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Kyle Bass Warns Fed Has Made "Stocks Only Game In Town" So "Rich Will Get Richer"
Having previously exposed the world to the "nominal stock market cheerleaders," it is clear that Kyle Bass sees things as only having got worse among developed nations. In fact, the following interview shows that he does not fear US losing its credibility since "developed western economies with the largest debt loads are all in the same boat." The discussion expands from the debt ceiling debacle to bonds and stocks, "given the lack of nominal yield in the bond market, all of the new money is going to continue into stocks. The interesting thing is it’s going to make the rich people richer and the middle and lower class won’t be any better off, which is the opposite of what the administration is trying to pull off," adding that being in stocks "is not your choice," thanks to Fed repression and that deficit contraction is all that can stop the Fed now.
As Bass warned previously,
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.
Jim: Do you feel the debt ceiling debate and the political theater in Washington are hurting U.S. credibility and our capital markets in the long-run?
Kyle: No...the entire world is in the same position we are in one way or another. That’s painting the world with a broader brush, but when you look at the developed western economies (and, of course, we’ll exclude countries with no net debt like Australia and Canada that are natural resource heavy), but the developed western economies with the largest debt loads are all in the same boat. Whether or not they have debt ceilings in the U.S. or bank note agreements like they had in Japan until they recently abolished them, there are all of these potential glass ceilings that are put on the marketplace that always tend to move. I think since 1960 we’ve raised our debt something like 82 times.
Jim: Economists have often said—I’m thinking of “This Time Is Different” by Reinhart and Rogoff—when countries have debt-to-GDP ratios over 100%, they get into trouble; Japan’s is 230%. Why have they not had trouble up until now?
Kyle: When you think about what Reinhart and Rogoff’s book says, it kind of gets to an answer but it’s not the right way to look at things; there are many more variables to analyze the situation with. One is, of course, debt to central government tax revenues—that ratio. Another one is what percentage of your central government tax revenues do you spend on interest alone? Those barometers are much more impactful than just using a debt-to-GDP barometer. And then when you think about Reinhart and Rogoff’s work, if you’ve read all the white papers that they’ve written prior to writing the book, one of the other conclusions that they draw is when debt gets to be about 100% GDP it becomes problematic. Well, what that means is, typically—and, again, painting the world with a broad brush—central government tax revenues are roughly 20% of GDP. So what they’re telling you is when debt gets to be 5 times your revenue, that’s when you start to have a problem. Historically, the analysis that’s been done empirically by academics has focused on the countries that have fallen into a restructuring or a default as a result of this ratio that you and I are discussing. Historically, those have been emerging market economies that have higher borrowing costs. So, it actually makes complete sense that that number is too low when you’re talking about a developed market economy versus an emerging economy because, in theory, a developed economy can borrow at lower rates than an emerging economy can. That being said, in Japan, when the debts are 24 times their central government tax revenue, they are already completely insolvent—it’s just a question of when does it blow up.
Jim: I want to turn our attention to the stock market right now and your view of where you see the markets right now. They don’t seem overvalued when you compare them to 2000 or 2007, but they’re not cheap; and, where do you go in a market when the rate of return on cash or bonds is hardly anything?
Kyle: I think that as long as the Fed—for instance, the Fed is still buying $85 billion a month; almost a trillion a year—you could argue that the Fed is being more stimulative today than they were a year or year and a half ago. When we were running a trillion to a trillion and a half deficits, the Fed, at a trillion dollars in a deficit, was buying every bond that was issued. Today, you have a scenario where the fiscal deficit in the U.S., we think, is somewhere around 650 to 700 billion dollars. So, in theory, the Fed is actually adding more money to the economy today than it was a year ago because the deficit is lower and they’re still buying the same number of bonds. So what I’m saying is the monetary base continues to expand. What the economists are saying is velocity continues to drop at a faster rate than the base is expanding. Well, velocity, I believe, is a coincident indicator at best—possibly a lagging indicator. So, when the v [velocity] turns around that’s when inflation shows up, but for now--you’re asking about stocks…I think, given the lack of nominal yield in the bond market, all of the new money is going to continue into stocks. The interesting thing is it’s going to make the rich people richer and the middle and lower class won’t be any better off, which is the opposite of what the administration is trying to pull off.
Jim: What is your outlook on when the Fed will taper or, eventually, raise interest rates?
