Gloom, Doom, or Boom? Finance and Economics

[Parodite]

any system left neglected for a long period of time will end up the same way - im not particularly convinced their is some magic arrangement which changes things.

Free market. But it's not that magic.

There is no free market without appropriate regulation; criminal law for starters, obviously.

An interesting grey area is the concept of theft. Shoplifting is easy to identify because you steal somebody else's property.

A popular candy is enforced equal opportunity, as opposed to enforced equal outcome. Everybody wants equal opportunity, and most will understand that enforced equal outcome leads to disasters. (Some socialists are still daydreaming about equal outcomes but once in power they always self-destruct which is a tragic silver lining)

I find the concept of equal opportunity absurd too however. It doesn't exist. It is because equal outcomes will never exist, that equal opportunities will never exist either because outcomes set the table for what will be the new opportunities and probabilities. Opportunity will never be equally distributed.

A toy thought: as there is creation of opportunity in a free market, there will also always be theft of opportunity.

[Simple Minded]

any system left neglected for a long period of time will end up the same way - im not particularly convinced their is some magic arrangement which changes things.

Free market. But it's not that magic.

There is no free market without appropriate regulation; criminal law for starters, obviously.

An interesting grey area is the concept of theft. Shoplifting is easy to identify because you steal somebody else's property.

A popular candy is enforced equal opportunity, as opposed to enforced equal outcome. Everybody wants equal opportunity, and most will understand that enforced equal outcome leads to disasters. (Some socialists are still daydreaming about equal outcomes but once in power they always self-destruct which is a tragic silver lining)

I find the concept of equal opportunity absurd too however. It doesn't exist. It is because equal outcomes will never exist, that equal opportunities will never exist either because outcomes set the table for what will be the new opportunities and probabilities. Opportunity will never be equally distributed.

A toy thought: as there is creation of opportunity in a free market, there will also always be theft of opportunity.

Very true. Parents are mostly to blame. Either due to their genetics or their child rearing expertise.

In my experience, most of equal opportunity starts with genetics and childhood conditioning. The result of good genetics, and good parental practices can not be underestimated relative to the results society can create or destroy.

Not at all hard at this stage in life, for me to look back 50 years, and predict which of my childhood peers would do well in life based upon their behavior when they were children.

Equal potential out of the womb would be both a noble and horrific goal to pursue. Geniuses and idiots would disappear within one generation.

[Mr. Perfect]

There is no free market without appropriate regulation; criminal law for starters, obviously.

An interesting grey area is the concept of theft. Shoplifting is easy to identify because you steal somebody else's property.

A popular candy is enforced equal opportunity, as opposed to enforced equal outcome. Everybody wants equal opportunity, and most will understand that enforced equal outcome leads to disasters. (Some socialists are still daydreaming about equal outcomes but once in power they always self-destruct which is a tragic silver lining)

I find the concept of equal opportunity absurd too however. It doesn't exist. It is because equal outcomes will never exist, that equal opportunities will never exist either because outcomes set the table for what will be the new opportunities and probabilities. Opportunity will never be equally distributed.

A toy thought: as there is creation of opportunity in a free market, there will also always be theft of opportunity.

Not really. Markets exist and operate with great efficiency even in the absence of regulation, they are called black markets.

Free markets are simply ownership and exchange based on private property rights, the right to own and the right to trade.

[Nonc Hilaire]

There is no free market without appropriate regulation; criminal law for starters, obviously.

An interesting grey area is the concept of theft. Shoplifting is easy to identify because you steal somebody else's property.

A popular candy is enforced equal opportunity, as opposed to enforced equal outcome. Everybody wants equal opportunity, and most will understand that enforced equal outcome leads to disasters. (Some socialists are still daydreaming about equal outcomes but once in power they always self-destruct which is a tragic silver lining)

I find the concept of equal opportunity absurd too however. It doesn't exist. It is because equal outcomes will never exist, that equal opportunities will never exist either because outcomes set the table for what will be the new opportunities and probabilities. Opportunity will never be equally distributed.

A toy thought: as there is creation of opportunity in a free market, there will also always be theft of opportunity.

