Friday, September 21, 2018

gold don't wanna pop


Amazing how the Lizard People don't want gold to cross the SMA(50):


But at the same time, the Forces of Liberty and Jebus aren't letting it collapse through the lower Bollinger band, either.

Maybe telling today is that the 8:45 puke of gold didn't cause silver to go into the red.


Friday videos: a propos of nothing, Muppets again


Mee mee!



Bonus:

Thursday, September 20, 2018

A propos of nothing, Muppets

The end of the US bid?


Dooooom!:

Macro Tourist - the end of the US bid?

Yeah, I think he's forgetting that you can invest in US equities from anywhere in the world, and that everyone else in the world also wants to buy US because Europe is a clusterfuck etc.

But still, maybe you want to read it.

Wednesday, September 19, 2018

winter recession?


WSJ RTE - Trump threatens more tariffs. This is the part that interests me:


ADD IT UP

Trump administration tariffs against China—implemented, on the way and threatened—would cover just about all imports from that country. That's going to leave a mark. It's hard to forecast precisely how much the economy could slow or inflation would rise. How does China retaliate? How do markets respond? How badly are supply chains snarled? But Oxford Economics estimates that U.S. gross domestic product growth could drop by a full percentage point next year if the U.S. tops off the current $250 billion with another $267 billion in tariffs. With the economy expected to grow at a 2.4% to 2.8% pace (according to Federal Reserve and Congressional Budget Office estimates), that's a significant drag.

FOR BETTER OR WORSE

New tariffs might provide a short-term boost before the long-term drag settles in—if companies respond by importing as much as they can from China before the tariffs hit. Revved up spending and rising inventories could boost growth through the end of the year. A New Year’s hangover would follow as consumers balk at higher prices and businesses stop ordering because their warehouses are stuffed. With interest rates set to go up next week and again in December, the tightening could make the impact of the spending slowdown worse. That's when the impact of the trade fight will be felt, Justin Lahart writes.

Calculating the impact of literally anything is a mug's game, but a rise in inventories always precedes recessions.

Then again, maybe it's housing inventories that are important, not consumer goods inventories.


Japan


EWJ has been crazy exciting the past few days.

And the weekly chart looks interesting:


That, my pretties, is a consolidation over time. MACD is now back to neutral and triggered upward. Price is back above the weekly EMA(10) and weekly Bollinger mean, and is presently breaking thru the weekly SMA(50).


GDX update, uni update


Yes, there really are girls at university who sound like a walking, talking tumblr post.

An annoying girl in my cities tutorial kept talking about how she was aware of her privilege.

She damn well should be aware, because the only reason she's in university is because her mommy and daddy live in a million dollar home in the 905, and continually voted conservative to drive the working class out of university with high tuitions.

I don't see her using her privilege to do anything whatsoever for the betterment of society, though, because all she knows how to do in 3rd year is blather her own personal opinions.

I'm not a Jordan Peterson worshipper, but he is totally right about the state of social science at university. The problem isn't leftie profs, though: the problem is that the university is full of entitled children of the rich who think they deserve a Ph.D. without doing the work. Meritocracy only existed at university as a way of weeding out the poors; with tuition at $7500/y., it's back to the old 19th century French model of the leisure class being given candy for writing bullshit.

Until the 905 mommies and daddies accept that they've parented their children badly and they should be punished with downward mobility, nobody will allow these profs to instil proper rational thinking and work effort into these brats. And so the collapse of western intellectualism will continue.

As an aside, my most Marxist prof at Mac (and yes, he really used to be a Marxist) also gave us the heaviest workload by far. And his final exam was a brutal 3 hours of constant writing. So no, it's not cultural Marxism that's the problem: it's letting kids go thru undergrad and grad without ever learning argument, rational thinking, standards of evidence, or empirics.

Anyway, GDX's chart is interesting:


A positive break upward through the EMA(10), a heavily oversold MACD and RSI, and RSI and MACD divergence over the past month all pile together to make this chart constructive, at least in the short term.

Gold has also failed to break down below $1200.

I guess someone's bailing out the Turkish banks, then?


Friday, September 14, 2018

Friday videos: Pursuit of Happiness


I forgot how good this band actually was.



What's especially interesting is that their first two albums were produced by Todd Rundgren, and this song in particular (which apparently they had written before meeting him) sounds so damn much like a Rundgren/Utopia song, it's scary.

It saddens me that despite Moe Berg's really beautiful songwriting, having Leslie Stanwick and Kris Abbott's perfect backing vocals, and leapfrogging a new band's obstacles very early on by making a very successful amateur video for their first song (before anyone thought a video could break a band), they were ultimately wrecked by singing with two godawful record labels in a row (Chrysalis, then Mercury). I just have to wonder how different their career would have been if instead they'd hooked up with Nettwerk in 1987: it worked out amazing for Sarah McLachlan, and these guys would have been an easier sell.


Thursday, September 13, 2018

OK, fine... memes.


This whole Trump Nike thing is generating so many fucking memes that I've just gotta wake my blog out of its perpetual slumber just to repost 'em:







Tuesday, September 11, 2018

Like I said about gold


Dumping 500 tons of gold into the market makes the price go down:

Al-monitor - Why are Turkey's gold reserves on the rise? The article is from April, when Turkey was trying to build up a cushion against currency collapse.

Since then, their banking system has moved into collapse. In such situations, all cushions against collapse get puked into the market to buy time. Only once there are zero reserves will Turkey get either bailed out or not.

And that is why you shouldn't rely on TA and other such bullshit for gold price analysis.



Tuesday, September 4, 2018

Short comment on silver


Well, silver is crashing back down to its late-2015 low.

Copper, oil and SLX are nowhere near such lows, though.

So I don't think you can read this as either a USD problem or a China slowdown problem. It's something specific to PMs.

Turkish banks puking gold into an empty book to buy another day of solvency fits the bill.

Good luck picking the bottom on this one, IKN. You should know by now to not base your opinions on TA.

Wednesday, August 29, 2018

En passant, a story about music royalties


In passing, here's a story about music royalties:

Digital Music News - I wrote a hit song for Justin Bieber, wanna see my royalties?

Of course it's got the typical complaint about digital royalties, and the typical Bob Lefsetz retort to this guy would be that 34 million spins on YouTube over 3 years is nothing: great, it got to #6 on the Hot 100, and was on the 100 for over 20 weeks, but radio airplay means nothing nowadays, most radio doesn't even play music, and he's already earned a pile on the digital sales.

I'd agree with Bob: Jenna Marbles' recent video teaching her dogs to swim, for example, already has 3M views in a week.

Then again, Jenna Marbles produces a video a week, at least, and is making enough money to live in a nice house in California. So she's defs getting paid much more than this songwriter's rate of $1 for every 170,000 views. So, this songwriter is probably getting fucked over by Justin on the songwriting royalties for YouTube. He should take another look at his contract, and ask YouTube what they think his share is on the spins.

But anyway, the main point was to point to the fact that, over 3 years, a top-10 single can earn you $250,000 in radio royalties alone.

I'd read interviews of "one-hit wonders" like Jesus Jones, who have a permanent income off one song, but never saw any hard and fast figures for airplay alone (Jesus Jones apparently get most of their money selling the song in international markets for advertising).

And by the way, this is a neat topic in economics: a songwriter is essentially generating capital (a song) that then produces a constant income (royalties). A song is, basically, a lot like a factory: it's actually a lot more like a patent.

And one problem, then, is that this capital depreciates: a lot of songs earn little money after the first year, so depreciation over the population is really high, like 50%.

Now, how much of the US's gross output is songs? Think about that. Try and calculate the discounted present value. It gets impressive.

