crashing into California ’ s many other longstanding dysfunctions , from housing to energy to climate change to disaster planning , and the compounding ruin is piling up like BMWs on the 405 .
Consider : To keep the pestilence at bay , many of California ’ @ @ @ @ @ @ @ week .
But to satisfy surging energy demand linked to record-shattering heat ( and a host of other mysterious reasons ) , state utilities had to impose rolling blackouts , forcing schools to come up with energy contingency plans to add to their virus contingency plans , now that millions of students face the threat of intermittent electricity .
For decades , California has relied on conscripted prisoners as a cheap way to fight its raging fires .
But to stave off coronavirus outbreaks in our long-overcrowded prisons , authorities released thousands of @ @ @ @ @ @ @ as climate change has ushered in a new era of “ megafires ” that includes some of the largest blazes the state has ever faced , the early release of inmates has left the state dangerously short of prisoners to exploit in battling the flames .
What is California ’ s fundamental trouble ?
Neither socialism nor Trumpian neglect and incompetence , but something more elemental to life in the Golden State : A refusal by many Californians to live sustainably and inclusively , to give up a little bit of their own @ @ @ @ @ @ @ suburbia , the ideal of much of American suburbia , was built and sold on the promise of endless excess — everyone gets a car , a job , a single-family home and enough water and gasoline and electricity to light up the party .
But it is long past obvious that infinitude was a false promise .
Traffic , sprawl , homelessness and ballooning housing costs are all consequences of our profligacy with the land and our other resources .
In addition to a hotter , drier climate , the fires , @ @ @ @ @ @ @ way of life .
Many blazes were worsened by Californians moving into areas near forests known as the “ urban-wildland interface.
” Once people move near forested land , fires tend to follow — either because they deliberately or inadvertently ignite them , or because they need electricity , delivered by electrical wires that can cause sparks that turn into conflagrations .
As the fires blazed around us this time last year , I warned of the “ end of California as we know it ” — that if we didn ’ t @ @ @ @ @ @ @ , the climate and the high cost of living would make the state uninhabitable for large numbers of people .
The take-away ?
Beyond a certain point even a place like California , blessed as it is with both Hollywood and Silicon Valley , can ’ t support the unsupportable .
So either the state , along with most of its nearly-as-badly-managed peers , gets a bailout of historic proportions with all the currency crisis/moral hazard implications that that implies .
Or California and its iconic car-centric/suburban lifestyle devolve into chaos .
Here @ @ @ @ @ @ @ which will at least provide a cautionary tale for other places now traveling the same road .

BY JOHN RUBINO
By now it’s painfully obvious that we humans tend to ruin our favorite places by overrunning them. And no place makes this point better than California. An absolute paradise 25 million people ago, parts of it are now a hellscape of Mad Maxian proportions. Consider:
Rolling blackouts due in part to bad planning and in part to overpopulation are disrupting businesses and making homes unbearable in 100-degree summer heat.
Wildfires, due in part to excess people being shunted into “suburbs” surrounded by brushland, are burning thousands of houses and roasting the unlucky wildlife that used to call those canyons and hillsides home. See Sanctuary for endangered condors burns in California wildfire.
As for California’s cities, well, here’s podcaster Joe Rogan’s brutal discussion of LA’s homeless situation:
We are primarily funded by readers. Please subscribe and donate to support us!
And the above is just the physical manifestation of an unsustainable development model. The financial side of things is even uglier. Public-sector unions now control state politics and have engineered pension plans that are both wildly overgenerous and catastrophically unfunded. So even in the absence of fires, blackouts and rising homelessness, the state would be careening towards bankruptcy.
What is California’s solution? Retroactive wealth taxes that reach out and pick the pockets of people who have already left.
Now even the New York Times, which generally sympathizes with California’s political model, acknowledges that the left coast is sliding into the abyss. A snippet from NYT columnist Farhad Manjoo:
California, We Can’t Go On Like This Across much of California in the last two weeks, many of my friends and neighbors have faced a dead-end choice: Is it safer to conduct your life outdoors and avoid the coronavirus, or should you rush inside, the better to escape the choking heat, toxic smoke and raining ash? Such has been the gagging unwinnability of life in the nation’s most populous state in the sweltering summer of 2020, in what I have been assured is the greatest country ever to have existed. The virus begs you to open a window; the inferno forces you to keep it shut. When the coronavirus first landed in America, California’s lawmakers responded quickly and effectively, becoming a model for the rest of the nation. But as the early wins faded and the cases spiked, each day this summer has felt like another slide down an inevitable spiral of failure. The virus keeps crashing into California’s many other longstanding dysfunctions, from housing to energy to climate change to disaster planning, and the compounding ruin is piling up like BMWs on the 405. Consider: To keep the pestilence at bay, many of California’s children began attending school online last week. But to satisfy surging energy demand linked to record-shattering heat (and a host of other mysterious reasons), state utilities had to impose rolling blackouts, forcing schools to come up with energy contingency plans to add to their virus contingency plans, now that millions of students face the threat of intermittent electricity. For decades, California has relied on conscripted prisoners as a cheap way to fight its raging fires. But to stave off coronavirus outbreaks in our long-overcrowded prisons, authorities released thousands of inmates earlier this year. Now, as climate change has ushered in a new era of “megafires” that includes some of the largest blazes the state has ever faced, the early release of inmates has left the state dangerously short of prisoners to exploit in battling the flames. What is California’s fundamental trouble? Neither socialism nor Trumpian neglect and incompetence, but something more elemental to life in the Golden State: A refusal by many Californians to live sustainably and inclusively, to give up a little bit of their own convenience for the collective good. Californian suburbia, the ideal of much of American suburbia, was built and sold on the promise of endless excess — everyone gets a car, a job, a single-family home and enough water and gasoline and electricity to light up the party. But it is long past obvious that infinitude was a false promise. Traffic, sprawl, homelessness and ballooning housing costs are all consequences of our profligacy with the land and our other resources. In addition to a hotter, drier climate, the fires, too, are fanned by an unsustainable way of life. Many blazes were worsened by Californians moving into areas near forests known as the “urban-wildland interface.” Once people move near forested land, fires tend to follow — either because they deliberately or inadvertently ignite them, or because they need electricity, delivered by electrical wires that can cause sparks that turn into conflagrations. As the fires blazed around us this time last year, I warned of the “end of California as we know it” — that if we didn’t begin to radically alter how we live, the climate and the high cost of living would make the state uninhabitable for large numbers of people.
The take-away? Beyond a certain point even a place like California, blessed as it is with both Hollywood and Silicon Valley, can’t support the unsupportable. So either the state, along with most of its nearly-as-badly-managed peers, gets a bailout of historic proportions with all the currency crisis/moral hazard implications that that implies. Or California and its iconic car-centric/suburban lifestyle devolve into chaos.
Here’s hoping for the latter, which will at least provide a cautionary tale for other places now traveling the same road.


investmentwatchblog--2020-08-27--Sarah Sanders Reveals the ONE REASON Why Joe Biden Should be DISQUALIFIED for President

Yael Halon from FOX News reports , Joe Biden ’ s pro-abortion stance should disqualify him as a candidate for @ @ @ @ @ office , former White House press secretary Sarah Sanders told “ Tucker Carlson Tonight ” @ @

Yael Halon from FOX News reports, Joe Biden’s pro-abortion stance should disqualify him as a candidate for the nation’s highest office, former White House press secretary Sarah Sanders told “Tucker Carlson Tonight” Monday.
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Read More/Source/Credit/FairUse:
www.foxnews.com/politics/sara…


investmentwatchblog--2020-08-28--Things Have Gotten So Bad That A Million New Claims For Unemployment Benefits In One Week Is Conside

Things Have Gotten So Bad That A Million New Claims For Unemployment Benefits In One Week Is Considered “Good News”