Not really. Markets exist and operate with great efficiency even in the absence of regulation, they are called black markets.

Free markets are simply ownership and exchange based on private property rights, the right to own and the right to trade.

Black markets depend on government regulation of the open market.

[Mr. Perfect]

But they operate without any government regulation, which is a brilliant point because certain leftists argue that markets cannot operate at all without government, then they leverage that to argue that we owe everything to the government because the government makes everything possible, bla bla bla.

What is fascinating is how closely black markets conform to all of our models. It's almost as if these things all follow natural laws.

[Miss_Faucie_Fishtits]

KIgsmm2uR8M

[Mr. Perfect]

The problem with Ron Paul and acolytes is that they never win elections. They never ever ever win anything. Ever.

So instead of repeating the same things for the umpteenth time I would like them to analyze in depth why they never ever ever win elections and what their plan is to win elections.

Also they blame Republicans too much for some unknown reason.

[Parodite]

Just wonder if it would not be better to just put some cash and metal in a super thick safe on my own property (in the ground?) To have my money digitized and exposed to whimsy banksters, market crashes, software bugs and vulnerabilities of sorts doesn't make sense any more.

Cash for the stash:
200.000 euros
200.000 US dollars
1.500.000 Chinese Yuan
20.000.000 Japanese Yen

Gold without mold and a silver lining:
500.000 US Dollars in gold
500.000 US Dollars in silver

Or is this naive. Looks secure to me. Of course this safe kills any stranger just looking at it.

[Mr. Perfect]

Just wonder if it would not be better to just put some cash and metal in a super thick safe on my own property (in the ground?).

I have.

[Typhoon]

uKI_rjDGhgg

[noddy]

https://cumex-files.com/en/

How Europe's taxpayers have been swindled of €55 billion

Cum-ex and its variant cum-cum were highly complex share deals with no economic purpose other than to receive tax ‘reimbursements’ from the state – but for tax that had never in fact been paid. This is how it went. The participants would lend each other shares of major corporations, creating the appearance for the tax authorities that there were two owners of the shares when in fact there was only one. The bank which settled the trades would then issue a ‘confirmation’ to the investor that tax on dividend payment had been paid to the tax office – when in fact it had not. With this confirmation in hand, the investors were then ‘reimbursed’ by the state. It’s a bit like parents claiming child benefit for two – or more – children when there is only one child in the family.

[Typhoon]

Canonical reminder of doom and gloom post boom.

Reason | When the Bubble Bursts, We're So Screwed

All we have to show for 9 years of economic expansion is record amounts of debt, and all long-term fiscal problems ignored.

Applies to most, if not all, industrialized nations.

[Typhoon]

Michael Hudson | Rescuing the Banks Instead of the Economy

Michael Hudson | The Lehman 10th Anniversary spin as a Teachable Moment

[Typhoon]

Wash Post | Is there a financial time bomb in sight?

Credit default swaps and intercompany notes.

Finance is the art of passing currency from hand to hand until it finally disappears.

~ Robert Sarnoff

[Typhoon]

Barron's | The U.S. Economy Is Suffering From ‘Graceful Degradation’

[Typhoon]

Share buybacks and dividends.

The Bear's Lair | The share repurchase bubble

GE was one of Wall Street’s major share buyback operators between 2015 and 2017; it repurchased $40 billion of shares at prices between $20 and $32. The share price is now $8.60 [$10.43 currently], so the company has liquidated between $23 billion and $29 billion of its shareholders’ money on this utterly futile activity alone. Since the highest Net Income recorded by the company during those years was $8.8 billion in 2016, with 2015 and 2017 recording a loss, it has managed to lose more on its share repurchases during those three years than it made in operations, by a substantial margin.

Nat Post | How weak economic growth is actually fuelling this bull market's rise

It’s not about fundamentals, it’s about scarcity.

