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"Equities Will Be Devastated" Crispin Odey Warns, Looming Recession Will Be "Remembered For 100 Years"

Tyler Durden's picture




 

"I think equity markets will get devastated," warns famed $12bn AUM hedge fund manager Crispin Odey in his latest letter to investors. Having been one of the biggest bulls of this particular central bank artificial-bull cycle, his dramatic bearish tilt (as we discussed what he thinks are the biggest risks underpriced by the market previously), is notable. Finally, Odey fears major economies are entering a recession that will be "remembered in a hundred years," adding that the "bearish opportunity" to short stocks looks as great as it was in 2007-2009.

 

Odey Asset Management (report for Dec 2014)

The themes I have been outlining since the second quarter of 2014 are now establishing themselves:

A faltering Chinese economy with growth ultimately slowing down to 3%.

 

A hard landing for those countries plugged into China’s growth - especially Australia, South Africa and Brazil.

 

A fall in commodity prices bringing with it pain to those heavily exposed. For oil this is the Middle East, Venezuela, Argentina, mid-west USA, Canada, Norway and Scotland.

No one forecast how fast and how far those commodity markets would fall. However, the same people who singly failed to see this coming are the first to say that the benefits of falling prices will outweigh the costs. My problem with such a hopeful outcome is that, in my experience, those that lose out from a fall in their income are quicker to adjust than those that benefit. In that intertemporal space lurks a recession.

For me, the slowdown/recession finds a secondary downturn thanks to the immediate closing down of any discretionary capital expenditure in the affected industr es and countries, something we are only just seeing. This obviously has knockon effects for incomes and employment. At that time the exchange rate is likely to be falling to give some support. In my world this slowdown in the commodity producer’s economy is felt via falling exports back in the beneficiary’s economy, which finds external markets weaken. Again, if I am right on timing, the effect can be great because it is not yet affected by a pickup in spending in the beneficiary’s economy.

As always, that is the theory and markets will show whether it works in practice. In my world, this hit to the world economy is the first experience of a business cycle since 2008. Most investors do not believe we can experi-ence such a downturn. They rely upon Central bankers who they think have solved the problem.

However, let’s also deal with three counters that I currently have to field:

1. ‘How long dare you be wrong?’

 

2. The opposite. ‘Do you think after a good quarter, this is all in the price?’

 

3. ‘But isn’t a downturn in the world economy leading to massive counter-measures in terms of liquidity, as en-visaged by Draghi and the ECB, which will push mar-kets and assets higher?’

My answers are as follows:

1. The performance of the fund since I decided that the world would end differently to my previous thinking, which was in March/April 2014, reflects that I have not been especially early in this call. It would have been rather nice to get the fall in oil spot on, but we didn’t.

 

2. No change in cycle lasts for nine months. This down cycle is likely to be remembered in a hundred years, when we hope it won’t be rated for “How good it looks for its age!”. Sadly this down cycle will cause a great deal of damage, precisely because it will happen despite the efforts of the central banks to thwart it.

 

3. We need to go back to 2008. We had seen reckless spending and reckless borrowing, fraudulently obtained credit advances and overvalued housing. And yet, de-spite the banks losing a great deal of money and house prices in the USA tanking, we hardly saw a recession in 2009. Why? Because when the Anglo-Saxon central banks lowered interest rates from 5.25% to effectively zero, they put the equivalent of 30% of net income into the hands of the overborrowed. There were other QE measures taken but this was the important one.

Today we get excited about what Draghi is going to with his QE plans for Europe. However, buying government bonds yielding 1.2% does not move the dial for European borrowers. Moreover it is almost impossible with negative short rates of 0.2%, because why would anyone sell a bond to the govern-ment, even if the yield is only 0.4%, to get a –0.2% yield on their cash? It looks like Draghi’s measures will disappoint markets. Faced with a deflationary bust, monetary policy will prove to be but “pushing on a string”.

There will be a strong temptation for individual countries to act independently of each other to soften the downturn. In this regard the story looks like it is only half way through. Russia will necessarily have to introduce exchange controls, and that really quite soon. Australia, where the average wage is over $70,000, while the USA is creating jobs at $28,000, will have to allow the currency to fall further. Japan has shown, under Abe, how it intends to react. ‘Everyman for himself’ puts enormous stress on a world trading system which has watched world trade rise from 12% to 32% of world GNP in little over 20 years.

So, where am I placing my money?

? Firstly, I think equity markets will get devastated. Un-announced business cycles ensured Japan’s stock mar-ket rating fell by two thirds over 20 years.

 

? Equities are priced for perfection, pushed up by SWF and high yield investors looking for higher yields and better covenants than high yield bonds.

 

? Commodity-related sectors look unappealing and dangerous.

 

? International consumer companies look overexposed to EMs.

 

? Fund management companies look overexposed to the wrong assets, especially EMs.

 

? Volatility is rising. Not every trade will work.

 

? Australia is still to see rates down to 0.5% at the short end, 1.5% at the long end, down from 2.5% currently.

 

? Currency trading is still to make the money. It made money last year as it was where the ‘tyres hit the road’ – equities are just the residual.

 

? Equity markets will struggle to understand the quarterly translation and transaction effects of these currency moves on corporate profits, starting with Q1 2015.

We have seen though some strange things, with economics 101 turned on its head. We’ve seen that falling prices produce more supply, as the biggest producers see that they can take market share and use the opportunity by reducing average costs through excess production. We’ve seen that in the oil, minerals and iron ore industries. We have also seen in the last couple of years that as bond yields fall, governments are able to issue more debt.

But this time round the problem we have as well is that politics will start to rear its head and we are left to deal with politi-cians who are increasingly critical of the capitalist system’s ability to allocate capital and provide for society.

For me the shorting opportunity looks as great as it was in 07/09, if only because people are still looking at what is hap-pening and believe that each event is an individual, isolated event. Whether it’s the oil price fall or the Swiss franc move, they’re seen as exceptions.

After the 1987 crash, a friend of mine, then a young Director of Sotheby’s, was sent to consult an old Partner who had been at Sotheby’s during the 1930s and was still alive, albeit in a nursing home. My friend asked the question “What was it like in the 30s?” and the man replied “It was like being bitten by a tarantula.” My friend didn’t really understand that, but later on in the conversation the old Partner said “A spasm of activity followed by a death.”

