okaycuckoo Posted March 17, 2012 Share Posted March 17, 2012 You have or I should? Sadly due to the insistance of the FT lawyers I am unable to quote him. But to paraphrase (hopefully with a modicum of accuracy) primarily debt hasn't been 'created' but transferred from the private to public sector, as the 'system' is designed to do in such circumstances. In other words the 'more debt' position doesn't obtain. If it were to his response is 'perhaps'. Hardly equivocal. If I'm missing your point please clarify........cheers! Yes, that is the point. He doesn't argue that the proposition is fallacious, but that the assumption that more debt is being created to solve a debt crisis is false. Unequivocal. Cheers! Quote Link to comment Share on other sites More sharing options...
R K Posted March 18, 2012 Share Posted March 18, 2012 Yes, that is the point. He doesn't argue that the proposition is fallacious, but that the assumption that more debt is being created to solve a debt crisis is false. Unequivocal. Cheers! Those claiming there is more debt are incorrect. Thus, the assertion is fallacious and fictitious. If my aunt had a d1ck she'd be my uncle and so on........ If there were to be more debt he appears to be equivocal on the claim you can't solve a debt crisis with more debt. Quote Link to comment Share on other sites More sharing options...
R K Posted March 18, 2012 Share Posted March 18, 2012 [/url] Nouriel Roubini @Nouriel Like Premier Wen, Li Keqiang says that China's growth is unbalanced uncoordinated unstable. Need for rebalancing as in 12th 5yr Plan goals Nouriel Roubinihttps://twitter.com/#%21/Nouriel' rel="external nofollow"> https://twitter.com/#%21/Nouriel' rel="external nofollow">@https://twitter.com/#%21/Nouriel' rel="external nofollow">Nouriel https://twitter.com/#%21/Nouriel' rel="external nofollow">https://twitter.com/#%21/Nouriel' rel="external nofollow"> China's goals are according to Li Keqiang: 1. Increase domestic demand/consumption; 2. Innovation-based growth based on human capital https://twitter.com/#%21/Nouriel' rel="external nofollow"> Nouriel Roubini @NourielChina's goals are according to Li Keqiang: 3. Continue reforms that open up China (taxation, SOEs pricing, income distribution, FDI, trade) https://twitter.com/#%21/Nouriel' rel="external nofollow"> https://twitter.com/#%21/Nouriel' rel="external nofollow">What's the Chinese equivalent of motherhood and apple pie? https://twitter.com/#%21/Nouriel' rel="external nofollow">https://twitter.com/#%21/Nouriel' rel="external nofollow">#Simples https://twitter.com/#%21/Nouriel' rel="external nofollow"> Quote Link to comment Share on other sites More sharing options...
R K Posted March 18, 2012 Share Posted March 18, 2012 Lagarde's speech to China Dev forum, Beijing http://www.imf.org/external/np/speeches/2012/031812.htm snip.... So, what are the policy priorities needed to propel China forward on this journey? Let me talk about three key dimensions. The first is to boost household incomes and promote inclusiveness.We know that more equal societies are able to achieve greater economic stability and lasting growth. This challenge is by no means unique to China. (Are you reading Osborne) But the policies to get there must be uniquely home-grown and customized to the local context.China has made spectacular progress in reducing poverty. But, for years, the income of ordinary Chinese people—albeit fast growing—has made up a smaller and smaller piece of the pie. Household disposable income has fallen as share of GDP from 65 percent in 2000 to less than 60 percent in 2010.The government is well on track to tackle this issue, already taking steps to expand social safety nets, and allocate more resources to pensions, healthcare and education. Poverty has fallen and rural development is clearly a priority. Yet, inequality is not something that can be rectified overnight. This is a marathon that will require continued action for years to come. The second priority is to prepare for the coming demographic challenge.We have seen through the experiences of many advanced economies, just how costly an aging population can be when the changing needs are left unaddressed.China’s demographic shift may be several years away, but it should heed this experience. The coming changes are so large that it would be wise to begin preparations today. The share of working age population will start to decline 4-5 years from now, and could fall by 10 percent over just the following 20 years. This will require sweeping changes. Efforts to strengthen healthcare and pension systems will be a key factor.Equally important will be efforts to enhance productivity