Friday, August 17, 2018
Wednesday, August 15, 2018
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?
at 11:52 AM
Tuesday, August 14, 2018
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.
at 7:48 AM
Friday, August 10, 2018
Friday, August 3, 2018
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.
at 9:39 AM
Death, the funny version:
Thursday, August 2, 2018
Monday, July 30, 2018
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
Thursday, July 19, 2018
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 - 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.
at 1:38 PM
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.