This page has been archived and commenting is disabled.

Men Go Mad In Herds

Tyler Durden's picture




 

Submitted by Jim Quinn via The Burning Platform blog,

The Chinese real estate bubble has been imploding for the last year. The Chinese economy is barely growing at 1.6% after decades of 10% growth. There are millions of unoccupied condos. There are dozens of ghost cities and empty office towers. It’s the most corrupt nation on earth. We are in the midst of a global recession.It’s pure madness that the Chinese stock market would soar when its leading economic indicators crash to 2008 lows.

Its stock market has gone up 115% in the last 9 months. It has gone up 80% in the last 5 months. It has gone up 35% in the last month. Housewives and other uneducated gamblers have opened a record 10.8 million new stock accounts this year, more than the total number for all of 2012 and 2013 combined.

The Hong Kong stock market has gone up 14% in three weeks.

Since real estate investing is failing miserably, the Chinese middle class have piled into stocks on margin. Where have I seen that before? Margin debt on the Shanghai Stock Exchange climbed to a record 1.16 trillion yuan on Thursday. When has buying overvalued stocks on margin when the economy is tanking ever gone wrong before? Have we already forgotten 2000 and 2008? Humans truly act like irrational herds of cattle stampeding in whatever direction they are pushed by their keepers.

 

After the markets closed for the weekend today in China regulators announced they were clamping down on the use of shadow financing for equity purchases and increased the supply of shares available for short sellers. Bloomberg explained what happened a few hours ago:

Investors have used umbrella trusts, which allow for more leverage than brokerage financing, to ramp up wagers on Chinese stocks after monetary stimulus sparked a world-beating rally in the nation’s benchmark equity gauge. Permitting mutual funds to lend their holdings to short sellers would make it easier for bearish traders to bet on a retreat after the Shanghai Composite Index closed at a seven-year high on Friday.

The announcement immediately caused Chinese stock market futures to crash by 6%. A similar move in U.S. markets would be a 1,000 point crash in the Dow. Monday should be interesting. The Chinese Plunge Protection Team is probably conferring with Yellen and her minions to avoid a worldwide contagion of people coming to their senses.

http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/04/china%20futures.png

Bloomberg stumbles upon the truth of all the stock markets in the world hitting record highs:

Chinese investors have been piling into the equity market after the central bank cut interest rates twice since November and authorities from the China Securities Regulatory Commission to central bank Governor Zhou Xiaochuan endorsed the flow of funds into equities.

Central bankers in the U.S., Europe and Asia have created another massive bubble. This time it is a bubble in stocks, bonds and real estate simultaneously. There is no place to hide. We are now in the blow-off stage. Markets are totally disconnected from reality, amateurs and muppets have been lured into the fray, margin debt is off the charts around the globe, and confidence in the infallibility of Yellen, Draghi, and the Asian central bankers couldn’t be higher. These bankers have been tasked by their .1% masters to elevate markets across the globe so they can extract the remaining wealth of the clueless plebs. We are now in the death throes of this latest tulip mania. It may go on for many more months or today may be the peak, but one thing is for sure – it will crash and burn. What happens next is anyone’s guess. But I’d put my money on war, chaos, and revolution. There will be no impunity for our gambling.

“Nations, like individuals, cannot become desperate gamblers with impunity. Punishment is sure to overtake them sooner or later.” ? Charles Mackay

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Fri, 04/17/2015 - 19:35 | 6004930 RU-GAY2
RU-GAY2's picture

Buh Bitcoin todaY!

https://btc-e.com

Fri, 04/17/2015 - 19:43 | 6004948 Yen Cross
Yen Cross's picture

Ummm. If I want sideways action, I'll watch the MSM.

 BTC, is like paper metals. The playahs, can't sell, and the buyahs can't buy.

 The market is saturated, and yes some mining can be done, at great expense.