and innovation to help prepare for the time when the labor force finally begins to shrink. The government can help lay the foundations by improving labor mobility and investing in human capital, for example, through better education and equal benefits for migrant workers.And actions to increase competition—particularly in the service sector—will also help the private sector play a role, including in creating more jobs. The third, and final, priority is financial reform.The ultimate goal should be to ensure that China’s financial system works to support, not destabilize, growth. It should be open and innovative. It should ensure that everyone has access to credit to help boost consumption, support smaller enterprises, and create jobs. Risks must be scrutinized and managed, so as not to threaten financial stability.I cannot do justice here to the gamut of financial reforms needed to underpin this transformation of China’s financial system.So let me sketch out the core elements of a broad roadmap: a stronger and more flexible exchange rate; more effective liquidity and monetary management; high quality supervision and regulation; more well developed financial markets and products; flexible deposit and lending rates, and finally opening up the capital account.Against this backdrop, I see no reason for the renminbi not to reach the status of an international reserve currency () and occupy a position on par with China’s economic size. Quote Link to comment Share on other sites More sharing options...
R K Posted March 18, 2012 Share Posted March 18, 2012 I love it - the head of the imf lecturing the Chinese communists on the need for greater equality. Yep, and quoting Napoleon Some 200 years ago, Napoleon Bonaparte said, “China is like a sleeping giant. And when she awakes, she shall astonish the world.” French are always good for a laugh Quote Link to comment Share on other sites More sharing options...
R K Posted March 18, 2012 Share Posted March 18, 2012 Obama better for private sector jobs than Bush Bush better for government sector jobs than Obama http://www.calculatedriskblog.com/2012/03/public-and-private-sector-payroll-jobs.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+CalculatedRisk+%28Calculated+Risk%29&m=1 Quote Link to comment Share on other sites More sharing options...
Democorruptcy Posted March 19, 2012 Share Posted March 19, 2012 An observation:- AAPL looks to have entered bubblicious territory. That ought to be a concern given its market cap and inclusion in the big indeces. In fact it's starting to look quite similar to the gold and silver bubbles blow offs of 2011......... (Linear chart to highlight the point) http://stockcharts.com/h-sc/ui?s=AAPL&p=D&yr=3&mn=0&dy=0&id=p86175554290 There's a nice lady on the telly now interviewing a nice man and he is predicting SEVEN HUNDRED AND FIFTY US DOLLARS for an Apple share. Quote Link to comment Share on other sites More sharing options...
Democorruptcy Posted March 19, 2012 Share Posted March 19, 2012 An observation:- AAPL looks to have entered bubblicious territory. That ought to be a concern given its market cap and inclusion in the big indeces. In fact it's starting to look quite similar to the gold and silver bubbles blow offs of 2011......... (Linear chart to highlight the point) http://stockcharts.com/h-sc/ui?s=AAPL&p=D&yr=3&mn=0&dy=0&id=p86175554290 Just seen another nice lady on the telly and she said this Apple dividend is 2108% more than the last dividend they paid. It seems that all the nice people on the telly want their viewers to buy Apple. If I have my shoes shined this week I'll report back if the boy tips Apple. Quote Link to comment Share on other sites More sharing options...
R K Posted March 19, 2012 Share Posted March 19, 2012 (edited) Just seen another nice lady on the telly and she said this Apple dividend is 2108% more than the last dividend they paid. It seems that all the nice people on the telly want their viewers to buy Apple. If I have my shoes shined this week I'll report back if the boy tips Apple. It's different this time etc etc........... Perhaps it'll end in a permanently high plateau It's a shame this gold bubble chart from 76-80 doesn't show the completion of the bubble a couple of weeks later in Jan '80, but still it shares the typical bubble characteristics and average timescale. AAPL shares the same initial sell off in to the March '09 lows, and we're now into year 3+ with an even greater multiple. It may blow off for another month or two, who knows, but the observation remains the same. Edited March 19, 2012 by Red Knight Quote Link to comment Share on other sites More sharing options...