Kyle: I personally think that what enables the Fed to taper, again, is a contraction in the fiscal deficit. Now, part of that equation will be remedied by higher tax collections; unfortunately, the other side of that equation is, of course, lesser spending, which isn’t going to happen. So, I believe they can taper to the extent that the fiscal deficit has contracted. I don’t think that they’ll be able to raise the Fed funds rate any time in the foreseeable future—3 to 5 years.
Jim: So, that would argue that stocks would be a better play.
Kyle: Unfortunately…because it feels like they’re making it the only game in town. It’s not your choice, but it’s the only answer though. [End transcript]
In the rest of this must-listen interview, legendary hedge fund manager Kyle Bass gives investors his most recent views on Japan, the impact and outlook for shale gas in the U.S., and a wide range of other topics.
If you would like to hear this full must-listen interview with Kyle Bass airing this Wednesday, CLICK HERE to subscribe.
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Moar plunge control
which is the opposite of what the administration is trying to pull off
correction: which is exactly what the adminstration is trying to pull off
Dumping endlesss baseless fiat into the stock market is like marking barrels of high level radioactive waste "soup" and thinking the problem is addressed or the reckoning will be delayed.
the rich are different
multiple homes
jets (plural)
yacht (and new yacht being built)
staff issues
entourage issues
getting the junior princes and princesses into the right schools
legal fees for that all important get out of jail free card
clothing, do any of you ZHers consider the expense of a wardrobe, parties to attend, meetings, parties, gala celebrations, parties, ribbon cuttings for the new wing of the University or Hospital or NBA team you just bought
Transgender highpriced hookers (for regulatory matters)
All that shit costs money
have some sympathy
"have some sympathy"
I think the Stones wrote a song about that.
Our enemy is the Fed.
http://www.planbeconomics.com/2013/10/the-mises-view-our-enemy-fed.html
But they create jobs. Trickle down economics. You get to work as their bathtub cleaner and contribute to the lower unemployment BLS stats.
lol
Not to mention partime jobs
Bass is suffering a bout of retarditis. He should be referencing Japan, not Zimbabwe.
We're following Japan, where their monetary policy & massive government deficits & debt gutted their equity markets by 70% in nominal terms and 95% in real terms since 1989.
This will be known as the Bass Top call more likely than not.
Re: Centrally-planned economies have an exceptionally poor track record.
They are usually the result of unplanned economies that also have an exceptionally poor track record.
The Fed came about when the top 1% were about to be hung from trees about 90 years ago and they "cut a deal". The "deal" was to allow the top 1% to take a cut of the entire US economy activity. It worked for awhile. Then, like all systems created by humans, even smarter sociopaths appeared and figured out a new way to screw the dumbasses using the existing system. The old sociopaths are replaced by new sociopaths. And so it goes.
Or, you call it what it is, but don't disclose that it is a by-product of aluminum production, or that it is a neurotoxin, and then buy the ADA leadership so they'll tell all the dentists to tell their patients how good it is "for the children". Apologies to the grammar nazis for the run-on sentence.
Turns out, we, the people are the best filters for all kinds of toxins- financial and otherwise.
Speaking of filters:
http://www.technologyreview.com/view/520706/how-to-build-a-plant-xylem-w...
Cheap, simple water filters made of plant xylem could dramatically reduce the incidence of water-borne diseases in places without access to clean drinking water, say engineers.
One useful tip to avoid food poisoning while travelling is to eat fruit you peel yourself. The thinking is that trees and plants filter the water they suck up from the ground so their fruit is unlikely to contain bacteria and other nasties.
That has given Rohit Karnik and pals at the Massachusetts Institute of Technology in Cambridge an interesting idea. Why not create safe drinking water in exactly the same way, using plant xylem filter water-borne bacteria from the mix?
It turns out that while plant biologists have studied plant xylem in detail and measured the rate at which it can transport water from roots to leaves, they’ve never thought of using it as a filter. So Karnik and co got to work to test their idea.
Xylem is the porous tissue that conducts fluid in plants. In woody plants, it is called sapwood. Surrounded by bark, it often surrounds older, inactive heartwood itself. In conifers, it is formed from dead cells called tracheids, which are essentially hollow tubes with diameters of up to 80 µm and lengths of up to 10 mm.
These cells grow in parallel and have closed ends. The water passes from one conduit to another through holes known as pits, which are covered in a membrane with nanoscale pores that act like a kind of sieve. Anything bigger than these pores cannot get through.
So in theory, the plant xylem from conifer trees should be an effective filter.
To find out, Karnik and co cut 1 inch-long sections of branch of the white pine tree pinus strobus. They peeled off the bark and stuffed the remaining sapwood into a tube, sealing any gaps with epoxy resin.