Fri, 04/17/2015 - 19:49 | 6004969 RU-GAY2
RU-GAY2's picture

Well we say to avoid mining for the time being but how can market be saturated?  People do not own, do not buy we BTC?

Fri, 04/17/2015 - 20:05 | 6005003 Manthong
Manthong's picture

"men go mad in herds"

..so I’m not the only one?

as for Bitcoin.. confidence in them, or confidence in us?

Fri, 04/17/2015 - 20:44 | 6005111 ThroxxOfVron
ThroxxOfVron's picture

"men go mad in herds"

 

100% fucking farmyard/feed-lot BULLSHIT.

Herds is a term for describing groups of bovine, equine, and other such dumb labor/foodstock/feed-lot/flock animals...

Cattle, sheep, & easily manipulated two-legged SHEEPLE fuck-tards 'go mad in herds'.

 

MEN DO NOT 'go mad in herds'.


Stop buying this crap.  

 

DO NOTICE: there is also a not-so-subtly hidden dig at MEN on display here.  

 

The recently MSM popularized but thoroughly baseless meme that WOMEN are not so easily deluded as MEN -and maybe one such not-male corrupt criminal conniving vagina ( cough-cough-BILLARY-cough ) should be put in charge just because she has a vagina and not a penis is being pushed as a political imperative.

There are thinking people, both MEN & WOMEN, who know when they are being lied to, being hustled, being oppressed, being robbed, being marginalized, etc..  

 

 

Fri, 04/17/2015 - 20:49 | 6005164 Squid-puppets a...
Squid-puppets a-go-go's picture

actually i think the use of the term 'men' here implies that women are of no significance in the activity of commerce/investment referred to.

So that would be a not-so-subtly hidden dig at women

see how you can make a point without using bold type?

Fri, 04/17/2015 - 20:55 | 6005181 J S Bach
J S Bach's picture

"Men Go Mad In Herds"

 

As long as men allow themselves to be "herded", then they deserve their fate.  The lunacy of international usury has been going on long enough that these "men" should have the tiny amount of brain matter which tells them that something's wrong.  Even Pavlov's dog figured it out after enough punishment.  No sympathy here.

Sat, 04/18/2015 - 08:00 | 6005926 Headbanger
Headbanger's picture

Throxx: WRONGGGG!!

How about the Nazis?

Or Jamestown?

Or Branch Dividians?

Or Heaven's Gate?

Or the fucking Moonies!?

It's "monkey see, monkey do" same as it ever was!

 

Sat, 04/18/2015 - 09:03 | 6006002 ThroxxOfVron
ThroxxOfVron's picture

ROFL

 

http://jonestown.sdsu.edu/?page_id=35666

"We began with a larger cohort than previous studies: namely, all Temple members living in Guyana rather than just those who died in Jonestown. Nevertheless, the number of African Americans comprising the group tops two-thirds, at 68% (Figure 1). Black membership thus dominates Temple life in Guyana by a substantial majority, but by a slightly smaller margin (2%) from earlier studies. While it seems likely that the percentage of black members to total membership in California is greater than either 68% or 70%, this conclusion is anecdotal, and based on the observation of hundreds of photographs of stateside members of Peoples Temple.[iv]

Almost twice as many females as males lived in Jonestown, which becomes significant when we look at leadership patterns in the community (below). Black females made up the largest group of residents of Jonestown (45%), with white females comprising 13%. Black males made up over one-fifth (23%), with white males making up a tenth, and the remainder falling in the Mixed or Other categories (Figure 2). Clearly women played an important role in the community, both numerically and organizationally. "

 

Do some fucking homework...

Fri, 04/17/2015 - 21:14 | 6005220 Milestones
Milestones's picture

Damn, I thought they are called "goyim"  I guess I'm not in the fast lane anymore.     Milestones

Sat, 04/18/2015 - 03:28 | 6005772 gadzooks
gadzooks's picture

This is not a competent interpretation of mens behavior,

its a cheap eronious perception of what is often withdrawl or by-product of something way more elaborate.

it should be erased.