R K Posted March 19, 2012 Share Posted March 19, 2012 I'm not even sure how a spread betting company can actually go bust....legally: http://ftalphaville....ly-way-smaller/ EDIT: Ahhh. More here: http://www.ft.com/cm...l#axzz1pSUxAppm Must have been one helluva St. Paddy's Day party. Ireland does seem to be a little careless with its accounting practices doesn't it. Quote Link to comment Share on other sites More sharing options...
R K Posted March 19, 2012 Share Posted March 19, 2012 Rebecca Wilder on house price to rent ratios http://www.economonitor.com/rebeccawilder/2012/03/19/housing-bubbles-less-frothy-but-europe-is-behind/ Spanning the years 2005 to Q4 2011 and indexed to 1997 Q1, home values peaked at roughly 1.7 times rent in the US, 1.8 times rent in Spain, and north of 2 time rent in Ireland and the UK. Since the peak, though, US home values have fallen to 1.0 times rent - a considerable reduction in asset prices toward fundamental value. In contrast, home values in Spain, the UK, and Ireland remain quite elevated to rents, 1.3 times, 1.6 times, and 1.4 times, respectively in Q4 2011. If 1.0 is deemed equilibrium, either home values in Spain, the UK, and Ireland must fall further and/or rents rise to normalize home values. That’s a tall order: rising rental values amid defficient and contracting domestic demand in Spain and possibly Ireland. The UK has more of a fighting chance, given its relatively easy monetary policy, compared to Ireland and Spain, where more accommodative monetary policy is very lagged amid fiscal contraction. Without growth, though, default is probably the only answer left to normalize housing markets in Spain and Ireland. (Posted on charts thread too) Quote Link to comment Share on other sites More sharing options...
R K Posted March 21, 2012 Share Posted March 21, 2012 (edited) A longer view (real price with regression) If we follow the 34 degree bear slope line to the -50% green variance line, we arrive at a very conservative end point for the current bear in 2022 - 2023 with the S&P at approximately 540. That, I wish to emphasize, is the conservative scenario. A more mathematically realistic scenario is illustrated in Figure 4. Here, a blue variance line has been added at the -65% level, below the green -50% line. This would take the end of the secular bear out to 2025 - 2026 at S&P 450. http://advisorperspectives.com/dshort//guest/John-Carlucci-120110-The-Great-Repression-Update.php and the San Fran FED demographic p/e model and paper http://www.frbsf.org/publications/economics/letter/2011/el2011-26.html Edited March 21, 2012 by Red Knight Quote Link to comment Share on other sites More sharing options...
okaycuckoo Posted March 22, 2012 Share Posted March 22, 2012 http://blogs.stockch...k-high-xly.html "New highs in this sector SPDR suggest strong consumer spending ahead." LOL = laugh out loud (source: urban squictionary). Quote Link to comment Share on other sites More sharing options...
Democorruptcy Posted March 22, 2012 Share Posted March 22, 2012 It's different this time etc etc........... Perhaps it'll end in a permanently high plateau One of the business channels had the Apple anti-christ on yesterday. He said if the price gets to $650 that would mean it has 5% of the S&P. At 5% lots of forced sellers would emerge because investment firms cannot hold shares in something that has more than 5%. Don't know if it is true or not but the nice people pushing Apple didn't seem to like him much and he was swiftly led away. Quote Link to comment Share on other sites More sharing options...
R K Posted March 22, 2012 Share Posted March 22, 2012 Equities:bonds (SPY:TLT proxy) Are we heading towards a right shoulder for this cyclical bull market at 1.40? Neckline back down at c. 1.00 http://stockcharts.com/h-sc/ui?s=SPY:TLT&p=D&yr=3&mn=0&dy=0&id=p19942331596 (there's other ways of showing this of course but this one will do for now) Quote Link to comment Share on other sites More sharing options...