My point is that we used all our monetary firepower to avoid the first downturn in 2007-09, so we are really at a dangerous point to try to counter the effects of a slowing China, falling commodities and EM incomes, and the ultimate First World effects. This is the heart of the message. If economic activ-ity far from picks up, but falters, then there will be a pain-ful round of debt default.

We already have volatility across asset classes and as I say, equities are the residual. There is a precious little earnings growth ex-Japanese exporters and we have now reduced our US cyclical exposure as we expect the commodity-induced recession in the mid-west to effect the resilience of the greater US economy. In Europe, we are half way through the write-off process, having written off half as much as the US. Draghi will disappoint and this may cause the first Euro rally given the fall from €1.25 to €1.15 in a month.

We are in the first stage of this downturn. It is too early to see what will happen – a change of this magnitude means the darkness and mist is very great. We will make some mistakes but with our thinking we won’t make the major mistakes. The problem is where you stand – I am amazed to see so many are fully invested given that equities are already fighting the downtrend. Mid and smallcaps have moved into bear markets and much relies on large caps to keep the whole thing going and they are very exposed to international trade.

 

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Tue, 01/27/2015 - 18:14 | 5713073 ml8ml8
ml8ml8's picture

If we remember it for 100 years it will be called a Depression.

Tue, 01/27/2015 - 18:36 | 5713118 Romney Wordsworth
Romney Wordsworth's picture

If we remember it for 100 years, some BAD GUY will have made THE TRIBE to suffer an EXODUS, or HOLOCAUST, or some other unspeakable devastation.

 

So basically I'm thinking a token BEAK will get tossed in jail... Maybe it's already happened... Maybe the story will be that 1.5 x 2,0002 Bernie Mafoffs were made to suffer at the hands of Adolf Von Pharaoh Von Ramuses III

 

Spielberg's great grandchildren will win Oscar Meyer statuettes for the storytelling.

 

At least DETROIT won't have changed much... ROBOCOP will still be dispensing JUSTICE.

 

Tue, 01/27/2015 - 18:37 | 5713200 Beam Me Up Scotty
Beam Me Up Scotty's picture

"But this time round the problem we have as well is that politics will start to rear its head and we are left to deal with politi-cians who are increasingly critical of the capitalist system’s ability to allocate capital and provide for society."

Thats because WE DON'T HAVE A CAPITALIST SYSTEM!!!  Not because a capital system can't allocate capital!!

Tue, 01/27/2015 - 18:54 | 5713273 NoDebt
NoDebt's picture

What's up with all the hyphenated words?  If the Fed actually raises rates what we'll remember in 100 years is that we did 1937 all over again.

Tue, 01/27/2015 - 19:11 | 5713342 FL_Conservative
FL_Conservative's picture

the "bearish opportunity" to short stocks looks as great as it was in 2007-2009.

 

From his lips to God's ears.

Tue, 01/27/2015 - 19:19 | 5713369 Four chan
Four chan's picture

personally i only have about 30 years left, so fuck it.

Tue, 01/27/2015 - 19:45 | 5713478 ajax
ajax's picture

 

 

@Four chan "personally i only have about 30 years left, so fuck it."

Yeah maybe, but those so-called breasts of yours have the same shelf life as a can of Campbell's "Baked Beans" ie from here to eternity. Plastic is rotting the guts out of us all.

Tue, 01/27/2015 - 19:56 | 5713530 COSMOS
COSMOS's picture

http://www.sfgate.com/crime/article/Thieves-ram-original-Wells-Fargo-ban...

Nothing is better than gold and its getting hard to find, leading to desperate measures.

Tue, 01/27/2015 - 20:13 | 5713557 SMG
SMG's picture

The market will crash for sure, but I personally think we're headed for hyperinflation ($500-$5000 for a loaf of bread?), so the nominal  value of the market may still go up, even though the true value of the shares crash.   Shorting may not work here.

They're going to have to come up a new word to decribe what's coming, recession/depression won't cover it.  Maybe the Great Collapse, or the Great Devistation.  God help us.

Tue, 01/27/2015 - 20:39 | 5713705 BraveSirRobin
BraveSirRobin's picture

I would hate to be managing money right now. All the options are hard and dangerous. Of course, some one will make out like a bandit (probably literally), but it probably be either a matter of luck, connections, or raw power.

 

Tue, 01/27/2015 - 21:17 | 5713863 brockhardman
brockhardman's picture

The only thing that will be around in 100 years from today will be all of those people who trusted the only one that can truly save you.

Tue, 01/27/2015 - 21:30 | 5713922 Its_the_economy...
Its_the_economy_stupid's picture

no one has the balls to short this juggernaut. get out, maybe. short it? never.

Tue, 01/27/2015 - 23:06 | 5714277 Richard Chesler
Richard Chesler's picture

Seriously now, how many of these hedge fund clowns need to come bearish on zerohedge before the es ramps another hundred points???

Long live President Okafka!

 

Tue, 01/27/2015 - 23:19 | 5714323 Thanatos
Thanatos's picture

Crisis Looming?

There's an app for that...

Somewhere.

Wed, 01/28/2015 - 00:30 | 5714547 Handful of Dust
Handful of Dust's picture
Americans Savers Treated Like Dogs

http://www.valuewalk.com/2015/01/income-inequality-americans-savers-trea...

 

Ruff !  Ruff !

 

Wed, 01/28/2015 - 05:14 | 5714958 ebworthen
ebworthen's picture

The banksters and their complicit FED lackeys hate us working savers for our values and morality.

"In that intertemporal space lurks a recession."  I think he meant depression, but o.k.

Tue, 01/27/2015 - 21:46 | 5714018 TinF0ilHat
TinF0ilHat's picture

Are you some math guy?

Wed, 01/28/2015 - 20:19 | 5718186 mkkby
mkkby's picture

Wow, this is some fine hedge fund manager.  Where can I send in my money?

Let's see... he says oil and commodities will go down, and China will slow down.  Hmmm, seems that's happened already.  Yes, this is some fine manager making a very bold prediction.

/s

Tue, 01/27/2015 - 22:15 | 5714128 asiafinancenews
asiafinancenews's picture

"They're going to have to come up a new word to decribe what's coming, recession/depression won't cover it."

