Financial topics

[Higgenbotham]

H your on target and watch South America and Africa.

I'm still holding just 5 lots from an average of 2612 now (some day trading profit today). We know the rally is fraudulent. However, the crooks are caught and we just have to be patient as we go in for the kill and squeeze the life out of them. I'm still up 55K since the March 13 close. We are seeing estimates for second quarter GDP down 25 to 50 percent and I think you posted one of those.

[Higgenbotham]

I'm going to repost a few snippets that may pertain to the current situation. This is from 2012.

The problem is this isn't the 1920s or 1930s. Whether there was deflation as in the US or hyperinflation as in Weimar, the sole proprietor had nowhere to go and kept his business open with reduced throughputs and lower income. The large corporate retail businesses that exist today don't operate on that model. With reduced thoughputs they lay off and close units. When enough units are closed the fixed overheads are too high to make profit. A sole proprietor can survive a 50% contraction of throughput but a mega corporation can not make a profit at some percentage of contraction and the wealthy owners can be fine with closing the doors because they don't need the business to survive and have no incentive to keep losing money.

My prediction 2 years ago as you quoted was that some of the big box units would get recycled in this manner after a bankruptcy. Since then, a lot of damage has been done to the economy with QE2, etc. My initial reaction is to say it will be impossible to get a reconstitution of big box retail in most or all US metro areas due to the damage inflicted over the past 2 years. More likely is that most US cities will decay and crumble, and most big box structures will be abandoned.

No need I can see to change this view from October 14, 2011. The actions since have made this a certainty. This specifies the effect that mann described, which I would term the inability to reconstitute. The wasting process Bernanke has employed has had 4 effects - depletion of savings to reconstitute, depletion of time to reconstitute due to the aging of the population, depletion of knowledge to reconstitute, and depletion of opportunities to reconstitute as the general economy has become more unsound and unstable.

Also from 2012.

The economy that's been locked into place with "business as usual" and "inflation targeting" is no longer the economy we can afford. That shows up in the fact that banks cannot find business projects to lend on, nor does the overall debt to GDP shrink due to pay downs. Companies like Google and Apple cannot find projects to use their tens of billions of cash that earns zero percent to earn a return on that money. Apple formed Braeburn in Reno, Nevada in 2006 to manage the excess cash. Obama and Bernake have locked a cost structure into place that is too high to earn a return on investment and they insist this will cure the economy. It won't while cash and labor remains idle and government pisses more money down money losing ratholes - big banks and big industrial conglomerates that don't know how to be profitable without bailouts and subsidies.

From 2015.

What I don't think most people see is what aedens summarized as a collapse occurs, "slowly at first then all at once." They see "all at once" as being out in the distant future. If for no other reason than those that have cried "wolf" or "fire" have been wrong for 40 years.

No pandemic occurred.
No nuclear war.
No hyperinflation that destroyed the dollar.
No fuel shortages or stoppages.
No cyber attack that took the Internet down.
No power grid failure or attack and no disruption of communications in general.
No military dictator takeover or civil war in any Western democracy.
No major disruption of transport of people or goods.

etc.

While the periphery breaks down rather slowly at first, the capital cities of the hegemon should collapse suddenly and violently.

a, not many of us have a signature line but if I did this one would be considered.

2011.

Bill Gross has said the same type of thing - that investments should be made in dividend paying staples like Procter and Gamble.

I used to work for a consumer products company in the manufacturing plants (food processing). Generally, this information should be freely available but I can tell you the advertising and other non manufacturing related costs are a larger percentage of the price tag on the shelf than the manufacturing cost itself. The company sold finished product for about $3 per pound, of which overhead was about half, manufacturing cost about 30 percent and profit about 20 percent. The manufacturing cost included all processing and packaging to the point of transport.

Seems to me that in the next great depression entrepreneurs will find ways to bulk manufacture and deliver things like laundry detergents for a fraction of what the large consumer products manufacturers are able to.

I think the problem a lot of these guys like Yastrow and Gross and Bernanke have is they have never manufactured anything and have no concept of how overheads can be shaved to the bone by private entrepreneurs in such a way that publicly traded companies will see none of the profit whatsoever. Given that it wouldn't take much of a reduction in sales (less than 40 percent, I would think) to render a behemoth like Procter and Gamble nonprofitable, I think any investment in even a supposedly safe company like that is extremely risky.

For Procter and Gamble,

Period Ending Jun 30, 2010 (All numbers in thousands)

Total Revenue 78,938,000
Cost of Revenue 37,919,000 (48%)
Selling General and Administrative 24,998,000 (32%)
Operating Income 16,021,000 (20%)

Cost of Revenue (or Cost of Goods Sold) is generally considered to be manufacturing cost.

