Where Fools Rule: Takin’ What They’re Givin’ ‘Cause I’m Workin’ for a Livin’

“Way back in the day,” as they say, I pulled a couple of Cold War deployments as a nuclear engineering officer aboard a nuclear-powered guided missile cruiser. There was also that submarine experience which was interesting, but the extended nuclear cruiser deployments were richer. My cruiser was USS Long Beach (CGN-65). We “rode shotgun” forContinue reading “Where Fools Rule: Takin’ What They’re Givin’ ‘Cause I’m Workin’ for a Livin’”

First Real Estate, Then Oil, Next is Food

The quantity of USDs in circulation has been growing at an accelerating rate since the JFK/LBJ Guns and Butter program. The bill came due when Nixon came along. One option was to cut spending and raise taxes to pay off the debt. Nixon took the other option and closed the gold window giving rise toContinue reading “First Real Estate, Then Oil, Next is Food”

The First Shall Be First, the Last Shall Be Last

OK, that title was not exactly the Sermon on the Mount. But it is Matthew – seriously. As much as the Sermon on the Mount, Matthew is also known for the “Matthew Effect” The Matthew Effect of Accumulated Advantage is sometimes summarized by the adage “the rich get richer and the poor get poorer“. The concept is applicableContinue reading “The First Shall Be First, the Last Shall Be Last”

Peak Population – Sow the Wind, Reap the Whirlwind

Chris Hamilton of Econimica shared two graphs reproduced above that summarize all we need to know about macro trends (see https://econimica.blogspot.com/2021/04/ever-fewer-people-need-ever-more.html). You don’t need the usual “talking head” on Squawk Box, or “insights” from some economist to explain the role of “economic slack”. It’s simple physics: wage-generating population (and, households), and money stock. All thereContinue reading “Peak Population – Sow the Wind, Reap the Whirlwind”

Weimar 2.0 Update: March 13, 2021

As of February 1, 2021, the US money supply (“M2”) was $19,432.4 million – call it $19.4 trillion. That’s up ~$4 trillion YoY or ~26% YoY. Remember that mark – a 26% YoY increase in the money supply against a GDP that declined ~1% YoY. And while you’re remembering consider, daily Federal spending closed outContinue reading “Weimar 2.0 Update: March 13, 2021”

Wedges Broke to the Downside

Can’t say I didn’t say “heads up”. I mean, that was a Triple-7 climbing out and they do tend to drop things. Well, Tim Knight was kind enough to observe the Plunge Protection Team in the Monetary Politburo stepped in with still more debt/inflation for American households to prop up the Money Class. But let’sContinue reading “Wedges Broke to the Downside”

Cross-Asset Complacency at 20-yr High

What can possibly go wrong? Well, here’s JPM’s John Normand ,head of cross-asset strategy, (courtesy of ZeroHedge): https://www.zerohedge.com/markets/complacency-20-year-highs-jpm-models-warn-imminent-correction Current readings for individual indicators and the composite are summarized in charts 3 and 4. In Chart 3,¬†four of the seven cross-asset measures have moved beyond the levels that have preceded previous corrections¬†(short and long-term valuation, positioningContinue reading “Cross-Asset Complacency at 20-yr High”

Deja Vu All Over Again: 50 DMA Reconnects

February 2020: February 2021: Sven Henrich (Northman Trader): https://northmantrader.com/2021/02/09/signal-fire-3/ No, this market is really not behaving that much differently from the one that led to the February 2020 top. Back then of course the Fed too was printing running their Repo program having cut rates three times already, now of course printing still $120B aContinue reading “Deja Vu All Over Again: 50 DMA Reconnects”

Resisting Your Bearish Impulses

Evil Speculator (https://evilspeculator.com/the-skew-must-flow/) offers some great truths: Markets move 87% of price in only 11% of the time, that is both combined to the up side and the down side. Within that 87 percentile markets either go UP or push SIDEWAYS 80% to 90% of the time. This means rising or range bound markets representContinue reading “Resisting Your Bearish Impulses”

Knock Knock Knockin’ On Inflation’s Door

Brian Wesbury, Advisor Perspectives: https://www.advisorperspectives.com/commentaries/2021/02/08/the-return-of-inflation Combined, Americans saved about $2.9 trillion in 2020, more than doubling the previous record high of $1.2 trillion in 2018. As of the third quarter of 2020, the amount Americans held in checking accounts, savings accounts, time deposits, and money market funds was up $2.8 trillion from the year prior.Continue reading “Knock Knock Knockin’ On Inflation’s Door”