The Labor Department announced on Thursday that another 1.006 million Americans filed new claims for unemployment benefits last week .
Prior to this year , the all-time record for a single week was just 695,000 , and so the number of Americans that are losing their jobs each week continues to remain at a catastrophic level .
But this latest figure is actually being spun as “ good news ” because at least it was lower than the week before .
And I am willing to concede that point , because we should definitely welcome any sign that the numbers @ @ @ @ @ @ @ direction .
However , there is no doubt that what we have experienced up to this point in 2020 is nothing short of an economic cataclysm .
Over the last 23 weeks , more than 58 million Americans have filed new claims for unemployment benefits .
Even if zero workers filed for unemployment for the rest of 2020 , this would still be the worst year for unemployment claims in all of U.S. history by a gigantic margin .
Vast hordes of workers have been losing their jobs week after week as the @ @ @ @ @ @ @ of our eyes .
This has truly been an economic horror show , and the most nightmarish chapters are still ahead of us .
When economic numbers start getting really bad , the government often decides to “ modify ” how they are calculated , and on Thursday the Labor Department announced that it will be “ changing how it adjusts weekly jobless-claims figures for seasonal swings ” .
Presumably , that should help the numbers look a bit better starting next week .
But no matter how much they massage the numbers @ @ @ @ @ @ @ fact that tens of millions of people are deeply hurting right now .
According to one new survey , 61 percent of Americans need “ another relief bill ” , and about two-thirds of Americans from the age of 24 to the age of 54 say that they are currently in financial distress… If you are not in financial distress at this moment , you should be very thankful for your blessings , because you are definitely in the minority .
And more layoff announcements just keep on coming with each passing day @ @ @ @ @ @ @ Lord & Taylor will be laying off all their workers and closing every single store… When I was a kid , I was always so intimidated by Lord & Taylor when my mother would take me to the mall .
I always thought that was where the rich people shopped .
I never imagined that someday I would see it go out of business forever .
Of course countless other retailers are going belly up as the worst “ retail apocalypse ” in U.S. history rolls on .
According to Coresight Research , @ @ @ @ @ @ @ the United States “ will close over the next three to five years ” … Can you imagine what our country is going to look like if that actually happens ?
Already , communities all over America are being blighted by one boarded up property after another , and this is especially true in many impoverished areas .
Of course our economic problems have been accelerated by a series of very unusual events that have been beyond our control .
It has been one thing after another here in 2020 , and the @ @ @ @ @ @ @ Hurricane Laura .
We were extremely fortunate that neither New Orleans or Houston took a direct hit from this storm , because it was enormously destructive .
Just consider what one survivor told the press about the devastation in his community… Let us hope that we will have at least a little bit of time before the next major crisis comes along .
Many had been hoping that August would be a quiet month , but that didn ’ t turn out to be the case , and now September is just a @ @ @ @ @ @ @ approach the fall season , it is being reported that wealthy investors have been “ hoarding cash ” … Is this a sign that many of them believe that trouble is ahead for the financial markets ?
Of course it isn ’ t just the wealthy that are deeply concerned about the months ahead .
Our nation has been gripped by endless turmoil for most of this year , and now a very hotly contested presidential election is just over two months away .
Meanwhile , economic conditions will continue to deteriorate , @ @ @ @ @ @ @ of Americans will become even more angry and even more frustrated .
If you believe that the U.S. is just going to snap out of all of this somehow and everything will turn out just fine in the end , then you simply do not understand the times in which we are living .
For so long we were warned that a “ perfect storm ” was coming , and now it is here .
And if you think that 2020 has been bad , just wait until you see what else is @ @

by Michael Snyder
The Labor Department announced on Thursday that another 1.006 million Americans filed new claims for unemployment benefits last week. Prior to this year, the all-time record for a single week was just 695,000, and so the number of Americans that are losing their jobs each week continues to remain at a catastrophic level. But this latest figure is actually being spun as “good news” because at least it was lower than the week before. And I am willing to concede that point, because we should definitely welcome any sign that the numbers are starting to move in the right direction. However, there is no doubt that what we have experienced up to this point in 2020 is nothing short of an economic cataclysm. Over the last 23 weeks, more than 58 million Americans have filed new claims for unemployment benefits. Even if zero workers filed for unemployment for the rest of 2020, this would still be the worst year for unemployment claims in all of U.S. history by a gigantic margin. Vast hordes of workers have been losing their jobs week after week as the U.S. economy melts down right in front of our eyes. This has truly been an economic horror show, and the most nightmarish chapters are still ahead of us.
When economic numbers start getting really bad, the government often decides to “modify” how they are calculated, and on Thursday the Labor Department announced that it will be “changing how it adjusts weekly jobless-claims figures for seasonal swings”.
Presumably, that should help the numbers look a bit better starting next week.
But no matter how much they massage the numbers, they can’t erase the fact that tens of millions of people are deeply hurting right now. According to one new survey, 61 percent of Americans need “another relief bill”, and about two-thirds of Americans from the age of 24 to the age of 54 say that they are currently in financial distress…
The latest survey by MagnifyMoney reveals 61 percent of the country needs another relief bill to pay for expenses. Over 80 percent of workers who have been laid off or furloughed due to COVID-19 are counting on more assistance. The poll of 1,010 Americans adds 71 percent of Generation X (ages 40 to 54) and 65 percent of millennials (ages 24 to 39) say they are currently in financial distress.
If you are not in financial distress at this moment, you should be very thankful for your blessings, because you are definitely in the minority.
And more layoff announcements just keep on coming with each passing day. On Thursday, we learned that Lord & Taylor will be laying off all their workers and closing every single store…
Lord & Taylor, the first department store established in the United States, is officially going out of business, ending a nearly 200-year run. The bankrupt company announced Thursday that all of its 38 remaining stores and website have begun liquidation sales — a reversal from last week’s decision to keep 14 locations open.
When I was a kid, I was always so intimidated by Lord & Taylor when my mother would take me to the mall.
I always thought that was where the rich people shopped.
I never imagined that someday I would see it go out of business forever.
We are primarily funded by readers. Please subscribe and donate to support us!
Of course countless other retailers are going belly up as the worst “retail apocalypse” in U.S. history rolls on. According to Coresight Research, approximately 25 percent of all malls in the United States “will close over the next three to five years”…
Another new report out this week from Coresight Research estimates 25% of America’s roughly 1,000 malls will close over the next three to five years, with the pandemic accelerating a demise that was already underway before the new virus emerged.
Can you imagine what our country is going to look like if that actually happens?
Already, communities all over America are being blighted by one boarded up property after another, and this is especially true in many impoverished areas.
Of course our economic problems have been accelerated by a series of very unusual events that have been beyond our control. It has been one thing after another here in 2020, and the latest major disaster to hit us was Hurricane Laura. We were extremely fortunate that neither New Orleans or Houston took a direct hit from this storm, because it was enormously destructive. Just consider what one survivor told the press about the devastation in his community…
“It looks like 1,000 tornadoes went through here. It’s just destruction everywhere,” said Brett Geymann, who rode out the storm with three family members in Moss Bluff, near Lake Charles, Louisiana. He described Laura passing over his house with the roar of a jet engine around 2 a.m.
Let us hope that we will have at least a little bit of time before the next major crisis comes along. Many had been hoping that August would be a quiet month, but that didn’t turn out to be the case, and now September is just a few days away.
And as we approach the fall season, it is being reported that wealthy investors have been “hoarding cash”…
A group of multimillionaire investors in the U.S. are hoarding cash at unprecedented levels. Tiger 21, a club of more than 800 investors, reported Thursday that its members have raised their cash holdings to 19% of their total assets on concerns over the economic consequences of the covid pandemic in the U.S. That’s up from about 12% since the start of the outbreak. About a quarter now expect the crisis to continue until the end of next June, the group said.
Is this a sign that many of them believe that trouble is ahead for the financial markets?
Of course it isn’t just the wealthy that are deeply concerned about the months ahead. Our nation has been gripped by endless turmoil for most of this year, and now a very hotly contested presidential election is just over two months away. Meanwhile, economic conditions will continue to deteriorate, and that means that tens of millions of Americans will become even more angry and even more frustrated. If you believe that the U.S. is just going to snap out of all of this somehow and everything will turn out just fine in the end, then you simply do not understand the times in which we are living.
For so long we were warned that a “perfect storm” was coming, and now it is here.
And if you think that 2020 has been bad, just wait until you see what else is ahead.