Anyway, just wanted to pass that along. I'd actually wonder if royalty cheques have remained constant over the past 30 years, or if songwriters are getting less per hit song than they got 30 years ago, for example.

Tuesday, August 28, 2018

Trump the fucking narcissistic child-minded twit, again


Oh, President Piddles is complaining again:

CNN - debunking Trump's claim that Google is only promoting left-wing hit pieces.

#1: If you think "conservative" "news" sites are news sites, you're fucked in the head.

#2: If you think NYT and WaPo are "left-leaning" sites, you're fucked in the head.

Seriously. I'm not even going to argue this. An argument on the topic assumes that you are a willing participant in a debate where, if given enough evidence, you will change your mind. But people who read fucktard sites like Fox are not ever interested in changing their mind. Trump could rape babies on a Satanic altar on video while denouncing the coal industry, and these people wouldn't change their opinion of him.

#3: Hey Piddles! If you don't like the news about you, maybe it's because you're not doing anything good whatsoever? I mean, the only "good Trump news" I ever see is you taking credit for things that other people have done. The "bad" news is all the things that you have done. Maybe you should stop doing anything whatsoever? Including, maybe, talking?

#4: The media isn't there to talk about how fantastic you are. Well... in other countries, like fascist Hungary or kleptocratic authoritarian Russia, the media is there only to trumpet how fantastic their overlord is... but not in a democracy.

I guess that democracy is the problem, then.

But, most importantly:

#5: Let's not forget that Trump is still about to be indicted for colluding with a foreign government to subvert a democratic election the United States, and nothing he says on twitter will change that.


Sunday, August 26, 2018

Lefsetz on Trump


Only because I'm sure Lefsetz, in his long career, has seen hundreds of big people go down in flames, I find his thoughts on Trump fascinating:

Bob Lefsetz - the king must die. Quotes, from once you get past his complaints about Subaru service:

Last night, on Fox of all places, Trump said not to impeach him because the economy would tank.

He’s starting to negotiate.

Well, as words from a socially retarded narcissist, this does seem like bargaining.

But, you say the Congress will never authorize impeachment.

It probably won’t get to that. Because if you know your history, the Republican Senators told Nixon he had to go. Ultimately the Republican Senators are gonna tell Donald Trump to go, if he doesn’t declare victory and leave early.

I'm not so sure. I think, at a minimum, they need to see themselves utterly slaughtered in the midterms, and then think it'll only continue to get worse. They're not going to act for self-preservation if they don't think their existence is in danger.

And this week especially has proven there are two teams, I checked the Fox site Tuesday and Cohen and Manafort were not even close to the top. Still aren’t. Which makes you think that Trump can survive in this topsy-turvy world, but he won’t.

Dunno where he gets those last three words from, given the previous sentence.

But here's the important bit:

So Trump demands loyalty, believing the government should be run like a Mafia family, but Sessions says no go, he’s already running from the stink, there comes a time when you defend yourself, like John Dean, because you realize the man in charge is not looking out for you, and you don’t want to go down with the ship.

[…]

And now David Pecker has turned state’s evidence.

And rather than talk to the portraits in the White House, like Nixon, Trump is talking to his minions at Fox, at rallies, but he’s stumbling, he’s lost his self-confidence, he’s on the run.

Life is a game, some know how to play it, some don’t. Some learn through experience, others repeat their mistakes. You succeed with a village, Peter Paterno told me how to play my hand. Donald Trump has only listened to himself, demanded loyalty and breached the compact on a regular basis, the only supporters he truly has are his family, and already some of its members are on the run.

Wednesday, August 22, 2018

Some Schadenfreude news


While you're all waiting for Trump's impeachment, which can't happen anyway til after the Dems take the House and Senate, because the Republicans would never go after one of their own no matter how corrupt and incompetent he is, even if it means they can replace him with the much more palatable (to Republicans) Mike Pence, here's some other news:


Financial Post - cryptocurrency investors wiped out. Apparently the value of all outstanding tokens is down by 75 percent. So why are they even still news?


Calculated Risk - demographics and inflation. This is an interesting idea: can inflation simply be a demographic phenomenon? This is from the BIS:
A robust relationship emerges that accords with the lifecycle hypothesis. That is, inflationary pressure rises when the share of dependants increases and, conversely, subsides when the share of working age population increases. This relationship accounts for the bulk of trend inflation, for instance, about 7 percentage points of US disinflation since the 1980s. It predicts rising inflation over the coming decades.
This is really neat.


CFR - Turkey's financial vulnerabilities. It's a different kind of crisis, but it's definitely going to have to come to a head. As an aside, Turkish banks facing a funding crunch, and having the ability to count gold as reserves, might explain why gold crashed this past month: the Turkish banks are liquidating their gold holdings first. Anyway, let's hope the German and Swiss banking fuckers who've backed this fascist get wiped out in the ensuing mayhem.


New Deal Demoncrat - 2012 Obama voters by 2016 vote. Basically, the Democrats need to find a better candidate than Hillary in 2020. As if they can even grasp that, instead of just blaming their defeat on some mythical neo-Nazis and racists suddenly coming into existence. Anyway, I don't know if this has any bearing at all on the 2018 midterms.

Wednesday, August 15, 2018

gold miner DOOOOOM


Wow, gold miners are really getting beaten like a mixed-race stepchild today. This breakdown is also happening in ex-USD terms.

It's a waterfall collapse, about 10% in 2 days, and it'll be interesting to see how far this falls.

Apparently, when a country like Turkey falls to pieces and sees its economy collapse, people sell gold, not buy it.

Maybe that's the physics for fascist dictatorships? It's only people who live in liberal democracies who buy gold when fear rises?


Tuesday, August 14, 2018

quickie


Still can't be arsed to post much, unfortunately. The market is on autopilot, everything seems wrong but maybe is supposed to be that way, and it seems I'm taking an extended vacation through August. The latter is probably because in Sep 2019 I'll probably be going to grad school, and if it all works out next summer I hope I can work full-time for a prof, so I understand that this is the last relaxation I'm going to have for years, and thus I want to max out.

Interesting to see gold crash below $1200. On BNN this morning, one talking head was rapping on the idea that gold investment faces a demographic crisis: it's only old psychos who want to buy gold as a hedge against The Ebil Sociamalism, young psychos are buying Buttcoin instead, so as the oldsters age we can expect gold demand will dissolve.

Nice story, but probably a bit silly, because a) gold demand is about the EMs and not the idiot American survivalists, and b) gold right now has done nothing in ex-USD terms except trade to the bottom of its range:



A "crash in gold" would have to be a crash ex-USD, to have any meaning. We're simply back to where we were in Dec '16 and July '17, with weekly RSI already cleared out and weekly MACD nearly at a suitable negative-level bottom. It seems gold miner investors know this:


Gold miner sentiment is simply back to the bottom of its channel, and RSI and MACD suggest it's just working off all its positive sentiment. Then again, channels do get broken.

So the gold weakness is really just a USD story, and artificial USD strength will always be generated by expectation of a New American Mercantilism like what Trump is pushing. Now, if the Dems can actually smash the Republicans this fall in blue-collar rust-belt districts, and if the Repubs think this happens because Trump's mercantilism has damaged the economy (which it will, given the international nature of supply chains), then you'll see the mercantilist policies peter out, USD will unstrengthen, and gold will lose some downward pressure.

A crash in Buttcoin will also make gold look better: yeah, I know I said gold demand is an EM phenom, but really honestly the Chinese nowadays are nuts about buttcoin and not gold.