They then filled the tube with 5 millilitres of deionised water under 5 pounds per square inch of pressure, equivalent to a gravitational pressure head of about 2 m or so, and waited to see what happened.
Sure enough, the water filtered through at the rate of 0.05 millilitres per second. That flow rate is equivalent to more than 4 litres per day, enough to keep one person in drinking water. That’s from a filter with an area of about 1 cm².
Next, they studied the material’s filtering properties. They added a red pigment to the water and measured the distribution of particle size within it. This ranged from about 70 nanometres to 500 nanometres in size.
The filtered water was clear, however. And the particle size distribution in the filtrate peaked at about 80 nanometres. Clearly, the xylem filters out particles larger than this. In a separate experiment, they added 20 nanometre fluorescent nanoparticles made of polystyrene and found that the xylem could not filter these out.
The evidence is clear. The planet will provide for us, always and forever. How many of us? That remains an open question.
That exactly. I'll add...
What's an easier country for a government to exert top-down control: one where vast amounts of the population have effectively no financial ability of their own, or a country with a vast middle class, capable of deciding alternate courses of action on their own and posessing the resources to act on that decision?
Although I'm leery of stocks at all-time highs, I don't trust bonds at all. Know too many bond pros who are out of bonds themselves.
Under the new Fed regime, it is not relevant if we think that stocks are overpriced. Clearly we have the Fed's blessing to use the Greater Fool Theory of stock investing -- but only as long as they don't taper. Which they won't. They CAN'T [shouting, yes]. Because the economy and demand for their fiat USD will tank.
The Fed is trapped between two untenable positions: They want to taper, but can't. They HAVE to keep 'printing' (increase the 'Money'* Supply) as the VoM is not doing enough to keep the product of the two (M*V) at levels to equate with economic growth.
Therefore... as long as they keep printing, the asset prices of stocks have no choice but to rise. And insofar you seek to invest some of your income (or free stock options) into stocks -- rather than in Commodities or RE -- you might as well buy shares in profitable businesses. By all means hop onto that train, but be sure to get/jump off before it reaches Terminal Station (Stock Yard), cause the brakes on this train are shot. Seat/position yourself accordingly. Good luck, as you may need it either way (if youre' not a Goldmanite).
* What they call Money Supply is actually Currency Supply, since their 'Money' is not true not true Money (since it is not an enduring store of value). But for purposes of consistency with their terminology and rhetoric, I will use 'Money' here. As long as you make the mental translation into 'Currency', every time you see the word 'Money' in regards to the Fed or the Markets.
Well, Kyle is a smart man and might be right short-term. But, I would also have money in a variety of other investments, especially hard assets.
The link below will take you to my first page, which has a review of the latest issue of American Hard Assets: The Silver Issue.
And to my latest articles on our visit to the northern Peruvian Andes and Wyoming if you would like to see some of what we just saw...
http://tinyurl.com/9hlvzdx
RB- I'm afraid if you're an "investor" (if there is such a thing any more) the short term is all there is. I'm not sure long-term thinking can even be applied in that world any more without covering your eyes and repeating over and over again "the government would never have the audacity to just take this from me someday."
If you have long term thinking there aren't many paths open to you that don't involve basic preservation measures, outside the system. That means owning some physical gold, purchased for cash in an anonymous way, stashing it in a safe place for several decades and KEEPING YOUR DAMNED MOUTH SHUT ABOUT IT. Some portion of your wealth kept "off the grid". Anything on the grid is known to the government and at risk for potential confiscation or confiscatory taxation- 401k, IRA, bank accounts, paper stock and bond certificates, real estate, (even art and collectibles to a certain extent), etc.
When the Fed took away market risk, they also indirectly sewed the seeds of confiscation risk.
I'm going to take credit for that last statement as an original- I don't think I've heard that connection made before anywhere. Nonetheless, I think it explains a lot of divergent behavior the last few years.
Evening, NoDebt. I agree with much that you say, both here and elsewhere (so I greened you). I think that there IS SOME case to be made for longer-term thinking, yes, our problems are grave and will almost surely lead to many tears...
But, I am not (likely, I hope) an easy target... This Fringe Blogger is not a big fish, or even a revolutionary one. But, by the time they get to us in a .gov frenzy of SHTF, this country (USA, I write from Peru, where, yes, we have hard to grab non-liquid assets here) will be so screwed that probably millions will have died before us... And we may get out beforehand. Timing may be everything.