investmentwatchblog--2020-08-28--America’s Metastasizing Class Wars

America’s Metastasizing Class Wars

Class wars are the inevitable result of an economic system in which ‘ anything goes if you ’ re rich enough and winners take most ’ .
The traditional class war has been waged between wage-earners ( who sell their labor ) and their employers ( owners of capital and the means of production ) .
These classes have been assigned various names ( proletariat , bourgeoisie , capitalists , etc . )
but these broad class definitions don ’ t describe all the class conflicts emerging in the modern U.S. economy .
Before we dig deeper , let ’ @ @ @ @ @ @ @ of capital still defines class : the wealthy live off unearned income skimmed from capital and everyone else lives off earned income from selling their labor .
( Those without either source of income become dependents of the State ) .
What you own or don ’ t own defines your class interests , but these have been fragmented into a multitude of sub-classes .
Six years ago I took a stab at defining America ’ s Nine Classes : The New Class Hierarchy ( April 29 , 2014 ) , to which @ @ @ @ @ @ @ , gig economy precariat , who paradoxically may own one of the means of production such as the car needed to become an Uber driver , but the precariat doesn ’ t own the controlling means of production , which is the Uber platform .
As a consequence , all the profits flow to the owners of the platform .
Since the gig economy is not traditional hourly employment , there is no employer-provided security at all .
My taxonomy of class in America : To which we add a new category of @ @ @ @ @ @ @ minimal security of the conventional Working Poor ( such as Amazon fulfillment center workers ) : For the purposes of today ’ s discussion , let ’ s focus on the conflicts between four classes : 1 .
The Central State , which includes the elected government , the permanent Deep State , the Federal Reserve and and the managers/technocrats who run the State Nomenklatura .
2 .
The owners of Capital and political influence ( The Oligarchs and New Nobility ) .
3 .
The Upper Caste , the top 10 % @ @ @ @ @ @ @ The lower classes of wage-earners and state dependents .
It comes as no surprise that there is no class conflict between the State and the Oligarchs / New Nobility since ours is a state-corporate system in which the state enforces the privileges of the super-wealthy /corporations , as the political class depends on the owners of capital for campaign contributions .
In return , the super-wealthy and corporations are awarded tax breaks and subsidies which lower their tax burdens below the rates paid by wage-earners .
The conflicts between the Central State and @ @ @ @ @ @ @ of income taxes are sharpening .
While Social Security taxes weigh heavily on lower-income workers , the bottom 50 % pay almost no federal income taxes and those between 51 % and 89 % pay a modest percent of all income taxes .
Unlike the managers/technocrats of the State Nomenklatura who are guaranteed benefits and pensions ( since the state can always print the money to pay them ) , the private-sector Upper Caste must rely on 401Ks and their own private wealth–all of which is exposed to the hazards of state actions @ @ @ @ @ @ @ , etc . )
and whatever market forces are still outside the control of the Federal Reserve .
The Upper Caste resents the heavy taxes they pay as the state fails to provide even the basics of security and infrastructure .
From the point of view of the Upper Caste , the state provides substandard education for their children , potholed roadways , modest Social Security and no healthcare until retirement ( Medicare ) .
Upper Caste entrepreneurs resent the heavy regulatory burdens and the privileges lavished on corporations and the super-wealthy .
@ @ @ @ @ @ @ and New Nobility who pay a lower percentage of their income in taxes .
The Financial Aristocracy can work the tax system to report income as capital gains ( a much lower rate than earned income ) and use a vast cornucopia of tax breaks and subsidies to reduce their tax burden .
The wage-earning lower classes resent the Upper Caste and the Oligarchs for obvious reasons , but they also resent the State dependents , many of whom live better than those working one of America ’ s tens of millions of @ @ @ @ @ @ @ expect State dependents to love their servitude , but they have reasons to resent the State as well .
Dependency breeds resentment , and this is exacerbated by loads of paperwork ( imposed to weed out fraud and scammers ) and the general inadequacy of many state benefits .
Meanwhile , the state managers/technocrats and politicos live in the same bubbles as the New Nobility .
( The Oligarchs live in a much more rarified bubble , of course . )
For these Protected Few , the system works great for me so @ @ @ @ @ @ @ .
Alas , it only works for the top slice of American society which vigorously maintains the bubble separating it from the coarse realities of the bottom 80 % .
In summary , class wars are the inevitable result of an economic system in which anything goes if you ’ re rich enough and winners take most .
While the working poor are recruited to fight and die in the Imperial Project , the super-wealthy focus on philanthro-capitalist foundations which are simply non-profit extensions of their for-profit power .
Social Mobility between classes @ @ @ @ @ @ @ .
Go ahead and do all the right things–borrow a fortune to get a college degree , build your resume with low-paying jobs working ridiculous hours , and so on , and eventually conclude you ’ re a precariat just like everyone else .
Maybe a better paid precariat , or maybe a poorly paid precariat , but that narrow band is all the Financial Mobility you ’ re ever going to get .
The winners in this system are protected by the State , while the losers are stripmined by crushing taxes @ @ @ @ @ @ @ the state .
Even if they don ’ t understand the exact mechanisms of financial control–the Federal Reserve ’ s bag of tricks , for example–they understand the rich get richer and the state protects them from the lower classes .
The danger to the state is not who rebels but who opts out .
Outright rebellion suits the state , as it can turn its monopoly on force on the citizenry .
But when those keeping everything glued together have had enough and find a way to quit , the entire system @ @ @ @ @ @ @ powerless to stop .
If the Upper Caste starts opting out , the private sector loses its tax donkeys and managerial expertise .
If what remains of the middle class opts out , what ’ s left of America ’ s civic glue disappears .
If the working poor opt out , the scut work required to provide the upper classes with their comforts will not get done .
( Hey , Mr. State Bureaucrat and Mr. Financier , here ’ s a saw and a knife .
Butcher your own meat .
@ @ @ @ @ @ @ of America ’ s class system might decide to follow Johnny Paycheck and Take This Job And Shove It ( 2:31 ) .
Becoming a dependent of the State is looking better all the time .
State Nomenklatura managers/technocrats also have reasons to opt out .
Their efforts to keep the whole thing glued together are not appreciated , for as I ’ ve noted here before , governing in an era of unraveling discord is no longer fun .
Conflicts within the upper reaches of the Deep State are also deepening as @ @ @ @ @ @ @ regardless of cost are meeting resistance from camps who recognize the impossibility of maintaining the current trajectory of soaring inequality and the infinite demands of the Imperial Project .
There ’ s only so much inequality and unfairness an over-promised populace can bear , and America is well past that point .
To those who claim “ people can ’ t afford to quit , ” just watch .
Those who ’ ve had enough will find a way to opt out .
There ’ s plenty of woodwork to disappear into .
@ @ @ @ @ @ @ Oligarchy and New Nobility ’ s skim of virtually all gains in the economy .
Anything goes if you ’ re rich enough and winners take most .
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by Charles Hugh-Smith
Class wars are the inevitable result of an economic system in which ‘anything goes if you’re rich enough and winners take most’.
The traditional class war has been waged between wage-earners (who sell their labor) and their employers (owners of capital and the means of production). These classes have been assigned various names (proletariat, bourgeoisie, capitalists, etc.) but these broad class definitions don’t describe all the class conflicts emerging in the modern U.S. economy.
Before we dig deeper, let’s stipulate that ownership of various forms of capital still defines class: the wealthy live off unearned income skimmed from capital and everyone else lives off earned income from selling their labor. (Those without either source of income become dependents of the State).
What you own or don’t own defines your class interests, but these have been fragmented into a multitude of sub-classes. Six years ago I took a stab at defining America’s Nine Classes: The New Class Hierarchy (April 29, 2014), to which I would now add a tenth class, gig economy precariat, who paradoxically may own one of the means of production such as the car needed to become an Uber driver, but the precariat doesn’t own the controlling means of production, which is the Uber platform.
As a consequence, all the profits flow to the owners of the platform. Since the gig economy is not traditional hourly employment, there is no employer-provided security at all.
My taxonomy of class in America:
1. The Deep State.
2. The Oligarchs.
3. New Nobility.
4. Upper Caste.
5. State Nomenklatura.
6. The Middle Class.
7. The Working Poor.
8. State Dependents.
9. Mobile Creatives.
To which we add a new category of the working poor who lack even the minimal security of the conventional Working Poor (such as Amazon fulfillment center workers):
10. Gig economy precariat.
For the purposes of today’s discussion, let’s focus on the conflicts between four classes:
1. The Central State, which includes the elected government, the permanent Deep State, the Federal Reserve and and the managers/technocrats who run the State Nomenklatura.
2. The owners of Capital and political influence (The Oligarchs and New Nobility).
3. The Upper Caste, the top 10% of the private sector.
4. The lower classes of wage-earners and state dependents.
It comes as no surprise that there is no class conflict between the State and the Oligarchs / New Nobility since ours is a state-corporate system in which the state enforces the privileges of the super-wealthy /corporations, as the political class depends on the owners of capital for campaign contributions. In return, the super-wealthy and corporations are awarded tax breaks and subsidies which lower their tax burdens below the rates paid by wage-earners.
The conflicts between the Central State and the Upper Caste which pays the majority of income taxes are sharpening. While Social Security taxes weigh heavily on lower-income workers, the bottom 50% pay almost no federal income taxes and those between 51% and 89% pay a modest percent of all income taxes.
Unlike the managers/technocrats of the State Nomenklatura who are guaranteed benefits and pensions (since the state can always print the money to pay them), the private-sector Upper Caste must rely on 401Ks and their own private wealth–all of which is exposed to the hazards of state actions (raising taxes, firing up inflation, etc.) and whatever market forces are still outside the control of the Federal Reserve.
The Upper Caste resents the heavy taxes they pay as the state fails to provide even the basics of security and infrastructure. From the point of view of the Upper Caste, the state provides substandard education for their children, potholed roadways, modest Social Security and no healthcare until retirement (Medicare).
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Upper Caste entrepreneurs resent the heavy regulatory burdens and the privileges lavished on corporations and the super-wealthy.
The Upper Caste also resents the Oligarchs and New Nobility who pay a lower percentage of their income in taxes. The Financial Aristocracy can work the tax system to report income as capital gains (a much lower rate than earned income) and use a vast cornucopia of tax breaks and subsidies to reduce their tax burden.
The wage-earning lower classes resent the Upper Caste and the Oligarchs for obvious reasons, but they also resent the State dependents, many of whom live better than those working one of America’s tens of millions of low-paid, few-benefits jobs.
You might expect State dependents to love their servitude, but they have reasons to resent the State as well. Dependency breeds resentment, and this is exacerbated by loads of paperwork (imposed to weed out fraud and scammers) and the general inadequacy of many state benefits.
Meanwhile, the state managers/technocrats and politicos live in the same bubbles as the New Nobility. (The Oligarchs live in a much more rarified bubble, of course.) For these Protected Few, the system works great for me so it must work great for everyone else. Alas, it only works for the top slice of American society which vigorously maintains the bubble separating it from the coarse realities of the bottom 80%.
In summary, class wars are the inevitable result of an economic system in which anything goes if you’re rich enough and winners take most. While the working poor are recruited to fight and die in the Imperial Project, the super-wealthy focus on philanthro-capitalist foundations which are simply non-profit extensions of their for-profit power.
Social Mobility between classes has decayed, and people grasp this. Go ahead and do all the right things–borrow a fortune to get a college degree, build your resume with low-paying jobs working ridiculous hours, and so on, and eventually conclude you’re a precariat just like everyone else. Maybe a better paid precariat, or maybe a poorly paid precariat, but that narrow band is all the Financial Mobility you’re ever going to get.
The winners in this system are protected by the State, while the losers are stripmined by crushing taxes or humiliated by their abject dependence on the state. Even if they don’t understand the exact mechanisms of financial control–the Federal Reserve’s bag of tricks, for example–they understand the rich get richer and the state protects them from the lower classes.
The danger to the state is not who rebels but who opts out. Outright rebellion suits the state, as it can turn its monopoly on force on the citizenry. But when those keeping everything glued together have had enough and find a way to quit, the entire system starts unraveling in ways the state is powerless to stop.
If the Upper Caste starts opting out, the private sector loses its tax donkeys and managerial expertise. If what remains of the middle class opts out, what’s left of America’s civic glue disappears.
If the working poor opt out, the scut work required to provide the upper classes with their comforts will not get done. (Hey, Mr. State Bureaucrat and Mr. Financier, here’s a saw and a knife. Butcher your own meat.)
Those trapped in the lower reaches of America’s class system might decide to follow Johnny Paycheck and Take This Job And Shove It (2:31). Becoming a dependent of the State is looking better all the time.
State Nomenklatura managers/technocrats also have reasons to opt out. Their efforts to keep the whole thing glued together are not appreciated, for as I’ve noted here before, governing in an era of unraveling discord is no longer fun.
Conflicts within the upper reaches of the Deep State are also deepening as those seeking to extend the status quo regardless of cost are meeting resistance from camps who recognize the impossibility of maintaining the current trajectory of soaring inequality and the infinite demands of the Imperial Project.
There’s only so much inequality and unfairness an over-promised populace can bear, and America is well past that point.
To those who claim “people can’t afford to quit,” just watch. Those who’ve had enough will find a way to opt out. There’s plenty of woodwork to disappear into.
Here’s a chart of the Oligarchy and New Nobility’s skim of virtually all gains in the economy. Anything goes if you’re rich enough and winners take most.
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investmentwatchblog--2020-08-28--Gold has reached the 2000 Dollar Plateau and it probably is the new “normal”