Side note: I was in a stats course, and a Chinese girl was sitting in front of me. Like all entitled bourgeois children of today, she had her laptop open and was watching the internet instead of paying attention in class, but what was interesting was that she was watching bitcoin price in real time. I know Chinese are gambling addicts, and I know that most Chinese students in Canada are children of the Chinese kleptocracy; so she was obvs watching bitcoin price because her daddy had given her a bitcoin wallet of embezzled money to pay for her stay in Canada.

Will the Dems hurt the Repubs in the fall midterms? Really, I have no clue. Let's look at possible causes:

Pro-Dem in 2018

1. Some prior Trump voters (including Obama voters and Sanders voters who switched to Trump) will feel buyers' remorse and switch to Dem.

2. Some prior blue-collar Trump voters may be turned off by Trump's pro-business policies and realize they were bamboozled again.

3. Angrier people have a higher turnout in midterms.

4. Empirics. The Repubs have been godawful weak in some races. I mean, Alabama elected a Democratic senator, how did that happen?

5. Demographics. The old, reliable Republican base is dying.

6. Money. If people like the Kochs are pulling funding, the Repubs are in trouble.


Anti-Dem in 2018

1. Really, the Dems haven't changed, so what would attract any Trump voter to their party?

It's all obviously very complex, and I'm not professing to know the answer, but at least I try and think about this crap once in a while.

But not this summer. Right now frankly I'd rather be playing Splix.


Friday, August 3, 2018

The US dollar narrative - a point


The idea recently has been that the USD is appreciating because Trump is going to fight a trade war (hegemonic mercantilism supports a currency) and reduce his trade deficit. More US goods on the world market mean more demand for US dollars to buy those goods, fewer foreign goods in the US market mean fewer foreign currencies demanded to buy those goods, and thus USD goes up versus everyone who's an "enemy of America" (Canada, the EU, the UK, etc.).

I'm wondering how long it's going to take before people realize there's an opposite narrative: tax breaks like Trump's, that generate a trillion-dollar-a-year federal deficit, should make a currency collapse in value.

Which, actually, would make for a better way to eliminate a trade deficit... though I doubt Americans will want to live through that hellscape.



Friday videos: Death, but with yeah you've got that already


Death, the funny version:



Thursday, August 2, 2018

The Krugginator on Buttcoin


Krugman - why I'm a crypto skeptic. Nice to see it managed to claw its way back to $8000, btw. Hope you all dumped.


Monday, July 30, 2018

Back


Sorry, had an emergency operation to have half my liver removed. But I've still got all my spleen, as you can see below:


Global - US firms queue up for tariff waivers. No, steel tariffs aren't as simple as you think.

New Deal Demoncrat - Q2 GDP is as good as it's going to get. I dunno, I mean what's supposed to stop this juggernaut?

Calculated Risk - no, the housing market hasn't peaked. If that's still doing fine, then the US will continue to expand.

WSJ - why Treasury hasn't labelled EU, China as currency manipulators. Germany, by the way, is engaged in constant currency manipulation: it's part of the ECU and trading with a currency that is weaker than a Deutschemark would be. And that's why Germany's current account surplus is eight fucking percent, and has been that high forever, which parenthetically was precisely the cause of the Spanish and Irish crises earlier this decade, but will never change because Germany owns the fucking EU.


Friday, July 27, 2018

Friday, July 20, 2018

Friday videos: Cannibal Corpse, but with a twist


As you can probably figger, I've just come across this Andy Rehfeldt guy and think his videos are fucking hilarious:






Thursday, July 19, 2018

Whoops, gold and silver suck again


Haven't been watching it for a while, so I was surprised this morning to see that gold has really dropped conclusively below $1300.

Two quick charts:


Silver weekly looks like death. If it doesn't turn around in the next week then this multi-year pennant resolves on the downside with pain. Eric Sprott will probably blow his brains out.



Gold looks slightly less horrible on the weeklies.


Tuesday, July 17, 2018

New Deal Demoncrat on retail sales and industrial production


New Deal Demoncrat - industrial production and real retail sales.

Everything looks fine, but with the trade actions recently taken I'm going to say the more important place to look for the next few months will be inventories and industrial capital investment.

Though, then again, oligarchic late capitalism actually has a fuck of a lot of wiggle room in pricing, and I remain agnostic as to whether 25% tariffs across the board are really going to show up in prices anywhere.


Working til you're 100? Yeah, about that....


BBC - what if we all have to work til we're 100? Yeah, about that:

There’s a sizeable gap between the amount that most people are saving towards their retirement, and the amount that they’re likely to need. It’s growing every day. According to a recent report by the World Economic Forum (WEF), people living in some of the world’s largest economies – the US, UK, Japan, Netherlands, Canada, Australia, China and India – collectively face an eye-watering $428 trillion savings hole by 2050.

So the World Economic Forum, besides being the organizers of the Dav(r)os event, must also be a group of fucking morons.

The reason I say this is that the supposed $428T shortfall is close to the total wealth of the planet. All publicly-traded world equities total $100T, private business is maybe another $100T, there's maybe $100T in bonds, gold is a pittance, and world real estate is about $250T - all figures plus-or-minus a huge margin of error.

Savings has to be invested in something that pays a return. So, if all the rich countries' old people suddenly had an extra $428T to cover their lifetime savings shortfall, that $428T would have to be invested in debt, equity, and real estate: things that pay a return.

But there would be no extra investment in production, because that extra $428T in savings would not cause any change to consumption demand.

So, that $428T would be invested in existing businesses, equities, and bonds, which would mean a UST10Y yield of maybe 1.5% and a US market forward P/E of over 30.

Neither of which can happen sustainably.

In any case, since it's Davros suggesting this number, it probably assumes that all old people in rich countries want to spend $100,000 a year on fucking caviar and fine wines, instead of complaining about how you can't any longer buy buttwipe for under $4 a pack.

Monday, July 2, 2018

As an aside


By the way, the No Fucking Sense Whatsoever award goes to WSBK in Boston, who this weekend decided to shit all over a comedy movie (Spinal Tap) with a bunch of commercials about kids dying of cancer.


Heh heh heh, FART


Reuters - Trump orders drafting of the FART act. When you elect stupid, you get newsworthy events such as this:
U.S. President Donald Trump has ordered the drafting of legislation that would mean abandoning key disciplines agreed at the World Trade Organization, Axios news website reported late on Sunday, to a skeptical response from trade experts.
Wait for it....
Axios reported on Friday that Trump wanted to leave the WTO, a story dismissed by U.S. Treasury Secretary Steve Mnuchin as “wrong” and “an exaggeration”.
Wait for it...
The website followed up on Sunday by publishing what it said was a draft bill, the “United States Fair and Reciprocal Tariff Act”, immediately drawing ridicule for legislation that would be known by its acronym, the FART Act.
THERE you go.

Friday, June 29, 2018

Friday videos: Bill Drummond being a nutter


No music this week... instead, Tony Wilson interviews Bill Drummond and his silly moustache on the release on the KLF's "The Manual":



And Bill proves that Alan McGee wasn't even remotely the biggest nutter from Glasgow in the 90s.

Thursday, June 28, 2018

Paul Hickey from Bespoke and his opinion on the market


CNBC - interview with Paul Hickey. Bespoke is the smartest market analysis organization out there, and I'm always tempted to renew my subscription so that I can get their opinions day-to-day. Here, Paul Hickey says that their analytics suggest a lot of the past few days' moves are just end of quarter rotation.

I disagree based on my view of the charts in the previous post, but hearing that Bespoke is on the other side always makes me doubt myself.

THE CHARTS YOU NEED TO SEE TO STAY ALIVE


My old "rule of threes" had me out of the market this week. Good thing:


The third peak happened in mid-June, and my totally silly-sounding "rule of threes" said that after the third peak, you're not going to get a third simple breakdown to the lower Bollinger, but rather a longer fall. Because the market never does the same thing three times.

