Financial topics

[Higgenbotham]

Other valuation measures I've run across lately.

Sven Henrich has been discussing total market cap to GDP. He said in a recent video that the market seems to run into trouble at 144% and that has turned it back a couple times. This week he noted the market is now at 146.5% of GDP.

Another valuation measure I've seen that is sort of similar to the above is a trendline on the NYA that shows the market is reaching limits right here. The market has been above this trendline (like in January 2018) but over the past few months it has only been able to test the trendline from underneath.

[Higgenbotham]

I remain steadfast in my belief that we are looking at a total civilizational collapse and that the stock market averages will go to zero (cease to exist). My idea of mean reversion in that sense is there has been a stock market that supports stock market averages for only the last 140 years, and that the mean reversion will be to zero (no stock market that supports stock market averages).

My more specific predictions would be:

• There will be a major global financial panic and crisis. Supply chains will break, resulting in unavailability of critical raw materials and components. Global trade will begin to shut down. As it begins to become apparent that the supply chain linkages are permanently broken, the global interlinked financial markets will shut down and cease to exist. This will all happen very quickly. It will not take years from the initial panic.
• The focus of governments will turn to controlling their panicked and hungry populations. Due to lack of availability of imported goods and adequate storage "sufficient to reconstitute" a system consistent with nation state government, this will prove to be too little too late and most government will devolve to the local level as populations lose faith in their national governments and the national governments lose the resources and ability to control their populations.
• There will be no large scale nuclear war. Instead, the population will be culled through starvation, local strife (including settling of long-standing scores) and disease. Wave after wave of pandemics will sweep the world.
• Similar to national economies and governments, centralized utilities will fail or become so decrepit as to be unsafe and unusable. All centralized utilities including the power grid will shut down permanently.
• The initial worldwide kill rate during the first couple decades following the financial panic will exceed 90%. The global population will be in the range of a few tens of millions when the bottom is hit in two or three centuries. Similar to the last dark age, the world's largest cities will have a population on the order of 25,000 and a large town will be 1,000.
• Life during the coming dark age will be similar to the last dark age but worse due to environmental damage and pollution.

[aeden]

https://cyber.harvard.edu/bridge/Critic ... tical4.htm These people will never enter reality but they will hire another poison midget to take whatever they want until cold stopped. What these village idiots and pillow biters wish to ignore is we are all people of color. As it was put bluntly the wall went down to re-shoe the horses. Its not the only code the educated ignore. Regional issues is the same stick that stirs the gruel for the trip the Hell they have chosen for regional reorder cults. As we know here with even the Kadesh files what and who they still have not cleaned up. The only issues outstanding is the body farm political forensic entomology results. Parsing antonyms as you know H is a poor business plan with a number of analyst also seen as nonfan.

[Higgenbotham]

These two headlines hit on Friday:

Atlanta Fed GDPNow estimate falls to 0.3% from 1% last week
New York Fed Nowcast estimate for 4Q GDP growth down to 0.4% annualized

On Friday, the S&P 500 index closed a record high, up 0.95% from a previous record high close (on Thursday). The S&P 500 index was up more in one day than the entire yearly GDP growth forecast by two regional Fed offices. And that's at an already record market cap to GDP percentage.

[aeden]

You touched on a very important point as did t on the repo carry seen and the alleged unwind which trended as Dr. Koo's balance sheet recession early. At this point in time it will only confuse them. The repo pivot assured risk off until December and we seen the actual values populated into April.
Murder the bots and study the ai scalars for know. Good hunting H.
Emptor.

[Higgenbotham]

The Atlanta Fed in their own words:

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2019 is 0.3 percent on November 15, down from 1.0 percent on November 8. After this morning's retail trade releases from the U.S. Census Bureau, and this morning's industrial production report from the Federal Reserve Board of Governors, the nowcasts of fourth-quarter real personal consumption expenditures growth and fourth-quarter real gross private domestic investment growth decreased from 2.1 percent and -2.3 percent, respectively, to 1.7 percent and -4.4 percent, respectively.

And the New York Fed in their own words:

Nov 15, 2019: New York Fed Staff Nowcast

The New York Fed Staff Nowcast stands at 0.4% for 2019:Q4.
News from this week's data releases decreased the nowcast for 2019:Q4 by 0.3 percentage point.
Negative surprises from capacity utilization and industrial production data drove most of the decrease.

[Higgenbotham]

And that's at an already record market cap to GDP percentage.

Actually, this is wrong. Total market cap to GDP was higher in 2000 and in January 2018. Wilshire 5000 to GDP is higher than it was in 2000, which probably explains in part why Buffett was recently reported to have $128 billion in cash.

[Higgenbotham]

There's a lot of talk about the yield curve and this thing and that thing as far as trying to pinpoint a market top. But something that's overlooked is the Dow Gold Ratio, and I feel that's as good as anything out there:

https://www.macrotrends.net/1378/dow-to ... ical-chart

The Dow Gold Ratio peaked in August 1999, October 2006, and September 2018. In the first two instances, stocks peaked about a year later, or we may say more accurately that the downside didn't start in earnest until about a year later.

I think the fundamental reason this ratio works is that the Dow Gold Ratio tells where the fundamental limits lie and after that the Fed can manipulate the cycle about a year longer to get nominal asset prices higher while real asset prices are actually falling relative to gold.

[aeden]

Neither Trump or Powell have any control over the timing anymore.
Putin gave your last and only warning, nice of him but I'd already worked it out by myself.
I'd wish you a Happy New Year, but its very doubtful it will.
The Russian SWF has already divested its USDs, not next year as announced, the Chinese
are dumping USDs. Win

Logic would suggest half of the herd dies and our average crops will go to actually vested interests.
At least Nancy and Schumer are not selling political prisoners organs for party member unless we missed that
unlike the good cops we know from the dna gulag banks.

I have no idea why these Marxist propaganda narrative outlet banks even think we pretend we care.

meanwhile

https://www.aier.org/article/while-you- ... passports/
Beginning no later than October 1, 2020, citizens of all US states and territories will be required to have a Real ID compliant card or US passport to board a commercial plane or enter a Federal government facility. Pundits citing the inevitability of what amounts to a national ID card have, regrettably, been vindicated.

Uniparty cult.

[aeden]

Finally, in what appears to be an effort to placate folks who remember the results of the 1986 IRCA amnesty, the sponsors of H.R. 4916 threw in mandatory use of E-Verify to ensure that new hires are authorized to work in the United States—but ONLY for agricultural employers! The bill includes no provisions to reduce the flow of illegal immigration into the United States, but it does ensure that they won’t be employed in agriculture. Instead, they will be competing with Americans and legal immigrants for jobs with unscrupulous employers in other industries where E-Verify use is not required.