[noddy]

https://www.economist.com/open-future/2 ... orld-order

Globalisation is already behind us. We should say goodbye to it and set our minds on the emerging multipolar world. This will be dominated by at least three large regions: America, the European Union and a China-centric Asia. They will increasingly take very different approaches to economic policy, liberty, warfare, technology and society. Mid-sized countries like Russia, Britain, Australia and Japan will struggle to find their place in the world, while new coalitions will emerge, such as a “Hanseatic League 2.0” of small, advanced states like those of Scandinavia and the Baltics. Institutions of the 20th century—the World Bank, the International Monetary Fund and the World Trade Organisation—will appear increasingly defunct.

[Typhoon]

The US Federal Reserve’s Federal Open Market Committee (FOMC) today announced a 0.25% cut in the influential US federal funds rate from a target range of 2.25% – 2.50% to a target range of 2.00% – 2.25%, a move which was closely watched and widely signaled, but which was the first such fed funds rate cut in over 10 years.

As an official interest rate which affects all other US interest rates including bank-to-bank overnight loans, the US Federal Reserve uses changes in its fed funds rate to manipulate US economic growth, but its impact is even more far-reaching, influencing as it does the relative strength of the US dollar versus other currencies, and the interest rate decisions of the world’s other major central banks.

Earlier this week in Tokyo, the Japanese central bank kept its overnight rate at -0.1% (minus 0.1%), vowing to keep interest rates in negative territory, while standing ready to buy more bonds (monetize debt) and ramp up the quantitative easing it has become famous for. Given that lower US rates will mean a weaker US dollar, this in turn means relative yen strength impacting Japanese exports, so expect the Bank of Japan to counter this US rate cut will further monetary easing in the near future.

The same is true of the Eurozone, where last week the European Central Bank (ECB) kept its deposit rate at -0.4% (minus 0.4%), with Mario Draghi preparing the market for even lower interest rates this September, and further quantitative easing in a race to the bottom in weakening the euro versus the US dollar. As Holger Zschäpitz of Germany's Welt commented today:

Totally absurd: Investors are paying #Germany more and more to lend the country money. Berlin sold €2.345bn of 10y debt at fresh record low yield of -0.41% vs -0.26% at Jul auction. Bid-to-cover rose to 2 from 1.2 at July 10 auction. pic.twitter.com/PHF2tiU5f0
— Holger Zschaepitz (@Schuldensuehner) July 31, 2019

We're living in interesting times.

[noddy]

the current China/Trump spat is creating economic dooooooooom articles faster than I can read or post them.

[Simple Minded]

the current China/Trump spat is creating economic dooooooooom articles faster than I can read or post them.

Who (Wu?) started it1?

[Nonc Hilaire]

I think the economy is crashing, but China is a scapegoat. They can easily avoid tariffs, and we are rationing corn already due to the massive crop failure.

[noddy]

If currency manipulation is a crime, then quantative easing isnt looking so easy to defend in the international court of opinion

Most of the articles Im reading suggest China cant attack back without destroying its self - the mechanism by which they lower their currency means acquiring a trillion bucks worth of american debt, so writing that off would require a dominance they dont yet have.

[Typhoon]

Was at a bit of a loss as in which thread I should post the following; Levitas, Modern Art, or here.

ZH | "See You After Jail Guys": Art World Stunned After Man Eats $120,000 Banana Duct Taped To Wall

Decided that it belongs here, in the Boom, a.k.a. irrational exuberance, thread.

Whereas the "art" world was briefly outraged after the 120,000 rotting banana was calmly eaten, unaware that they themselves were the joke, normals argued this piece is a perfect representation of what the art world has become with its gaping wealth inequalities and where idiotic "art" such as a banana duct taped to a wall sells for $120,000. Others, however, chose not to go as deep and appreciate the simplicity of the art piece. Yet others blamed the Fed for flooding the world with so much money that a banana duct taped to a wall was actually bought by someone for $120,000.

[crashtech66]

Hmm, I"ve been to a few art exhibits where eating a banana would have been a welcome respite from my eyes being assaulted.

[noddy]

Most of the articles I read on this say that the modern art world is rife with drug money laundering because rich people can give each other large sums of money for things that the price is only set by rich people giving each other large sums of money for things.

any other business the numbers need to add up, but not this business.