So now, SPY wants to break its SMA(50).

QQQ:


QQQ had previously sailed up to a new all-time high. Now, however, it's negated the positivity of that move. At best we get a long protracted retest of the all-time breakout. The hold of the SMA(50) makes me feel positive right now.

$VIX:



$VIX was popping for the past few days, but that could simply have been due to end-of-month fund repositioning. And in any case, today's $VIX doesn't make the same noises as last year's $VIX because of the destruction of the XIV ETF. So you have to look at the index charts to see whether the $VIX move really means something.



And emerging markets look positively terrible right now. The acceleration of the decline after the fail at the weekly SMA(50), to below -2 SD, makes a further 20-30% drop look suspiciously likely right now.

You could interpret all this as just the markets accepting the reality of a new American mercantilist trade policy.

What's scarier is if you instead interpret all this as the final rolling-over of US equities before a crash, recession, and eventual cyclical (at least) bear market.


Sunday, June 24, 2018

The stupidity of Canadian marijuana legalization


CBC - Canadian government is looking to price legal marijuana at... wait, what?

$10 a gram?

I thought the whole point of legalizing pot was to put the illegal drug dealers out of business.

But, as it turns out, the Canadian government wants to price legal marijuana at a price above the illegal street price.

Meanwhile:

Macleans - Ontario's pot strategy includes shutting existing dispensaries. They have hundreds of existing businesses who could sell legal pot in the province, but instead they're trying to drive them all underground.

This, along with the stupid rule that nobody can grow more than four plants, means that

1) the illegal drug trade will continue to make huge profits, and

2) people growing pot on their own will continue to be targets of violent home invasions.

It's hard to figure out what the idiot government is actually intending to do here.


Saturday, June 23, 2018

Evangelicals get funnier all the time


This story says everything you need to know about American evangelical Christians:

Reuters - evangelicals back pimp for Nevada legislature. No, seriously, he runs brothels in Nevada, and the evangelical Christians love him and want to help elect him.

Thursday, June 21, 2018

New Deal Demoncrat sounding the horn of fear, this time empirically


New Deal Demoncrat - poor housing permits points to looming slowdown in GDP. The housing cycle really is the US economic cycle, so this is important:

The preponderance of evidence, based on this morning's report on housing permits and starts, is that increased interest rates and continuing increased prices are beginning to take a bite out of the market.

[...]

Should single family permits fail to make a new high for at least one more month, and should the decline be over 5% from peak, I will switch their rating from positive to neutral. And, while the evidence is by no means conclusive, I would say the preponderance of the evidence is that housing is slowing down, and that will have an effect on the economy over the next 6 - 12 months.




Monday, June 18, 2018

The charts say nothing


Haven't posted charts in a while.

The charts are actually confusing as hell right now:


Emerging markets are tanking.



Gold is tanking.



But gold ex-USD is still doing fine, with no violation of the SMA-50 support. Silver is still rangebound, though the big puke downward last week looks like a warning of a future drop.



And yet, tech stocks are doing fantastic. This is a breakout to a new alltime high.

I guess you could interpret this as a play on American hegemony: the USA rules tech completely, and tech is a field with extreme market power, so any move by the US to impose an oppressive new world order is going to be reflected in a big pop in QQQ and a big drop in, say, EMs.

Saturday, June 16, 2018

The invasion begins


At 9AM, let's watch the Vikings beat Argentina the way they beat England:






Friday, June 15, 2018

Feel good soccer story


Feel good story for you:

Al Jazeera - Iceland in the World Cup. The descendants of Viking warriors and Irish slavegirls, who were chased out of their homeland for murdering too many people and sailed off to live on the world's largest active volcano in the middle of the North Atlantic, and who now while away their days pulling jetliners with their teeth and occasionally winning wars against England, are on their way to World Cup history.

I'm rooting for them all the way. Be especially great if they kicked the snot out of the Russians.

Friday videos: Rush's 2112, played by... wait, what?


Rush's "2112", played by... wait, what?


Monday, June 11, 2018

You're not allowed to like DeNiro anymore


Well, all those Republicans are going to have to quit watching mobster movies, as well as Brazil, Raging Bull, and Taxi Driver:




Recession coming in 2019, or not


It's recession watch time!

Jason Smith - JOLTS data and the 2019 recession. His model suggests that a recession is coming in 2019. Of course, you don't have to believe him, he's an econophysicist.

New Deal Demoncrat - I take issue with the JOLTS data indicating a 2019 recession. YoY hires haven't turned down yet, so no recession.

Jason Smith, Later That Same Day - Oh yeah? Well, so's your mom. Actually, more of a discussion on possible problems with his model.

Far as I'm concerned, the death of the neoliberal world order due to Trumpian stupidity should be able to trigger a recession all on its own, and then there's that whole Italian banking crisis in the making thing.

As for Trumpism, by the way:

New Deal Demoncrat - about the last time a narcissistic moron emperor destroyed the world. Important to note is that Kaiser Wilhelm single-handedly managed to destroy 30 years of empire-building under Otto von Bismarck. Then there was the whole two world wars and extermination of the Jews thing.

Speaking of which, some of Trump's (and Putin's) biggest supporters also seem to hate Jews quite a bit.

I think it's because Jews are great comedians, and right-wing fruitcakes hate comedy.


Tuesday, June 5, 2018

Jim Chanos on Bitcoin


INET - Chanos says bitcoin is a security speculation game. Great quotes from him. The introductory quote says it all:

I’ve found in my research and my teaching that what I would call the “fraud cycle” — instances of large-scale financial fraud over multiple platforms and companies in the financial markets in the modern era (the last 500 years) — follows the financial cycle with a lag. That means that as business and particularly financial markets improve, peoples’ sense of disbelief and caution that they’ve often earned from the previous downturn begins to erode. Schemes that before might have seemed too good to be true begin to be embraced.

And as for the utility of bitcoin:


Bitcoin is still the area for people who are trying to avoid taxation or other examinations of their transactions. That’s one thing where I think it probably still has utility, but the governments have figured that out.

Last year, just as the mania was really going, an early convert who had gotten in early and had made a lot of money wrote this humorous blog about trying to cash in his winnings, if you will. He chronicled telling the exchange that he wanted to convert his bitcoins into U.S. dollars and have them wired into his U.S. bank. It took something like eight or ten days and numerous follow-ups and phone calls. The funniest part was his having to fax his passport to Lithuania. [...]

Using a fax machine to Eastern Europe struck me as kind of the antithesis of what you’re trying to do here. So this is simply a security speculation game masquerading as a technological breakthrough in monetary policy. Someone at Grant’s interest rate conference recently said that it was as if we had intentionally created a “monetary Somalia.”

And an interesting aside comparing the Bushes to the Clintons, which the Democrats should fucking pay attention to when discussing why the working class has abandoned them:

I always joke that the two presidents who have put more executives in jail than all the rest combined were both named Bush. W’s father was instrumental in prosecuting the S&L [Saving and Loan] crooks back in the early ‘90s and put about 3,000 of them in jail. I think they realized that the public was losing money in the stock markets, not just because of the frauds, but because the long dot-com bull market had ended. People were upset. Then when you had the revelations of WorldCom and Enron on top of it, there was a sense that every corporation was crooked and this was going to have exogenous impacts on the economy and the market as a whole. I think they correctly realized that we’ve got to basically show that we’re the cops on the beat. And they did.

