Kyle Bass shared his macro views during the “Squawk on the Street”
News That Matters
Nahhh ... The Problem Is NOT ENOUGH Debt! </sarc>
Greenspan: “Debt, Deficits and Entitlement Programs Are All Coming to a Head In a Few Months, All Over the World”Submitted by George Washington on 09/09/2015 16:12 -0400
What Could Possibly Go Wrong?
The centrally-planned house of cards is finally starting to shake uncontrollably.
Will the Japanese “monetary perpetuum mobile” ever get questioned by financial markets?
Why I've come to thinking that Kyle Bass' short JGB premise may well be wrong
"The positive wealth effect of the equity market on consumption or aggregate demand is limited in China, but an equity market collapse would hurt millions of mid-class households and pose great danger to the economy and social stability."
The lack of faith in central bank trustworthiness is spreading. First Germany, then Holland, and Austria, and now - as we noted was possible previously - Texas has enacted a Bill to repatriate $1 billion of gold from The NY Fed's vaults to a newly established state gold bullion depository..."People have this image of Texas as big and powerful … so for a lot of people, this is exactly where they would want to go with their gold," and the Bill includes a section to prevent forced seizure from the Federal Government. Is this the first step down a road to secession?
Most investors have heard Kyle Bass' rather eloquent phrase, "buying gold is just buying a put against the idiocy of the political cycle. It's that simple." However, what few may remember was his warnings in 2011, suggesting the University of Texas Investment Management Co. take delivery of its gold - as opposed to trusting it in the 'safe' hands of COMEX massively levered paper warehouse. Now, as The Star Telegram reports, Texas is going one step further with State Rep. Giovanni Capriglione asking the Legislature to create a Texas Bullion Depository, where Texas could store its gold. The goal is to create a secure facility that would allow the state to bring home more than $1 billion in gold bars that are owned by UTIMCO and are now housed at HSBC in New York.
"As you know we are increasing our gold holdings, although this comes with market risks. The price of it (gold) swings, but on the other hand it is a 100 percent guarantee from legal and political risks."
"The Q1 US GDP data was a major disappointment to the market as business investment declined due to the intensifying US profits recession. Only the biggest inventory build in history stopped the economy subsiding into a recessionary quagmire. The US economy is struggling and the Fed will ultimately re-engage the QE spigot. Talk is growing that China will soon be doing the same as local authorities struggle to issue debt. But this week we want to focus on Japan, having just made my fist visit to that fine nation for over a decade! Japan, the third largest economy in the world, is also in trouble (see chart below) and will soon be increasing its off-the-scale QE programme to an out-of-this-world QE programme." - Albert Edwards
While it’s an open question as to whether acquirers are grossly overpaying in the race to find drug targets that fit well with their existing pipelines and offer the best chance for marketing synergies, it appears that at least in some cases, the premiums paid in healthcare M&A deals are being passed right along to patients. "It seemed like highway robbery,” one industry insider tells WSJ.
"How many rich people do you know today that are poorer than they were at the peak in 06/07 (apart from Dick Fuld), I don't think I know any.. QE has been distributive to the rich... but now that the world has started this policy it is unable to end it... the next recession will be a hard one because the tools in the toolbox are not there to avert a severe downturn... where are the liquidity worries at the moment? Equities would be the toughest to exit.. it's like a 5-lane highway going in and goat trail coming out... Brazil is great example"