Agreed. Perhaps 'inflationary stagnation'? The price of everything you need goes up while the price of everything you own goes down. 

Wed, 01/28/2015 - 01:23 | 5714679 ersatz007
ersatz007's picture

how about "oops, I crapped my pants!" ?

Tue, 01/27/2015 - 23:13 | 5714301 Bill of Rights
Bill of Rights's picture

Transition.

Tue, 01/27/2015 - 20:14 | 5713593 me again
me again's picture

Silver is somewhat better than Gold for transactions; except major ones; and there's plenty of boht; once you get over the odd idea you have to have it buried in your back yard.  plenty of bags of used US 90% Silver coins available to put in the back yard; or whatever;

Wed, 01/28/2015 - 04:38 | 5714908 tenpanhandle
tenpanhandle's picture

The odd idea of burying your silver is fostered by the desire to not get ripped off; making it not so odd after all.

Tue, 01/27/2015 - 22:02 | 5714078 Augustus
Augustus's picture

Typical urban criminal dummies.  Steal a couple of vehicles to trash out.

Use those to steal some nuggets worth $10,000.

Must have sourced some bad stuff from Colorado.

Wed, 01/28/2015 - 02:25 | 5714768 pgroup
pgroup's picture

Uh, the insurance company will pay a lot more ransom than the melt value to get them back.

Wed, 01/28/2015 - 03:45 | 5714849 natty light
natty light's picture

The justification is off. 

Tue, 01/27/2015 - 18:59 | 5713287 ZerOhead
ZerOhead's picture

Since the financial and political elite control how history is recorded they will likely attribute the entire forthcoming apocalypse to morally corrupt HOMEOWNERS and NATIONS who REFUSED to pay the honest and victimized hard-working banksters for the shitloads of crappy unsustainable debt they created...

Tue, 01/27/2015 - 19:51 | 5713489 Escrava Isaura
Escrava Isaura's picture

 

 

Crispin Odey: "I think equity markets will get devastated"

Who cares! Nice distraction (propaganda), anyway.

 

Now Mr. Odey, let me show you the real meaning of “get devastated”:

 

First: Energy

The data below is barrels of oil per day per rig.

Middle East

2000 Average: 140,144 / 2014 Average: 59,945

US:

2000 Average: 6,465 / 2014 Average: 4,577

World

2000 Average: 36,148 / 2014 Average: 21,698

http://peakoilbarrel.com/rig-count-drilling-less-oil/

 

Second: Finance

In 2015 AD, humanity condenses into a single couple of superhumans.
While increasing the total debt by $1 provides an at least $0.01 growth in the nominal GDP (immature debt), the system can grow by exponentially increasing the amount of new borrowings. When the growth in the nominal GDP per $1 of new debt becomes zero, refinancing the accumulated debt and interest becomes impossible, and the system implodes.

http://2012wiki.com/index.php?title=Novelty_theory

 

Third: Panicking

Economic situation could soon become intolerable as the richest countries inequality increase.

Super rich are buying 'secret boltholes' where they can hideout in the event of civil uprising against growing inequality…. Nervous financiers from across the globe have begun purchasing landing strips, homes and land on remote areas…

http://www.mirror.co.uk/news/world-news/panicked-super-rich-buying-boltholes-5044084

 

 

Tue, 01/27/2015 - 20:28 | 5713649 me again
me again's picture

http://commondatastorage.googleapis.com/static.panoramio.com/photos/orig... Good runway. In Northern California. Very isolated by road; long, long, torturus two lane road out to the State hwy 101. And everybody between this runway and the highway is a pot grower;  LEO's don't go there. Cheap forested land. have to be a bit of a pioneer. cold wet winter. but very beautiful. no one will bother you. Everyone is self-sufficient.

Tue, 01/27/2015 - 20:47 | 5713736 Escrava Isaura
Escrava Isaura's picture

 

 

Wrong! Can’t be US because Americans cannot live in scarcity

It has to be within a peaceful, pacific culture.

Nations like the US and Brazil are a NO NO. Also, Christianity on both nations are too superficial (cynical attitude of positive thinking, entitle of privileges or special treatment).

And the weather has to be subtropical all year long. Lots of rain.

 

 

Tue, 01/27/2015 - 21:31 | 5713921 me again
me again's picture

Wrong ? I lived in the woods there and flew in and out in my airplane; but you know more about it than I do ? Of course, you do.

Tue, 01/27/2015 - 21:15 | 5713859 me again
me again's picture

Oh; sorry. don't know why. you can look it up yourself. it's called Shelter Cove Airfield; Northern Calif.

Tue, 01/27/2015 - 21:53 | 5714050 macholatte
macholatte's picture

 

Been there... drove that road. Absolutely love Humbolt County and regret very much not buying some land up there about 8 years ago.  The Redwood Forest is where God would live if He could handle being in California.

Wed, 01/28/2015 - 02:54 | 5714799 thegr8whorebabylon
thegr8whorebabylon's picture

RW,  Please watch this and adjust your demons accordingly

https://www.youtube.com/watch?v=U1Qt6a-vaNM&x-yt-cl=84503534&x-yt-ts=1421914688#t=4875

every-thing's a rich man's trick

what's with all the hy-phens?

 

 

 

 

Wed, 01/28/2015 - 08:27 | 5715123 Romney Wordsworth
Romney Wordsworth's picture

I don't have any demons because I speak the truth.

 

16 people up there 'junked' my comment. Apparently NONE of them watched the 20th century unfold because what I described is an exact carbon copy replica of what transpired during that 100 year stretch. All I did was to play the same script forward for another 100 years, [& substituted a few fictional name changes].

 

Now, if one would prefer a 'hypothetical' realm, I can almost assure you that if my initial comment had used Russian or other ME sounding names then, I wouldn't have been replicating any truth, yet nobody would have paid it any bother [especially the 'junkers', who, instead, would have appreciated the lie].

Wed, 01/28/2015 - 10:38 | 5715494 TruthHunter
TruthHunter's picture

"THE TRIBE to suffer an EXODUS, or HOLOCAUST"

I see a lot of down votes. Why diss the messenger for the truth?

He's right, history will repeat.