P&G doesn't have as much overhead and income as the company I worked for (52% vs 70%) but private competitors still have a healthy chunk to go after and consumers have a healthy chunk of potential savings to realize. This company is a sitting duck in my opinion.

[richard5za]

H your on target and watch South America and Africa.

I'm still holding just 5 lots from an average of 2612 now (some day trading profit today). We know the rally is fraudulent. However, the crooks are caught and we just have to be patient as we go in for the kill and squeeze the life out of them. I'm still up 55K since the March 13 close. We are seeing estimates for second quarter GDP down 25 to 50 percent and I think you posted one of those.

I have had another look at S&P 500. Notice the high volume when it went down and the low volume going up. I think its a bear market rally rising on FOMO buyers (fear of missing out) and short squeezes. I reckon it could go as far as 50 dma, just below 2900. Then there will be good money on the shorts. What other views?

[aeden]

The best science already pointed out the effects in large percentages and the actual smart cultures will not even implement it on themselves.
Americans are to damn deceived or soaked in sickening avarice to care. H is trying to strip from a smaller
base as the swap lines pouring in paper assurances. The AI cults have Intel filters to an art form.
We got stone cold Marxists and pushers elating in effect stupid narcissists run the Planet.
The effects are lethal as the middle is annihilated and rendered to what we already knew.

I will dollar cost average into dislocations in zone sweeps.
Book four will opened after the reflation moves to see what survived as we noted.
As we noted they are stripping from a smaller base in the sogo notes.

Highly trained technicians have been denigrated from indolently clear decisions top down.
Change agents immobilized actual thought maps to care.

We know who left us defenseless for some years anyways.

https://oig.hhs.gov/oei/reports/oei-06-20-00300.pdf

Everyone that was thinking seen this around new years and wached then weld the doors closed in China.
No one can be in denial this deep and long can offer an apology sincere enough to the dead and think we are not
aware for many many months.

[vincecate]

I have had another look at S&P 500. Notice the high volume when it went down and the low volume going up. I think its a bear market rally rising on FOMO buyers (fear of missing out) and short squeezes. I reckon it could go as far as 50 dma, just below 2900. Then there will be good money on the shorts. What other views?

If you click "daily increase" in the bottom right of:
https://gisanddata.maps.arcgis.com/apps/opsdash

It looks like the world may have passed the peak. You can also click on individual countries on the left and see that the USA, Italy, Spain, etc seem to have passed the peak. So the ideas of hospitals needing 10 times as many beds as they have seems not to be occurring and investors have some relief. And if the curve went up fast people can imagine it going down fast. There is more and more evidence that anti-malaria and anti-cancer drugs can help against the virus. From this they can think "short V shaped recession" and buy. So the market may go up a bit more.

While I never bought the "3.4% death rate" claim (the data of people so sick they come to a hospital is not a statistically random sample of the population) this is not over yet. Having everyone stay home "flattens the curve". This means that while it went up fast it can take far longer to go down. While it does the USA can loose a million jobs per day. All sorts of businesses will close. All sort of debt won't be paid. This will ripple on and on. The survival instinct of saving money just to be sure you have enough to buy food will kick in. You can get by without that nice new X, Y, or Z. The economy will grind lower and lower.

The other problem is that Africa and India may just be starting. There are things the world needs from these places like raw materials and medicine. I think these places will get it bad. We rich places can buy a bunch of food and mostly stay in our homes for a long time, going out very little, but I don't think isolation will work so well in poor places. But if your supply chain starts with raw materials from Africa and Africa is shut down then China and the West can still have supply problems.

After previous decades of the Fed making easy money (I think 1920s but there are plenty of examples) people take on too much debt, then things go bad. I think sometime in the next month or two when people realize the virus recovery curve is not nearly as fast as the initial infection curve was and the extent of the debt problems and company closings and job loss becomes more clear the market will go much lower. As Peter Schiff says, the virus is the pin popping the everything bubble. Our problems do not go away even after virus is gone.

Also, at some point I expect there to be inflation. We may be seeing some in food already at the local store. If people see inflation then their faith in the power of the Federal Reserve will be shaken. Then things will crash for sure.

Anyway, I am thinking to buy more S&P puts today or if we go higher. I sold like 10% of mine when they were much higher priced than now.

[aeden]

May WTI +12% to $28.36/bbl; June Brent +8.5% to $35.79/bbl.
The reported deal comes as a virtual meeting between OPEC and its allies kicked off.