 

Fri, 04/17/2015 - 19:50 | 6004970 nailgunnin4you
nailgunnin4you's picture

Fucking obama

Fri, 04/17/2015 - 21:44 | 6005281 pgroup
pgroup's picture

Shouldn't that read "Go get buttfucked, Jugears."?

Fri, 04/17/2015 - 22:56 | 6005453 runswithscissors
runswithscissors's picture

 obama Goes in Mad Nerds

Fri, 04/17/2015 - 19:57 | 6004974 Captain Debtcrash
Captain Debtcrash's picture

  Those who buy into bitcoin are being naive. It was created by those who you think you are thumbing your nose to.

Fri, 04/17/2015 - 20:39 | 6005079 Renfield
Renfield's picture

Very good article, together with the suggestive 1996 'planning' paper it references. Thank you for posting it.

PS: Please see my reply to Jack Burton, below. It may be relevant to what you said here.

Fri, 04/17/2015 - 20:30 | 6005092 kchrisc
kchrisc's picture

For those that understand the demise of the Nothaus Liberty Dollar, and who and what was behind its demise, they will then understand what Bitcoin really is.

The banksters need to repay us.

 

Bitcoin, just another bankster and power ponzi.

Fri, 04/17/2015 - 22:43 | 6005415 chilli sauce
chilli sauce's picture

I think, I can never earn over which I paid by my precedent employer, but I was wrong, world is so large to try their fate.but now I am making $92/hr even more, can easily minimum $1700/week, on the experience everyone must try to do work online, easy way to earn, here's an example what I do... www.globe-report.com

Fri, 04/17/2015 - 19:35 | 6004931 SilverDoctors
SilverDoctors's picture

They may go mad in herds a bit sooner than expected...
Fund manager Dave Kranzler just warned that today's market dump is due to a surge in T-Bond Repos...indicating a MASSIVE liquidity squeeze has begun due to a derivatives accident...

Fri, 04/17/2015 - 20:23 | 6005058 Renfield
Renfield's picture

Geez, I just ran over here to post a link to your article and you got in ahead of me!

OK, so let me just echo what you said:

http://www.silverdoctors.com/reverse-repos-go-parabolic-liquidity-shock-...

Is this as very important as I think it is? I remember this happened just prior to the 2008 collapse. HSBC had to be bailed out (March 2007), but then hedge funds started collapsing, followed by Bear Stearns, followed by some big names in 2008 (AIG, Lehman). Denninger wrote a long explanation about how the reverse repo market signalled the market fall, which led to the 2008 panic.

My skin is crawling after reading the Silver Docs article, put together with this:

http://investmentresearchdynamics.com/is-government-preparing-for-martia...

...also referenced in your article.

As a finisher, quoting from the comments under the second article, comes the following eyewitness account:

<<I know that the government is starting to position themselves in a geographical configuration. That configuration will enable the “boots” to fan out and neutralize any “patriots” who want to defend the constitution. I also read sometime ago that the U.N. may be brought in to assist U.S. troops. The U.N. vehicles were sighted in Texas and as far east as the Smokey Mountains. The FEMA camps do exist. I personally looked at one just outside of Indianapolis. I thought at first it was a conventional prison. The person that drove me out to see the facility also pointed out the large incinerators that are on the property. I hope for all our sakes that this is for another purpose and not what others have been eluding to.

admin: Did you happen to take pictures?

Earl Kanardi: Sorry , No pictures. We were there 10-15 minutes and a non-military, private security car raced towards us. The guard asked who we were and why we were on the property. Then asked if we had any photographic equipment including phones.We told him we had no photo equipment and our phones were in the car. He then noted the license plate and warned us to never come back to the area. If we were caught again we would be arrested. I’m truly not into “fear porn” or sensationalism, just telling what I actually looked at with my own eyes. Just retelling this story makes me very uneasy. As I said I have no knowledge of what the purpose of a facility like this could be for. I do know with everything that is going on that this can’t be good.>>

I'm starting to think we are about out of time...