I also think that, in the end, they will NOT confiscate gold (IRAs and bank account bail-ins, they might very well). To confiscate the gold this time around, they would have to take our guns... An not many gun owners trust the government...
Molon Labe. And there would be much litter around the landscape should they come...
DoChen,
Watch this and then let me know if they are going to sit idley by and let you play with your guns.
http://www.infowars.com/leaked-video-military-police-briefing-with-fema-over-gun-confiscation-and-martial-law/
Remember Katrina, the NRA did a video on its aftermath on gun confiscation.
I hope we are not pushed to Molon Labe, however my confidence wanes...
DaddyO
Evening DaddyO, yes, the cops are more militarized and militant now. But there are 80,000,000 of us gun owners. We are stocking up as much as DHS is...
I too think (but do not know -- anything really) that this will end badly, but by the time they get to the Bearing Family, America will be gone. We may be gone to Peru...
***
My blog is one part of my self-expression (as is Tai Chi) and one of my First Amendmend rights. I treasure, and use, my personal liberty.
I too hope that it does not come down to Molon Labe.
Yep, understood. I know what you've shared of your own 'geographic profile' on ZH. You're much more comfortable with geographic mobility than most Americans are, myself included. For instance, If I ever woke up in Peru with a hangover and a fresh tattoo I'm reaching out to two places for immediate help:
1. You via ZH
2. The American Embassy to come rescue me (if it hasn't been attacked and burned down by terrorists while our president sleeps).
I understand those that are comfortable with flitting around the globe. I do. But I'm not. Most people I know in America are not. That may be a weakness, or a strength depending on how you look at it. But it's how things are. We've always felt we had enough control over our situation, at least withing our own borders, that we didn't worry about stuff like this too much. Now we're worried about it and we're turning to what we know: how do we deal with this in a local way. Leaving the US is certainly an otion for those with the resources. Most of us don't have those resources, though, nor the inclination. We'd rather fight this battle on our home turf, so to speak. Hell, it's still WORTH fighting for, despite how dark things look right now.
No easy answers.
Absolutely right about no easy answers.
My inclination would be to stay and fight if it came to that. But, maybe not! I still don´t know.
I like to think in terms of probabilities. Yes, things do look pretty bad, but my guess is that they will not reach the point of TEOTWAWKI, although things will likely get scary.
If I stay in America, I will not be an easy fish to pluck. Nor am I in the 1%. But, who knows what will happen?
(Since I became "FOA" some 13 months ago, I fear less than I used to, and I don´t mean "Friend of Another")
Some fears are reasonable, the ones I had that were alcohol induced are long gone.
The fears I have today are rational and well founded!
I am coming up on 31 years FOA and I have come to terms with Fear, but that said "Future Events Aren't Real" until you visit the ZH Zone and then all bets are off.
I too have given some thought to expatriating if things got too bad and have made the decision that right, wrong or indifferent, my roots are too deep to leave.
I am taking steps to increase my sphere of influence locally to establish Committees of Safety (COS) and Committees of Correspondence (COC).
It may be a waste of time but they proved useful a long time ago and may do so again.
We'll see...
DaddyO
"I too have given some thought to expatriating if things got too bad and have made the decision that right, wrong or indifferent, my roots are too deep to leave."
DaddyO- thanks for that. That's pretty much what I was trying to convey in my own ham-fisted way, above.
Pls explain the acronym FOA?
Shit hits the fan before the end of this year. Watch.
Then again, it doesn't.
Fuck, I need some cash flow. Hoping the shit stays behind the dyke till May. Then again, it might not.
I kind of like the mental image of BenYellen plunging a toilet full of shit in the hopes that the broken sewage pipe will take just a little more. Perhaps instead of the "SHTF" moment, I'll start referring to the SHTB (shit hits the Bernanke) moment that is coming sooner or later.
I would pay good money to heave a bucket of shit on the Bernake. Well, not money, but a bunch of FRN's.
Fuck it. I'd part with a shiny or two.
Look, they are way down on the turd list for people to oversee this show. That means it's about time for last call, the lights are blinking. When it gets to the point that you have to guess about the people who are guessing what to do in an economy full of guesses, I'm guessing it's time to get out.
No shit, Yellen? And we have all these mental gyrations about a fucking AA rated manager taking over to manage the World Series of fucking economies? And we're checking her/its credentials? Step back people, they want us to watch her/it fuck around and talk while hey slip out the back door with the loot.
Hold this anchor for me, I'll be back in a minute.
