Is AAPL the next AOL, and is Tim Cook the next Thorsten Heins? It all depends on China: if the world's most populous nation can get its stock market, its economy and its currency under control, then this too shall pass. The problem is that if, as many increasingly suggest, China has lost control of all three. At that point anyone who thought they got a great deal when buying AAPL at $92 will have far better opportunities to dollar-cost average far, far lower.
While status quo-huggers are all too happy to point out gold and silver's lack of utter exuberance amid this week's carnage, perhaps they need to re-comprehend the difference between a heavily manipulated 'paper' market and the surging demand for physical precious metals that is evident in the 20-plus percent premium - and rising - being paid for silver bullion currently...
Donald Trump is no phenomenon or wonder, only someone money has been immunized and given a suit of armor under our capitalist system; a person with true elite-freedom. No, Trump is just a figurehead for those with closeted anger trying to resist unstoppable change in the world and resent their loss of power.
"The [Chinese] slowdown was predictable, predicted, unavoidable," Lagarde was quoted as saying." Well, yes, it was... by everyone but the IMF. Here is the history of the IMF's Chinese GDP growth forecasts taken straight from its World Economic Outlook quarterly pieces. The graph needs no explanation.
Today's most anticipated event at tthis year's Jackson Hole event was the panel on "Global Inflation Dynamics", not because there is any core inflation in the world (at least not in the way the CPI measures it), especially not now that China is finally in the deflation exporting business, but because the most important speaker at this year's Jackson Hole, Fed vice chairman Stanley Fischer, alongside BOE's Mark Carney, the ECB's Constancio and the RBI's Raguram Rajan, would comment. Moments ago he just did, and courtesy of Market News, here are the highlights.
Iif there is one currency in the world that “deserves”, so to speak, ultimate execution it is that of the Japanese. The Bank of Japan has done more than any other central bank for far longer to kill it, but like any horror movie villain it seems immune to any reckoning or even the laws of financial sense. In the bigger picture, that is as much a damning indictment as a tale of orthodox resilience. It shows that monetary redistribution is nothing but a trap, an incredibly narrow and locked economic existence that can and will be permitted by any sustained apathy.
Political turmoil isn’t Malaysia’s only problem. Two weeks ago, in the wake of the yuan devaluation, a $10 billion bond maturity sparked the largest one-day plunge for the ringgit in two decades, serving notice that whispers about a replay of the currency crisis that gripped the country in 1997/98 were about to become shouts. Because it appears the situation is set to deteriorate meaningfully in the near term, and because the country’s political situation could serve to undermine already fragile confidence, we thought it an opportune time to revisit exactly what happened two decades ago.
Small Cap stocks are in the middle of their worst summer doldrums since 2011 - and in fact for many individual stocks, worst summer since the collapse in 2008/9. While talking heads proclaim these smaller (supposedly more domestically-oriented) stocks a must-own, they have underperformed significantly as the credit cycle turns (thanks to their higher sensitivity to funding costs, among other things). Judging by this week's farce, the supposedly high-beta small caps are being BTFD'd aggressively either and perhaps that is because, since 1926, on average, September and October are the only months in which small-capitalization stocks have posted losses.
Simply put, a perfect storm of failing trends...
Some context for those who insist renewables will 'solve' everything...
So why did debt levels rise so dramatically after the final central bank restraint was removed? It is essentially due to the massive subsidy central bankers provided. If you tax a thing you get less of it (think all the tax on labour) but if you subsidise it you will get more of it. As time went by, debt obviously grew ever larger and eventually large enough to become an integral part of the business cycle. In other words, central banks could not stop the subsidy for fear of creating, well, a 2008 financial meltdown.
Last night we heard the best 'excuse' yet if you are caught with an Ashley Madison account, from Dan Loeb - "due diligence." Today, not to be outdone by a married hedge fund manager, Vice-President Joe Biden's son "Hunter" has unleashed his own set of excuses for member ship of the extramarital affairs website, as Breitbart reports - Biden thinks international agents, possibly Russian, who objected to his board membership with a Ukrainian gas company set up a fake account to discredit him. However, IP mapping suggests otherwise...
Tens of thousands of demonstrators poured into the streets of Kuala Lumpur on Saturday to call for the resignation of Prime Minister Najib Razak whose government has been accused of obstructing an investigation into how some $700 million from the Goldman-backed 1Malaysia Development Berhad mysteriously ended up in Najib’s personal bank account. Meanwhile, the country stands on the precipice of an outright financial meltdown.
The more we think about it, the less the classical division between microeconomics (which studies the behavior of individuals and production entities) and macroeconomics (which deals with the performance of the economy as a whole and not its individual markets and components) makes any sense - certainly not in the 21st century. And in our view it is this disconnect between the two that is at the heart of the failure of Keynesian economics – which at best is incomplete and at worst is all just baloney.