Whereas after 2008 under the Democrats:

People in New York and San Francisco and Boston might be fine with everything, but in the South and Midwest, where you’re from and where I’m from, there’s still this general sense that “the bastards got away with it and I’m still suffering.” So there is an exogenous cost to this where people don’t feel that there was justice. They feel that they were taken advantage of by those sharpies on the coasts.

Sunday, June 3, 2018

Sunday extra: catnip


As you know if you've been here a while, I grow catnip outside for my cat.

Now, catnip grows pairs of leaves along a stem; those pairs then eventually become branching points for arms, which then again grow leaves along them in pairs again. They then branch as well, and so on a few times. And each subsidiary branch, as far as I can tell, then builds its own separate pipe down the main branch to the root bundle below. But everything works in pair symmetry in a typical catnip plant.

Anyway, a few times I've had a mutant catnip, which grows leaves in triplets instead of pairs. The first time, it essentially had no root system, so the structural gene that got transposed to produce triplets must have overwritten the root structure gene.

The second three-leaf catnip plant lived a bit longer, but never grew tall.

But this year:


The plant in the centre is a three-leaf catnip, and it's about the same size as the non-mutant catnip plants around it.

I'll be interested in seeing if it flowers, and if so I might collect all the seeds. Though all my plants this year have just sprouted in the ground without my help from the previous year's seed scatter, thanks to the sunny and wet spring we've had.

But it's neat to see how unstable the structural part of a plant's genetic library is.

As an aside, far to the right of this picture there's what seems to be a mutant mint plant: it's a lighter shade of green, and the leaves are rounder, and it smells of lemon instead of mint. I doubt it's hybridized: it's probably just a devolved mutant mint, because the seed packet I grew it from was crap.

Friday, June 1, 2018

On the crypto crisis of faith


FT - the crypto crisis of faith. Apparently there's this crypto investor clown who's selling his Manhattan townhouse for $30m in bitcoin.

Except he isn't. In reality, he's selling his house for $30m in cash, but $45m if you want to pay in bitcoin instead.

Which means that he feels bitcoin is only worth 2/3 of its cash quoted price. Either because it's so illiquid (unlike currency), or because as his lawyer states it's so volatile (unlike, y'know, currency).

Either that, or he's simply charging a 50% money-laundering fee, which seems to me like one heck of a high risk premium to charge on a mob deal, but then again I don't regularly interact with the mob so what do I know.

But it is a sign that the top has come and gone when the bigshots in the bitcoin pump scam all start converting their bitcoins into real hard assets.

Oh, and McAfee is starting to wonder if he might have to eat his own dick on TV. Forget Otto Rock and his "Daniel Ameduri promised to shut down his company!!1!" story, because an even more fun (and actually relevant outside the world of goldbug pump and dump bullshit) story is how McAfee will wriggle his way out of his promised autophallophagy without cratering bitcoin.


Friday videos: Let Forever Be


And how does it feel like, to watch in 360p?



As an added extra, here's Noel talking about recording "Let Forever Be" and "Setting Sun" with the ChemBros, and you know it'll be fun to watch just cos it's Noel:

Thursday, May 31, 2018

Ontario election: ok that's it, I've decided


I just got a YouTube ad where Mike Ford promised me 12% off on my hydro bills.

12%? Wow! Fuck education, environment, and the apparent complete and utter incompetence of a fat clown whose daddy was rich, whose brother was a cokehead, and who can't even string together an intelligent sounding sentence!

A 12% special on Hydro, and the beer in the corner store thing, is all I needed to see in the Conservative platform, I'm hooked.

</sarcasm>

<sarcasm>

ADDENDUM: he's also going to use his mystical power to control the international commodity markets to cut the price of gas by 10c per litre! Or, of course, just bankrupt the province by cutting the provincial tax on gas.

</sarcasm>

Monday, May 28, 2018

What is this I don't even


FT Alphaville - a crypto stunt gone tragically wrong. It starts out with a bunch of crypto clowns climbing Mount Everest (wait, what?) to bury a hard drive full of their cryptocurrency (wait, why?).

Being as they're on Mount Everest, you should expect that it all goes downhill from there.

Oh, and they're Ukrainian, which means it's even more surprising that something bad happened or that they're morons who let their Sherpas die.

I remain utterly unamazed that people still invest in this.

Sunday, May 27, 2018

More funnies: James Acaster makes girls pee


Watch the girl with black hair beside him. She just couldn't stand it.





NDD: weekly indicators starting to suck edition


New Deal Demoncrat - weekly indicators.

I hadn't been following this for a few months, so I had no idea M1 and M2 were sucking so very badly.

Tax withholding also stinks.

Saturday, May 26, 2018

Saturday funnies: James Acaster


You think it's funny, but then at about 3:00 he takes you to a vast new universe of hilarity:



What makes it even funnier is Melvin Odoom constantly butting in about the relative merits of bushes and benches.


Friday, May 25, 2018

Thursday, May 24, 2018

Some news


Hey, so Bitcoin's only $7500 now, eh?

BBC - Trump lawyer paid by Ukraine to arrange White House talks. God, Republicans must like doing the bidding of Russia for this clown to stay in office.

New Deal Democrat - RIP bond market. I doubt it. You need for people to suddenly not have any money to invest, or for worldwide debt to suddenly explode higher at a faster rate than worldwide savings. Interest rates are a demographic phenomenon.

CCN - US government opens probe into Bitcoin price manipulation. And just like that, it's the end.


Tuesday, May 22, 2018

Teachers leaving for other fields


Tim Taylor - on US teachers quitting for other fields. This shows you how desperate they are to leave an utterly fucking dismal field:

"Teachers are leaving their jobs for other careers at a rate that has grown steadily every year in the past three years. ... The majority of educators leaving Educational Services (NAICS Sector 61) are starting careers in the Healthcare and Social Assistance sector. ... For starters, some jobs in Healthcare and Social Assistance, which includes nurses, child care and family assistance services, often require some of the same skills. “Administrative Services,” which includes office workers, is another category that attracts many educators leaving the workforce."

Seriously, healthcare and social assistance? Nursing and child care? Those are fucking horrible jobs that everyone with a choice will avoid. For teachers to go into those fields means their own jobs are dismal. They'd rather compete with Mexican illegal immigrants to change diapers or babysit toddlers for $12/hr jobs than continue teaching.

You've wrecked the teaching profession.

And now, some fuckstick in Texas is saying he wants teachers to carry guns, so that when the next nutcase with an automatic starts shooting up a school, they can heroically protect the lives of our children.

Problem 1: teachers are paid less than police. Police get paid extra cos they can get shot at. Right now, teachers are leaving the profession because they're not even getting paid enough to teach. Do you want to pay teachers more?

Problem 2: Police have the legal power to shoot to kill. Teachers don't. Are you going to rewrite the law to give teachers the right to kill?

Problem 3: Police are blanket indemnified against tortious claims for anything they do while lawfully performing their job. Are you going to indemnify teachers in law?

Problem 4: Police are trained in firearm use. Fuck, movie prop guys are trained in firearm use. Are you going to pay teachers for firearm training and certification?

Problem 5: Police have health coverage so that when they get shot, the health care and rehabilitation cost doesn't bankrupt their family. Do you want to extend that health coverage to evil, socialist, gay-agenda-promoting teachers?

Problem 6: Some American teachers, probably most, have been selected on the basis of teaching ability, not on the basis of the ability to make an instant life-or-death decision in a firefight. What are you going to do? Fire them all and replace them with ex-Marines? Ex-Marines cost more.



New Deal Demoncrat finally identifies the two things to watch for


New Deal Demoncrat - interest rate and gas price watch.

NDD identifies interest rates and gas prices as the two things that will be early indicators for the next economic slowdown.

Bell rung, watchlist identified, his first watch call since the 2009 crisis ended.