Even after investors sell off some of their gold to capitalize on their winnings , Harald Seiz , CEO and founder of Karatbars International , says the price of the precious metal will remain stable .
( KFo ) After reaching all-time highs this month , there is has been an understandable adjustment of the gold price over the last few weeks .
Gold and silver prices had been steadily rising since May , before gold took an 8 % dive and silver ended up losing closer to 20 % .
But that trend was stopped abruptly .
After the @ @ @ @ @ @ @ it was time for the bargain hunters to make their move .
“ Buying at $ 1.850 – $ 1.900 seems unattractive , if not panicky.
” , says Harald Seiz , but he thinks the current price level for gold is stable for the foreseeable future .
A mix of improving forecasts for the economy and government aid programs tug at gold in both directions Gold will come under pressure as economic data for the United States and other industrialized countries improves over the next months , also contingent on a more @ @ @ @ @ @ @ for the Corona virus .
At the same time governments will continue to introduce aid programs and pump money into the economy to increase purchasing power while risking inflation by doing so .
According to Seiz the one aspect that will have the gold price trending above 2.000 Dollars is the ongoing and lasting demand for the commodity .
“ If it weren ’ t for the basic regularities of the economy of supply-and-demand , we probably would be witnessing a slow downward spiral over the next couple of months.
” , Seiz @ @ @ @ @ @ @ precious metal is a store of value that , if not a currency on its own merits , would survive the harshest economic crisis and be tradeable with any new government introduced currency .
Any plan is only as good as the gold you own At the end of August the Economic Policy Symposium , the annual Central Bank summit , will take place , in a virtual setting because of the pandemic , in Jackson Hole , Wyoming .
The symposium has had an impact on the gold price in the past @ @ @ @ @ @ @ Chairman of the Federal Reserve will be watched closely .
This year ’ s title of the symposium is “ Navigating the Decade Ahead : Implications for Monetary Policy ” .
Harald Seiz commends bankers and economists for trying to lay out economic strategies for the future , but also warns that we ’ ve painfully witnessed this year that contingency plans are needed for unforeseen events as the one we ’ re living through currently .
Considering all these variables , Seiz is certain that gold will continue to be a valuable @ @ @ @ @ @ @ investors to simultaneously participate in the stock markets and buttress their long-term financial security .
Disclaimer : This content does not necessarily represent the views of IWB .

Even after investors sell off some of their gold to capitalize on their winnings, Harald Seiz, CEO and founder of Karatbars International, says the price of the precious metal will remain stable.(KFo)
After reaching all-time highs this month, there is has been an understandable adjustment of the gold price over the last few weeks. Gold and silver prices had been steadily rising since May, before gold took an 8% dive and silver ended up losing closer to 20%. But that trend was stopped abruptly. After the profit takers had satisfied their needs, it was time for the bargain hunters to make their move. “Buying at $ 1.850 – $ 1.900 seems unattractive, if not panicky.”, says Harald Seiz, but he thinks the current price level for gold is stable for the foreseeable future.
A mix of improving forecasts for the economy and government aid programs tug at gold in both directions
Gold will come under pressure as economic data for the United States and other industrialized countries improves over the next months, also contingent on a more probable than possible discovery of a cure for the Corona virus. At the same time governments will continue to introduce aid programs and pump money into the economy to increase purchasing power while risking inflation by doing so.
According to Seiz the one aspect that will have the gold price trending above 2.000 Dollars is the ongoing and lasting demand for the commodity. “If it weren’t for the basic regularities of the economy of supply-and-demand, we probably would be witnessing a slow downward spiral over the next couple of months.”, Seiz adds. People have internalized that the precious metal is a store of value that, if not a currency on its own merits, would survive the harshest economic crisis and be tradeable with any new government introduced currency.
We are primarily funded by readers. Please subscribe and donate to support us!
Any plan is only as good as the gold you own
At the end of August the Economic Policy Symposium, the annual Central Bank summit, will take place, in a virtual setting because of the pandemic, in Jackson Hole, Wyoming. The symposium has had an impact on the gold price in the past, and the keynote speech by the Chairman of the Federal Reserve will be watched closely. This year’s title of the symposium is “Navigating the Decade Ahead: Implications for Monetary Policy”.
Harald Seiz commends bankers and economists for trying to lay out economic strategies for the future, but also warns that we’ve painfully witnessed this year that contingency plans are needed for unforeseen events as the one we’re living through currently.
Considering all these variables, Seiz is certain that gold will continue to be a valuable asset, because it allows risk averse investors to simultaneously participate in the stock markets and buttress their long-term financial security.
Disclaimer: This content does not necessarily represent the views of IWB.


investmentwatchblog--2020-08-28--U.S. Presidential Elections Are Coming: Should We Vote for Gold?