 

Why shouldn't the future

hold further reactions against the Jews? Israel

and Goldman Sachs impose on friend and foe alike.   

 Jews don't seem to ever admit they might have responsibility

for their own ill treatment. (Jeremiah and Josephus couldn't

 possibly be right; they were collaborators.)  

The Holocaust can only delay the cyclic reactions of history.

Any guilt or horror for the past will be replaced by present

annoyances.

I am not antisemitic. Why should I be, I have Jewish ancestors.

 

 



Tue, 01/27/2015 - 18:23 | 5713123 Uchtdorf
Uchtdorf's picture

But he didn't say anything about gold or Kyle Bass' nickels or anything like that?

Tue, 01/27/2015 - 18:56 | 5713298 quasimodo
quasimodo's picture

Don't kid yourself, blokes such as these have some stashed away. I'm sure he is not in full retard, but these types are hedged to some extent. He has a base he needs to pander to, so he won't be chicken little screaming about full on metals and lead.

Tue, 01/27/2015 - 23:15 | 5714297 Escrava Isaura
Escrava Isaura's picture

 

 

Uchtdorf

But he didn't say anything about gold or nickels... 

me again

I lived in the woods there and flew in and out in my airplane

 

Ohh boy! Will these two ever get it?

 

The Coming Anarchy, by Robert Kaplan

The intense savagery of the fighting in such diverse cultural settings as Liberia, Bosnia, the Caucasus, and Sri Lanka--to say nothing of what obtains in American inner cities—indicates something very troubling that those of us inside the stretch limo, concerned with issues like middle-class entitlements and the future of interactive cable television, lack the stomach to contemplate.

 

 

Tue, 01/27/2015 - 18:22 | 5713125 Sudden Debt
Sudden Debt's picture

Long time average memory has dropped to 2,9 seconds... even goldfish have outpaced the average population.

So maybe it will be written in the last paper book but nobody will bother reading it.

I wonder how many young kids at age 21 and lower read zerohedge for example...

Tue, 01/27/2015 - 18:25 | 5713142 lordylord
lordylord's picture

"I wonder how many young kids at age 21 and lower read zerohedge for example..."

I wonder how many kids are reading.

Tue, 01/27/2015 - 18:38 | 5713222 bulldung
bulldung's picture

Couple of years ago I advised a young finance student to try to read and understand ZH. He did and at the end of his undergrad years he was asked to stay on for grad school, full ride. I knew him when he was in high school , bright kid but no too bright. The level of understanding of real markets he acquired from reading ZH set him apart from those who limit their reading to the classroom material. You all contributed to his and my education, thanks.Bulldung

Tue, 01/27/2015 - 18:47 | 5713252 fuu
fuu's picture

That will be 2 and 20 please.

Tue, 01/27/2015 - 21:02 | 5713795 walküre
walküre's picture

If we were successful then this scholar either graduated to be the baddest ass on WS or he quit the industry and started planting turnips. Once your eyes are open, there really is no middle ground.

Tue, 01/27/2015 - 21:36 | 5713955 Redneck Hippy
Redneck Hippy's picture

I don't learn that much from ZH but it provides a needed boost to my paranoia quotient.  Without ZH, I am not nearly cynical enough to survive.

Tue, 01/27/2015 - 23:44 | 5714420 aardvarkk
aardvarkk's picture

Well yeah, reading ZH can teach you things you never knew before.  But I come here to get the crap scared out of me about what's going to happen next.  It's kind of like going to a horror flick, with the minor exception that one of these days the plots on ZH are actually going to happen.

Wed, 01/28/2015 - 01:18 | 5714673 HardAssets
HardAssets's picture

Many of us come to ZH because the percentage of clueless & apathetic dumbazzes is much lower here than what we usually find. (Mention 'QE' to most people and observe the blank look on their faces.) ZH is a place where we can argue with others who at least recognize the terminology.

Wed, 01/28/2015 - 04:30 | 5714898 90's Child
90's Child's picture

I've been reading zerohedge before I was 21.

Found the website by asking my buddy bout a good reliable website that covered the stock market ect....

ZH has opened my eyes to a lot of things.

Tue, 01/27/2015 - 19:17 | 5713359 curbyourrisk
curbyourrisk's picture

Is there an APP for Zerohedge?

Tue, 01/27/2015 - 19:46 | 5713486 Money Boo Boo
Money Boo Boo's picture

yes, it's called Clash of the Clans

Tue, 01/27/2015 - 19:31 | 5713429 WillyGroper
WillyGroper's picture

There's hope. I had a young black well mannered 22 yr old tell me people don't read anymore.

Yet he did. He was sharp as a tack too.

Tue, 01/27/2015 - 19:53 | 5713516 Gooseleg
Gooseleg's picture

28 year old here, been a daily reader for 5 years.

Tue, 01/27/2015 - 21:37 | 5713950 Yes_Questions
Yes_Questions's picture

 

 

and I'll bet friends in your age group look at you like a fucking alien when you start to rant about world events.

 

don't worry, those of us 20 years ahead-a-ya have to deal with it too.

Tue, 01/27/2015 - 22:38 | 5714206 Gooseleg
Gooseleg's picture

Some yes but you would be surprised.  Many in my age group can feel that something is wrong, something is out of line with the current system.  Even if they are unable to put their finger on the reason, cause or circumstance causing this feeling, they know something isn't as it should be.  Out of those that have that feeling, several in my sphere of influence have been stacking PMs, reading up on the Federal Reserve System and fighting for Ron Paul not too long ago.  My generation is not without hope.

However, there are plenty that cannot or will not "think out of the box".  I know this is not unique to my generation.  Growing up with the internet, the almost free flow of information gives us no excuses however.  Ignorance is no excuse.  It's easy to see how my parents and grandparents could have not seen or understood the world through the same looking glass.

Tue, 01/27/2015 - 23:38 | 5714376 Yes_Questions
Yes_Questions's picture

 

Thank You, forgot to include "some"

 

keep on Keepn' on.

 

I'll say this, and this advice is worth every cent you just paid for it: no-one will take you too seriously until you are 30 -35 years old.  

 

so, please don't bother with taking yourself too seriously either before then, or, really ever.

 

unless you actually are really, REALLY good at whatever it is you do...

