Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Faber's macro commentaries make sense (and I agree w/some of them), but he's been calling for a catastrophic drop for so long (YEARS!) that people now dismiss him as a perma-bear whenever he's quoted/interviewed in the financial media and/or tells people to adjust their allocations.
But, like most pundits, despite "being wrong" for YEARS when The Big One(tm) does come, whenever it comes, I'm sure he'll be right out there saying he-told-us-so.
Frankly I think the 'generational buying opportunity' was not 2008-09, but will occur at the bottom of the NEXT global market crash ... which I agree w/Faber will happen in the forseeable future. I remain ready to pounce, but am also quite comfortably positioned in the markets and will remain there for a looooong time to come.
I like Faber and find him highly amusing (who else has responded to the question on CNBC of how you should allocate assets with "it depends on how many girlfriends you have"?)
I hope that there is not another 2008.
That said, this is my honest view:
That if it looks like we may be heading in that direction, the Fed will bail out Radio Shack (after the fact), Shake Shack and even Shaq.
They will try every voodoo economic BS tactic left. You will see QE4, you will see NIRP. Heck, a ban on physical cash so that no one can escape NIRP wouldn't surprise me. Every trick in the book will be used - you think that what's going on in Shanghai in terms of banning short selling and other "rules" can't be put into place here, at least to some degree?
They will bail out, print and nationalize like there's no tomorrow - if it comes to that, because the alternative if we have another 2008 and go back to square one is this:
All of the attitude by the Fed of "don't audit us, don't question us and no we aren't going to respond to an investigation about the Fed leaking information" will be ignored in a bleeping hurry.
If we have had QE1, 2 and 3 and operation twist and all other manner of financial engineering BS and we find ourselves back at square one after another 2008-style situation, Janet and company will have a lot of 'splaining to do (and they don't seem fond of that) because the anger will be immense and Congress will ab-so-lutely point the finger at them.
You think people were mad at Wall Street after 2008? LOL, at the very least twice as bad if it happens again.
If we have another 2008, in some ways it'll be game over. There will be tumbleweeds hosting CNBC because no one will be watching. The rejection of stocks by the public will be extraordinary - you're not going to get anyone back in and probably for years. The Fed will be too busy in hearings to do much. Attempts to push the public back into risk assets after that will be likely met with legitimate anger (or at least a collective middle finger.)
So yeah, I believe that there is a sense of "reflate or bust" desperation with governments around the world who don't want another 2008 because of all of the many things that would imply.
Perhaps I'll be wrong but I continue to fear that this time around if there's a crisis you will want to own assets instead of sitting in cash or bonds.
We'll see.
---
Someone posted this at ZH in the comments section years ago and I don't disagree with the gist of it, although I'm not as negative and think the how/why (I don't think they'd print like there's no tomorrow because this is the end, but because they believe another 2008 would be some degree of "game over") is different. I don't think another 2008 would be "the end", but I perhaps can see where it would be the end of the global economy as we know it today. Perhaps this is "the ultimate bubble" for use of a better term and what we look like as a global economy on the other side of it will be very different.
"Hope you didn't put much money on that bet, Dawg. These fuckers are going to print hard enough to wake the dead. They'll print like mo'fos, print like mad men, print like fly pimps. Print until their eyes bleed.
They will print via the swaps, via bank bailouts and mergers, via fixed Treasury yields, via real honest-to-God negative interest rates, via loans to banks on no collateral, via payroll tax reductions, and in the end via actual fiat paper instruments which they might very well drop in bails from actual mutherfucking helicopters.
They will not give two figs what anyone thinks.
Here is why.
Because this is the Goddamned end of it my friend. There is no accounting beyond this point. There will be no history of it. No one to take notes of rates of exchange, or of the graft and violence, nobody to worry about the deficit or the GDP or the national debt of any nation large or small under the blazing Goddamned sun.
End. Of. It. Does anyone bitch about how Rome totally debased their coinage at the end? Hell no. But whoever did it had enough to hand and grabbed some land with a nice vineyard and sat back and waited for the Middle Ages to start 700 years further on.
And that's what a singularity is about. Anything that passes through is striped of all meaning. Nothing we think is important now will remain so beyond the event horizon. Nobody will remember, nobody will write about it, nobody will be held to any standard. Ever for ever."
Hi @scott 'Course, I'm being a smart butt. Do I have to provide data for my prediction? If I am only able to predict based upon my intuition, then anyone will just have to take my word for my feelings.
Hi @scott 'Course, I'm being a smart butt. Do I have to provide data for my prediction? If I am only able to predict based upon my intuition, then anyone will just have to take my word for my feelings.