Moar impeach
5 moar years of no interest ....seniors will be dead by then....just the plan scooby
Uh Kyle, they know already. Thats why they did it.
"it’s going to make the rich people richer and the middle and lower class won’t be any better off, which is the opposite of what the administration is trying to pull off,"
kyle is a smart man and he knows that it is NOT the opposite, it is exactly what administration trying to put off. look at TSA, militarisation of police, 15 gov agencies snooping on everything.
I call his statement lying bullshit.
"I call his statement lying bullshit."
Couldn't agree more. This whole narrative that the Fed and the administration are not deliberately enriching the top .01% at the expense of the middle class is getting really, really tired. Anyone who claims that their intentions are good and their policies wrong, is either lying or an idiot. Kyle Bass is not an idiot. So what's his agenda? Probably to push the sheep into stocks on the premise that they can only go up from here because of these supposedly mistaken policies.
he probably was told a while ago what he could say and not say.
Yup. You won't get invited to CNBC if you are not following the script to the T.
What you guys just said is total fucking bullshit and you all know it, you guys are smart people. Bass runs a huge fund with a broad range of investors, he cannot for his fund's credibility's sake say that he thinks they are intentionally doing it even if thats what he thinks. Theres a big difference between being a day trader or a zerohedge commentor and running a massive fund with a huge portfolio like Bass. He has to be careful and choose his words wisely.
He is a good guy and from what I can see, he would be the last guy you could try and force him to go on a bullshit script, now that you know stop acting like fuckin kids.
What is there to hedge against anymore ? It's all up, up and up.
He would be the last guy to go in on a bullshit script because he runs a hedge fund with a broad range of investors? He does not invest for the middle class. he is politely trying to clue them in on the shit sandwich they are eating while reassuring the 1% they will continue to eat it.
Bass has just explicitly stated that everyone should join the equity train b/c it's different this time, and the Fed can't/won't lose control of things, and that the BernYellen "put" is as god as gold, hence he has earned retard status.
my takeaway was that Bass was saying the admin is "seeing" the opposite effect of its "stated" goals...
as to the stock market's legs, i never would have imagined the LAST 5 years, let alone how long we may Zimbabwe along going Forward™
Japan got 20 years in tandem with their export based economy....
Let's see how far we get on mining....the amerikan middle class
'He does not invest for the middle class.'
yup, entry level to his club is $5mil
By whom?
The Fed and the administration are the top .01%......but you knew that.
Where is great fool?
"....middle and lower class won’t be any better off, which is the opposite of what the administration is trying to pull off,"
You're mis-reading his statement. By"Pull off", he means pull off the perception, that the middle/lower class will be better off with his policies. Which is easy when the MSM keeps covering for him and making him apppear disconnected from his actions. He's outside the disfunction in DC and here to help the folks. No different than Democrats in general having "pulled off" the perception that they help the poor.
"I call his statement lying bullshit."
Same with ObummerCare: collect an outright TAX on those who fail to sign up without having to deliver any services. They must have been 'high fiving' one another when they thought up this one. They're ripping up (our) floorboards to keep this fire going.
The entire world in the same position as the US? Give me a break Kyle. Nobody else has the reserve currency. Nobody else (except the UK and some small city-states) has financialized and deindustrialized their economies to the extent the Americans have. An end to the US dollar hegemony, which is surely coming, won't be good for anyone in the short term, but Americans obviously have the most to lose. This kind of self-reassurance is part of how they got in this mess.
And do you really think the administration is working for the lower and middle classes? More nonsense.
I think his main point is the end to the dollar hegemony is a long ways away.
Well that may be true, but no-one can guess the timing of this. And it's also true that Kyle and every other fund manager desperately want it to last a long ways before they have o head for the hills so this is hope and self-justification as much as it is logic.
While no-one can predict timing, accelerating phenomena with no brakes (monetary inflation, cognitive issonance) generally lead to compressed timelines ...
I believe Kyle built that fortress for a reason. All i am sayin is everyone on here shorting this disaster may be dead broke well before the day ever comes to hit it big.
At least I avoided the Christmas rush of going broke trying to short the market.
I'm at Disney right now. was going to touch base with you but I am stuck on a ridiculous schedule here. What is so nice about Disney is it is so small and inexpensive. It's like u barely spend any money while u are here.
Ha! Yeah, you're better off going to an NFL game with an intention of getting really drunk and overeating. For Disney these days you need to think about a second mortgage. But there's no inflation, so we've got that going for us.
