Kyle Bass Tells 'Nominal' Stock Market Cheerleaders: Remember Zimbabwe

Tyler Durden's picture


Amid the euphoria of today's crossing of the Dow's Maginot Line at 14,000, Kyle Bass provided a few minutes of sanity this morning in an interview with CNBC's Gary Kaminsky. Bass starts by reflecting on the ongoing (and escalating) money-printing (or balance sheet expansion as we noted here) as the driver of stock movements currently and would not be surprised to see them move higher still (given the ongoing printing expected). However, he caveats that nominally bullish statement with a critical point, "Zimbabwe's stock market was the best performer this decade - but your entire portfolio now buys you 3 eggs" as purchasing power is crushed. Investors, he says, are "too focused on nominal prices" as the rate of growth of the monetary base is destroying true wealth. Bass is convinced that cost-push inflation is coming (as the velocity of money will move once psychology shifts) and investors must not take their eye off the insidious nature of underlying inflation - no matter what we are told by the government (as they will always lie when its critical). Own 'productive assets', finance them at low fixed rates (thank you Ben), and finally, on HLF, don't bet against Dan Loeb.

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Fri, 02/01/2013 - 14:48 | 3206882 Say What Again
Say What Again's picture

I watched this piece.  The ZIMM reference was priceless!


Fri, 02/01/2013 - 14:57 | 3206913 hedgeless_horseman
hedgeless_horseman's picture



So what would the chart for a bottle of HerbaLife Cell Activator* priced in gold look like?

*Supports the body’s absorption of micronutrients and promotes cellular energy production.

WTF is a micronutrient?

Fri, 02/01/2013 - 14:59 | 3206933 CheapBastard
CheapBastard's picture

It's "The Sandwich Generation:"


According to a new Pew Research study that was just released,one out of every seven adults in the United States is financially supporting their kids and their parents at the same time.  Pew Research is calling it “the Sandwich Generation”.

Fri, 02/01/2013 - 15:01 | 3206941 The Juggernaut
The Juggernaut's picture

When it becomes serious you have to lie.

Fri, 02/01/2013 - 15:03 | 3206949 MillionDollarBonus_
MillionDollarBonus_'s picture


What a day! Not only did the S&P sustain a spectacular rally above 1500, but the VIX plunged into the 12s in an epic collapse, sending shockwaves of shame and embarrassment throughout the doomer libertarian community. Let's review the facts:

  1. Interest rates are at all time lows 
  2. The stock market is soaring despite a set back in the GDP
  3. The housing market is now undeniably in a recovery
  4. Employment is picking up, in line with our Federal Reserve's dual mandate

Listen folks: this is a recovery - there's no denying it anymore. Doomer ZHers need to admit that they were wrong. ZHers may have lost most of their pride and dignity, but they still have an opportunity to retain a semblance of credibility if they admit that they were wrong


Fri, 02/01/2013 - 15:07 | 3206957 Meat Hammer
Meat Hammer's picture

Who's paying you?

Fri, 02/01/2013 - 15:10 | 3206971 Say What Again
Say What Again's picture

Hey MDB,

Can I buy some puts on the SPY from you?

Fri, 02/01/2013 - 15:12 | 3206977 The Juggernaut
The Juggernaut's picture

MillionDollarBonus: can't you see its all a manufactured lie?

Fri, 02/01/2013 - 15:14 | 3206996 Say What Again
Say What Again's picture

Are you related to L. Ron Hubbard?

Fri, 02/01/2013 - 15:40 | 3207106 economics9698
economics9698's picture

"Zimbabwe's stock market was the best performer this decade - but your entire portfolio now buys you 3 eggs"

In Germany 1923-25 the stock market did flips but after inflation investors lost 33%. 

Fri, 02/01/2013 - 15:47 | 3207159 SafelyGraze
SafelyGraze's picture

take-home headline:

Bass recommends southern African stock, calls it "best performer", advises timely out-rotation   

Fri, 02/01/2013 - 15:57 | 3207198 Say What Again
Say What Again's picture


I see you've spent some time at the Daily Gazette!

Say hello to Louis for me.

Fri, 02/01/2013 - 16:03 | 3207235 economics9698
economics9698's picture

If you adjust 14,000 today to 14,000 2007 you get 12,681 using official numbers.  Careful with that inflation, it will kill you.

Fri, 02/01/2013 - 16:36 | 3207367 FEDbuster
FEDbuster's picture

I am still a Zimbabwe multi-trillionaire, so listen up (how's that for an opening).  In it's heyday, the Zimbabwe stock market rose 200+% daily.  Will the S&P have a 200% up day?  Maybe MDB is right when the S&P hits 100K, 200K, etc.,,, and a gallon of gas or milk is 1,000 FRNs.  You might need a trillion dollar platinum coin to buy a house.  As we continue heading into the shit abyss, all things are possible.  