Fri, 04/17/2015 - 23:11 | 6005500 Squid-puppets a...
Squid-puppets a-go-go's picture

if they got themz incinerators..... it means their scientists fukt up on making that zombie virus!

Sat, 04/18/2015 - 10:11 | 6005988 ThroxxOfVron
ThroxxOfVron's picture

Anyone with two brain cells to rub together knew the Derivatives stacks were going to fail eventually.

Trillions levered against hot air.

There is nowhere near enough collateral to stem a real stack compression at one of the TBTF.  Citi or DB alone could easily collapse the entire system.  

The Derivatives simply cannot ever be covered by marginal post facto 'collateralizations'.  

 

The Derivatives edifice is a fraud and should be unwound as any simple fraud would be: all unbacked contracts are simply declared null and void.   If not fully collateralized from inception, the very thing that would make any such talk of rescuing via FED interventions or covering via FDIC guarantees moot; -these are phony contracts to do what could not possibly be done.  

I fully agree with Denninger on this particular point of consideration with respect to unbacked derivative emissions being akin to entering into fraudulent bets -bets made without any accounts with which to pay.

It is quite similar to and should be treated much as counterfeiting or check kiting..

These institutions deserve to be hit with RICO statutes and the entire management involved in any manner hauled off to the hoosgow.

 

Further:  IMHO, The FED would be damned foolish to Repo it's cache of Treasuries in the event of a stack destabilization.  Once the powder is gone all they will have is the dregs of non-prforming MBS, Maiden Lane debris, and no-profit Momo stock/etf trash.

Oh, and the printing press?  -Good luck with that Janet!  How many trillions of dollars can you generate between the opening of the Monday trading session and the close?

-The next day?  

-& the next day after that??

...& where would all those trillions of dollars flow to since there is no collateral or real tangible assets anywhere to buy with such sums?  

You want a little more than 2% inflation do you???  

 

Go ahead and increase the credit/money supply by a thousand fold in just a week or two, Janet; -and see what happens to the Dollar...

 

IF the house of cards is finally coming down it is to be welcomed.

Phantom wealth is all that will be destroyed.  Real wealth and risk will be repriced.  Healthy.

Let it rip.

Fri, 04/17/2015 - 20:27 | 6005082 Shad_ow
Shad_ow's picture

"accident?"  Now they are calling it an "accident?"

Fri, 04/17/2015 - 19:40 | 6004941 Yen Cross
Yen Cross's picture

  Is anyone up for a quick game of hangman?  -- { :_}  splat.

 

Fri, 04/17/2015 - 20:34 | 6004953 Thirst Mutilator
Thirst Mutilator's picture

 "Men, it is said, think in HERDS...

It will be seen that they go MAD, in HERDS"

 

Hey SMOKEY ~ Does that mean that you're about to go MAD for believing Mohammed Atta flew a plane into the WTC ~ & that WTC7 collapsed, FREEFALL, into its own footprint?

 

20:33 ~ So far, all we know is that 'SMOKEY' has 3 sychophants on his payroll...

Sat, 04/18/2015 - 01:44 | 6005708 DavidPierre
DavidPierre's picture

SmokeyQuinn has yet to understand any of the truth behind 9/11. 

He is just full of shit and still writing meaningless economic tripe.

Just another satisfied MORON !

Again he FAILS the... 

 9/11Litmus Test

https://www.youtube.com/watch?v=p6O4LE0eTYc

Fri, 04/17/2015 - 19:49 | 6004968 Whatta
Whatta's picture

Or as Sting put it:

"Men go crazy in congregations
But they only get better
One by one"

Sat, 04/18/2015 - 07:58 | 6005928 Headbanger
Fri, 04/17/2015 - 19:52 | 6004979 stant
stant's picture

Brothers in the war of Rome

Fri, 04/17/2015 - 19:53 | 6004981 ebworthen
ebworthen's picture

There's a herd of mad men and women in the Wall Street casino!