Sorry we couldn't meet up. This week would have been no good for me anyway, but next time.
Re: What is so nice about Disney is it is so small and inexpensive.
Dude, you're not in Disneyland, that's the local traveling circus. They didn't charge you full price did they?!!
You're in Washington DC?
Don't disagree and can attest from personal and painful experience. All I'm saying is there is book-talking going on here more than impartial analysis, and in that sense he's just milking the cow like every other wall street mafioso and he's part of the problem, not some voice for the ausrtians and he drives me crazy along with the whole shitshow.
TBH, I think they can goose this thing up to 20K......fundamentals be damned.
It will also make the downturns more "presentable". "We lost 3K in the span of 3 months on the DJIA, but hey, it's off the LOWS of the decade!".
The key player is bonds when it comes to the market crashing, but that is just my opinion.
Will the eventual crash in bonds effect stocks? Will a political effect to be named later effect stocks? Will a meteor hitting the Earth effect stocks?
If you keep printing, does it even fucking matter at this point?
It matters. If they can keep commodity costs down then stocks did their job. If commodity costs get out of control then it matters less.
RE
Agreed. However I assumed they've completely manipulated those prices at this point (minus oil).
That's why they really needed control of LIBOR, IMO. CDOs and oter debt instruments often buys those commodities as hedges.
Well, we obviously aren't Zimbabwe until our Saudi friends stop taking our paper dollar.
One of the best parts of having a reserve currency to play with is: (besides being able to have the females with the largest teeth) you get to export inflation to the other dumbasses.
RE
No...this *is* their plan: to make rich people even richer (actual wealth effect) and to make fake people feel like their are richer (fake wealth effect i.e. pumping up 401ks via stock asset bubble).
The poor people don't exist to the Fed: they are just numbers on a spreadsheet.
The Fed doesn't work for the people; they work for the bankers.
The Fed doesn't work for the people; they work for the bankers.
They are the bankers...
+$1 Million in nickels...
This should be the article that finally makes everyone on here take a step back and realize this is going to go on for longer than most of us expect it to.
I expect nothing except that it will end badly. I'm trying to make choices based on my values as much as my well being or profit. This is not easy. I'm not in the markets and will not return. I see them as flawed, not just in operation or construction but morally. Today investing, more than anytime in my remeberance, is outright gambling. This investing is not creating anything. It is simply relying on the premise that someone will pay more for something than you did. Hang out at any casino and you can see the result. Roughly the same amount of money goes out the door as in, it only changes hands (less the house cut of course). There is no doubt there are some smart people there who are good at reading the "market" and can profit, but is it any better than simply watching for drunks and following them around until the pass out to pick their pockets? When our own government gets in on the act with lotto, we know we are fucked. It should have been enough, skimming the profits of the stock market and banking, not to mention taxes. But now they have to lure people with nothing into placing the bet for easy money. Hey, its what the big boys do, right.
Yes, I'm setting it out, making the big bucks at .5% on my deposits and waiting for the day when big gov says its all actually theirs anyway. I hope and pray that somehow people will see what they are doing and step back from it, but we see this is less true today than ever. We now have the financial advisor who will "help" the gambler find where the weak souls live and profit from the next lemming drive off the cliff. Its not that we are all evil, we just see an opportunity to make a buck, and besides, everybody is doing it! So many here detest those working in government and The Fed for basically fucking us, but those workers don't see it that way. They are just fullfilling a need in an "honest" and regarded profession. I'm sure there are a few that would admit they are fucking everyone, but look at the parade of fools working for Obama and ACA that are convinced they are doing God's work, and what does it hurt if there is a good paycheck and some kickass benefits as well.
The road to hell is paved with good intentions...and the paving contractor ain't doing too badly either!
human history shows hubris and madness always end in tears and blood. I bet this time is NOT different. It's not a question of IF but a question of WHEN.
But once you've accepted that 'IF' is already decided, you find that 'WHEN' is far more important than it previously appeared. 2 weeks, 2 months, 2 years or 2 decades? Get it wrong and you're almost as hosed as if you never saw it coming in the first place.
Admittedly I see things in not just an economic sense but when he says we are not losing credibility because the rest of the world is no better, I can't help but wonder if the whole world is broke, how can any have any credibility? They all lie. They all use flawed theories to manipulate their economies. They all misrepresent their actions as benefiting the poor and middle class yet we see only the super rich advancing. WHAT FUCKING CREDIBILITY IS HE TALKING ABOUT?!
Actually let me add maybe this is their plan and they are getting the opposite result. The Central Banks could be just that fucking stupid.
