Big inflation numbers
The S&P had a small drop this week and it was attributed to the recent inflation numbers.
This wednesday the 4.2% number was released, a large increase, and it was above the 3.6% predictions consensus.
The CPI versus DJI:
Fed Fund rate:
Rate vs DJI:
Yellen which I guess is head of the FED now said they might have to increase rates.
Let's be real and keep it short, clearly their goal would be to slow down inflation a bit, with a small rate, not to crash the stock market.
All the depression -60% S&P permabears are just crazy.
All the people saying a rate increase will crash the stock market are too lazy to look at what happened in the past?
They're part of a worldwide conspiracy to prank us? Aliens have hidden cameras? It's just beyond...
All you need to know is in 2007-2008:
- Zimbabwe interest rates were at 600 then 1200%
- Inflation was at billions of percents
- The stock market went to the moon
Also big inflation is back in Zimbabwe, rates are at 40% have been at 20-60% in the last years, and:
"For the fifth time in Zimbabwe’s history, its currency has just collapsed…"
"Zimbabwe Shutters Stock Exchange, Blocks All Mobile Money Payments As Currency Collapses (Again)"
HAHAHAHA:
"The government claims mobile payment operators and the stock exchange are either deliberately or inadvertently acting to sabotage the economy, and are the cause of the Zimdollar’s volatile black market exchange rate."
Zimbabweans don't give a rats ass about their government ponzi scheme returning 1 million percent interest in monopoly money.
They even rather buy crypto. All value in the country just pours into the stock market.
And then the government whines that it's the stock market fault if they are incompetent.
Also to keep in mind Warren Buffett bough Coca Cola in 88 and companies were way undervalued and dividends were insane.
And all boomers that are mind bogglingly ignorant give people as advice "save your money keep it at the bank" because they used to get huge interest.
In the 60s there was a NWO, and then the US entered into consumerism.
Back in the 70s there was mega inflation it was a big period of growth.
It was good inflation.
Now there are bad demographics, big debts, and truckers that say they won't go back to work unless they get paid $100K a year, everyone is on benefits.
Well to sum up just look at France: it is a good way to predict the future.
High unemployment and people not even looking for jobs, while companies struggle to hire people.
A GDP growth of 0 (while taking lots of debt), so in reality it declined for a good 20 years.
So obviously the current inflation is bad inflation.
Manipulating numbers is cute, but the fundamentals are way more important and crush all the rest.
What can you do if supply is low, people don't want to go to work, people go retire with no kids to replace them, no one knows how to build stuff because it's all being made in China, Mexico, or Germany, terrorists ransom companies, terrorists riot in the streets and destroy everything, companies that produce stuff from base materials can't get as many base materials, I could go on.
Producing the same amount of energy with troll windmills just demands so much more ressources.
By the way in the last 300 years the temperature went up by 1°C and we increased CO2 by 60%.
Let's humor Greta and say 100% of the temp increase is due to CO2.
To get another degree (1°K or C) we need another 60% CO2 increase, at the current rate it would take 100 years.
Even if you completely believe them and go worst case scenario (100% correlation) it seems a bit... hysterical to go full wood elves.
There is just no way the (real) inflation will stop. THERE IS NOT ENOUGH STUFF FOR EVERYONE.
The US are not just going to reverse on the gigantic government spending, welfare, stimies & unemployment benefits, mediocre demographics, CO2 transition, convince China to hold their usd bags, regain foreign investors confidence, and I don't even know what I missed.
If the FED raises rates to 40% or something the common folk will all in, smart money use the stock market as a store of value.
And common folks with some savings (say 100k) getting 40% a year PLUS benefits won't bother going to work so production declines a bit more.
And common folk just made near millionaires will want to spend more.
Doomed if they do not raise rates. Doomed if they do. Pretty ridiculous to believe in magic wands.
I see no future where the stock market stops going up. Just a guess:
Keep rates at 0-1% ==> Stonks go up as they're doing now.
Raise rates to ~5% ==> Stonks go up or stagnate. The USD keeps its value for a while as fools get baited "safe haven".