R K Posted March 22, 2012 Share Posted March 22, 2012 Vix and More - 'dangers'.... http://vixandmore.bl...t-reversal.html Montier pretty much nailed the 'cash' v 'hedging' argument here for me. 'Cash' outperformed bonds and equities during the 70s decade overall and protects reasonably well against both inflation and deflation without the insurance costs of derivate products or the timing/complexity issues. Going to cash 'early in 2010 and 2011 paid off quite well, though of course it may not to in 2012. https://www.gmo.com/Europe/CMSAttachmentDownload?target=JUBRxi51IIA6KcUdqlSIwEgyohGQxhh7bRXD4xyxMHJ0yKJp8UmLQbB%2b96yuKzHmQPVU8fCau6aDZCTV5JgnttLdI9Ykx5M4AuhCuLvbFbY%3d Quote Link to comment Share on other sites More sharing options...
R K Posted March 22, 2012 Share Posted March 22, 2012 [/url] DJ FX Trader @djfxtrader TIPS Sold At Negative Yield, But Demand Robust [Dow Jones] Gold still falling........... https://twitter.com/#%21/djfxtrader' rel="external nofollow"> Quote Link to comment Share on other sites More sharing options...
R K Posted March 23, 2012 Share Posted March 23, 2012 (edited) Following on from the long term regression chart above....... Rolling 15 year real returns http://advisorperspe...ure-Returns.php You can see we tested against periods during the Great Depression, the 1970s inflationary bear market, the 1982 bottom, and the middle of the 1990s technology bubble in 1995. The table also shows expected 15-year returns given market valuations at the 2009 bottom, and current levels. These are shaded green because we do not have 15-year future returns from these periods yet. Note real total return forecasts of 6.7% annualized from the bottom of the market in February 2009. This suggests that prices just approached fair value at the market's bottom, but they were nowhere near the level of cheapness that markets achieved at bottoms in 1932 or 1982. As of the end of May 2011, expected future returns over the next 15 years are almost exactly 0 percent. #takethemoney Edited March 23, 2012 by Red Knight Quote Link to comment Share on other sites More sharing options...
R K Posted March 23, 2012 Share Posted March 23, 2012 continuing this weeks Tulip mania iShineything theme [/url] Nick Bubb @NickBubb1 It looks like the new Apple iPad alone drove about 12% of that overall amazing 21% growth in sales at John Lewis Department Stores last week Are iThings now systemically more important than govvie bonds? https://twitter.com/#%21/NickBubb1' rel="external nofollow"> Quote Link to comment Share on other sites More sharing options...
R K Posted March 23, 2012 Share Posted March 23, 2012 Wow. It will be the retail prices index one day. Don't know why Ben/Merv even bother with bonds when they can simply put in a mega order for ithings at John Lewis. #iQE Quote Link to comment Share on other sites More sharing options...
R K Posted March 23, 2012 Share Posted March 23, 2012 The Economystic picks up the story (a week after I called the iBubble here ) http://www.economist.com/node/21551065?fsrc=scn/tw/te/ar/irational Others reckon that the outlook for its business is not the only thing that has been driving the steep ascent of Apple’s shares. The stock has seen such heavy gains in recent weeks that many investors can’t afford not to have Apple in their portfolio. Fund managers that are judged against a benchmark where Apple is heavily weighted, like the NASDAQ 100 or the S&P 500 technology index, have to scramble to keep a heavy exposure to Apple. “The speed of the move and the size of the company scare people who haven’t got it,” says Andy Ash of Monument Securities. “The danger is that you end up with everyone buying it because they have to rather than because they want to.” Some wonder whether the stock is headed into bubble territory. Apple’s p/e is much lower than that of stocks in the dot-com bubble; America Online’s was a ridiculous 154 in 1999. But contrarian thinking is thin on the ground. There is very little short interest in Apple. “Call” options, which give the right to buy Apple stock, are much more expensive than “puts”, which give the right to sell the stock, says Mark Sebastian of Option Pit, a consultancy. Of the 54 analysts who track Apple stock, only one has a sell rating, according to Bloomberg. Robert Shiller, a Yale economist and author of “Irrational Exuberance”, reckons that the “emotional attachment” to the Apple story and “wild” enthusiasm about its stock are reminiscent of a bubble. “You could play the bubble, because it might not be over yet, but I wouldn’t put money in Apple stock,” he says. If there was a fall, it would ripple. Technology investors, which have a higher concentration of Apple in their portfolios, are the most vulnerable. Apple makes up more than 18% of PowerShares QQQ, an exchange-traded fund with heavy exposure to technology stocks, for example. More unsettling are funds that have strayed into buying Apple against their mandate, including some mutual funds that are supposed to focus on smaller companies. “If Apple has a wobble, you could see it dictate broader market movements,” says Alec Levine of Newedge, a broker. Quote Link to comment Share on other sites More sharing options...