The only thing more dangerous to humanity than malice is stupidity.
This is the exact result they wanted. they have threaded the needle as far as they are concerned. Show me Blankfein's head in a guillotine and I will show u the opposite result.
Debts and Deficits Don't Matter!
http://www.youtube.com/watch?v=_W1Iw2JL8w0 (8:21)
Re: Debts and Deficits Don't Matter!
The sad thing is, they probably don't matter all that much if it was just a bunch of numbers.
The problem with debt is that it's no different from a narcotic. And the narcotic aspect of it causes the problems.
The "Conservates" and "Liberals" go into denial (in different ways) that what they love isn't really funded with debt.
The politicians realize that as long as they supply more debt they never have to say no to anybody: Bomb the sand-people AND go shopping (sure, no problemo)
The politicians become postitutes for the debt pushers.
The citizens don't care as long as they get enough bling and free-shit from the government (git yer govenment hand off my Medicare)
The debt pushers supply the debt in exchange for owning the entire country.
So, the amount of debt doesn't matter. It's the morality of the debt.
When You Wish Upon A Star - sung by Jiminy Cricket (Cliff Edwards)
http://www.youtube.com/watch?v=HKh6XxYbbIc (3:24)
haha that is so true
What event will cause the velocity to increase and force the fed's hand to increase rates. They can control money but not external events. We will not know the event until after it has passed. Stop searching for it. Enjoy the relative calm before the next crisis
Is there a 10 times ETF for the top ten stock?
Ha Ha. If you find out, let me know. Also should I buy it in the morning or afternoon?
The key is to dispel the myth that stocks are the only game in town. The stock market is a Ponzi scheme dependent on the greater fool theory. It cannot continue indefinitely without a significant correction. After 2008, many people decided they would never again invest in the public finance markets. The securities industry, banking cartel and financial media are doing everything they can to lure those people (and new 'investors') back into the Ponzi to keep it rolling. Resistance is not futile - resist and convince everyone you know that there are alternatives, particularly private markets, hard assets, real estate.
`"Stocks only Game in Town"` `So "Rich will get Richer"`
'Only in America?' Where the only game in-town is U?S?'
not so fast,... as diversions go, we've been had?!?
Ref: http://english.daralhayat.com/ scroll down 'Women have Excelled' article by Jihad el-Khazen--- Tuesday, 29, 51 2013 Note1: Liberal/ Moderate Arab Site :-)) jmo
Excerpt: " the IMF numbers say that between 2008, the year the global financial crisis hit, and 2012, the Saudi economy posted the highest growth after China and India with the 'Group of Twenty" (G20) countries (the world's top 20 economies). Between 1999 and 2012, the Saudi economy grew fivefold, [...]"
Note2: James Morris author c1957 ~56 years hence "ISLAM Inflamed" Quote pgs. 250-251 Part 4: "Oil and Abadan" "The shift in ownership, indeed, has been within the Western community. British, French, Dutch companies were all represented in the Middle East, but the most important producers had long been the Americans. They exploited the Saudi and Bahraini oilfields outright, had a half share in Kuwait, and a substantial cut in Iraq, Persian, and Qatari fields. Britain, on the other hand , had only a half share in Kuwait and a major share in the Iraqi, Persian, and Gulf fields. In 1939 the Americans share in the Middle East oil production was (13%) thirteen percent and the British (60%) sixty percent. By 1956 the American share was (65%) sixty-five percent and the British (30%) thirty percent. This was partly the result of diplomatic pressure-- American interests were first admitted to a share of Iraqi oil as a result of the State Department intervention, and no DOUBT the same is true for Persia." end quote
It's been along time since the Arab Oil Embargo (1973?) but America has never lost its grip on the ME,... and perhaps the share/ split was as high as 75% USSA and 25% British, if that!?! jmo Please realize to this date in time we (america) still hold ownership of Iraq and Iran oil ??? Energy is where the money is made --- it's not equities, it's $$$PetroDollars (Rockefeller's and Rothschild's ... a trillionaire duopoly)
So there you have it,... the Bush's make money, the Cheney's make money and we hold the 'BAG-ole-Tricks', full-of-Shit!
Love them new women taxes.
The have created a safe haven for stocks, so the stock market is now a safe haven. Unprecedented in the history of the markets. These financial crackpot engineers ala The Fed has shifted the money flow straight to Wall Street and the banks. Great plan geniuses, all we need is some crony nut at a bank, firm to blow it all up again.