Over the past few months , we have focused – for obvious reasons – on the pandemic and the following economic crisis .
However , there are also other important developments happening in the background , apart from media attention that still focuses on the coronavirus .
As they can substantially affect the gold prices , precious metals investors should be aware of them .
One of the most important of such issues is the U.S. presidential election that is approaching fast .
And the polls suggest that we could see the change of the President in the White House @ @ @ @ @ @ @ Joe Biden ( blue line ) has an average polling margin of 9 percent over incumbent President Donald Trump ( red line ) .
Will Biden win ?
That ’ s a great question .
Polls say so , but who trusts polls these days ?
We believe that it is certainly possible , given that some voters could be dissatisfied with Trump administration ’ s handling of the epidemic , and especially if the second wave of the coronavirus is not contained quickly and the double-dip recession arrives .
Trump could share @ @ @ @ @ @ @ Bush , who lost to Bill Clinton amid the early 1990s recession following jobless recovery .
However , if the economy improves , the race could tighten between now and election day .
What would President Biden imply for the US economy and the gold market ?
Well , although I don ’ t support Trump ’ s trade policy , I ’ m neither impressed with Biden ’ s economic agenda .
Under his economic revival plan , the federal government would spend $ 700 billion on research and development for new @ @ @ @ @ @ @ goods and services .
What is key here is that Biden plans to pay for these and other programs by raising taxes “ on corporations and the wealthy ” .
In particular , he wants to hike the corporate tax rate from the current 21 to 28 percent .
I can be wrong , but Wall Street would not welcome lifting taxes , especially during the fragile recovery from the economic crisis .
So , the stock market could tank , if Biden wins .
But it does not have to… So far @ @ @ @ @ @ @ polls giving Biden higher chances .
After all , still a lot can happen before November , so the markets can be waiting until the outcome of the presidential race looks more certain .
It ’ s also possible that investors expect that Biden would moderate his proposals after elections or that they focus more on other parts of Biden ’ s agenda .
For instance , Biden ’ s trade policy is less protectionist than Trump ’ s and he could end the trade wars with China ( and other countries ) @ @ @ @ @ @ @ year .
Hence , the possible effect of Biden ’ s triumph on equities and gold market is ambiguous .
Theoretically , given that the stock market rallied , while the price of the yellow metal plunged , after Trump ’ s victory in 2016 ( see the chart below ) , we should expect the reverse if Trump loses .
But it should be too simplistic reasoning and both the stock and gold market could easily interpret Biden ’ s possible victory in a bullish manner , as investors tend to do @ @ @ @ @ @ @ an initial , short-term volatility , the underlying upward trends could resume .
After all , Biden is generally acceptable to the investors .
He is not as radical as Bernie Sanders or Elizabeth Warren .
He is actually more mainstream in several aspects than Trump .
And the financial markets managed to operate or even thrive under both Trump and Obama , whose vice-president was Biden .
In other words , no matter who will reside in the White House , the current macroeconomic conditions should remain generally favorably for the precious @ @ @ @ @ @ @ of the soaring fiscal deficits ( according to the CBO , the federal budget deficit was $ 2.7 trillion in the first nine months of fiscal year 2020 , $ 2.0 trillion more than the deficit recorded during the same period last year ! )
and federal debt ( according to the IMF , general government debt is expected to rise to 160 percent of GDP by 2030 even without further rounds of fiscal stimulus ! )
, as well as negative real interest rates , and the fastest pace of growth in @ @ @ @ @ @ @ , as the chart below shows .
Moreover , no matter who wins , we do not expect radical changes in the accommodative fiscal and monetary policies , and the overall macroeconomic outlook , until the economy fully recovers from the coronavirus crisis .
Investors should remember that although politics is important , what the Fed does is also , if not more , important for the stock and gold markets – and the U.S. central bank will not abandon its dovish bias , no matter who would reside in the White House @ @ @ @ @ @ @ up extravagant government spending and stimulus packages .
If there is no difference , maybe we should vote for gold ?
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We hope you enjoyed it .
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by Arkadiusz Sieron, PhD
Over the past few months, we have focused – for obvious reasons – on the pandemic and the following economic crisis. However, there are also other important developments happening in the background, apart from media attention that still focuses on the coronavirus. As they can substantially affect the gold prices, precious metals investors should be aware of them.
One of the most important of such issues is the U.S. presidential election that is approaching fast. And the polls suggest that we could see the change of the President in the White House. As the chart below shows, Joe Biden (blue line) has an average polling margin of 9 percent over incumbent President Donald Trump (red line).
Will Biden win? That’s a great question. Polls say so, but who trusts polls these days? We believe that it is certainly possible, given that some voters could be dissatisfied with Trump administration’s handling of the epidemic, and especially if the second wave of the coronavirus is not contained quickly and the double-dip recession arrives. Trump could share then the fate of George H.W. Bush, who lost to Bill Clinton amid the early 1990s recession following jobless recovery. However, if the economy improves, the race could tighten between now and election day.
What would President Biden imply for the US economy and the gold market? Well, although I don’t support Trump’s trade policy, I’m neither impressed with Biden’s economic agenda. Under his economic revival plan, the federal government would spend $700 billion on research and development for new technologies and energy initiative and on American goods and services. What is key here is that Biden plans to pay for these and other programs by raising taxes “on corporations and the wealthy”. In particular, he wants to hike the corporate tax rate from the current 21 to 28 percent. I can be wrong, but Wall Street would not welcome lifting taxes, especially during the fragile recovery from the economic crisis. So, the stock market could tank, if Biden wins.
But it does not have to… So far, investors are totally unfazed by the polls giving Biden higher chances. After all, still a lot can happen before November, so the markets can be waiting until the outcome of the presidential race looks more certain. It’s also possible that investors expect that Biden would moderate his proposals after elections or that they focus more on other parts of Biden’s agenda. For instance, Biden’s trade policy is less protectionist than Trump’s and he could end the trade wars with China (and other countries) that worried the markets so much last year.
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Hence, the possible effect of Biden’s triumph on equities and gold market is ambiguous. Theoretically, given that the stock market rallied, while the price of the yellow metal plunged, after Trump’s victory in 2016 (see the chart below), we should expect the reverse if Trump loses.
But it should be too simplistic reasoning and both the stock and gold market could easily interpret Biden’s possible victory in a bullish manner, as investors tend to do during bull markets. Or, after an initial, short-term volatility, the underlying upward trends could resume. After all, Biden is generally acceptable to the investors. He is not as radical as Bernie Sanders or Elizabeth Warren. He is actually more mainstream in several aspects than Trump. And the financial markets managed to operate or even thrive under both Trump and Obama, whose vice-president was Biden.
In other words, no matter who will reside in the White House, the current macroeconomic conditions should remain generally favorably for the precious metals. We mean here the environment of the soaring fiscal deficits (according to the CBO, the federal budget deficit was $2.7 trillion in the first nine months of fiscal year 2020, $2.0 trillion more than the deficit recorded during the same period last year!) and federal debt (according to the IMF, general government debt is expected to rise to 160 percent of GDP by 2030 even without further rounds of fiscal stimulus!), as well as negative real interest rates, and the fastest pace of growth in the money supply in the modern history, as the chart below shows.
Moreover, no matter who wins, we do not expect radical changes in the accommodative fiscal and monetary policies, and the overall macroeconomic outlook, until the economy fully recovers from the coronavirus crisis. Investors should remember that although politics is important, what the Fed does is also, if not more, important for the stock and gold markets – and the U.S. central bank will not abandon its dovish bias, no matter who would reside in the White House. Neither Trump nor Biden would give up extravagant government spending and stimulus packages. If there is no difference, maybe we should vote for gold?
Thank you for reading today’s free analysis. We hope you enjoyed it. If so, we would like to invite you to sign up for our free gold newsletter. Once you sign up, you’ll also get 7-day no-obligation trial of all our premium gold services, including our Gold & Silver Trading Alerts. Sign up today!
Arkadiusz Sieron, PhD
Sunshine Profits: Analysis. Care. Profits.


investmentwatchblog--2020-08-28--Debase your currency – what’s next?

Debase your currency – what’s next?

In case you missed the news this morning : www.reuters.com/article/us-usa-fed-jacksonhole/in-landmark-shift-fed-adopts-average-inflation-target-elevates-jobs-focus-idUSKBN25N0HM To summarize what happened this morning – “ the Fed will seek to achieve inflation that averages 2 % over time ” .
The goal of increasing inflation is to create an environment for job growth and eventually push up interest rates .
Let ’ s dig a bit into what that means .
The Facts ( as I can find them online ) : • Currently real yields are at 0 % or negative • The US debt is over $ 26 Trillion , but expected to be over @ @ @ @ @ @ @ is low – currently about 1 % for 2020 : www.usinflationcalculator.com/inflation/current-inflation-rates/ • The US tax revenue is $ 3.8 Trillion in FY 2021 : www.thebalance.com/current-u-s-federal-government-tax-revenue-3305762 • Here ’ s where most of it goes ( hint social security and medicare/medicaid ) : www.cbpp.org/research/federal-budget/policy-basics-where-do-our-federal-tax-dollars-go • US tax interest payments are $ 393 Billion for 2020 Someone please check this line of thinking , but a 1 % increase in interest rates leads to an additional $ 260 Billion+ interest payment for federal debt .
Given we are running a deficit , we can ’ @ @ @ @ @ @ @ are printing money to pay off debt , thus raising our debt even more .
It ’ s an infinite loop ( think brrrrrrrrrrrr ) .
Thus if we raise inflation higher than our interest rates , we debase our currency ( e.g .
it ’ s worth less ) , and can pay back our debt with money that isn ’ t as valuable .
Alright , here ’ s where my Economics Major from a Liberal Arts school is thinking this is all headed .
In the short term , Powell @ @ @ @ @ @ @ give Congress the green light for stimulus ( Yay !
Buy Calls on anything ! )
, and once things are good again ( lol ) , they will begin to curb inflation so it averages 2 % .
My question for this group is when has debasing a currency ever been a bullish thing long term and how does Powell ever think the Fed can curb back inflation once the train starts moving ?
• Low yields + high inflation have led me to buy GLD/SLV .
Buy options expiring in 2021 @ @ @ @ @ @ @ under $ 220 ) • Ignore all news about Covid – Covid news likely won ’ t cause any more long term market swings with how much money is being injected into the economy Afterthought : The overnight market has suggested that interest rates should be much higher ( www.cnn.com/2019/09/17/business/overnight-lending-rate-spike-ny-fed/index.html # : ~ : text=Rates % 20spike , is % 202 % 25 % 20to % 202.25 % 25 .
– hit 10 % last September ) .
Synthetically suppressing interest rates is not a good thing .
The Fed has been printing @ @ @ @ @ @ @ short term rates low , but if it gets out of hand , you could start to see a jump interest rates alongside increased inflation from the Fed policies .
Someone else can try to handle that question – what happens when inflation and interest rates rise… Disclaimer : This information is only for educational purposes .
Do not make any investment decisions based on the information in this article .
Do you own due diligence or consult your financial professional before making any investment decision .