Raise rates to 10% ==> Stonks might go down as they're quite expensive. The USD stays strong for a while.
Raise rates to 40% ==> Stonks go up like Zimbabwe and others. USD obviously is going to zero if they raise this much.
But they can't keep the USD strong long while throwing money at everyone. Some people will save the usd they're getting for free to get the 5%, some people will spend it, some people will still not go to work. Production still goes down with consumption goes up.
And the FED have shown until now they do not want the stock market to go down, at least during a cycle that lasts 4 or 8 years, I have noticed this by looking at price action and indicators and the FED rates, and this cycle happens to start and end in November of certain years, it's in the chart.
It looks like the BOJ popped the bubble. The US are not Japan of the 80s-90s.
tradingeconomics.com.../government-spending
"Chidhakwa and Chigumira also mentioned that the fiscal position of Zimbabwe began to decline beginning the early 1990s due to budget deficits caused by numerous factors such as increases in civil service wages and salaries, high expenditures in social services, relief programs during periods of droughts, and parastatal (Renev: partially state-owned) losses. Industries and sectors, as well as subsidized credits, became inefficient due to their dependence on the ownership and control of the state."
For Germany the causes were a government that was trolling France.
And Venezuela recently: Maduro printed money in 2013 following the example set by Chavez, which helped in the short term but short term only (covid stimies anyone?), and then he kept spending, while offering rates of 20 to 60% but the population still avoided the currency (even the dumbasses, weird, they play dumb but then they run away from these obvious scams I guess it depends how fast it goes - boiling frog theory).
The public went to the stock market and us dollar. As usual the government whined that there was a "conspiracy" against them and as usual - because you know, had nothing to do with them printing magic beans - the solution was a magical one: imposing price controls 🤣
Now the country is a desert but the stock market is still high, just not very open.
It recently fell from 2.5 million points to 5000 in a straight line I don't know what this is about. Anyway same childish story as usual and Venezuela is on a trend to return to prehistory. "This was not real socialism let's try again" Ye keep trying until you're smashing rocks together genius.
A significant part of the country has fled, I wonder if those are the champagne socialists? Smh.
As the country goes through the paleolithic the weak will die so the strong will be able to rebuild.
Humanitarian aid slows down but does not stop this process.
tradingeconomics.com...nezuela/stock-market
The US story has almost nothing in common with Japan, a little in common with Germany but not much, some in common with Zimbabwe but not all - there is no state control, and everything in common with Venezuela.
As I said playing with rates won't matter (if they pay high rates they'll have to print even more to pay people it's just another way to throw money around), and if the US starts whining about a conspiracy and you know all that stuff that goes with it like price controls then it's the end of them.
Did I miss something?
I wonder what Peter Schiff has to say about this, I'll update this idea if I hear something interesting from his podcast.
The US are so going to double down and continue on the Venezuela path.
This wednesday the 4.2% number was released, a large increase, and it was above the 3.6% predictions consensus.
The CPI versus DJI:
Fed Fund rate:
Rate vs DJI:
Yellen which I guess is head of the FED now said they might have to increase rates.
Let's be real and keep it short, clearly their goal would be to slow down inflation a bit, with a small rate, not to crash the stock market.
All the depression -60% S&P permabears are just crazy.
All the people saying a rate increase will crash the stock market are too lazy to look at what happened in the past?
They're part of a worldwide conspiracy to prank us? Aliens have hidden cameras? It's just beyond...
All you need to know is in 2007-2008:
- Zimbabwe interest rates were at 600 then 1200%
- Inflation was at billions of percents
- The stock market went to the moon
Also big inflation is back in Zimbabwe, rates are at 40% have been at 20-60% in the last years, and:
"For the fifth time in Zimbabwe’s history, its currency has just collapsed…"
"Zimbabwe Shutters Stock Exchange, Blocks All Mobile Money Payments As Currency Collapses (Again)"
HAHAHAHA:
"The government claims mobile payment operators and the stock exchange are either deliberately or inadvertently acting to sabotage the economy, and are the cause of the Zimdollar’s volatile black market exchange rate."