The Fed feeds corruption with it's bubble machines, it's very cartel/commie/national socialists. Incredible that this has occurred
Oh, no! if Kyle Bass is purposely lying to us about the admininstration's true agenda who can we trust anymore? maybe he is auditioning for Ben's job. or perhaps his good looks and smarts have landed him a slot on the Squawk Box, who knows?
Dow 1.4 Million in 10 years
"it’s going to make the rich people richer and the middle and lower class won’t be any better off, which is the opposite of what the administration is trying to pull off,"
He thinks this "is the opposite of what the administration is trying to pull off"?
What ever gave him that idea?
Greenspan said the stock market was up a huge amount but is not bubbly.
When the Nasdaq was a bubble, Greenspan siad he couldn't see a bubble before it burst.
When housing was a bubble, Greenspan said it was just frothy. With his new book, he says we all knew it was a bubble.
Greenspan is repeating the pattern, saying the stock market is not bubbly now. Greenspan is a banker. Bankers have been trading in the market, supposedly. So why, after such a big run in the market, would Greenspan be pushing stocks? The bankers need bag holders to sell to, don't they?
We are going for the DOT COM levels. The Fed keeps pushing money into stocks.
That's Right, buy the Up.
Force everyone into stawks.. just like forcing everyone into ObamaCare. What could possibly wrrong ?
ObamaCare has worked out well.... its just a computer glitch.....
''if you kill all the prairie dogs, there will be no one to cry for the rain.''
Could a certain K.B. be starting to sell stawks? BTFATH? no thanks. Never do as they say, even respected and clever K.B.
Bass is on the money here. As fonz said above, this article is prime proof that all the ZIRP, QE, BTFATH, stocks to the moon, etc. is going to last a lot longer than anyone thinks.
I realized how wrong I have been the past five years just the other day. Seriously. Kept waiting for the system to implode, bought silver, etc., but now I think there are still years to go, and to prep.
Have a friend who has had to eat his stored foods, twice, now. His family wants to have him committed. Too bad for them he's the main bread-winner, but, he's in a world of hurt as a 50-year-old who's sunk retirement savings into silver. No return, kicking himself daily, looking at his paper losses and the gains he missed in the market. His friends laugh at him.
He will, eventually, be right, but eventually may be a long time coming, and, there's no guarantee of how right he will be.
To me, it's all relative. Boom or bust, the rich will still be rich, the rest of us will survive or prosper in relation to our relative position. If you are a spendthrift debt junkie, you're screwed before you start. In a great reset, you go lower. If you're somewhat prudent, you'll rise when SHTF. The poor, well, that's what SNAP and Obamaphones are for.
But, I definitely think trading stocks - maybe even buying some calls for quick short term gain (can hardly believe I'm saying this Kool-aid kind of stuff) - is the way to go for the near to mid-term, and speaking of mid-term, November 2014 might just happen to be an event horizon, or not, but a year is always a good measure. we won't be having the same kind of nonsense out of Washington that we did with the shutdown and the debt limit has been pushed out of the picture, indefinitely, so the thumbs-up, all clear signal is pretty clear.
Forward, Soviet!
"The interesting thing is it’s going to make the rich people richer and the middle and lower class won’t be any better off, which is the opposite of what the administration is trying to pull off."
Kyle Bass is far too smart to actually believe that monetary policy's objective is to lift all boats equally - and specifically, to lift the middle and lower classes.
Central planning of the price of money was and is designed to permit politically-connected cliques front-run the inflationary effect of the new money. Specifically, the way newly-created currency is introduced into the monetary transmission mechanism (it's put into a very small set of politically-connected hands in the first instance) permits those new-money-recipients to purchase assets at prices that were arrived at conditional on a smaller money supply.
That is why theBenBernank's "helicopter moment" was so egregiously dishonest - he knew full well that the money-printing he was predicting, was NOT the same as a helicopter drop of new currency (whose effects would have been FAR more neutral and more obviously inflationary). He knew he was misrepresenting the potential policy response, but he did it anyway.
The thing that makes me lol the hardest, is that people think that monetary policy's long and variable lag structure has been compressed into days or weeks.It is a chainsaw, not a scalpel - but because monetary economics is pretty bewildering to anybody who hasn't studied it formally, the investment community (who by and large are functionally innumerate) believe - or pretend to believe - that monetary authorities are surgeons, not lumberjacks.
People forget how many times in history the parasite classes (politicians and their hangers on) have tried this same trick: if it worked, Zimbabweans would be the richest people on the planet.