 

 

 

Wed, 01/28/2015 - 02:12 | 5714753 Glass Steagall
Glass Steagall's picture

There is hope for the younger generation... 

Couple weeks ago, I tell my 14 y/o, "So, did you know that in all actuality, we probably never put a man on the moon?" 

His response: "You're only now learning that?"

+1 young man.

Wed, 01/28/2015 - 01:20 | 5714659 Tsunami Wave
Tsunami Wave's picture

Same here.  Will be 29 pretty soon; read this for 5 years and will continue reading.  None of my other friends I know read this, and when I bring up this site to them and the information that is mentioned on here, lets just say they don't have anything nice to say back.  Good to know there's other people my age that come to this oasis in a desert of nothingness.

 

Edit: Judging by the responses I'm seeing, while I agree some people are waking up, by far and large, many people my age and younger will never simply understand nor get it, until this comes to them.  The instagram-taking, facebook-using, snapchat-messaging users who only care about immediate & pointless news from huffpuke/VICE/viralnova/upworthy/buzzfeed, or pretend-intelletual news following the NYT/Guardian/WaPo/Huffpuke (again), or just flat out idiots that can muster saying Fox News sucks but never comprehending the rest of the media spreads disinformation - will never knew how something like how a financial or global political system works.  Until they move on from the latest news on gay marriage, or 'deflate-gate', or fake racism, the new feminism, etc., they will never wake up.

Wed, 01/28/2015 - 02:01 | 5714739 Absolute Truth
Absolute Truth's picture

28 yo here also. Started reading about 6 months ago. Sandy Hook opened my eyes, which lead to Building 7, federal reserve, PMs, Boston Hoaxathon, water fluoridation, importance of the 2nd Amendment & owning/being proficient w an AR, Charlie Hebdo... I have convinced a few friends in taking the Red Pill, but I think many believe I'm a nut.

Gene Rosen

Wed, 01/28/2015 - 03:12 | 5714818 thegr8whorebabylon
thegr8whorebabylon's picture

tryin to upvote you Gene R.  but it won't let me.

this is as clear as it gets;

https://www.youtube.com/watch?v=U1Qt6a-vaNM&x-yt-cl=84503534&x-yt-ts=142...

 

Wed, 01/28/2015 - 02:10 | 5714747 eucalyptus
eucalyptus's picture

29, I've read ZH almost daily for 5 years. Would tell younger siblings about zh wisdom since they were 19 and said sibling had a friend of the same age that read ZH daily.

 

Tue, 01/27/2015 - 19:20 | 5713371 spiral galaxy
spiral galaxy's picture

Actually, I have a lot a faith in the youth today in that I work with them and they are an integral part of my business.  They are well educated, ambitious and hard working.  Looking at it from their perspective, they have to find their way through all the MSM and political BS to find the truth........and they ARE finding it!!  I think it will be a pleasant surprise to many here to see in the near future their rejection of the MSM and political lies and distortions.  Godspeed!

Tue, 01/27/2015 - 19:58 | 5713538 Pareto
Pareto's picture

I agree.  I've been running into some pretty sharp well informed 16 to 20 yr olds, who have miles over their older brothers and sisters who are 25 and 30.  They have an acute sense of how hard it is to make money and survive AND SAVE.  Almost like they've been enlightened despite their knowledge suppressing education.

 

Its refreshing.  Just wish there were more of them.

Tue, 01/27/2015 - 20:53 | 5713754 ClassicalLib17
ClassicalLib17's picture

In my school district of 17,000 they trot out the new crop of college bound students every year and publish their dreams and goals in the local newsrag..  I was saddened to read that the one student who wanted to become an aviation engineer,  the rest were poli-sci and other useless endeavours, set a goal for himself to design an aircraft that could deliver food to the world's hungry.  I had to wonder how much this stupid kid actually studies aircraft.  I  didn't have to wonder where his thought process was nurtured.  Sad

Wed, 01/28/2015 - 00:03 | 5714134 reader2010
reader2010's picture

Most people don't think. If they wanted to learn how to think, they would have visited the most prominent thinkers' thoughts.  Higher "education" that we have today is nothing but the combo of 10% job-training and 90% indoctrination.

Let me quote one of the leading thinkers of our time.

It is obvious today that “surviving” has so far prevented us from “liv­ing”; that man’s insistence on making himself useful in his work is actually of little use to him in his own life, and even kills him. It is clear, too , that life usually ends precisely because it has never begun (which most people realize only in their last moments); and that the price of representation is paid for in terms of world-weariness and self-contempt.

This vicious cycle continues out of an old inertia: the need to work in order to survive compensates for the life lost in wage labor (an even costlier form of survival). The effect on consciousness is fatal, with two sets of prejudices contributing to the mortification: in the first, survival takes precedence over living; and in the second, the exer­cise of the intellect - through critical analysis of society, of political issues, of cultural decay, of the future of human­ity - takes the place of existence, while the body is left to express its discontent through sickness and malaise. And one need not get very close to these ideas to detect a whiff of the cassock. 

— Raoul Vaneigem, The Movement of the Free Spirit, 1993

 

Tue, 01/27/2015 - 23:15 | 5714317 froze25
froze25's picture

Moar, than you think. Colledge kids, some anyway are really into it. Thank Ron Paul /campaign for liberty.

Tue, 01/27/2015 - 18:24 | 5713138 malek
malek's picture

 Looming

Hahaha!

 Recesssion

Muaaahahahaha!!

 the "bearish opportunity" to short stocks looks as great as it was in 2007-2009

Stop it, you're killing me!!!
And they will get carried out in stretchers...

Tue, 01/27/2015 - 20:32 | 5713662 me again
me again's picture

Already short the S&P and making money. Will make a lot more. A Lot More .

Tue, 01/27/2015 - 21:16 | 5713866 gatorengineer
gatorengineer's picture

bullshit...  no one is making money in this chop

Tue, 01/27/2015 - 21:26 | 5713905 me again
me again's picture

I post the positions on here immediaely when i put them on; this one is short @2054.50 X 4-$200 / pt. looks like around $4,000 without straining the vacuum tubes. Of course, that's not what I'm fishing for; but  now i can put on the zero loss stop order; capiche ?? This position was taken yesterday and posted here yesterday. You can apologize whenever you find it convenient.