Which is better than some clown bloggers out there, who make up a new cutesy slogan and watchlist and looming apocalypse every six months for their goddamn incomprehensible investment newsletter where they describe the decisions that make them significantly less money than if they'd just bought a passive S&P 500 index ETF.


The opioid crisis


WSJ RTE - prescription rates driving the opioid crisis, not unemployment.

Textbook statistical study here.

If joblessness was a cause of drug abuse, then the differential impacts of the 2008 crisis on different states would show a differential effect on drug abuse.

But the data don't show that.

Thus, it's really just a case of Republican states (where addiction is more common) being full of doctors who love prescribing drugs. And Republican voters loving taking drugs, instead of trusting in Christ to lead them through times of difficulty.

As an aside, Jordan Peterson (yeah, I've been watching him, wanted to see what the fuss was about) makes the point that "people who are depressed feel physical pain more, it's statistically proven. And people who feel pain more get prescribed more opioids." Thus, Republican states must be more psychologically depressing states.

If that's the case, then the above study must show that Republican depression has nothing to do with economic hardship.

Maybe Peterson can explain whether more hateful people feel depression more.

Or maybe whether the cognitive dissonance required to profess love of Christ and patriotism, while simultaneously hating the 50% of Americans who don't vote for your party, correlates with increased depression and physical pain.

New Deal Demoncrat is getting full of himself


New Deal Demoncrat - dear professor Krugman....

Dude,

You never admit that you read my blog. Why would you expect that K-dog will admit to reading your blog?

Seriously, though, the Krugginator tends to stay away from social media because it's full of dickless fucksticks constantly trying to make their mark by taking on Teh Ebil Krugman Sociamalist, kinda like an army of WWF fans demanding a title shot with the heavyweight champion without ever having contested a match. He even ignores taunts from the St. Louis Fed's resident clown Stephen Williamson, leaving it to DeLong to respond to Williamson's idiotic jawboning.

Put succinctly, K-dog always has a choice of how to apportion scarce resources. He can

1) chat with a large pool of distinguished economist friends like Mo Obstfeld, Larry Summers or Barry Eichengreen on economics topics that extend his knowledge and understanding, or

2) read a blog by some guy.

If K-dog is a rational maximizer of utility facing a time constraint, he will always choose 1 over 2.

Just accept that we all can't be the blog that Obama relied on to provide him with critical national security insights in the midst of an international crisis.

Monday, May 21, 2018

New Deal Demoncrat, retail sales


New Deal Demoncrat - April retail sales.

By the way, look at the retail sales chart:



It spiked along with the S&P 500. So was the S&P 500 spike of earlier this year really unearned, or was it entirely reasonable?



Wednesday, May 16, 2018

Bespoke on S&P 500 trailing PE


Bespoke - S&P 500 trailing 12-month PE. Wherein they give you pictures like this:


And if you look real close you'll see that while yes, it would have been bad to buy at the 30 peak in 2000, it was a fucking amazing time for a long-termer to buy in early 1992.

Now you have a reason to ignore forever any fuckstick who whines about the S&P trailing 12-month PE.


Tuesday, May 15, 2018

On the underdevelopment of the Balkans


Branko Milanovic - a geographical hypothesis for why the Balkans are underdeveloped. He brings up 20th century communism and earlier Turk exploitation as explanations, then includes high mountains (as barriers to land travel) and contiguity with the Ukrainian steppe (as enabling constant invasions) as new explanations.

Unfortunately, Branko forgets that trade never happened over land in this era. It was always by sea, where transportation costs are a tiny fraction of the land transportation costs.

There are a few counterexamples, like the land silk route thru Asia (which required a single massive empire to enable it) and the later land gold route through Africa (ditto). But boring trade of boring average commodities happened by sea and river.

And the interior of the Balkans was inaccessible from the sea due to the Iron Gates. There was no way to get from the Black Sea to Hungary and beyond, except by trails. There was I guess a road from Venice through Carinthia to the Austrian interior, but there again you have the problem of roads being too expensive for travel. Thus there could be no external trade connections with the Balkans, thus no wealth.

So there's an alternate theory for you.

You could counter that the massive Hungarian silver and gold deposits exploited starting in the 13th century became a good replacement for wealth by trade... but then you'd have to do the work to figure out if the Balkan-Western wealth gap narrowed during that time. It may have: they built a fuckton of new castles and saw massive immigration from Germany.

As for invasions, why not look at the economy of Hungary before and after their slaughter at the hands of the Mongols in 1241-2? Hungary in fact bounced back rather quickly from a very thorough genocide: ten years later they were healthy enough to go back to constant war with Bohemia, with a few hundred new stone castles having been built in their territory. I think the effect of invasions and slaughters is a lot different in the middle ages, where no economies were operating anywhere near capacity in the first place.


Monday, May 14, 2018

Nouriel Roubini again, on... yup you guessed it



Nouriel Roubini - cryptocurrency scams. Crypto is beginning to sound even stupider and stupider:

Initial coin offerings have become the most common way to finance cryptocurrency ventures, of which there are now nearly 1,600 and rising. In exchange for your dollars, pounds, euros, or other currency, an ICO issues digital “tokens,” or “coins,” that may or may not be used to purchase some specified good or service in the future.

Huh... that kinda sounds like massive hyperinflation through money printing, doesn't it?


Thus it is little wonder that, according to the ICO advisory firm Satis Group, 81% of ICOs are scams created by con artists, charlatans, and swindlers looking to take your money and run. It is also little wonder that only 8% of cryptocurrencies end up being traded on an exchange, meaning that 92% of them fail.

Wow. Well, thankfully, from my own experience here at university, most of these scams are only fleecing corrupt Chinese communist party officials.


If you invest in a conventional (non-crypto) business, you are afforded a variety of legal rights – to dividends if you are a shareholder, to interest if you are a lender, and to a share of the enterprise’s assets should it default or become insolvent. Such rights are enforceable because securities and their issuers must be registered with the state.

Moreover, in legitimate investment transactions, issuers are required to disclose accurate financial information, business plans, and potential risks. There are restrictions limiting the sale of certain kinds of high-risk securities to qualified investors only. And there are anti-money-laundering (AML) and know-your-customer (KYC) regulations to prevent tax evasion, concealment of ill-gotten gains, and other criminal activities such as the financing of terrorism.

In the Wild West of ICOs, most cryptocurrencies are issued in breach of these laws and regulations, under the pretense that they are not securities at all. Hence, most ICOs deny investors any legal rights whatsoever. They are generally accompanied by vaporous “white papers” instead of concrete business plans. Their issuers are often anonymous and untraceable. And they skirt all AML and KYC regulations, leaving the door open to any criminal investor.

Wow. Again, I guess, easy come easy go.


In fact, the only reason to restrict a purchase to token-holders is to create an illegal cartel of service providers who are safe from price competition and in a position to gouge their customers. Consider Dentacoin, a ridiculous cryptocurrency that can be spent only on dental services (and which almost no dentist actually accepts). It would be hard to come up with a better illustration of why business cartels are illegal in all civilized countries.

Of course, the crypto-cartels would counter that customers who incur the cost of buying a token will benefit if that token appreciates in value. But this makes no sense. If the price of the token rises above the market value of the good or service being provided, then no one would buy the token. The only plausible reason for forcing the use of a token, then, is to hike prices or bilk investors.

Wow^2. Seems like the people buying this garbage don't even know basic economics... which I guess is understandable if their only education has been the Mises Institute or some Ron Paul videos.