Zimbabweans don't give a rats ass about their government ponzi scheme returning 1 million percent interest in monopoly money.
They even rather buy crypto. All value in the country just pours into the stock market.
And then the government whines that it's the stock market fault if they are incompetent.
Also to keep in mind Warren Buffett bough Coca Cola in 88 and companies were way undervalued and dividends were insane.
And all boomers that are mind bogglingly ignorant give people as advice "save your money keep it at the bank" because they used to get huge interest.
In the 60s there was a NWO, and then the US entered into consumerism.
Back in the 70s there was mega inflation it was a big period of growth.
It was good inflation.
Now there are bad demographics, big debts, and truckers that say they won't go back to work unless they get paid $100K a year, everyone is on benefits.
Well to sum up just look at France: it is a good way to predict the future.
High unemployment and people not even looking for jobs, while companies struggle to hire people.
A GDP growth of 0 (while taking lots of debt), so in reality it declined for a good 20 years.
So obviously the current inflation is bad inflation.
Manipulating numbers is cute, but the fundamentals are way more important and crush all the rest.
What can you do if supply is low, people don't want to go to work, people go retire with no kids to replace them, no one knows how to build stuff because it's all being made in China, Mexico, or Germany, terrorists ransom companies, terrorists riot in the streets and destroy everything, companies that produce stuff from base materials can't get as many base materials, I could go on.
Producing the same amount of energy with troll windmills just demands so much more ressources.
By the way in the last 300 years the temperature went up by 1°C and we increased CO2 by 60%.
Let's humor Greta and say 100% of the temp increase is due to CO2.
To get another degree (1°K or C) we need another 60% CO2 increase, at the current rate it would take 100 years.
Even if you completely believe them and go worst case scenario (100% correlation) it seems a bit... hysterical to go full wood elves.
There is just no way the (real) inflation will stop. THERE IS NOT ENOUGH STUFF FOR EVERYONE.
The US are not just going to reverse on the gigantic government spending, welfare, stimies & unemployment benefits, mediocre demographics, CO2 transition, convince China to hold their usd bags, regain foreign investors confidence, and I don't even know what I missed.
If the FED raises rates to 40% or something the common folk will all in, smart money use the stock market as a store of value.
And common folks with some savings (say 100k) getting 40% a year PLUS benefits won't bother going to work so production declines a bit more.
And common folk just made near millionaires will want to spend more.
Doomed if they do not raise rates. Doomed if they do. Pretty ridiculous to believe in magic wands.
I see no future where the stock market stops going up. Just a guess:
Keep rates at 0-1% ==> Stonks go up as they're doing now.
Raise rates to ~5% ==> Stonks go up or stagnate. The USD keeps its value for a while as fools get baited "safe haven".
Raise rates to 10% ==> Stonks might go down as they're quite expensive. The USD stays strong for a while.
Raise rates to 40% ==> Stonks go up like Zimbabwe and others. USD obviously is going to zero if they raise this much.
But they can't keep the USD strong long while throwing money at everyone. Some people will save the usd they're getting for free to get the 5%, some people will spend it, some people will still not go to work. Production still goes down with consumption goes up.
And the FED have shown until now they do not want the stock market to go down, at least during a cycle that lasts 4 or 8 years, I have noticed this by looking at price action and indicators and the FED rates, and this cycle happens to start and end in November of certain years, it's in the chart.
It looks like the BOJ popped the bubble. The US are not Japan of the 80s-90s.
tradingeconomics.com.../government-spending
"Chidhakwa and Chigumira also mentioned that the fiscal position of Zimbabwe began to decline beginning the early 1990s due to budget deficits caused by numerous factors such as increases in civil service wages and salaries, high expenditures in social services, relief programs during periods of droughts, and parastatal (Renev: partially state-owned) losses. Industries and sectors, as well as subsidized credits, became inefficient due to their dependence on the ownership and control of the state."
For Germany the causes were a government that was trolling France.