Wed, 01/28/2015 - 14:10 | 5716546 malek
malek's picture

Hmm, you sure you're not picking up coins in front of the steamroller?

I have never seen you post any position here before.
And would you explain in basic terms exactly what kind of derivative you bought there?

Wed, 01/28/2015 - 08:02 | 5715082 Pumpkin
Pumpkin's picture

LoL!  Kind of what I was thinking.  When we bet, there is real money there to steal.  And they damn well know it.

Tue, 01/27/2015 - 18:31 | 5713170 Bossman1967
Bossman1967's picture

Thats the buy signal I have been looking for time for me to sell my PM and go full retard in this market long. These guys full of shit

Tue, 01/27/2015 - 20:33 | 5713669 me again
me again's picture

You're just kidding, right ?

Tue, 01/27/2015 - 19:07 | 5713330 Uber Vandal
Uber Vandal's picture

I wonder if the circuit breakers would let the DJIA go down to 41.22 like it did in 1932?

http://stockcharts.com/freecharts/historical/djia19201940.html

It only took about twenty five years to recover. Plus a world war, and a few other things that have been discussed here before, to exceed the 1929 stock market high of 381.17

http://stockcharts.com/freecharts/historical/djia19401960.html

 

 

Tue, 01/27/2015 - 20:14 | 5713591 p00k1e
p00k1e's picture

UB,

Doesn't Mr. Market have to ‘close the gap ‘ from 1932?  LOL

Tue, 01/27/2015 - 21:24 | 5713890 Uber Vandal
Uber Vandal's picture

You know, it never has, has it?

It did from 1903.

http://stockcharts.com/freecharts/historical/djia19001920.html

Wowzers, this could get Fugly.

Tue, 01/27/2015 - 19:27 | 5713402 TheReplacement
TheReplacement's picture

IF... anyone is around to remember it will be called a miracle... or a curse.  But then, I always was the optimist.

Tue, 01/27/2015 - 19:54 | 5713523 serotonindumptruck
serotonindumptruck's picture

The Earth will be dead planet in 100 years.

A radioactive wasteland extinct of ALL life.

(Except maybe for some grossly mutated virii or bacteria)

Tue, 01/27/2015 - 21:22 | 5713891 Cautiously Pess...
Cautiously Pessimistic's picture

I agree and 100 years may be a stretch.

 

Thanks TEPCO.

Tue, 01/27/2015 - 21:45 | 5714001 serotonindumptruck
serotonindumptruck's picture

Not counting the thousands of nuclear weapons that can be launched and/or deployed within minutes, leading to the devastation of the planet many times over, it's the 437 nuclear power plants located around the world (with 71 more currently under construction) that should be of concern.

Fukushima Daiichi is only one of 48 nuclear power plants in Japan.

What happens to Planet Earth after all of these nuclear power plants melt down?

After global thermonuclear war has occurred?

These are some of the questions that keep me up at night.

Tue, 01/27/2015 - 21:52 | 5714043 Yes_Questions
Yes_Questions's picture

 

 

and banksters, don't forge...

 

nevermind, you covered it.

 

carry on.

Tue, 01/27/2015 - 19:32 | 5713428 ajax
ajax's picture

 

 

If anyone remembers The Depression ...

https://www.youtube.com/watch?v=LlliCeDQF10

Je suis toujours Charlie, je n'ai pas oublie,

Ajax

 

Tue, 01/27/2015 - 20:48 | 5713732 me again
me again's picture

I like the way this guy thinks; I'm going to his website now; thanks, Tyler.

Tue, 01/27/2015 - 21:23 | 5713872 me again
me again's picture

http://commondatastorage.googleapis.com/static.panoramio.com/photos/orig... There ya go binky; this one works okay. Nope. it doesn't work either. well, you'll just have to suffer through googling "Shelter Cove Airfield" / northern Calif.

Tue, 01/27/2015 - 22:09 | 5714102 Bangin7GramRocks
Bangin7GramRocks's picture

Get a look at this guy! NERD ALERT!!

Wed, 01/28/2015 - 00:28 | 5714546 loregnum
loregnum's picture

Exactly. Pathetic how all these people refuse to use the "d word" now as though somehow not accepting reality will make things better.

Wed, 01/28/2015 - 03:00 | 5714810 Nexus789
Nexus789's picture

That's if there is any one around to remeber.

Wed, 01/28/2015 - 09:57 | 5715244 pelican
pelican's picture

I read someplace that they used to call it a Recession and moved to the word Depression to make it sound less bad.  Now the meaning is inverted.

Tue, 01/27/2015 - 18:14 | 5713074 lordylord
lordylord's picture

Good thing it's not a depression!

Tue, 01/27/2015 - 18:15 | 5713078 ml8ml8
ml8ml8's picture

Jinx.

Tue, 01/27/2015 - 19:10 | 5713345 ZerOhead
ZerOhead's picture

As long as the government is willing to deficit spend recessions or depressions can be avoided in the classic sense. They just need a reason to blow a couple more trillion like war or infrastructure repairs...

Remember in 2009 the deficit was 10% of GDP, 2010 > 9%, 2011 >8%, 2012 >7%, 2013 >6% etc

http://economix.blogs.nytimes.com/2013/12/24/the-budget-deficit-as-seen-...

Tue, 01/27/2015 - 20:49 | 5713742 me again
me again's picture

Didn't yoiu know J.P.Morgan got rich shorting the 1929 Crash ? Why don't you short this one.? The Market opens every day. They do sell short contracts.  "It's an ill wind indeed, that blows no man some good"; left over from the days of the sailing ships.

Wed, 01/28/2015 - 04:23 | 5714891 weburke
weburke's picture

I dont agree with him. sure it makes sense, but, they are supporting the market that is primariily controlled. They can print 400 trillion tomorrow.

Tue, 01/27/2015 - 18:16 | 5713075 SelfGov
SelfGov's picture

Remembered in a hundred years just as the global peak of oil production should. Hopefully it is remembered for thousands.

Tue, 01/27/2015 - 18:21 | 5713102 lordylord
lordylord's picture

Let's not try to cover up the failures of big government and central banking with peak oil.  Nice excuse though.  Maybe you think there should be a central bank of oil. 