Fri, 02/01/2013 - 17:21 | 3207525 A L I E N
A L I E N's picture

Thats right, you better take notes boy!

Fri, 02/01/2013 - 21:58 | 3208195 trav777
trav777's picture

so if we're goin ZIM, you should be levered long to the hilt, right?

Oh and you better be armed if you're white.

Sat, 02/02/2013 - 18:44 | 3209710 Rogue Trooper
Rogue Trooper's picture


These 'Whities' demonstrate the gangsta technique LOL

I, for one, if faced with a similar situation would still prefer to utilise the capabilities of my M1A.  Sure they could get 'lucky' as the morons spary rounds in a random manner.

Final shootout from Unforgiven... Classic Clint and worth reflecting upon in these dark times.

Whities Weapon of Choice.... The M1A!

Fri, 02/01/2013 - 18:10 | 3207671 Tango in the Blight
Tango in the Blight's picture

I'm a Zimbabwe quadrillionaire. I have 10 of those 100 trillion dollar notes.

If I could somehow change Zimbabwe Reserve Bank to Federal Reserve Bank on the notes could I then pay off all the world's national debts?

Fri, 02/01/2013 - 18:19 | 3207684 FEDbuster
FEDbuster's picture

I'll trade all my Zimbabwe trillions for one of Obama's trillion dollar platinum coins.

Fri, 02/01/2013 - 22:18 | 3208262 MajorWoody
MajorWoody's picture

Even if you don't agree with MDB you have to listen to his reasoning.

If you don't your setting yourself up for a sh!tsandwich tasting.

Keep repeating your own mantra over and over you brainwash yourself.

Keep an ear on MDB.

Fri, 02/01/2013 - 22:57 | 3208378 fourchan
fourchan's picture

hes going to be right, again, one day. real right.

Sat, 02/02/2013 - 18:14 | 3209660 saveandsound
saveandsound's picture

Hi MajorWoody,

I agree - when you like to stay in touch with reality you need to re-check your worldview every once in a while. However, what do you think the upcoming currency wars are going to bring?

I believe - I do not know - that asset prices and the CPI will go up. And wages stay where they are. Countries which want to contain inflation will need to establish capital controls or see their exports diminish.

*narf* I'm brainwashing myself again. ;-)

Sat, 02/02/2013 - 15:54 | 3209422 SAT 800
SAT 800's picture

I tried over and over again to explain to American Citizens that were happy with their 401K portfolios that they had "made" nothing; because of inflation. The result is they don't want to talk to you anymore. Inflation works because it goes by slowly and people really don't think very carefully. A bigger number must be better.

Sat, 02/02/2013 - 16:45 | 3209506 HyperinflatmyNutts
HyperinflatmyNutts's picture

 The last time the Dow was 14000 in 2007 GOLD was $700 now in 2013 once again the Dow is 14000 but this time GOLD it pushing $1700.  Gold and Silver Bitchez.....  The Dow can go to 20000 who cares?  The Dow to GOLD will be 1 to 1.  up up and away..  

Fri, 02/01/2013 - 16:05 | 3207239 brockhardman
brockhardman's picture

Kyle Bass speaks -> I listen

Fri, 02/01/2013 - 16:38 | 3207375 Karlus
Karlus's picture

"Bass recommends southern African stock, calls it "best performer", advises timely out-rotation"


Tonight on MS-NBC:

Kyle Bass, famed shortseller from Texas is now recommending trading your portfolio for eggs. Panel, what do we think of this new recommendation and what does this do for Bass' reputation in the market?

Fri, 02/01/2013 - 18:17 | 3207685 FEDbuster
FEDbuster's picture

Buy a chicken instead, then you will have an egg a day.

Sat, 02/02/2013 - 15:59 | 3209430 SAT 800
SAT 800's picture

Unless you make the acquaintance of an economics Phd. who explains to you that the Chicken is an example of an investment with declining future value; so you should slaughter it and eat today in order to take advantage of the "wealth effect"; then you will wake up tomorrow with no chicken and no egg.

Fri, 02/01/2013 - 15:17 | 3207016 in-Credible Banker
in-Credible Banker's picture

"Say What Again"  - now THAT's a handle!!!!  Well done man!!!



Fri, 02/01/2013 - 15:22 | 3207028 Say What Again
Say What Again's picture

Thank you.

Come on over to my house after the close, and I'll buy you a Kahuna Burger.  Mia will be there too.

Fri, 02/01/2013 - 22:35 | 3208327 stuman
stuman's picture

Hey, is that the Big Kahuna Burger on the corner?