"Madness of Crowds" and all that... 

http://www.amazon.com/Extraordinary-Popular-Delusions-Madness-Illustrated-ebook/dp/B003I84MBO

Fri, 04/17/2015 - 20:18 | 6005045 Jack Burton
Jack Burton's picture

"When has buying overvalued stocks on margin when the economy is tanking ever gone wrong before?"

It is easy to drag the masses into becoming day traders on margin. First your corporate controlled media run story after story of easy money. Then the brokers and advisors whisper in people ears "don't miss out, look at the returns. Your neighbors are cashing in, the time is now, or get left behind."

The long nurtured paradise of making "wealth without work" hangs like ripe fruit before the masses, They know the elites are mostly "wealth without work billionaires". They have been conditioned by media to want in on a free ride economy, with teh central bank guarnatees of rising equity share prices.

I remember the years of 2004-05-06 here in the USA. Local news stories of Car Repair Shops where the mechanic and his wife day trade stocks on the office PC, they even turn away people seeking mechanic work in order to follow the market and trade. The news coverage is glowing, of how new capitalists are being born in America. Grant you, they look down on the guy when he fixed cars for money, and added value to society. But now that he passes up real work, and plays stocks, he is now a real capitalist. I can imagine this same scene a million times over in China. As long as people chase wealth without work, the sharks will skin the fuckers alive once they get their money in play on markets.

Fri, 04/17/2015 - 20:38 | 6005114 Renfield
Renfield's picture

<<I can imagine this same scene a million times over in China. As long as people chase wealth without work, the sharks will skin the fuckers alive once they get their money in play on markets.>>

China has the most controlled population in the world. I'm sure you've seen this article before, Jack, out of Taiwan:

http://www.wantchinatimes.com/news-subclass-cnt.aspx?id=20150416000091&c...

<<A new identity card which may be launched in China will not only record a person's name, address and date of birth, but will also hold their credit records, a record of which hotels they have stayed in, which flights and train journeys they have taken, as well as their social security information, according to an article published on the website of Chinese-language newspaper Ming Pao Canada. The cards will also serve as Yikatong public transport smart cards. All of this information will be linked to National Public Security databases, which will enable public security bureaus all over the country to check up on citizens at will. ... Authorities hope to make use of the new generation of internet technology, including the Internet of Things, big data, cloud computing, satellite positioning and smart technology to strengthen their control over society. To promote the implementation of the new controls, the government plans to include public security infrastructure in its evaluations of officials. This also means that local leadership will be held responsible for big criminal cases or social disorder that occurs under their supervision.>>

Sorta fits the bitcoin discussion above, I think.

Stupid westerners all focused on Russia, and not even looking at China at all... China, who has been buying resources all over this continent. China, who owns a great deal of North American debt. And China, who will almost certainly be the leader of a global trading economy that uses asset-backed currency. But noooo, let's all stare at Russia, who hasn't been a threat to North America since the '80s.

Any North American 'investor' whose wealth is tied up in paper right now, is going to pauperised when that paper collapses. But any peasant who owns a small amount of resources -- be those resources land, bullion, agricultural business, or anything real -- had better put their thinking cap on soon. An asset-backed currency is going to require governments to have some assets so that they can trade. And what logically happens when a government needs assets? Well, it could nationalise assets, and/or declare certain assets illegal if not turned over for government currency, and/or use what it does have -- land and labour -- as its trading assets, to be part of an asset-backed currency global trading block.

<<It is easy to drag the masses into becoming day traders on margin.>>

This is how the masses are pauperised. Those who are paupers, have only their labour left to sell -- at any price, no matter how low. Those who have anything other than labour, had better be doing some thinking about what happens to those assets the day after an asset-backed currency is introduced, and their broke government wants to be a participant in asset-backed global trade.