by willowpiper3
In case you missed the news this morning: www.reuters.com/article/us-usa-fed-jacksonhole/in-landmark-shift-fed-adopts-average-inflation-target-elevates-jobs-focus-idUSKBN25N0HM
To summarize what happened this morning – “the Fed will seek to achieve inflation that averages 2% over time”. The goal of increasing inflation is to create an environment for job growth and eventually push up interest rates. Let’s dig a bit into what that means.
The Facts (as I can find them online):
Currently real yields are at 0% or negative
The US debt is over $26 Trillion, but expected to be over $30 Trillion by 2021
Inflation is low – currently about 1% for 2020: www.usinflationcalculator.com/inflation/current-inflation-rates/
The US tax revenue is $3.8 Trillion in FY 2021: www.thebalance.com/current-u-s-federal-government-tax-revenue-3305762 Here’s where most of it goes (hint social security and medicare/medicaid): www.cbpp.org/research/federal-budget/policy-basics-where-do-our-federal-tax-dollars-go
US tax interest payments are $393 Billion for 2020
Someone please check this line of thinking, but a 1% increase in interest rates leads to an additional $260 Billion+ interest payment for federal debt. Given we are running a deficit, we can’t afford interest rate hikes given we are printing money to pay off debt, thus raising our debt even more. It’s an infinite loop (think brrrrrrrrrrrr). Thus if we raise inflation higher than our interest rates, we debase our currency (e.g. it’s worth less), and can pay back our debt with money that isn’t as valuable.
We are primarily funded by readers. Please subscribe and donate to support us!
Alright, here’s where my Economics Major from a Liberal Arts school is thinking this is all headed. In the short term, Powell wants to increase inflation, which will give Congress the green light for stimulus (Yay! Buy Calls on anything!), and once things are good again (lol), they will begin to curb inflation so it averages 2%.
My question for this group is when has debasing a currency ever been a bullish thing long term and how does Powell ever think the Fed can curb back inflation once the train starts moving?
Positions:
Low yields + high inflation have led me to buy GLD/SLV. Buy options expiring in 2021 (SLV under $35, GLD under $220)
Buy undervalued ETFs like DVY and XLE
Ignore all news about Covid – Covid news likely won’t cause any more long term market swings with how much money is being injected into the economy
Afterthought: The overnight market has suggested that interest rates should be much higher (www.cnn.com/2019/09/17/business/overnight-lending-rate-spike-ny-fed/index.html#:~:text=Rates%20spike,is%202%25%20to%202.25%25. – hit 10% last September). Synthetically suppressing interest rates is not a good thing. The Fed has been printing into overnight repos since September to keep short term rates low, but if it gets out of hand, you could start to see a jump interest rates alongside increased inflation from the Fed policies. Someone else can try to handle that question – what happens when inflation and interest rates rise…
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.


investmentwatchblog--2020-08-28--$800 to $800,000 back to $800. What a wild ride.

Turned $ 800 into $ 3,000 after years of diligent trading .
I was a well diversified , disciplined investor @ @ @ @ @ .
Went Yolo with the $ 3k on Tesla Earnings Options in November 2019 and @ @ @ @ @ 120,000 .
Got addicted to playing earnings calls .
I was pretty good at it @ @ @ @ @ $ 800,000 .
Long story short , let $ 300,000 ride on Slack earnings , @ @ @ @ @ last quarter .
It was a downward spiral from there .
I ’ m in @ @ @ @ @ a sub $ 1,000 account .
I just made $ 100k on Salesforce ’ s @ @ @ @ @ m putting it all on Slack Earnings again ( 9/11 exp .
call options around @ @ @ @ @ Wish me luck .
Right before Slack earnings .
Everything Expired worthless .
Disclaimer : @ @ @ @ @ educational purposes .
Do not make any investment decisions based on the information in this @ @ @ @ @ due diligence or consult your financial professional before making any investment decision .

by hurley53017
Turned $800 into $3,000 after years of diligent trading. I was a well diversified, disciplined investor who wallowed in due diligence.
Went Yolo with the $3k on Tesla Earnings Options in November 2019 and turned $3,000 into $120,000. Got addicted to playing earnings calls. I was pretty good at it and my portfolio peaked at $800,000.
Long story short, let $300,000 ride on Slack earnings, and they shit the bed last quarter. It was a downward spiral from there. I’m in the process of rebuilding from a sub $1,000 account.
We are primarily funded by readers. Please subscribe and donate to support us!
I just made $100k on Salesforce’s Earnings, and i’m putting it all on Slack Earnings again (9/11 exp. call options around $35 strike). Wish me luck.
Right before Slack earnings. Everything Expired worthless.
Webull Account
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.


investmentwatchblog--2020-08-28--Powell has shown no meaningful concern for, or awareness of, the widening of income and wealth gaps

Powell has shown no meaningful concern for , or awareness of , the widening of income and wealth gaps generated @ @ @ @ @ The Fed is not only silent to the asset bubble and the resulting expanding wealth @ @ @ @ @ it and with it is accelerating ever wider social divisions and political tensions that have @ @ @ @ @ Reckless doesn ’ t even begin to describe it .
t.co/5GTh3pPBL7

Powell has shown no meaningful concern for, or awareness of, the widening of income and wealth gaps generated by Fed policy. t.co/Tmc68ra5av
The Fed is not only silent to the asset bubble and the resulting expanding wealth gap but is actively encouraging it and with it is accelerating ever wider social divisions and political tensions that have been building for years.
Reckless doesn’t even begin to describe it. t.co/5GTh3pPBL7
— Sven Henrich (@NorthmanTrader) August 27, 2020


investmentwatchblog--2020-08-28--The Social and Economic Side Effects of Negative Interest Rates

Our world is currently suffering from acute schizophrenia .
Banks are pushing impact and sustainable investing like crazy , companies are subordinating their production sites and supply chains to the noble goal of sustainability , and more and more parts of our society are discovering ecologism as the most meaningful political religion of our time .
At the same time—and this reveals the extent of the schizophrenia—our current economic structure is showing serious anomalies that are diametrically opposed to meaningful sustainability—first and foremost negative interest rates , which are increasingly eating into the structure of the economy and are turning @ @ @ @ @ @ @ world of negative interest rates , the arrow of time runs backward .
With negative interest rates , the present is more valuable than the future , the now seems more desirable than the tomorrow .
The attraction of providing for the future is dwindling and with it the very care for the future .
However , once the future is neglected , the very present degenerates into stagnation , throwing you back ever more .
As a concrete consequence , negative interest rates promote rampant consumerism .
Many people ’ s social @ @ @ @ @ @ @ .
Consumption is becoming a lifestyle .
Not only is consumption happening more frequently , but also in greater quantities , not least because it is becoming less and less worthwhile to refrain from consumption , i.e .
saving in the true sense of the word .
People ’ s time preferences are completely distorted and hardly correspond to market interest rates .
If time preferences of market participants and interest rates on the market diverge , malinvestments and misallocation of capital are the logical result .
The exaggerations are strongest at the @ @ @ @ @ @ @ .
Consumer-related and non-consumer-related areas are flourishing .
The interim hype of the fidget spinners or the excess supply of hairdressing salons in small Swiss cities are examples of the former , while the construction boom that has been going on for years in Switzerland is an example of the latter .
Low to negative interest rates make previously unprofitable investments and projects suddenly appear profitable .
At the same time , falling interest rates mean that later investors and companies can get into debt at “ more favorable ” interest rate conditions @ @ @ @ @ @ @ fueled even more .
More intense competition among economic players , fired up by falling interest rates , is increasingly a strain on the latter .
On the one hand , economic actors are facing intensifying competition that is squeezing margins .
On the other hand , negative interest rates also have a capital-destroying effect , which consequently leads to deflationary tendencies—forces that once again nag at economic actors ’ profitability .
As a consequence , central banks are rushing to “ rescue ” companies from this real destruction of capital by making @ @ @ @ @ @ @ to fuel the fire that is already burning .
While interest rates continue to come under pressure due to ongoing floods of liquidity , zombie companies are kept alive .
Capital that has actually been used unprofitably is not released to be used and allocated by more solid companies .
It remains in ailing corporate structures , which ultimately puts a strain on the overall economy .
Competition is intensified to a degree that ultimately does not correspond to the preferences of market participants anymore .
If their sovereignty as consumers , investors @ @ @ @ @ @ @ the cheap money of the negative interest rate policy , these very resources would be released and zombie companies would be left to their actual fate .
The existence of zombie companies ultimately affects the morale of employees within an economy .
This very morale is likely to decrease especially in the environment of zombified economic structures .
Thus , a growing proportion of zombie companies gives birth to more and more so-called bullshit jobs .
These jobs are meaningless , as their existence is no longer geared to the preferences and wishes @ @ @ @ @ @ @ because of liquidity injections , low interest rates , or politically mandated transfer payments .
Also , the real wages of workers are exposed to continuous devaluation in a negative interest rate environment .
In particular , asset price inflation and the resulting decline in yield purchasing power over the years are more significant than many would suspect at first sight .
In view of these distortions , individual economic actors seem to find that economic processes quickly get out of hand .
As their ability to make decisions and coordinate is undermined @ @ @ @ @ @ @ actors , especially if they see themselves as the losers of monetary policy and politics as a whole , feel powerless and frustrated .
The economy is mentally impoverished , which is reflected in the consumption of more and more human capital in the form of burnout .
However , employees are not the only ones whose profession is made more difficult by negative interest rates .
Even the work of the entrepreneur and investor becomes more and more difficult and burdensome with negative interest rates .
The important instrument for discounting expected @ @ @ @ @ @ @ absurdity .
If the interest rate is negative , cash values go into infinity and reasonable discounting becomes impossible .
Entrepreneurs and investors are in the dark in their intertemporal planning .
They make mistakes that they would otherwise be less likely to make .
Assets and goods of all kinds are wrongly priced and will inevitably be repriced again and again by the market .
This implies shock-like volatility .
Some might be able to profit from this volatility , but most will not , while more and more seem to be @ @ @ @ @ @ @ rates ultimately also cloud hopes of fundamental structural adjustments .
They cement , indeed reward , the inability to learn and undermine the sustainable foundations of productivity .
The economy and financial markets are increasingly becoming zombified constructs in which sustainability becomes a real farce and any meaning for individual economic actors is quickly lost .
The monetary distortions and the economic distortions caused by them are mainly to the detriment of human mental states .

