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Biderman On Biflation And 'After The Endgame'
"What happens when the Bernanke Put dies?" is the salient question that Charles Biderman of TrimTabs asks and answers in today's effusive excursion into a market that will face both deflation and inflation. In response to the question of what happens after the current miasma of markets ends, Biderman opines that assets will deflate - once the Bernank's constant handing over of trillions to bankers is done, equity and bond prices will deflate and commodity prices will inflate. Nominal USD-priced commodities will soar against a deflating currency as asset prices for everything else will deflate. Concerned, just as we have been, that outbreaks of violence will occur in Europe as their 'safety net' unravels, Charles adds that while the US faces turmoil, Europe will get their ahead of us as "their entire welfare-state-based economies will need a do-over". He does offer a silver-lining for the post-modern world with some thoughts on the productivity boom (and not just leverage) that an online world will bring and while he believes US housing has bottomed for the lowest 2/3rds of the population, he remains extremely cautious on equity prices and their inevitable crash.
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Stop looking at the fiat money. Too variable, a shell game.
Figure out what you need and make arrangements.
Will All the Money Printing Lead to Hyperinflation?
http://www.cnbc.com/id/47960752
Tired of these - at some point it will al blow up. Please, be specific on when and how - otherwise the sun will blow up in 5 billion years, so you know you better be prepared. Some folks were trying to short YHOO in 1996 because PE was too high - they all went belly up after 1997,1998, etc. No more abstract shit will hit the fan - everyone knows there are problems. A true analysis puts a firm scenario layout with dates and facts instead of nonsensical blabbering about something bad can happen at some point. At least Ray Dalio sticks to 2013 as his timeframe - I respect that! All else is BS!
Oracles are a dime a dozen. Always have been.
The Willing Suspension of Disbelief is the BEDROCK of our modern world.
See You In September
Doode, no one can be specific. No one can be specific. I understand your frustration and sometimes it gets to me too. Why are people so vague? Because it all depends on other people's decisions. At the level of Bernanke, Merkel, Monti, et al., and the people of each country making their own decisions. Additionally, there are the black swans. Not the tail risk financial stuff that someone foresees, but truly unforseeable stuff. Personally, I thought Syria shooting down the F-4 could have been it ... Turkey counter-attacks Syria, demands NATO help, arab mideast & Russia rally for Syria and attack Israel because the opportunity is there, oil spikes, economic collapse. You need to do your own evaluation, then take what actions you think protect you best given the varied scenarios.
We're in car, headed towards a cliff, with Bernanke at the wheel.
How long will it take the car to go off the edge? Can you even predict this, since Bernanke is the one working the gas pedal? No matter how accurate you are today, he could decide to go faster or slower at any time, making your previous prediction worthless.
Just because we can see the end coming doesn't imply that it's possible to determine exactly when it will happen.
"Please, be specific on when and how"
That's the stupidest thing you can do, besides it's incredibly hard to predict timing.
Doode, we're scroode!
Another harvard egghead with a system to beat the stock market. :roll:
Bernanke will NEVER stop issuing QE ... QE to infinity and beyond.
So the real question should have been, "what happens when markets wake up and realize that unlimited liquidity does not solve our solvency problems?" ... ie, the "put" is still there, it just doesn't work anymore.
So Bernanke is a smart guy, and he has got to know that his put doesn't put anymore - that's kind of the end of QE isn't it?
"That's kind of the end of QE isn't it?"
NO! ... QE NEVER ends and ZIRP NEVER ends. If they do, our country defaults ... on everything. The FED will absolutely abandon everything else they supposedly stand for in the name of keeping interest rates at zero.
New Biderman epsiode out:
http://www.youtube.com/watch?v=GEXzcyo4seQ
Thanks Chuck!
Bernanke PUT = Bernanke Premium
If you are long, you overpaid!
Where in the hell does he get the welfare state isn't entrenched in the U.S? Has he been paying attention? WTF?
No kidding. The shock, and the do-over, will be much larger in the U.S. where denial is off the charts. The three-year free pass the U.S. has got while Europe drags through its political issues only makes it worse.
Europe's welfare state has produced aggregate budget deficits of 3% of GDP with high interest rates in many countries while capitalist America is at 8% of GDP with manipulated ZIRP and lots of dishonest accounting (Freddie and Fannie anyone?). Europe is in aggregate trade balance with the rest of the world while America sucks up the world's resources and products in ever greater quantities sending nothing but bogus paper, soldiers and weaponry in return.
