Generational theory, international history and current events
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Higgenbotham wrote:
Higgenbotham wrote:Question in my mind is if the pundits quoted above regarding the yield curve are wrong. My guess is yes, because the train is approaching faster than it would be before a typical recession because what is coming is a category 6 shitstorm, not a recession. I think the ratio of FAGIX to VUSTX shows that.
The CDC birth rate statistics were updated here on June 5:Higgenbotham wrote:All recent posts aside, these are my big picture items indicating a bear market is possible:
Primarily:
Decline in birth rates similar to what preceded 1929 and 1966 tops.
FAGIX VUSTX ratio indicates lack of confidence similar to 2007 onset of stock market decline.
During and after the last crisis, there was a lot of discussion about liquidity versus solvency. Based on the number of zombie companies and poor corporate credit, this crisis is going to be about solvency. While this isn't measurable and comparable as far as pinpointing the approximate place for a stock market top, as the items quoted above are, it definitely is another big picture item to take into consideration.
And these items are all things the Fed can't control. They can control liquidity, but not birthrates, credit spreads, or solvency.
Higgenbotham wrote:https://www.cdc.gov/nchs/data/vsrr/vsrr-007-508.pdfResults—The provisional number of births for the United States in 2018 was 3,788,235, down 2% from 2017 and the lowest number of births in 32 years. The general fertility rate was 59.0 births per 1,000 women aged 15–44, down 2% from 2017 and another record low for the United States. The total fertility rate declined 2% to 1,728.0 births per 1,000 women in 2018, another record low for the nation. Birth rates declined for nearly all age groups of women under 35, but rose for women in their late 30s and early 40s.
It seems so...I’m here to tell you that the inevitable became reality in 2008. We’ve had an interlude over the last few years financed by trillions of new currency units.
However, the economic clock on the wall is reading the same time as it was in 2007...
I call them the 97th percentile.But the Deep State is much broader than just the government. It includes the heads of major corporations, all of whom are heavily involved in selling to the State and enabling it. That absolutely includes Silicon Valley, although those guys at least have a sense of humor, evidenced by their “Don’t Be Evil” motto. It also includes all the top people in the Fed, and the heads of all the major banks, brokers, and insurers. Add the presidents and many professors at top universities, which act as Deep State recruiting centers… all the top media figures, of course… and many regulars at things like Bohemian Grove and the Council on Foreign Relations. They epitomize the status quo, held together by power, money, and propaganda.
Altogether, I’ll guess these people number a thousand or so. You might analogize the structure of the Deep State with a huge pack of dogs. The people I’ve just described are the top dogs.
But there are hundreds of thousands more who aren’t at the nexus, but who directly depend on them, have considerable clout, and support the Deep State because it supports them. This includes many of the wealthy, especially those who got that way thanks to their State connections… the 1.5 million people who have top secret clearances (that’s a shocking, but accurate, number)… plus top players in organized crime, especially the illegal drug business, little of which would exist without the State. Plus mid-level types in the police and military, corporations, and non-governmental organizations.
These are what you might call the running dogs.
In many ways, Washington models itself after another city with a Deep State, ancient Rome. Here’s how a Victorian freethinker, Winwood Reade, accurately described it:
Rome lived upon its principal till ruin stared it in the face. Industry is the only true source of wealth, and there was no industry in Rome. By day the Ostia road was crowded with carts and muleteers, carrying to the great city the silks and spices of the East, the marble of Asia Minor, the timber of the Atlas, the grain of Africa and Egypt; and the carts brought out nothing but loads of dung. That was their return cargo.
"While the periphery breaks down rather slowly at first, the capital cities of the hegemon should collapse suddenly and violently."The American Deep State rotates around the Washington Beltway. It imports America’s wealth as tax revenue. A lot of that wealth is consumed there by useless mouths. And then, it exports things that reinforce the Deep State, including wars, fiat currency, and destructive policies. This is unsustainable simply because nothing of value comes out of the city.
Higgenbotham wrote:Previous posts from March, then the updated chart below.
Higgenbotham wrote:Higgenbotham wrote:Question in my mind is if the pundits quoted above regarding the yield curve are wrong. My guess is yes, because the train is approaching faster than it would be before a typical recession because what is coming is a category 6 shitstorm, not a recession. I think the ratio of FAGIX to VUSTX shows that.The CDC birth rate statistics were updated here on June 5:Higgenbotham wrote:All recent posts aside, these are my big picture items indicating a bear market is possible:
Primarily:
Decline in birth rates similar to what preceded 1929 and 1966 tops.
FAGIX VUSTX ratio indicates lack of confidence similar to 2007 onset of stock market decline.
During and after the last crisis, there was a lot of discussion about liquidity versus solvency. Based on the number of zombie companies and poor corporate credit, this crisis is going to be about solvency. While this isn't measurable and comparable as far as pinpointing the approximate place for a stock market top, as the items quoted above are, it definitely is another big picture item to take into consideration.
And these items are all things the Fed can't control. They can control liquidity, but not birthrates, credit spreads, or solvency.
Higgenbotham wrote:https://www.cdc.gov/nchs/data/vsrr/vsrr-007-508.pdfResults—The provisional number of births for the United States in 2018 was 3,788,235, down 2% from 2017 and the lowest number of births in 32 years. The general fertility rate was 59.0 births per 1,000 women aged 15–44, down 2% from 2017 and another record low for the United States. The total fertility rate declined 2% to 1,728.0 births per 1,000 women in 2018, another record low for the nation. Birth rates declined for nearly all age groups of women under 35, but rose for women in their late 30s and early 40s.
The FAGIX VUSTX ratio looks to be about the same position it was in December 2007 when the economy was already determined to be in recession (some months after the fact of course) and the stock market had already rolled over from the October 2007 high.
The 2018 provisional number of births in the US are down a bit over 12% from the 2007 high. The birth numbers also fell a bit over 12% from 1921 to 1928 (a year before the 1929 crash).
It's one measure of investor propensity to indiscriminately gamble. When the ratio is up investors are showing a preference to buy junk debt over safe treasuries and vice versa when the ratio is down. It tends to lead the stock market. For example, you can also see it led the 2009 stock market bottom.John wrote:What's the significance of the FAGIX VUSTX ratio?