Tuesday, May 8, 2018

Good ol' Charlie Munger


CCN - Charlie Munger says trading bitcoin nearly as bad as trading in harvested baby brains. This guy's great:

The 94-year-old Munger then proceeded to compare cryptocurrency trading to dealing in “freshly harvested baby brains,” arguing that both would be immoral even if profitable.


“Suppose you could make a lot of money trading freshly harvested baby brains. Would you do it?” he asked. “To me bitcoin is almost as bad.”

Munger then took aim at bitcoin proponents, alleging that it is disgraceful to promote cryptoassets and chastising them that it is “beneath you.”


“I regard the whole thing as a combination of dementia and immorality. I think the people pushing it are a disgrace,” he concluded. “There ought to be some things that are beneath you, that you just don’t do, and this is one.”


To be fair, harvested baby brains won't make McAfee eat his own dick on national TV.

Monday, May 7, 2018

Caste hatred in India


BBC - caste hatred in India, what it looks like.

As an aside, here at university, among the most rabid anti-white critique you'll ever hear will be from bourgeois pseudo-leftist Indians with upper caste family names.

And the entitled brats don't even see how ironic it is that a brat from a million dollar home in Mississauga, whose family bars Dalits from even entering their temple, can pretend to be leftist.


OMGWEALLGONNA... be stinking rich forever?


Yes, let's all puke stocks!

Calculated Risk - best April ever for intermodal. And intermodal is trade, and trade is up when the economy is up. Let's all puke stocks then!

Calculated Risk - Q2 forecast: 3-4% growth. Yes, let's also puke stocks when the economy has finally bust out from 3%!!

Sure, the market went way too far way too fast in winter, and that's why we're down 10%. Not because of some idiot president.


Monday, April 30, 2018

Market comment


If you remember, the market went down a few weeks ago on Korea tensions, as it seemed Trump was willing to start a nuclear war with Small Korea.

And so today, not to be outdone the market goes down on futher Korea tensions, as Moon and Kim meet for a historic summit that ended in hugs and giggles. Possibly also a pillowfight in bras and panties.

Speaking of which....

BBC - Moon Jae-In says Trump should get a Nobel Peace Prize. BWAHAHAHAHAHAAA!!!!


Wednesday, April 25, 2018

Oh and also, the Russians are hacking Google again


Oh and also, Google is slow today, so I guess the Russians are trying to hack them again.


Well there's two great contrary indicators for you


BI - American investors just went pessimistic on the market. And you know what this has always meant in the past? Great time to buy stocks.

Also, Business Insider has an article on Albert Edwards being pessimistic, which isn't as perfect a bottom-tick indicator as worthless idiot Raoul Pal but it's close.

Strangely, though, BI expects people to want to pay for Albert Edwards' worthless fucking nonsense. I guess they aren't making money on advertising anymore so they have to go the paywall route and hope for enough stupidity to keep them in business.


All is not lost for John McAfee


If you don't remember, anal-application-of-synthetic-stimulants pioneer John McAfee offered to eat his own dick on national TV if Bitcoin doesn't go to $500,000 by July 2020.

Given that bullshit "alternative currencies" are proliferating like bunnies, there is literally no way that this can happen.*

But all is not lost, John McAfee!:

BBC News - US soldier gets first penis and scrotum transplant.



* - well, it can happen if these people are somehow able to use their existing crypto holdings as security on loans to buy more crypto. And actually, I'd love to see that happen, just to see how much they bleat when they lose more than 100%.

Sunday, April 22, 2018

Back online



Had to study for exams, and was otherwise bummed at having fucking ice and snow in April, but now that everything has more or less worked out I'm back online!

New Deal Demoncrat - weekly indicators. Rail is still fantastic, tax withholding is down due to the Trump tax cuts, and Baltic Dry seems to be spiking with resources.

Speaking of which, a late-cycle thing to look out for is a spike in commodities. Seems we're getting there now. That might be nice for miner stocks....


Thursday, April 12, 2018

Bespoke news


BIG is always a fantastic dose of reality:

Bespoke Investment Group - jobless claims streak of 162 straight weeks.

Bespoke Investment Group - AAII bullish sentiment collapses.

Add that to the $VIX finally collapsing below its EMA(20) and you've got a fantastic reason to buy, not sell.


Tuesday, April 10, 2018

Flurry of Daniela activity


Was checking my blog stats in the first time in forever, and saw a flurry of hits yesterday on my "Is Daniela Cambone married?" post from years back.

That always means Daniela's just put up a video on YouTube where she's interviewed someone. Usually it's someone utterly reprehensible like Peter Schiff or Doug Casey who drives the hits to this blog.

But today, it's the only mildly reprehensible, but also in this case funny and loveable, Mark Cuban:



Daniela doesn't manage to get Mark to show her where on the doll the bad goldbug touched him.

At least he can get uproarious laughs out of her, which means he has ten times the charm of her typical guest.

And you can tell he thinks she's hot.

Where goes the Republican party now?


Reuters - older educated voters shift away from Trump. Quote:
The 12-point swing is one of the largest shifts in support toward Democrats that the Reuters/Ipsos poll has measured over the past two years. If that trend continues, Republicans will struggle to keep control of the House of Representatives, and possibly the Senate, in the November elections, potentially dooming President Donald Trump’s legislative agenda.

“The real core for the Republicans is white, older white, and if they’re losing ground there, they’re going to have a tsunami,” said Larry Sabato, a University of Virginia political scientist who closely tracks political races. “If that continues to November, they’re toast.”
A year ago I would have called bullshit on this, given it's mainly House incumbent Dems who are up for reelection in November. Then again, if Alabama can swing Democrat, that's possibly indicative of a major shift to the world of American politics, no?

Though obviously I know a lot of this commentary comes with a hidden undercurrent of Democrat wishful thinking.

Where goes the market now?


WSJ - leverage will determine if China or the US comes out on top. The problem China faces in a "trade war" is that a country with the large trade surplus and low exports doesn't have much room for retaliatory tariffs. If the US imposes $150B in tariffs on China, that's a greater amount than China's entire US imports: so what are they going to do in retaliation?

China’s $506 billion worth of exports to the U.S. last year equaled 4% of its gross domestic product, while the U.S.’s $130 billion worth of exports to China equaled just 0.7% of GDP. This makes Chinese growth more at risk in a trade war. It also means that if both countries carry through on their threats to apply tariffs to $50 billion of the other’s exports, the U.S. has way more targets left to hit afterward than China.

Tariffs on Chinese imports raise costs for Americans but they would be easily manageable given the size of the U.S. economy. Indeed, perhaps the biggest risk to China from a trade war is that global manufacturers no longer regard it as a reliable base from which to supply the U.S. and shift operations elsewhere. If China retaliates by punishing U.S. companies’ operations in China, for example with health or safety violations, it aggravates that risk. Foreign investment has been key to China’s acquisition of technological and industrial know-how.

China could attempt to roil U.S. markets by selling, or buying fewer, U.S. Treasury bonds. But global trading in those bonds is so heavy the consequences may not be great; and it would push China’s currency higher, further endangering exports.

U.S. exports to China are not easily replaced. Several bloggers have observed that China imports so much of the world’s soybean supply that it has few alternatives to the U.S. Brazil, the only other major supplier, is already reaching its capacity. That means China would have to keep importing American soybeans while its tariff rippled through to the price of tofu, bean curd, animal feed and thus chicken and pork. “Chinese tariffs would no doubt hurt US farmers, but likely hurt Chinese consumers more,” Brad Setser of the Council on Foreign Relations said on Twitter.

So I think all this "OMG China trade warz!!!!" nonsense is going to melt away, and the market will suddenly remember Trump's tax breaks to corporations as earnings season progresses.


Friday, April 6, 2018

Ouch!


Ouch!