It’s unclear whether the tentative deal is contingent on the U.S. also committing to curbs at talks on Friday. An agreement from OPEC+ and a broader alliance -- including America -- is crucial to reviving prices that have sunk to an 18-year low. Not only oil companies, but entire oil-dependent economies need the market to rebound if they’re to balance ailing budgets.

We are going to be good and yes the light never left.

https://www.youtube.com/watch?v=CIHWaaJNktQ no accidents exist so no need to date it here either anymore.

1912
I have a clear memory of the newspapers as they were that morning. I had a sheaf of them, for it is my melancholy business to know what each is saying. I learned there were dark and portentous matters, not actually with us, but looming, each already rather larger than a man's hand. If certain things happened, said one half the papers, ruin stared us in the face. If those thing did not happen, said the other half, ruin stared us in the face. No way appeared out of it. You paid your half-penny and were damned either way. If you paid a penny you got more for your money. Boding gloom, full-orbed, could be had for that. There was your extra value for you. I looked round at my fellow passengers, all reading the same papers, and all, it could be reasonably presumed, with foreknowledge of catastrophe. They were indifferent, every one of them. I suppose we have learned, with some bitterness, that nothing ever happens but private failure and tragedy, unregarded by our fellows except with pity. The blare of the political megaphones, and the sustained panic of the party tom-toms, have a message for us, we may suppose. We may be sure the noise means something.

[aeden]

While 71 percent of Republicans responded that China should pay other countries in some way for the damage done because of the outbreak, only 41 percent of Democrats felt that way.

https://www.zerohedge.com/geopolitical/ ... an-bio-lab

https://www.thelancet.com/journals/lanc ... 7/fulltext

https://www.youtube.com/watch?time_cont ... e=emb_logo

https://www.zerohedge.com/markets/free- ... -junk-etfs

Step 1 done, Office has taken over the fed, next step is to take us back to constitutional money some contend,
then pay off the debt using worthless *** bucks at 0% interest since SOE is gamed at levels you will see much l8ter.

That's what winning looks like for you sick ignorant liberals.

REIT stocks last monday and they're all exploding right now. They're priced at 20 cents on the dollar right now... tyler

logically it's the dumbest trade ever but when you see how the crybabies are crying for a bailout, those guys will get billions and billions for sure.

https://www.zerohedge.com/markets/stock ... -know-them

https://www.youtube.com/watch?v=uqUa_G1h3pw

thread: l8ter, sogo, salem, venn, koo, pareto effect, matthew 13

[Higgenbotham]

H your on target and watch South America and Africa.

I'm still holding just 5 lots from an average of 2612 now (some day trading profit today). We know the rally is fraudulent. However, the crooks are caught and we just have to be patient as we go in for the kill and squeeze the life out of them. I'm still up 55K since the March 13 close. We are seeing estimates for second quarter GDP down 25 to 50 percent and I think you posted one of those.

I haven't increased to more than 5 lots yet, but may soon.

The past 2 days I have bided my time by doing some regular bot smashing. That brought my break even up to 2624 on the 5. Of course, adding up here will bring it up a lot more.

[aeden]

04/09/20 Sold 237.59
04/09/20 Sold 2.39
04/09/20 Sold 1,783.24
04/09/20 Sold 2,706.43
04/09/20 Sold 4,809.07
04/09/20 Sold 1.63
04/09/20 Sold 6,156.36
04/09/20 Sold 399.48
04/09/20 Sold 826.33

And if a bunch of hedge funds get wiped out - what's the big deal? Let them fail.
So they don't get the summer in the Hamptons - who cares.
https://www.zerohedge.com/markets/let-t ... out-people

In fact, sometimes CNBC's hosts seem downright confused when people don't seem to care about asset prices above all else - like that time Rick Santelli said we should all just go get infected and let grandma die to save the stock market. What's more, Wapner seemed almost personally insulted by Palihapitiya's response.

I will sweep brazil and turkey tomorrow.
Sold cig and veon and some oil into bear rally.
Reflation trade is beast on meth.
Book four into the window - raising cash

This is my fourth bear market. These poor bastards will never know what hit them.
And this is how the inflation starts.

Energy and food.

The avarice and moral hazard is astounding to witness.

https://www.youtube.com/watch?v=61jfm219ArA

[aeden]

https://www.youtube.com/watch?v=JIFksZhRZDU

https://www.zerohedge.com/s3/files/inli ... k=Rbay6tNI

The corn people froze and coal people starved.
Mom was so poor these damn fools cannot even pretend to comprehend it.