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Everything posted by Jimbo

  1. THE GOD OF PONZI Thy name is FED. A dark and hungy god arises. The Wealth Transfer Vehicles are being sacrificed upon the alter of reality. The FED can no longer hold the center. All is in disarray. Debt destruction slouches towards....wherever...... Is it any co-incidence all the WTV's and Ponzi's grew and flourished under the FEDs interest rate suppression policies. No co-incidence at all.
  2. NOT A BEAR MARKET IN AUSTRALIA The Australian Stock Market only down 10% in 2022. Vesus US market down 21%. I expect this pattern to continue. We dont have all the overvalued tech crap in our index and companies never got so overvalued here. Plus we are resource stock heavy. NO BEAR MARKET IN NICOTINE Altria has only gone from $47 to $45 this year. What bear market??????????
  3. THE PATH OF LEAST RESISTENCE Its always about the path of least resistence. (One of my favourite laws of economics and physics and human nature). What are the Central Banks path of least resistence. More printing and more inflation. They exist to bail out the borrowers and asset values. All that debt has to be made safe for democracy. Of course this is poison for the bondholders. Only now do the bondholders "Get It". But they should bave realised that a long time ago and sold up. Debt holders have been undercompensated for at least the past 5 years.
  4. MUSINGS ET AL Bear markets are markets in reality. Bull markets are markets in belief. At least half the bull market since 2009 has been simply muiltiple expansion caused by the endless FED printing.
  5. INTRODUCING A NEW BOND There is a new bond in town. 1/ It yields the CPI%. 2/ Its tax free. What a great investment!!!! Clearly superior to TIPS What is this great bond called. Its called......FOOD.
  6. PRINTING AS THE FINE ART OF THEFT The FED printed trillions in 2020 and 2021. Did the value of all those printed dollars appear from thin air????? No it did not. It was stolen from the bond holders. They didnt realise this in 2020. They started to realize this in 2021. But only in 2022 do they fully realise this. If inflation is a tax on money. Then printing is a tax on bonds. Realised in the form of "Capital loss plus inflation" Im surprised bond funds still exist. Im surprised anyone other than the FED owns any bonds.
  7. CRYPTO....ITS ALL ABOUT THE KULTINESS Crypto has no intrinsic value....no stream of free cash flows stretching into the distant future to pay dividends etc. But as it has a price it has a value....but only a "price value" and really only a sale price value ...as you need to sell to crystalise the value. Assets with intrinsic value have a price and a value which is independent of each other ...a "value value" so to speak. Crypto's price IS its value. And is purely psycologically determined. Therefore the investment in the great propaganda apparatus on the internet to influenence the price of cypto's. The bigger the "Kultisphere" surrounding a crypto the higher the price. This is very similar to the kult stocks, meme stocks, SPACS etc. Thus Crypto is a great speculation but a terrible investment. Really one for the traders using technical analysis. Or for those who can measure the "Kultiness" level of the crypto and whether it is increasing or decreasing. Price follows Kultiness!!!! This is usually measured/signalled by changes in trading volume, number of youtube promotors and youtube promoter hits, google searches, mentioned on bulletin boards, subreddit posts, being added to or being subtracted from crypto exchanges, facebook post mentions, tweets, total market cap and market cap growth, etc etc. In other words the whole great and varied apparatus of internet "Atttention" in all its myraid expressions is measured to determine a crypto's level of "Kultiness". I am sure there is a vast army of algos/traders/hedge funds that measure all this and use these stats to trade crypto's.
  8. THOUGHTS ON CRAPTO Just a PONZI scheme that soaked up a large part of the excess liquidity from the big 40% M2 print. No big print now (well less of a print anyway....M2 still increasing) so no liquidity to push crapto higher. So it collapses under the weght of its lack of intrinsic value....ie..no real income and the transactional and mining costs. A wealth transfer vehicle just like SPACS. A wealth transfer scheme just like long bond funds were in 2019 and 2020 when they basked in the high returns of endless FED provided liquidity which turned real bond rates negative. Think of the big print as basically a welfare scheme for fraudsters. Money is getting smarter....slowly.....as this bear wears on. Note the staking schemes in Crypto are just PONZI engines designed to attract the dumb money and provide the liquidity so the insiders can cash out their large stakes. However if/when the FED goes full print again expect a partial resubstantiation of the craptoverse and the other WTV's.