Tue, 01/27/2015 - 18:43 | 5713240 SelfGov
SelfGov's picture

Increased government size and inefficiency is a side effect of declining EROEI. All of the shenanigans of the central bankers are attempts to grow beyond the point that natural limits will allow.

It all comes down to physics.

Tue, 01/27/2015 - 19:26 | 5713403 ajax
ajax's picture

 

 

"It all comes down to physics."

Wrong. Finance and economics don't ever come down to physics and not even to maths. Where were you in 2007/08 ?

Tue, 01/27/2015 - 23:41 | 5714394 SelfGov
SelfGov's picture

Conventional crude production peaked in 2005. Oil prices went up. The fed increased rates which made homes across America more expensive. Pop goes the housing bubble.

Yes physics.

Tue, 01/27/2015 - 18:50 | 5713263 metaforge
metaforge's picture

Dunno that he was covering it up per se... Energy & economy are tied together - cannot grow the debt-based financial world at X% annually when energy does not also grow at that rate or more.  Wait til all the shale players start defaulting... think they'll ever get junk loans again?

Tue, 01/27/2015 - 21:56 | 5714062 Yes_Questions
Yes_Questions's picture

 

 

yes.

Tue, 01/27/2015 - 19:11 | 5713346 Hohum
Hohum's picture

SelfGov,

I think you assume that all oil is produced with positive cash flow, no matter the price.

Tue, 01/27/2015 - 18:17 | 5713079 zorba THE GREEK
zorba THE GREEK's picture

Looming recession will be remembered for 100 years.......no one can remember 100 years,

take it from an old guy, that just ain't happening

Tue, 01/27/2015 - 18:30 | 5713161 Romney Wordsworth
Romney Wordsworth's picture

Art Cashin is working on it...

Tue, 01/27/2015 - 18:48 | 5713256 fuu
fuu's picture

Art Cashin is a murderer who deserves justice...

Tue, 01/27/2015 - 18:59 | 5713309 Romney Wordsworth
Romney Wordsworth's picture

I'm just here so I don't get fined...

Tue, 01/27/2015 - 20:47 | 5713733 Usurious
Usurious's picture

 

 

dont grab ur junk

Tue, 01/27/2015 - 21:52 | 5714042 fuu
fuu's picture

You're fine.

Tue, 01/27/2015 - 18:16 | 5713082 Greenspazm
Greenspazm's picture

So we now know what he says. When will we know what he does?

Tue, 01/27/2015 - 18:18 | 5713101 SheepDog-One
SheepDog-One's picture

He may be right, but no way in hell I'm 'shorting stawks', they'll murderize ya first!

Tue, 01/27/2015 - 19:51 | 5713508 lotsoffun
lotsoffun's picture

sheep dog - you are the best.  and i agree.  anybody going short has been wrecked for 5 years, and it won't stop.

i have to admit - i did it.  i had puts on apple, i did the unthinkable.  i shorted apple.

i bought way out of the money july strike 85 in november and sold in december.  doubled my money.

(i bet only 3k.....)  still - i felt good.  can you really imagine.  i shorted apple?  the GREATEST company ever to live.

and can you imagine - i made up for a year or two of interest on all my 40 years of savings, that earned me 0.01% last year.  nice thing is, if you make less than 10 bucks a year, no statement.

the GREATEST product ever available to mankind.  the greatest thing ever to happen.  i love my i-crap, even if i will never buy any of it.

ok. ok.  sorry.  6 inches is still better than 5...

 

Tue, 01/27/2015 - 20:35 | 5713683 zyby
zyby's picture

Ya, but 8 inches is better than 6 inches.

Thu, 01/29/2015 - 20:34 | 5722851 lotsoffun
lotsoffun's picture

i gotta work with what i got......

 

Tue, 01/27/2015 - 18:20 | 5713104 Glasgow Gary
Glasgow Gary's picture

Hey Crispin: how's your shrill inflation call from 2010, 2011, and 2012 coming along? --Your pal, GG

Tue, 01/27/2015 - 18:58 | 5713285 booboo
booboo's picture

We already had inflation, targeted at government, MIC, college, "stawks", housing, medical care, hmmm whats the meddling red thread that runs through all of those areas..think..think..oh wait, GOVERNMENT.

Tue, 01/27/2015 - 18:20 | 5713106 Sudden Debt
Sudden Debt's picture

There’s still room to make it much worse. Right after QE4, oil 160 and gold 5000 people will start to wonder and sell this market.

But now, as half the world is short on all indexes, a wipeout by a peak in stockprices will kill a lot of hedge funds and banks. That will cause a QE4 and start a inflation spike that will never end.

But let’s wait for that another 4 to 5 months.

Enjoy the world as it is now and realise it will get a lot worse for 99% of the population and if you’re in a dark spot already that the lights might go out all together If you’re not prepared for this.

 

Tue, 01/27/2015 - 18:27 | 5713145 Uchtdorf
Uchtdorf's picture

I appreciate your estimate of 4-5 months. I'm thinking October is when this dead fish economy shows its white belly. 

Tue, 01/27/2015 - 18:53 | 5713275 metaforge
metaforge's picture

DOW:Au ratio going to 1:1 as Schiff predicted for a while now?

Will be interesting to see if that normal 15:1 oil:gold ratio is restored any time soon - an in which way the restoration might happen.

Tue, 01/27/2015 - 19:38 | 5713456 TheReplacement
TheReplacement's picture

That would seem unlikely.  Oil and gold are different and not really related.  Oil requires a completely different kind of demand.  Nobody will be buying oil to store value.  Nobody will be buying gold to heat their homes.

Gold demand will fluctuate with confidence in fiat.  Since the petrodollar seems to be churning things over, printing/pumping moar will probably shake confidence and drive up gold.

Yeah?

Tue, 01/27/2015 - 18:19 | 5713109 overmedicatedun...
overmedicatedundersexed's picture

hope he took off his apple shorts, or he's in the house of pain.

Tue, 01/27/2015 - 18:35 | 5713196 MrPalladium
MrPalladium's picture

Apple is below its high reached on Nov 20, 2014. Shorting AAPL will be a winner this year.

Tue, 01/27/2015 - 18:58 | 5713300 metaforge
metaforge's picture

I tend to agree.  Down 4 end of day, up 5 after hours... meh...   you can't eat iPads.