And Venezuela recently: Maduro printed money in 2013 following the example set by Chavez, which helped in the short term but short term only (covid stimies anyone?), and then he kept spending, while offering rates of 20 to 60% but the population still avoided the currency (even the dumbasses, weird, they play dumb but then they run away from these obvious scams I guess it depends how fast it goes - boiling frog theory).
The public went to the stock market and us dollar. As usual the government whined that there was a "conspiracy" against them and as usual - because you know, had nothing to do with them printing magic beans - the solution was a magical one: imposing price controls 🤣
Now the country is a desert but the stock market is still high, just not very open.
It recently fell from 2.5 million points to 5000 in a straight line I don't know what this is about. Anyway same childish story as usual and Venezuela is on a trend to return to prehistory. "This was not real socialism let's try again" Ye keep trying until you're smashing rocks together genius.
A significant part of the country has fled, I wonder if those are the champagne socialists? Smh.
As the country goes through the paleolithic the weak will die so the strong will be able to rebuild.
Humanitarian aid slows down but does not stop this process.
tradingeconomics.com...nezuela/stock-market
The US story has almost nothing in common with Japan, a little in common with Germany but not much, some in common with Zimbabwe but not all - there is no state control, and everything in common with Venezuela.
As I said playing with rates won't matter (if they pay high rates they'll have to print even more to pay people it's just another way to throw money around), and if the US starts whining about a conspiracy and you know all that stuff that goes with it like price controls then it's the end of them.
Did I miss something?
I wonder what Peter Schiff has to say about this, I'll update this idea if I hear something interesting from his podcast.
The US are so going to double down and continue on the Venezuela path.
> In 1967 following the Israel-Palestine 6 days war there was an Oil shock (it's not the famous one, the famous one is the 1973 one). Arab countries imposed santions on the US, UK and the GDR.
Fun fact: in 1967 guess who made up (partially) for the supply crash of Oil?
-> The USA (do not count on them they are green now)
-> Iran (haha not going to happen this time BUT Iran "happens" to be completely surrounded by american bases that just happen to be there no particular reason, and they might happen to decide to bring democracy to Iran)
-> Venezuela (can they even ship oil now that they returned to neolithic?)
oilfieldwiki.com/wiki/1967_Oil_Em...
"Western military experts generally estimated that in early 2003, Iraq’s armed forces were down to about 40% of their 1991 Gulf War levels"
"Iraq was thought to have between 1,800 and 2,000 tanks in working order, compared with at least 5,500 before the 1991 Gulf War."
Oh and they were outdated.
Iran has 3700 tanks.
"The chairman of the Joint Chiefs of Staff, Air Force Gen. Richard Myers, testified before the House Armed Services Committee on 18 September 2002 that Iraq had more than 2,000 main battle tanks, 3,500 armored personnel carriers and 2,000 artillery pieces."
Iran (according to globalfirepower) has 770 self-propelled artillery, 2108 towed artillery, 2475 mobile rocket projectors.
Also >500k soldier, >300K reserve personel, over 1 million paramilitary.
Iran might get the support of surrounding muslim countries but my little finger says no, unless arabs are really mad about Israel.
I mention this because even if it's not just because of some oil embargo, the middle east conflict could escalate or the US could use it to justify more intervention, more american bases around Iran and they might be looking for any excuse to invade it.
When you have 1 million frikking bases around a country entirely surrounding it...
The US demographic pyramid:
This is why it's just going to keep getting worse.
Also since the USD has lost value and Yuan gained, gets harder to import.
It's more than theories and predictions now. It got very tangible last year.
In 2020 the countries that build stuff said "we're keeping it for ourselves".
So the west went "hey hey hey did you know masks were useless even N95?"
And then they went "hey hey hey how about a toilet paper mask these are super efficient those that deny it are science deniers and conspiracy theorists"
And they also went "hey hey hey trololo how about we ban or spread negative propaganda about all drugs that are in low supply and too cheap for big pharma to get into?"
The opposition media in the US is now starting to invite Peter Schiff regularly XD