I hope it is clear what I'm trying to say.

Fri, 04/17/2015 - 20:26 | 6005077 starman
starman's picture

• Housing Starts Plunged at Annualized Pace of 31.0% (-31.0%) in First-Quarter 2015
• Real Retail Sales Contracted at 2.0% (-2.0%) Annualized Pace in First-Quarter, Worst Showing Since Depths of Economic Collapse
• Annual Real Sales Growth at Recession Level
• Real Earnings Fell by 0.4% (-0.4%) in March
• March Year-to-Year Inflation: -0.1% (CPI-U), -0.6% (CPI-W), 7.5%

Fri, 04/17/2015 - 20:27 | 6005083 PoliticalRefuge...
PoliticalRefugeefromCalif.'s picture

.."The object of life is not to be on the side of the majority, but to escape finding oneself in the ranks of the insane." Marcus Aurelius

Madness is a fever and man gets the fever, I have noticed that animals are either of gregarious, herd nature or tend to operate absent group-think.

History is repeat with examples of herd mentality's compulsion compelling the entire herd over the cliff at breakneck speed, this may be another- if not next week, soon.

 

Fri, 04/17/2015 - 20:37 | 6005113 Sandmann
Sandmann's picture

Chinese are inveterate gamblers so it is really Casino not Stock Exchange. The bubble is their plateau in terms of Walt Rostow's thesis whereas it is the post-industrial problem in the deindustralised and financialised West.

 

Fri, 04/17/2015 - 20:41 | 6005130 Hohum
Hohum's picture

It is not madness.  The Chinese stock market and the US and EU and whatever reflect that generating wealth is rapidly becoming a thing of the past.

Fri, 04/17/2015 - 21:37 | 6005267 homiegot
homiegot's picture

Proving that we are essentially no diifferent that a herd of wilderbeasts. 

Fri, 04/17/2015 - 22:01 | 6005332 R_Dannesjold
R_Dannesjold's picture

Hope they can keep the scam going for a while more, I haven't had the chance to buy enough btc and pm:s yet

Sat, 04/18/2015 - 05:22 | 6005836 TheSecondLaw
TheSecondLaw's picture

My thoughts exactly.

Fri, 04/17/2015 - 22:57 | 6005458 runswithscissors
runswithscissors's picture

"we herded some folks..."

Fri, 04/17/2015 - 23:35 | 6005550 Magooo
Magooo's picture

WE  ---- ARE --- FUCKED

Sat, 04/18/2015 - 07:09 | 6005884 GreatUncle
GreatUncle's picture

China like the USA, UK, EU and the rest of the planet.

We have moved into a world of low growth now because ... everything is exploited nothing left, no niche etc.

Imagine now, you get the answer very easily what do you do in this low growth world Keynes never seen and all that Keynesian debt out there that cannot ever be paid?

Easy answer then is it not? ... to preserve the economic system as is and those entitled positions at the top the central bank with the whole banking system will attempt to create the 2% or greater (may have to pay for a contraction also) growth to sustain the debt.

What the fuck happens to ordinary people in this as the system inflates if they have no skin (asset) in the game? Yep fucked well and truly.

IMPORTANT POINT - As you watch the stocks rise because of the above there is a correllation of fact the more the stocks rise the bigger the depression truly is whatever the MSM want to tell you because in fact you are measuring the depression and no longer the real stock price.

At some time that size is going to be noticeable and it is accelerating because the more they create the bigger the subsequent creation has to be to feed it = Keynesian screw up.

So you can't stop now central banker although in hindsight I bet you wish you could? The more you create the faster the acceleration of the size of the problem because we are in a 0% 0r less growth world so you have no way to pay that ODIOUS debt.

Trapped you can't let housing or stocks fall now so what's next?

 

Do NOT follow this link or you will be banned from the site!