(America does have a food surplus, but even this depends on foreign energy despite what nat gas fracking / abiotic oil / energy independence crazies might think)
The rudest of awakenings awaits in the belly of the beast.
It has been some years now since the U.S. changed from being a net exporter to a net importer of food.
Everyone goes when the whistle blows! It seems to be coming close, like a monster in the dark. I want someone to explain why it couldn't happen in like 3 days at anytime...it really seems like it could all be over in a heartbeat, which is sorta scary, since I am going backpaking for a few days here soon.
it has felt exactly like this at least a half a dozen times since Sept 2008. go backpacking. have fun. forget about this crap for awhile.
BTFD in effect right now. Look at that algo go.
2013-2015 is the end of the end-game... End of fiat, end of central planning put, end of wellfare states, end of pension funds and I hope: THE END OF THE ELITE, IF NECESSARY BY FORCE
Does not compute. If the Bernanke put dies, USD goes to the moon and commodities go to the woodshed. Everything goes down. Gold collapses the least because Europeans, Japanese and Chinese won't be able to get their hands on enough USD.
yes....biderman needs a lesson on deflation. high priced commodities is not sustainable with falling wages.
Are you related to kito?
It can be because the US is no longer the biggest consumer of commodities. That belongs to nations whose incomes are rising. When the dollar is no longer trusted as a store of value, its velocity will skyrocket. No one will want to hold onto it longer than they have to. They will exchange it for hard assets as fast as they can.
Great episode. I say its great becuase I agree with him. People should always concentrate on the positive while keeping an eye on the negative. Buy commodity producers, they have been whacked big time lately.
There's no way commodity prices are going north if everything else is heading south. Money is going to disappear a hell of a lot quicker than it appeared when the credit spigot finally runs dry.
Housing is not remotely close to bottoming...Price levels, worst case scenario, go back to 1970's levels when fiat money began. Reset will be a bitch and everything in the banking world will probably be nationalized or gone...
yup! w/put the bernanke put, assets will tend to deflate
somebuddy ought to tell biderman that globally-co-ordinated QE for the purpose of keeping the checks in the mail has been in evidence since january '12
and that fungibility of global ponzinomics is bullish for assets in general but not wildly so as were QE's I & II by the FED
therefore, things are kinda...dead
however, things are not as unstable as before dodd/frank gave the FED the new job description and powers to regulate almost the entire "economy" as it sees best
this power is from congress; the political hacks had destroyed the economic system with the "housing for all" bullshit and the instability was threatening their political management of perceptions
so they passed the buck to benzelbub and said: we need this stabler
yes, this is raiderNationRadio... and i saw cliff branch at kMart tuesday, trying to keep things upbeat; the guy is like 2 years younger than slewie; i don't think he was there for the kids
i saw some niners players set up at a grocery when i paid my elec bill last month; very upbeat to the shoppers looking over the $6.99 watermelons and the steaks @ $12.99/lb. uncooked.
maybe season ticket sales aren't where TPTB would like to see them or memorablilia can make a comeback right along with housing?
aaand...we have another "do-over" socialism doesn't work! sighting for the re-set crowd on zH to thump their chests over, too!
what a fuking show! keep drinking, tyler!
EXCLUSIVE: Report from Inside a Major Insider Rothschild Conference
http://www.economicpolicyjournal.com/2012/06/exclusive-report-from-inside-major.html
Yes, there is a sunrise even after a nuclear explosion. Isn't that comforting.
So fed up with the the-end-of-the-world-is-tomorrow story. All I know is that the US$ is getting stronger every day and the gold crash is accelerating. All those people who know what will happen but don't see what is happening are fucking annoying. I live here now so do you.
Disneyland?
I've written a book on "Biflationary Depression" that has insights on why this happens. My background is thermodynamics and information theory, so it doesn't contain the usual Keynesian drivel. I know, it's a book from a non-economist, but how have those guys been doing lately?
http://www.futurnamics.com/biflation.php
How can assets not deflate? Everyone is broke, there is no new money in the system all the central banks can do is recycle existing (bad) loans.
What matters is one asset relative to another: there is no absolute hedge against deflation. Some assets will decline in price rapidly because they have no long-term value (suburban development). Others will decline in price (much) less than the others (gold, resources).
As for currency, I don't claim to know the endgame of currency and neither does Biderman, there are too many variables.