Tue, 01/27/2015 - 18:20 | 5713113 spinone
spinone's picture

If there's anyone around in 100 years to remember it.

Tue, 01/27/2015 - 18:28 | 5713153 Uchtdorf
Uchtdorf's picture

"In the year 2525, if man is still alive."

https://www.youtube.com/watch?v=izQB2-Kmiic

Tue, 01/27/2015 - 18:23 | 5713119 cherry picker
cherry picker's picture

You need people to remember, the human race may have obliterated itself by then :)

Tue, 01/27/2015 - 18:33 | 5713188 new game
new game's picture

"may have"? ha,...

Tue, 01/27/2015 - 18:23 | 5713120 Robert.Paulson
Robert.Paulson's picture

I will forget this article as soon as I close this tab...

Tue, 01/27/2015 - 18:23 | 5713121 Hitlery_4_Dictator
Hitlery_4_Dictator's picture

he doesn't realize that fundamentals no longer matter...in 100 years tey will say this was the birth of a new renaissance, while we are flying in our cars

Tue, 01/27/2015 - 18:23 | 5713126 me or you
Tue, 01/27/2015 - 18:53 | 5713280 g'kar
g'kar's picture

yes it was, thanks

Tue, 01/27/2015 - 18:57 | 5713297 me or you
me or you's picture

Thank You! :)

Tue, 01/27/2015 - 21:07 | 5713811 Rusty Shorts
Rusty Shorts's picture

Thank you.

 

THE GOLD SCANDAL: What They Aren't Telling You!

https://www.youtube.com/watch?v=gZcRk7UClO4

Tue, 01/27/2015 - 18:26 | 5713140 Hohum
Hohum's picture

We'll all be hunter-gatherers in 100 years.  The upcoming recession won't be a topic for discussion.

Tue, 01/27/2015 - 18:33 | 5713180 Romney Wordsworth
Romney Wordsworth's picture

I'm thinking Soros will be walking around as a zombie trying to collect on the last fiat currency he leveraged short.

 

Wait a minute... That's TODAY ~ Nevermind.

Tue, 01/27/2015 - 18:25 | 5713143 koncaswatch
koncaswatch's picture

I'm thinkin' of shorting stawks.. but you go first. lol You guys with those big balls tell us about it.

Tue, 01/27/2015 - 18:38 | 5713216 yogibear
yogibear's picture

The only problem with shorting stocks is that the Federal Reserve's skittle pooping unicorn is likely to shove his long horn up your behind.
The Fed's not about to let this market find price discovery.

Tue, 01/27/2015 - 18:26 | 5713147 yogibear
yogibear's picture

Ben Bernanke's "Mission Accomplished"

“I would like to say to Milton and Anna: Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again.”

-- Ben Bernanke, Nov. 8, 200

Tue, 01/27/2015 - 18:28 | 5713149 More_sellers_th...
More_sellers_than_buyers's picture

I call Bull shit!! He is just trying to call a top because he has been riding the wave for so long it seems ridiculous.  He thinks hes smart.  His gut is telling him if its not the top, than we must be close.  But he is not smart enough to realize that this time it really is different.  It will never stop.  The markets have no pricing mechanism other than the fed anymore.  It is far more likley we will see dow 70000 and 50 dollar gallons of milk than it is we will see a downturn.  They should remove the NYSE signs and replace them with welcome to the central beurocracy signs lol

Tue, 01/27/2015 - 19:31 | 5713426 stu11
stu11's picture

I agree, the markets only go lower if it is politically acceptable for them to do so.

 

Tue, 01/27/2015 - 20:36 | 5713679 cn13
cn13's picture

Which is why this time truly is different.  Almost no one seems to think the equity markets can go down due to FED intervention.

 

But when the markets do finally fall, the loss of confidence in FED interaction is what will push them down to much lower levels than many are currently expecting.

 

As always, it is only a question of timing. 

 

 

Tue, 01/27/2015 - 18:27 | 5713152 wendigo
wendigo's picture

IS the collapse in the future, or has it already begun? 

Tue, 01/27/2015 - 18:28 | 5713157 Barnaby
Barnaby's picture

Eggs and barley and bourbon
So sweet so simple and strange
Eggs and barley and bourbon
And more are found daily at the Grange!

I like old folk songs. Like that one from the 20s in Coshocton, Ohio. Reminds me of what we lost.

If it gets worse, if this keeps up, city centers will arise like power bases where rich men use city resources to fight each other. Oh wait.

Tue, 01/27/2015 - 18:33 | 5713178 Batman11
Batman11's picture

"This down cycle is likely to be remembered in a hundred years."

They said that bout the great depression.

I suppose we did remember but didn't learn.

An under regulated wall street always crashes and causes global recessions (1929/2008).

 


Tue, 01/27/2015 - 18:34 | 5713193 Thisisbullishright
Thisisbullishright's picture

It will be a miracle if anyone is still around in 100 years!!

Tue, 01/27/2015 - 18:35 | 5713201 Creepy A. Cracker
Creepy A. Cracker's picture

Not to worry... Algore says that we will all be dead soon from Global Warming® (since rebranded Climate Change®, since rebranded CO2 Pollution®, since rebranded Climate Disruption®).  Nobody will be left to remembner.

</s>

Tue, 01/27/2015 - 18:55 | 5713295 g'kar
g&#039;kar's picture

Same folks who brought us Global CoolingTM

Tue, 01/27/2015 - 20:32 | 5713663 lakecity55
lakecity55's picture

"Atmospheric Fluctuations" is my guess for the next iteration of this nonsense.

Wed, 01/28/2015 - 01:58 | 5714732 Charming Anarchist
Charming Anarchist's picture

I believe the nonsense is much more sinister than most folks can believe. 

 

We are being prepped and programmed for a natural disaster false flag. 

Tue, 01/27/2015 - 18:41 | 5713228 petaloka
petaloka's picture

I can't remember what I had for dinner last night.

Tue, 01/27/2015 - 18:43 | 5713235 Kreditanstalt
Kreditanstalt's picture

One good Australian job at $70,000 is equivalent to about three burger-flipping $28,000 (or less!)American  McJobs.

This guy still believes in "The Recovery".  That's his problem...

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