"There is no accounting beyond this point." Actually, "this point" was the tulip Mania bubble in 1636. Everything since then is just the wind-down, which will itself go on for a while longer. Folks just haven't realized it yet, but they will, any time now.
Comments
Faber's macro commentaries make sense (and I agree w/some of them), but he's been calling for a catastrophic drop for so long (YEARS!) that people now dismiss him as a perma-bear whenever he's quoted/interviewed in the financial media and/or tells people to adjust their allocations.
But, like most pundits, despite "being wrong" for YEARS when The Big One(tm) does come, whenever it comes, I'm sure he'll be right out there saying he-told-us-so.
Frankly I think the 'generational buying opportunity' was not 2008-09, but will occur at the bottom of the NEXT global market crash ... which I agree w/Faber will happen in the forseeable future. I remain ready to pounce, but am also quite comfortably positioned in the markets and will remain there for a looooong time to come.
I hope that there is not another 2008.
That said, this is my honest view:
That if it looks like we may be heading in that direction, the Fed will bail out Radio Shack (after the fact), Shake Shack and even Shaq.
They will try every voodoo economic BS tactic left. You will see QE4, you will see NIRP. Heck, a ban on physical cash so that no one can escape NIRP wouldn't surprise me. Every trick in the book will be used - you think that what's going on in Shanghai in terms of banning short selling and other "rules" can't be put into place here, at least to some degree?
They will bail out, print and nationalize like there's no tomorrow - if it comes to that, because the alternative if we have another 2008 and go back to square one is this:
All of the attitude by the Fed of "don't audit us, don't question us and no we aren't going to respond to an investigation about the Fed leaking information" will be ignored in a bleeping hurry.
If we have had QE1, 2 and 3 and operation twist and all other manner of financial engineering BS and we find ourselves back at square one after another 2008-style situation, Janet and company will have a lot of 'splaining to do (and they don't seem fond of that) because the anger will be immense and Congress will ab-so-lutely point the finger at them.
You think people were mad at Wall Street after 2008? LOL, at the very least twice as bad if it happens again.
If we have another 2008, in some ways it'll be game over. There will be tumbleweeds hosting CNBC because no one will be watching. The rejection of stocks by the public will be extraordinary - you're not going to get anyone back in and probably for years. The Fed will be too busy in hearings to do much. Attempts to push the public back into risk assets after that will be likely met with legitimate anger (or at least a collective middle finger.)
So yeah, I believe that there is a sense of "reflate or bust" desperation with governments around the world who don't want another 2008 because of all of the many things that would imply.
Perhaps I'll be wrong but I continue to fear that this time around if there's a crisis you will want to own assets instead of sitting in cash or bonds.
We'll see.
---
Someone posted this at ZH in the comments section years ago and I don't disagree with the gist of it, although I'm not as negative and think the how/why (I don't think they'd print like there's no tomorrow because this is the end, but because they believe another 2008 would be some degree of "game over") is different. I don't think another 2008 would be "the end", but I perhaps can see where it would be the end of the global economy as we know it today. Perhaps this is "the ultimate bubble" for use of a better term and what we look like as a global economy on the other side of it will be very different.
"Hope you didn't put much money on that bet, Dawg. These fuckers are going to print hard enough to wake the dead. They'll print like mo'fos, print like mad men, print like fly pimps. Print until their eyes bleed.
They will print via the swaps, via bank bailouts and mergers, via fixed Treasury yields, via real honest-to-God negative interest rates, via loans to banks on no collateral, via payroll tax reductions, and in the end via actual fiat paper instruments which they might very well drop in bails from actual mutherfucking helicopters.
They will not give two figs what anyone thinks.
Here is why.
Because this is the Goddamned end of it my friend. There is no accounting beyond this point. There will be no history of it. No one to take notes of rates of exchange, or of the graft and violence, nobody to worry about the deficit or the GDP or the national debt of any nation large or small under the blazing Goddamned sun.
End. Of. It. Does anyone bitch about how Rome totally debased their coinage at the end? Hell no. But whoever did it had enough to hand and grabbed some land with a nice vineyard and sat back and waited for the Middle Ages to start 700 years further on.
And that's what a singularity is about. Anything that passes through is striped of all meaning. Nothing we think is important now will remain so beyond the event horizon. Nobody will remember, nobody will write about it, nobody will be held to any standard. Ever for ever."
'Course, I'm being a smart butt. Do I have to provide data for my prediction?
If I am only able to predict based upon my intuition, then anyone will just have to take my word for my feelings.
It seems with a title like that, you're always going to be expecting bad things to happen.
Of course, a broken clock is right twice a day, so he could quite possibly be right this time.