  9. THE LONG BOND So TLT has lost 10% YTD. And remember thats just the nominal loss ....in real terms you have to add inflation in......how about 18% real. By the time this is all over the loss will be 30-50% nominal. And even more in real terms.
  10. OVERVALUED STOCK OF THE DAY Disney Market cap $200 billion Free cash flow $2 billion Its not pretty Not pretty at all.
  11. AN OFFER JUST TOO BAD TO NOT REFUSE One of the joys of a truley disfunctional financial system created by massive central Bank interferrence is I keep on getting adds from a certain bank to deposit money. The rate offered.....drumroll please...... A wonderful 1.9% Inflation in Australia is currently 5.1% Now if the rate offered was say 8% I might consider it. The numbers just dont add up!!!!!!!!!!! What will happen when said bank actually has to pay real rates for its money........ For the shareholders.... It won't be pretty. Not pretty at all. Banks were great investments while the era of central bank cheap money lasted....but when its gone....the capital gains and dividends will be replaced by capital losses and no dividends.
  12. ON THE OTEHR SIDE OF THE WAVE The 40% M2 print from March 2020 onwards was a varitable tsunami of money. It pushed stocks and bonds and houses way above reasonable values. Since the start of 2022 we have been "on the other side of the wave" Going down. The retailers are surfers on the wave. We have not reached the bottom yet. But there will be rallies!!!!!! Take Costco for instance Sells for 37 PE and 40 times free cash flow. Clearly worth about 100 B NOT the 200 B it is currently valued at. So many of the large cap stocks still have significant PONZI values in their stocks that need to be burned away.
  13. THOUGHTS ON THE BEAR We realy have been in Bear mode since Archegos blew up in Feb 2021. Its working its way from the most frothy elements to the most basic. From Spacs to Walmart. Still has a while to run. The wealth transfer vehicles are being washed away by the tide of reality. Bonds are still for bagholders.
  14. 2022 - THE YEAR OF THE BAGHOLDER Yes as the year unfolds, 2022 is definitely the year of the bagholder....as all the cyptographers are finding out..... Stablecoins ....what a joke......ponzi coins in reality....... Yes the year reality came to ponziville. One presumes some sort of stock bear markety rally thingamebob whatever should probably break out about now. Ho Hum Ho Hum. On banks As doc says they are hiding massive bond losses (bagholder alert bagholder alert). Also deposit rates will have to be raised dramatically to keep the depositors from fleeing. Its not going to be pretty.
  15. THE FED AS A PRIMAL FINANCIAL CHAOS GOD When you think about it the FED is a financial chaos agent of the first order. By it distortion matrix it creates chaos in financial markets. It is the greatest pumper and dumper of financial (and real) assets of all time. Of course its great for speculators. All you have to do is front run the fed to make a fortune. Its easy to predict the future as a speculator with the FED as your very own chaos engine. I said bondholders were bag holders all last year. Because the 40% M2 print said so.
  16. WHAT A RIDE The SPXL ETF (3x leveraged index ETF) went from $19 to $146 from 20 March 2020 to 4 Jan 2021. What a rise !!!!!!!!!!!!! A 40% M2 print will tend to do that to a stock index. Particularly a leveraged one. And then it all fell apart. Thats what tapering the big print and instituting some QT (mostly synthetic QT) will do to an overvalued leveraged stock index.
  17. SYSTEM TO THE DOWN Still lots of overvalued stocks that need to be adjusted down to reality.
  18. THE GENERALS FALL ONE BY ONE First is was Meta platforms. Then it was Netflix The generals fall one by one. Where is the "Falling Generals ETF" to take advantage of this process.
