Where We Are in the Cycle

An image in a Tweet accurately describes the folly of Fed-sponsored bubbles.

A Tweet by OccupyWisdom accurately portrays the Fed-enhanced Cycle of Stupidity.

If accurate, and I believe the graphic is precisely on the mark, the interest rate cycle is nearly over, just as a near-unanimous consensus has formed that the bond bull market is over and the stock market is headed for new highs.

Deflationary Setup

Asset bubble bursting is inherently deflationary.

As I stated yesterday, it's increasingly easy to stick with my prognosis: Inflation is in the Rear-View Mirror.

Then again, many believe Everything Bad is Priced In.

Enjoy what's left of the bubble.

Mike "Mish" Shedlock

Comments
No. 1-18
RobinBanks
RobinBanks

Clearly the Russian and Chinese central banks don't share your views on gold, Wagner.

Wagner___
Wagner___

@TheLege I have said it multiple times that Gold portfolio in long term has underperformed any portolio holding major stock index product. And for your record, you have never given a constructive response. Instead you have resorted to name calling, which I think tells a lot about your arguing skills.

Whenever I bring up "Gold vs Stocks" topic, then someone in response posts "nominal stock index prices" vs "nominal gold prices" and claim that gold actually performed almost equally good as stocks in long run.

However, when I point out flaws in such thinking and recommend to look at "portfolio as a whole performance" and not "nominal stock index prices", then I rarely get a further response from folks like you.

The reason I don't get response is because exponentionally compounding gold maintenance fees and exponentionally compounding stock dividends are too hard to disprove as big plus for stock portfolio when compared against any gold-related product portfolio.

To be honest, I think that Mish has the neccessary background to grasp those concepts (dividends and maintenance fees) and write a well balanced article on this topic. However, he has never done so. I can only speculate why. Nevertheless, I would like to point out that he HAS connections with folks making money by selling gold related product. Go and Google it.

Also, Mish's Tesla bashing is very flawed and he simply parrots zerohedge narrative that claims that Tesla is going to go bankrupt soon due to negative Free Cash Flow. But he never bothers to ask what is Free Cash Flow in the first place. It is clear that Free Cash Flow looks better for companies that reinvest in CapEx (e.g. Amazon buys warehouse or buys servers for AWS datacenter. Easy to account such things on books). However, Tesla reinvests into more abstract things that are harder to value and may actually count under OpEx (e.g. tell me how much worth is GigaFactory if there is only one out there? How much worth is the Intelectual Property Tesla produces, like software, patents and car production pipeline optimizations? Engineers working on IP count as expense for company)

Tengen
Tengen

He's been around, everyone has read his posts for a while. He parrots MSM talking points. Imagine someone who gets all their news from CNN and then searches online for anyone who dares to disagree with their narrative. That's essentially what he does. The whole point of a site like this is to get away from the dime-a-dozen MSM outlets.

MntGoat
MntGoat

There aren't really a ton of ARM loans in the US mortgage market. I think 98%+ of the people who have bought a home in the US in the last decade have very low rates mostly starting with a 3, 30 year fixed, fully amortizing mortgages. Europe, Canada, NZ, Aus is another story, there are NO 30 yr fixed mortgage loans over there.

MntGoat
MntGoat

I don't think Wagner is a troll. Why is someone who has a different opinion from the herd here at Mish’s site automatically a troll? It’s good, it adds to the debate. Who wants an echo chamber?

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