Bitcoin's trading at $6584 now?

Y'know, with price action like that, I'd be dumping what I have and buying something else.


Friday videos: The Go Gos, but not as you know them


Fun fact: Terry Hall from Fun Boy Three actually co-wrote this song, so it's not even a cover.


Wednesday, April 4, 2018

Bitcoin keeps on sucking


Now bitcoin is at $6747.

I suggest DaYvan Cowboy buy more. Lots lots more.


Tuesday, April 3, 2018

Wakanda and economics


Tim Taylor - Wakanda and economics. How exactly do you get to be the world's most technologically advanced economy on nothing but vibranium?


Sunday, April 1, 2018

Hey, remember Bitcoin?


Hey, so why is bitcoin down to $6910?

Zerohedge says "it would be unfair to be totally dismissive of what the Blockchain technology has brought about", but how is it unfair to note that Visa can process a million times as many transactions per second as crypto, yet crypto is supposed to be taken seriously as a payment method? Or is it not really a currency? Cuz, y'know, currencies are payment methods.

Then Zerohedge says "One must remember that the aftermath of the dotcom bubble also affirmed that truly innovative organizations and technologies could weather the storm", which is true if "innovative" means blathering libertopian nonsense. I mean, we all know that'll always weather the storm.

Then Zerohedge says "Whether or not crypto ventures will share a similar fate to dotcoms remains to be seen", which kinda sounds like their Russian paymasters are throwing in the towel and want to move on to their next scam.


Friday, March 30, 2018

Friday videos: Bananarama, but not as you know them


Bananarama and Fun Boy Three, and you understand this if you know that Bananarama were roomies of Steve Jones and almost got managed by Malcolm McLaren:


Monday, March 26, 2018

And by the way....


Bush Jr. and Obama both brought in tens of billions of tariffs on things, and nobody freaked out about them.


Friday, March 23, 2018

Calm words from Liz Ann Sonders



My favourite market commentator has some calm words to get you through the "OMG can an idiot president really cause a collapse in world trade" fears:

Liz Ann Sonders - quit piddling your frilly little pink girl-panties.

Unfortunately Jeffrey Kleintop is still around, shitting all over her reports with his fucking unqualified idiot free-trade nonsense that he got from his BA in business admin and his MBA - neither of which are an economics degree, or even a political economy degree.

But you can just ignore his crap, which is easy to find in her write-ups because it's always hyperbolic emotional nonsense, and focus on Liz's sensible commentary:

With the recent myopic focus on tariffs and trade over the past several weeks, investors might have forgotten that the underlying foundation of the U.S. economy remains solid, although the softer retail sales report caused the Atlanta Fed GDPNow model to dip under 2% for the first quarter, which now has only a couple of weeks left. In spite of these weaker first quarter growth projections, business sentiment remains very optimistic. The NFIB small business optimism index is at its highest level since 1983, with a record-high reading for its “good time to expand” component. In addition, the Institute of Supply Management (ISM) Non-Manufacturing Index (covering about 88% of the U.S. economy) dipped only slightly to 59.5, while the forward-looking new order component rose to a quite robust 64.8. The accompanying ISM Manufacturing Index (covering the other 12% of the U.S. economy) rose to a robust 60.8, while orders remained strong. And actions are increasingly backing up these positive surveys, with The Wall Street Journal reporting that according to FTR Transportation Intelligence, heavy truck orders were up 76% in February relative to the year ago period.

Additionally, the labor market remains strong, with forward-looking jobless claims recently hitting their lowest level since 1969 and the latest monthly jobs report showing a surprisingly strong 313,000 jobs were added in February. The unemployment rate remained at a low 4.1%; with its flat reading reflecting a jump in the labor force participation rate from 62.7% to 63.0%. Perhaps most calming to the markets was that average hourly earnings were up only 2.6% year-over-year; down from the downwardly revised 2.8% in January, and calming some fears about more aggressive Federal Reserve policy after the prior month’s hotter wage reading.

Read her every week, it's free and Liz is a genius.


Uber is just a scammy gold exploreco, here's why


Getting into annoying discussions about Uber at school in a transport policy class, so I'm going to unload here.

First:

Uber really just gains traction by being another genocide-of-the-proletariat story: hey, wouldn't it be great if we just got rid of 4% of the US workforce that make a living driving? It's a totally bourgeois story.

Second:

Hey, remember when Uber was a taxi company? Yeah, that worked until the London cabbies put an end to it.

Fact is, Uber was only "revolutionizing" taxi service by inventing a poorly-thought-out workaround for labour laws, where they asserted their drivers were private contractors. Once they had to treat drivers like everyone else treats drivers, they had to get out of the taxi business.

I think there might have also been a problem in Uber not owning plates. See, taxi services get regulated with a plate system, which is an enforced restriction of supply. That is needed for their industry to stay profitable: in an unregulated libertarian free market, driving becomes a zero-entry-cost perfect competition environment, and by definition nobody can make money in one of those. I'd like to know if there was ever a suit against Uber for operating in a market without plates.

And in any case, Uber shows how fucking stupid they were by trying to operate in a perfect competition market: that is not where you start a new business, ever, and hopefully they're fucking teaching this in first-year business school.

So, now they pivot out of the taxi industry to become a "self-driving car" company.

No, self-driving cars will not be allowed onto the road until tort law catches up. That's what makes this Arizona case so important: it will establish who has liability for tortious injury caused by a self-driving car.

And I'm sorry, but no trucking company is going to dump their driver Sanjeet for a robot, because Sanjeet is the guy who can take the blame for a fatal collision. With Sanjeet replaced by a robot, either the trucking company will have to assume total liability as owner, or they'll be renting from Uber who will then have to assume liability as owner.

And no, you don't make money by creating a business that just buries you in liabilities. And no, existing companies absolutely never change their mode of business to increase their liability. Ever.

So Uber can't make money in self-driving logistics.

So now Uber falls back on the idea of taxis... just that now they'll be self-driving ones.

Which is stupid. Gwynne Dyer (who is generally fiercely intelligent in the field of political economy, but is way out of his fucking wheelhouse here) repeats the vacuous crap that

The long-term impact of autonomous vehicles on private car ownership will be just as great. A recent KPMG survey of car industry executives found that 59 per cent of chief executives believe more than half of today's car owners will no longer want to own a car by 2025 — just summon a cheap self-driving taxi whenever you want to go somewhere.

It's Uber on stilts. Self-driving taxis will be everywhere, and respond to the summons in just a minute or two. No parking problems ever again, and far less congestion on the roads because a taxi fleet one-quarter as big as the current total of private cars would suffice to meet even maximum rush-hour demand.

which ignores the fact that we fucking have that now. Right now you can hail a car that takes you anywhere you want to go. It's called a taxi. And nobody takes them. I know for a fact that during the day, my urban neighbourhood only has 3 cars in my dispatch area from one of the three taxi companies. Those taxis ain't replacing more than 0.01% of my neighbourhood's car fleet, and it's not going to change.

Again, the only way Uber could increase usage is by reducing cost to patrons, which can't be done profitably otherwise taxi companies wouldn't need licensing systems to constrain supply.

And Uber has never been profitable - even when they were running their cab service all over the western world in violation of labour laws, they still needed a constant influx of cash from printing shares just to stay in business. If you can't make money in that paradigm, you're not going to make money in a new paradigm that just copies it.

Uber is nothing but a bullshit gold exploreco, spinning bullshit stories to people who don't know anything, so they can print more shares and sell them to suckers. Their real business is eating share capital.

And the fact they just handwave their way through liability issues and labour law issues and the fucking iron rule of perfect competition markets shows they have no fucking clue what the real world is.