R K Posted March 23, 2012 Share Posted March 23, 2012 [/url] PIMCO @PIMCO Gross: bull mkt may be dead but bear mkt remains in the distance. Fool me once.....shame on....... https://twitter.com/#%21/PIMCO' rel="external nofollow"> Quote Link to comment Share on other sites More sharing options...
R K Posted March 23, 2012 Share Posted March 23, 2012 AAPL drops 9.7% (temporarily)...jitters. Think what errors here can trigger elsewhere. Think who might want to trigger errors and has the wherewithal to do it. http://ftalphaville....few-bats-aapls/ Perhaps the batteries on the BATS iPad servers ran a tad hot. It's scary thinking about all the glow ball collateral pricing hanging off a device which serves little purpose and will expire before the first Mayfly. #luddite Quote Link to comment Share on other sites More sharing options...
Crash Buyer Posted March 24, 2012 Share Posted March 24, 2012 (edited) Following on from the long term regression chart above....... Rolling 15 year real returns http://advisorperspe...ure-Returns.php #takethemoney Whilst on the GMO site I found this article from the same author analysing the "record profits so quickly after a recession" conundrum. In short, the US fiscal deficit has been the main driver of this sharp profit growth, in contrast to historic norms where investment drives profits (as you'd expect). The report concludes that we can expect profits to mean revert based on some level of deficit reduction following the US elections this year. https://www.gmo.com/America/CMSAttachmentDownload.aspx?target=JUBRxi51IIBtbYEu0yy2D233Qql0krF9YIWDpyU9bC1DsIW9OxrQN38JW598obIegPVL5Vm43jTd74zJ0R1rY2lRRYvkFggPe%2bdZF4oUF%2bEun279ii1ThA%3d%3d Edited March 24, 2012 by Crash Buyer Quote Link to comment Share on other sites More sharing options...
R K Posted March 24, 2012 Share Posted March 24, 2012 (edited) Whilst on the GMO site I found this article from the same author analysing the "record profits so quickly after a recession" conundrum. In short, the US fiscal deficit has been the main driver of this sharp profit growth, in contrast to historic norms where investment drives profits (as you'd expect). The report concludes that we can expect profits to mean revert based on some level of deficit reduction following the US elections this year. https://www.gmo.com/...279ii1ThA%3d%3d Thanks, CB. Also we know equity prices tends to leverage earnings on both the up and down cycle via the p/e ratio. Govt. needs to 'encourage' corporate investment to offset deficit reductions from which they've benefitted. I guess there is a trade off here though with the retiring boomers being the beneficaries of the QE supported rising asset prices and higher (than they would otherwise have been) dividend payouts. Policymakers must surely be aiming to keep nominal prices as (relatively) high as possible whilst the real value diminishes into the next p/e trough. I'm sure they 'get' this. There's a very obvious outcome too if whichever Republican were to be elected and slashes the deficit as they claim they will whilst hanging Ben (or successor). They don't appear to have figured that out yet, which in Romney's case is very odd indeed. Edited March 24, 2012 by Red Knight Quote Link to comment Share on other sites More sharing options...
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