My...those are tasty burgers ;)

Fri, 02/01/2013 - 15:08 | 3206962 Randall Cabot
Randall Cabot's picture

But Tom DeMark's sell signal is up to 23, surely the market is exhausted by now:


Fri, 02/01/2013 - 15:08 | 3206965 ParkAveFlasher
ParkAveFlasher's picture

If this economy keeps recovering, we're gonna need more guns.

Fri, 02/01/2013 - 15:17 | 3206973 Banksters
Banksters's picture

Milliondollarbonus, I usually don't pick on retards, but today I'm feeling somewhat sadistic.


1. Money is debt.   

2.  Banks are raping savers, by my estimates 3-4 trillion dollars, through zirp.   That is a whole lotta STIMULUS.

3.  Banks aren't loaning because they are ZOMBIES.

4.  Wages are flat, which means falling, due to inflation

5.  Employment is nothing more than a statistical mirage.   You can't have millions of people disappear and not have it affect the overall unemployment rate


Sell stupid somewhere else.   

Fri, 02/01/2013 - 15:40 | 3207110 Say What Again
Say What Again's picture

Rumor has it that MDB suffered a serious head injury.

Therefore, he's not a retard -- he's a "victummmm"

Fri, 02/01/2013 - 16:18 | 3207291 chunga
chunga's picture

You guys forgot the disclaimer.

No offense intended for regular, normal retards and victims.

Fri, 02/01/2013 - 15:21 | 3207026 Apostate2
Apostate2's picture

You nailed it. I am an Apostate thus always wrong. 

All those salubrious taxes cometh.


Fri, 02/01/2013 - 15:24 | 3207040 Gimp
Gimp's picture

Is that you Steve?

Fri, 02/01/2013 - 15:30 | 3207059 q99x2
q99x2's picture

Go long MDB and get those 3 eggs.

Fri, 02/01/2013 - 15:37 | 3207084 Jake88
Jake88's picture

Interest rates at all time low. True. Too bad nobody wants a loan

Stock market soaring. True. Remember Zimbabwe. Set back in GDP. - Two "set backs" in a row equal recession.

Housing market in undeniable recovery. - FALSE

Employment picking up. - A smidge maybe but real unemployment is still very high.

Fri, 02/01/2013 - 16:35 | 3207365 Mr. Magoo
Mr. Magoo's picture
Zimbabwe: Best Performing Stock Market in 2007?

April 10, 2007 by

What happens next?????????

Fri, 02/01/2013 - 15:54 | 3207193 steelhead23
steelhead23's picture

You know, when an alcoholic is suffering delerium tremens, a good stiff drink would alleviate the symptoms - but the alcoholic is still addicted and will eventually die.  Party on.

Fri, 02/01/2013 - 23:50 | 3208493 FEDbuster
FEDbuster's picture

Barkeep Ben keep the shots of QE coming, let's party like it's 1999!

Fri, 02/01/2013 - 15:57 | 3207204 WhiteNight123129
WhiteNight123129's picture

You can not be short when you have currencies being gutted.

I mean look at the Merval from Argentina, went up 750% since 2002.
If you are on a 2 + 20% you have to love it.

Of course it is a recovery, a nominal recovery. A large nominal recovery, soon to become a hugely large nominal recovery.


Fri, 02/01/2013 - 17:25 | 3207532 Panafrican Funk...
Panafrican Funktron Robot's picture

"If you are on a 2 + 20% you have to love it."

Definitely an argument in favor (for those in power) of continued, rapid devaluation.  The other fun part is that, once you're done paying he 2 'n 20, you then get to pay cap gains tax on those nominal gains.  Hello, tax revenues!  Which of course get recycled right back to the cronies.  

Fri, 02/01/2013 - 15:58 | 3207213 WarHorse
WarHorse's picture

Can you still remember what the shooter on the grassy knoll looked like?

Fri, 02/01/2013 - 16:41 | 3207390 Karlus
Karlus's picture

Was it G Gordan Liddy, or some Texas rangers wearing hats?

The conspiracy nut in me said its the two Secret Service guys wearing Johnson masks....

Fri, 02/01/2013 - 16:57 | 3207452 Fish Gone Bad
Fish Gone Bad's picture

JFK was shot from a storm drain.

Fri, 02/01/2013 - 21:12 | 3208012 MisterMousePotato
MisterMousePotato's picture

Actually, weird as it may sound, Woody Harrelson's father was probably one of the team. Else a remarkable coincidence. (Ditto GWB, Sr.)

Fri, 02/01/2013 - 16:10 | 3207263 Rick Blaine
Rick Blaine's picture

1.  Yeah, and I'm not sure why you think that's a good thing.

2.  And who exactly is buying stock?

3.  What???

4.  Are you on crack?  The participation rate is where it was like 30 years ago.

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