via mises.org:
Our world is currently suffering from acute schizophrenia. Banks are pushing impact and sustainable investing like crazy, companies are subordinating their production sites and supply chains to the noble goal of sustainability, and more and more parts of our society are discovering ecologism as the most meaningful political religion of our time.
At the same time—and this reveals the extent of the schizophrenia—our current economic structure is showing serious anomalies that are diametrically opposed to meaningful sustainability—first and foremost negative interest rates, which are increasingly eating into the structure of the economy and are turning the world upside down.
In a world of negative interest rates, the arrow of time runs backward. With negative interest rates, the present is more valuable than the future, the now seems more desirable than the tomorrow. The attraction of providing for the future is dwindling and with it the very care for the future. However, once the future is neglected, the very present degenerates into stagnation, throwing you back ever more.
Counterproductive Economic Activity
As a concrete consequence, negative interest rates promote rampant consumerism. Many people’s social propensity to consume tends to be exaggerated. Consumption is becoming a lifestyle. Not only is consumption happening more frequently, but also in greater quantities, not least because it is becoming less and less worthwhile to refrain from consumption, i.e. saving in the true sense of the word. People’s time preferences are completely distorted and hardly correspond to market interest rates.
If time preferences of market participants and interest rates on the market diverge, malinvestments and misallocation of capital are the logical result. The exaggerations are strongest at the two poles of the economic capital structure. Consumer-related and non-consumer-related areas are flourishing. The interim hype of the fidget spinners or the excess supply of hairdressing salons in small Swiss cities are examples of the former, while the construction boom that has been going on for years in Switzerland is an example of the latter.
Low to negative interest rates make previously unprofitable investments and projects suddenly appear profitable. At the same time, falling interest rates mean that later investors and companies can get into debt at “more favorable” interest rate conditions. The result: economic activity is fueled even more.
More intense competition among economic players, fired up by falling interest rates, is increasingly a strain on the latter. On the one hand, economic actors are facing intensifying competition that is squeezing margins. On the other hand, negative interest rates also have a capital-destroying effect, which consequently leads to deflationary tendencies—forces that once again nag at economic actors’ profitability. As a consequence, central banks are rushing to “rescue” companies from this real destruction of capital by making more and more liquidity available.
Only to fuel the fire that is already burning. While interest rates continue to come under pressure due to ongoing floods of liquidity, zombie companies are kept alive. Capital that has actually been used unprofitably is not released to be used and allocated by more solid companies. It remains in ailing corporate structures, which ultimately puts a strain on the overall economy. Competition is intensified to a degree that ultimately does not correspond to the preferences of market participants anymore. If their sovereignty as consumers, investors, and workers were not thwarted by the cheap money of the negative interest rate policy, these very resources would be released and zombie companies would be left to their actual fate.
We are primarily funded by readers. Please subscribe and donate to support us!
From Risk-Free Interest to Interest-Free Risk
The existence of zombie companies ultimately affects the morale of employees within an economy. This very morale is likely to decrease especially in the environment of zombified economic structures. Thus, a growing proportion of zombie companies gives birth to more and more so-called bullshit jobs. These jobs are meaningless, as their existence is no longer geared to the preferences and wishes of market participants, and only exist because of liquidity injections, low interest rates, or politically mandated transfer payments.
Also, the real wages of workers are exposed to continuous devaluation in a negative interest rate environment. In particular, asset price inflation and the resulting decline in yield purchasing power over the years are more significant than many would suspect at first sight.
In view of these distortions, individual economic actors seem to find that economic processes quickly get out of hand. As their ability to make decisions and coordinate is undermined by ever more cheap liquidity, economic actors, especially if they see themselves as the losers of monetary policy and politics as a whole, feel powerless and frustrated. The economy is mentally impoverished, which is reflected in the consumption of more and more human capital in the form of burnout.
However, employees are not the only ones whose profession is made more difficult by negative interest rates. Even the work of the entrepreneur and investor becomes more and more difficult and burdensome with negative interest rates. The important instrument for discounting expected future investment returns is completely reduced to absurdity. If the interest rate is negative, cash values go into infinity and reasonable discounting becomes impossible. Entrepreneurs and investors are in the dark in their intertemporal planning. They make mistakes that they would otherwise be less likely to make.
Assets and goods of all kinds are wrongly priced and will inevitably be repriced again and again by the market. This implies shock-like volatility. Some might be able to profit from this volatility, but most will not, while more and more seem to be affected negatively by it.
Negative interest rates ultimately also cloud hopes of fundamental structural adjustments. They cement, indeed reward, the inability to learn and undermine the sustainable foundations of productivity. The economy and financial markets are increasingly becoming zombified constructs in which sustainability becomes a real farce and any meaning for individual economic actors is quickly lost. The monetary distortions and the economic distortions caused by them are mainly to the detriment of human mental states.


investmentwatchblog--2020-08-28--Hello I’m the Square guy. Ready to lose it all fighting Tesla. 32k in puts bought today.

Disclaimer : This information is only for educational purposes .
Do not make any investment decisions based on the information @ @ @ @ @ you own due diligence or consult your financial professional before making any investment decision .

by NYGiants1532
We are primarily funded by readers. Please subscribe and donate to support us!
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.


investmentwatchblog--2020-08-28--JPOW’s historic speech’s impact on the market and what you ignored

Disclaimer , this is not financial advice Jpow ’ s announcement yesterday on thursday at 9:20am was called historic for a number of reasons .
He announced the FED will continue most of its financial policies it created in july but as the minutes from the previous meeting showed , they were anticipating the stimulus to also be a driving factor for the economy .
The meat of what JPOW said was the interest rates need to increase their targets , as they anticipate the economy ’ s lack of spending having additional deflationary practices .
In the short term @ @ @ @ @ @ @ you may even see the top blown off of previously “ boring ” companies like PG , HD ect The most impact you will see is the bond market This is dangerous because the bond market going down could trigger an asset liquidation if it drops too low too quickly .
It in fact going down as we drag up to the next FOMC meeting in Sept will cause definitive action from the FED .
The plays i am eyeing are TLT puts or metal calls are good plays , tech calls ( @ @ @ @ @ @ @ but aapl ) ALL WITH EXP 9/18 ( nothing past this ) Important things to consider for the month to come , Disclaimer : This information is only for educational purposes .
Do not make any investment decisions based on the information in this article .
Do you own due diligence or consult your financial professional before making any investment decision .

by Nawtreallyme
Disclaimer, this is not financial advice
Jpow’s announcement yesterday on thursday at 9:20am was called historic for a number of reasons. He announced the FED will continue most of its financial policies it created in july but as the minutes from the previous meeting showed, they were anticipating the stimulus to also be a driving factor for the economy.
The meat of what JPOW said was the interest rates need to increase their targets, as they anticipate the economy’s lack of spending having additional deflationary practices.
In the short term this is very bullish on stocks, you may even see the top blown off of previously “boring” companies like PG, HD ect
The most impact you will see is the bond market
This is dangerous because the bond market going down could trigger an asset liquidation if it drops too low too quickly. It in fact going down as we drag up to the next FOMC meeting in Sept will cause definitive action from the FED.
The plays i am eyeing are
We are primarily funded by readers. Please subscribe and donate to support us!
TLT puts or metal calls are good plays, tech calls (msft, amzn, fsly, anything but aapl) ALL WITH EXP 9/18 (nothing past this)
Important things to consider for the month to come,
FOMC FED Meeting September15-16*
VIX Expiration 16 September 2020
Congress Back in Session Sept 7th
Positions right now
TLT 159p 9/18
SPXS 5c 9/18
SQQQ 22c 9/18
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.


investmentwatchblog--2020-08-28--Economics of expectations: Stocks will keep going to the moon for the next 2 months before correctio

Economics of expectations: Stocks will keep going to the moon for the next 2 months before correction

