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17 March 2023

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The Estonian Fox

If this had been a stand-alone article, it could be bad news indeed. The Fed has been lying for quite some time (years), and releasing the smell of moral hazard. But at the end of the article, there are "related articles" for what appear to be more possibly self-serving articles by associated folks. We'll have to wait another year or so to see if Mr. Stockman is correct.

The orange & blue graph near the end of the article stood out to me. Rotate the graph clockwise by 90 degrees. Then concentrate on the shape from 2010 to 2018. Don't you see the pompadour hairstyle, the jutting chin? Yes, it sure looks like the one who used to be the savior of the U.S., now in the dog pound. The fiscal realities work in mysterious ways!!!

scenes

"the government is trying to bake into its ‘solution’ "

Ah well, such are 'solutions'. Tweaking knobs on a thing usually best left to the natural vagaries of a million small decisions by individuals always seems to involve keeping more and more balls in the air.

Add in all the newly invented forms of leverage and paper scarcely connected to reality, the ability to quickly move funds, often under software decision making, and the 50+ year death in community (and honesty) that diversity brings you, and there ya go. It seems to me that you get unexpected crashes, maybe obvious in retrospect, as much from the Big Machine's feedback loops as you do poor decision making.

The Estonian Fox

For the exact opposite view from Stockman's (Ken Fisher)
in Fisher Investments® MarketMinder Digest

Putting the Regional Bank Scare Into Perspective-
The banking system is healthier than perceived.
https://www.fisherinvestments.com/en-us/insights/market-commentary/putting-the-regional-bank-scare-into-perspective?fiut=c&utm_source=marketminder&utm_medium=email&utm_source=MarketMinder&utm_medium=email&utm_campaign=MM+Digest+(Prospect)+3.17.2023&utm_term=Putting+the+Regional+Bank+Scare+Into+Perspective&utm_id=85489&sfmc_id=42444819

As Winter Wanes, Prices Continue to Cool-
Inflation is easing even more than headline data suggest
https://www.fisherinvestments.com/en-us/insights/market-commentary/as-winter-wanes-prices-continue-to-cool?fiut=c&utm_source=marketminder&utm_medium=email&utm_source=MarketMinder&utm_medium=email&utm_campaign=MM+Digest+(Prospect)+3.17.2023&utm_term=As+Winter+Wanes%2c+Prices+Continue+to+Cool&utm_id=85489&sfmc_id=42444819

You have to realize that Ken Fisher is the eternal optimist - every day is an up-day for stocks. Of course, over the years he's been correct, since the slope of stock market value is in direct proportion to American ingenuity. Don't bet against that ingenuity.

Bill Tozer

Maybe off topic, but a look back to 2008 and even an appreciation of George H W Bush during the Keating Five S&L crisis. As Biden spouts folks are going to jail, I just don’t see it.

Bill Moyer “To Big to Jail”

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

scenes

"Don't bet against that ingenuity."

Just what exactly is that ingenuity creating in the stock market? More growth in the FIRE industry? Larger and larger market caps in the surveillance capitalism biz (just how big is the advertising industry anyway)? Explosive increases in DEI consultancies? Ability to generate currency inflation? It's easy to conflate Elon Musk with US industry generally, but he's a phenomenon. Maybe improvements in computational power (with lower utility on the margin).

I wonder sometimes just how economic growth, GDP, productivity should be measured. I'm never comfortable with how it's presented.

It's possible to have ingenuity without benefit. The BLM grifters have proved that.

Scott O

"...since the slope of stock market value is in direct proportion to American ingenuity. Don't bet against that ingenuity."

The trouble is that good old "American ingenuity" is a quickly disappearing thing. Between the govt trying to smother it with endless and arbitrary regulations, and the hive mind of the modern social borg, it can hardly find a place to thrive.
Capitalism only works when there is the discipline of the consequences of failure. Now we have Crony Capitalism where the favored are treated like the govt. It can swallow endless billions and never fail. Yellen openly admitted it. The hicks in Oklahoma might lose their hardware store because their bank went under, but by god the movie stars and the Chinese investors will be bailed out.
We are doomed. The machine might be big and moving fast, but if the fire is out in the boiler it will eventually come to a halt. Momentum works great until it doesn't. Then there's the first half of that law to consider.

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