The scripted quality of the Ferguson events seemed as formally predictable as an 1856 minstrel show, and the parallel is worth reflecting on because the nation appears determined to explode again in some kind of a civil war — bearing in mind Karl Marx’s advisory that “history repeats, first as tragedy, then farce.” As is the case with many show-biz extravaganza’s of our time the script had many authors. A week after the grand jury decision and the riot that followed, the Michael Brown incident is already disappearing down the national memory hole. Why? Mainly because anyway you cut it Michael Brown was a poor candidate for martyrdom.
A recently published FBI report accidentally proves that while the police claim cops face growing threats from rowdy populations – like in Ferguson – the opposite is true. The governemnt places a higher priority on their own than on the lives of those they claim to “serve,” “protect,” and “work for.” It cares more about exonerating the police of their crimes than providing justice to those they abuse. There is no justice when the criminal is the cop.
The big selloff in 2015 will come from housing and housing-related investments as the marginal cost of capital rises through regulation and through “margin calls” on banks as their profit-to-GDP ratios grow too high for the economy to function properly. The dividend society is here and the true manifestation of Japanisation is not a future event but a thing we are living in right now…
The oil industry is no longer what it once was, it’s not even a normal industry anymore. Oil companies sell assets and borrow heavily, then buy back their own stock and pay out big dividends. What kind of business model is that? Well, not the kind that can survive a 40% cut in revenue for long. Cheap oil a boon for the economy? You might want to give that some thought.
There’s probably no other place more enthralled with its own state of being today than Silicon Valley. Now probably more than ever the tech capital just might be believing their own hype more now, than in the “glory days” of the 90’s.
The precipitous decline in the price of oil is perhaps one of the most bearish macro developments this year. We believe we are entering a “new oil normal,” where oil prices stay lower for longer. While we highlighted the risk of a near-term decline in the oil price in our July newsletter, we failed to adjust our portfolio sufficiently to reflect such a scenario. This month we identify the major implications of our revised energy thesis. The reason oil prices started sliding in June can be explained by record growth in US production, sputtering demand from Europe and China, and an unwind of the Middle East geopolitical risk premium. The world oil market, which consumes 92 million barrels a day, currently has one million barrels more than it needs.... Large energy companies are sitting on a great deal of cash which cushions the blow from a weak pricing environment in the short-term. It is still important to keep in mind, however, that most big oil projects have been planned around the notion that oil would stay above $100, which no longer seems likely.
Here are a couple of reasons why Keynesian economists are truly a menace in today’s bubble ridden and debt-impaled world. It seems that both Harvard’s Kenneth Rogoff and Princeton’s Paul Krugman are on the global advice circuit, peddling what amounts to sheer snake oil to desperate politicians and policy-makers who have already buried themselves - so far to no avail - in unprecedented waves of fiscal and monetary “stimulus”.
What was truly notable in Weidmann's statement is his open jab at the stupidity of Keynesian economics itself. To wit from Bloomberg: ECB Governing Council member Jens Weidmann says at event in Berlin that consumer prices in euro area “are strongly influenced by the energy prices, which are at the moment experiencing a positive supply shock.” The punchline: "There’s a stimulant effect coming from the energy prices - it’s like a mini stimulus package." But wait a minute, isn't deflation under Keynesian voodoonomics, the biggest bogeyman imaginable? It turns out deflation is only bad when it impacts... the S&P 500.
As we prepare for the annual food fest, and post-Thanksgiving tryptophan-induced food coma; we thought this weekend's reading list should be a bit of a smorgasbord of interesting topics to stimulate your brain cells between naps and football.
While the media continue to just about exclusively paint a picture of recovery and an improving economy, certainly in the US – Europe and Japan it’s harder to get away with that rosy image -, in ordinary people’s reality a completely different picture is being painted in sweat, blood, agony and despair. Whatever part of the recovery mirage may have a grain of reality in it, it is paid for by something being taken away from people leading real lives.
I read your post Pity the Sub Genius and agreed with a lot of what you wrote. However you missed what I think is the biggest killer of middle class jobs, and that is technological innovation.
It's not a bubble. Until it is...
A tidal wave of gold repatriations may have begun. As speculated in my last post, I raised a concern that should be shared with all western Central bankers…a widespread flood of countries demanding their gold back to their home soils.
All the blather about "growth" and GDP is just propaganda to misdirect our attention from the real problem: the total domination of governance and finance by a class of vested interests and mega-wealthy cartels/oligarchies.