Markets are moved by nothing more than fundamentals , but the pricing is never efficient because of expectations , miscalculations , uncertainty and reflexivity .
That ’ s because there are thinking participants involved , and almost all of them are dumb humans .
Phase 1 ( SPY goes from 338 to 222 ) : The virus news drops , the market sells off quickly with exponential fears and bearish expectations .
Huge volatility because nobody can price equities accordingly , because the virus is an unknown force and we don ’ t know how countries and economies will react @ @ @ @ @ @ @ at this point Phase 2 ( SPY goes from 222 to 285 ) : Near the bottom the FED announces monetary expansion , and the important thing to understand here is that nominal interest rates will stay at zero for the next few years , because that ’ s exactly how they did it in 2008 .
At this point institutional investors and smart retail traders realize that they need to slowly unload all the bonds they have ( and the FED will buy them , or some dumbfuck boomer will ) .
@ @ @ @ @ @ @ what you might believe , bond investing is only profitable in a falling rates enviroment , since in a rising rates enviroment , bond stay dead flat ( you lose money in the present because bonds you already hold devalue , and you make money in the future because you buy bonds with higher rates but the net result is a fat zero ) .
If interest rates are zero , the only thing they can do form here is go up , and that is bad for bondholders .
The institutions start @ @ @ @ @ @ @ since they are expecting long term stagflation and a weak dollar ( because some dumbfuck economist said so ) , they think it ’ s a good idea to start buying equities and gold for long term gains , and the FED encourages them to do so , jacking up the futures every night and driving expectations of a quick market recovery up and up .
It does not matter if the economic data and employment data is bad , beacuse there is nowhere else to put money .
This thing is a @ @ @ @ @ @ @ last 10 years , simply because we are at the end of a long term macroeconomic debt cycle and the governments of the developed economies have no ammo left .
Naturally , if you buy stock today , you trim the loose weight and go with stocks with great fundamentals , that are going to be affected less by the virus , and that represent the future of innovation and industry development : tech stocks .
The majority of the trading volume of the rally happens before the prices start to get too @ @ @ @ @ @ @ the rally starts to loose momentum because we reach the prices that are believed to be fair by analysts .
From this point onwards , stocks will be overvalued .
Phase 3 ( SPY goes from 285 to the fucking moon ) : Some strong bullish days are enough to encourage dumb retail investors and traders to join the party .
As you know , registered activity and trading volume by retail has increased by a lot .
It ’ s not a coincidence that FAANG , MSFT , TSLA are the ones @ @ @ @ @ @ @ they are household names and they attract retail traders because they have seen how these stocks have soared in the past 10 years .
The mainstream culture abount invetsing for the past decade has been to buy the dip and hold it , and a lot of people that missed out on 2008 saw this as their chance to get in long term .
Notice that after a small dip caused by profit taking at 320 , the volume has been low : that ’ s because institutional investors are not moving .
@ @ @ @ @ @ @ in a risky space , and you can clearly see that by looking at the relative price of put options .
Everybody is hedging , but they are not selling because they are expecting the market to go higher .
Everyone thinks it ’ s a bubble and the prices will keep rising because dumb money coming in , but because everyone thinks that , nobody takes the money out and keeps holding .
The expectations of the presence of a bubble have now created a bubble .
And if nobody is selling @ @ @ @ @ @ @ because now everybody is talking about the stock market ( and everyone is at home more ) , prices keep going up and you get insane P/E and Price/Book ratios and stock charts that look neraly vertical Only changes in fundamentals can move the market .
As long as they stay the same , more average people will hear online about invetsing and will be attracted to the market .
you will start to hear people talking about stocks on social media and at the supermarket .
Even the fact that there are @ @ @ @ @ @ @ help without knowing anything is worrying .
Expectation will drive the stocks higher and the stock being higher will drive expectations up .
It ’ s a vicious cycle .
It ’ s plausible that we could arrive to 380-400 levels .
In my opinion fundamentals will change only with the arrival of november .
There will be uncertainty because of new corona waves , Q3 earnings , and most importantly , whoever wins the elections , the market will tank .
If Biden wins , Trumps will tank the market the spoil @ @ @ @ @ @ @ , the market will tank regardless , because they can not let the asset bubble machine run for too long , otherwise fiscal policy become useless because all the money is going into equity and consumer spending stays down .
The targets for the correction are 310 , then probably 270 if there is a massive overreaction and panic selling , and if we fall further it will be no man ’ s land TLDR Bubble up until november , then the markets tank Personal positions at the moment : I am long @ @ @ @ @ @ @ .
Short on TSLA hedging with calls .
Edit : I rely a lot on technicals for the entry points of my trades .
I am bullish for the next 2 months , but if I see a good opportunity to short on technicals , I will probably do it sooner .
I don ’ t think it will come though Disclaimer : This information is only for educational purposes .
Do not make any investment decisions based on the information in this article .
Do you own due diligence or consult your @ @ @ @ @ @ @ .

by bragghy
Markets are moved by nothing more than fundamentals, but the pricing is never efficient because of expectations, miscalculations, uncertainty and reflexivity. That’s because there are thinking participants involved, and almost all of them are dumb humans.
Phase 1 (SPY goes from 338 to 222):
The virus news drops, the market sells off quickly with exponential fears and bearish expectations. Huge volatility because nobody can price equities accordingly, because the virus is an unknown force and we don’t know how countries and economies will react. We are anticipating a full depression at this point
Phase 2 (SPY goes from 222 to 285):
Near the bottom the FED announces monetary expansion, and the important thing to understand here is that nominal interest rates will stay at zero for the next few years, because that’s exactly how they did it in 2008.
At this point institutional investors and smart retail traders realize that they need to slowly unload all the bonds they have (and the FED will buy them, or some dumbfuck boomer will). That’s beacuse, contrary to what you might believe, bond investing is only profitable in a falling rates enviroment, since in a rising rates enviroment, bond stay dead flat (you lose money in the present because bonds you already hold devalue, and you make money in the future because you buy bonds with higher rates but the net result is a fat zero). If interest rates are zero, the only thing they can do form here is go up, and that is bad for bondholders.
The institutions start naturally looking for yields elsewhere, and since they are expecting long term stagflation and a weak dollar (because some dumbfuck economist said so), they think it’s a good idea to start buying equities and gold for long term gains, and the FED encourages them to do so, jacking up the futures every night and driving expectations of a quick market recovery up and up. It does not matter if the economic data and employment data is bad, beacuse there is nowhere else to put money. This thing is a trend that has constantly happened in the last 10 years, simply because we are at the end of a long term macroeconomic debt cycle and the governments of the developed economies have no ammo left.
Naturally, if you buy stock today, you trim the loose weight and go with stocks with great fundamentals, that are going to be affected less by the virus, and that represent the future of innovation and industry development: tech stocks.
The majority of the trading volume of the rally happens before the prices start to get too high, and at some point, the rally starts to loose momentum because we reach the prices that are believed to be fair by analysts. From this point onwards, stocks will be overvalued.
Phase 3 (SPY goes from 285 to the fucking moon):
We are primarily funded by readers. Please subscribe and donate to support us!
Some strong bullish days are enough to encourage dumb retail investors and traders to join the party. As you know, registered activity and trading volume by retail has increased by a lot. It’s not a coincidence that FAANG, MSFT, TSLA are the ones that are carrying the market higher: they are household names and they attract retail traders because they have seen how these stocks have soared in the past 10 years. The mainstream culture abount invetsing for the past decade has been to buy the dip and hold it, and a lot of people that missed out on 2008 saw this as their chance to get in long term.
Notice that after a small dip caused by profit taking at 320, the volume has been low: that’s because institutional investors are not moving. They know perfectly well that we are in a risky space, and you can clearly see that by looking at the relative price of put options. Everybody is hedging, but they are not selling because they are expecting the market to go higher. Everyone thinks it’s a bubble and the prices will keep rising because dumb money coming in, but because everyone thinks that, nobody takes the money out and keeps holding.
The expectations of the presence of a bubble have now created a bubble.
And if nobody is selling but dumb retail demand is very high because now everybody is talking about the stock market (and everyone is at home more), prices keep going up and you get insane P/E and Price/Book ratios and stock charts that look neraly vertical
My humble predictions
Only changes in fundamentals can move the market. As long as they stay the same, more average people will hear online about invetsing and will be attracted to the market. you will start to hear people talking about stocks on social media and at the supermarket. Even the fact that there are so much newfags around here asking for help without knowing anything is worrying. Expectation will drive the stocks higher and the stock being higher will drive expectations up. It’s a vicious cycle. It’s plausible that we could arrive to 380-400 levels.
In my opinion fundamentals will change only with the arrival of november. There will be uncertainty because of new corona waves, Q3 earnings, and most importantly, whoever wins the elections, the market will tank. If Biden wins, Trumps will tank the market the spoil the party. And if Trump wins, the market will tank regardless, because they cannot let the asset bubble machine run for too long, otherwise fiscal policy become useless because all the money is going into equity and consumer spending stays down.
The targets for the correction are 310, then probably 270 if there is a massive overreaction and panic selling, and if we fall further it will be no man’s land
TLDR Bubble up until november, then the markets tank
Personal positions at the moment: I am long on SPXL and got short dated calls. Short on TSLA hedging with calls. Edit: I rely a lot on technicals for the entry points of my trades. I am bullish for the next 2 months, but if I see a good opportunity to short on technicals, I will probably do it sooner. I don’t think it will come though
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.