  19. THE FED's TRASH TALKING QT The Fed will continue to trash talk QT while continuing to print to suppress interest rates. Why!!! Well think of the FED as a poker player with a losing hand. i.e. whatever action the FED takes long bonds must fall in value..... Mr market has a winning hand but the FED is trying through the use of trash talking QT to get them to fold. By folding I mean getting Mr Market to hold onto their losing long bond position. In this case to hold (long bonds) is to fold. And to fold (sell long bonds) is to hold. Mr Market needs to call the FED's bluff.
  20. THE SYNTHETIC QT CLUBBING And right on que the FED comes out and gives this bear market rally a good synthetic QT clubbing. (this is going to be their modus operandi for a while......a small dose of real QT mixed with a lot of synthetic QT) But they are still printing......... The cognitive disonance is large...... The FED wants to still print AND talk the stock market down...... They want the maximum of stock market fall for the minimum of interest rate increase.
  21. MORE THOUGHTS ON THE FED PUT As I have said before I dont think there is a stock level trigger. But there is a ten year treasury rate trigger...... I think its in the 4-5% band somewhere. As that is the where danger zone for large scale corporate default begins. Tripple Bs would then yield 6%. The FED will draw the line at large scale corporate defaults. The tripple B crowd must be protected. The FED doesnt like rate rises at all because all the debt in the system means it will create real damage. The SPAC crowd have largely been eliminated. We have seen the reaction to synthetic QT and it had not been pretty. Not pretty at all.
  22. ITS ALL ABOUT THE DEFAULT EVENT HORIZON RATE I dont think there is a stock market level that will trigger the FED put. 3700 or whatever...... (there is still 900 points to go before this is reached). I do think there is a level on the ten year treasury rate that will trigger the put.
  23. THE BERKSHIRE HATHAWAY ANNUAL LETTER Short and sweet for 2021. However I have one problem with it. The return table that accompanies it is never adjusted for inflation. So the 20% annual return since Warren took over is actually 15% real. And the 10% S&P return is actually 5% per annum. Which makes Warren look better as he actually outperforms the S&P by 300% after adjusting for inflation..
  24. ONE ETF (OR IS THAT 2) TO RULE THEM ALL And the outstanding ETF of this entire bull market since late 2008....... Has been SPXL. The Direxion 3 times leveraged bull S&P 500 ETF. A 28% return per annum from its founding on 5 November 2008. And the timing for its creation was just perfect. And the FED providing all the cheap leverage it needed...... PERFECT FRAME!!!!!! An ETF could not have been designed better to take advantage of the QE gravy train and ride the frame forces. But not anymore.....has lost 24% since the start of the year. But the SPXS the short alternative has gained 24%. Smart money has made the switch!!!!
  25. A SHORT HISTORY OF THE FED BALANCE SHEET Its all there...plain as day....in the chart of the FED balance sheet. When did it all start........ Most say in the bail outs of late 2008....... But perhaps we should look nearer.....in early 2018 when the FED tried to do a bit of QT So softly softly so the market wouldnt notice........ They propbably thought is was going real swell. But the hedge funds leveraged into treasuries certainly didnt think so....... The QT pushed the REPO rate they had to pay on their money up and up and up. The hedge funds could see their profits disappearing before there very eyes. Something had to be done about this obviously unacceptable situation. And so on 17 September 2019....a day that will live forever in financial infamy.... The REPO market printed 10%. And just like magic a $500 Billion REPO facility was created out of thin air to pour the healing balm on troubled waters. Was'nt that nice of the FED..... Even better the virus came along shortly afterwards.... crushed treasury rates and provided the perfect opportunity in April 2020 for the hedge funds to get out of thier leveraged bond positions and into stocks. Shortly afterwards the FED increased the money supply by 40%..... And its been up up up and away for the FED balance sheet ever since. Of course this created a lot of inflation and a lot of very over valued stocks. So the FED had to throw a few bones to the shorts after February 2021 with all its QT talk....... Though I find the FED's tough QT talk unconvincing. And its transitory inflation meme was just so ridiculous...... Then the FED created that nice Reverse Repo Program so all the hedge funds could hide in a house made out of bricks while the inflationary Wolf huffed and puffed and blew all the bonds and stocks down. All that FED QT tough talk really helped a lot..... And that folks is where we are now. Waiting for the real QT. But will it be GODOT QT???????????
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