Category: Economy

Another week the US stock market closing higher and it looks like January will close positively by next week if FOMC does not want to ruin the bull party. But who knows. Given the geopolitical mess we are seeing everywhere … we just don’t know when and where a shock may happen to upset the current bullish outlook.

Here is a video trying to piece together the economy of the Roman Empire. The focus of the video is to compare the Roman Empire’s GDP against the modern era USA. This comparison makes no sense as technologies we have nowadays did not exist say, just 200 years ago or even just 100 years ago.

For those who are concerned about the current economic conditions and what may happen this year, here is Gundlach discussing his take with Charles Payne. His takes on the situation may not agree with what the MSMs are saying.

I find this interview of Patrick Boyle very interesting. He talks about the past how hedge funds are so different from the modern day version of them. He also touches on quite a number of interesting subjects. Hope you enjoy this.

As someone who eats eggs almost everyday, here is a video talking about eggs that tried to settle the arguments around the quality and taste of eggs across all kinds of eggs. I do not agree with the conclusion of the video because I know a lot about eggs and the studies he quoted are not done properly. Why? Industrialized high-end eggs offered by big companies are just another elaborate scheme to make more money from the “organic” movement.

Back to work now.

Have a great weekend all!

What a week for the stock market – NVidia blowoff earning midweek and Powell hawkish statement on Friday gave the world completely opposite outcomes based on normal expectations. Nvidia earning sent its stock price up 11% on Wednesday night but then on Thursday all that gain were wiped out during normal market hours. Powell hawkish statement initially was thought to have pressured stock market lower on Friday but then the stock market went higher in the afternoon. Media and gurus keep trying to give an after the fact explanation of what happened. But does that matter?

Here is a video discussing Burry’s bearish bet in better context. For those of you who want to ride his coattail, watch it to gain a better understanding of the macro situation. But keep in mind that the real reason why Burry made the bet can be something else completely. And also remember that the reporting of one’s positions for each quarter has a 45 days time window. So between end of June and now, Burry’s position may have changed already.

I find this video has a more balanced view of the macro factors that will shape the near future of world economy. If you don’t want to watch this hour long video, I can summarize it here – we are f$#ked.

Back to work for me. No point overthinking much on what to do when the financial system collapse or reset.

Have a great weekend all!

Option expiration week ended with SPX closing at the lowest level over the past few weeks. It is not something unexpected because of the largest technology companies had a huge rally earlier this year. Even if they are not crashing down, taking a breather for a few weeks is reasonable.

The biggest news in the financial world this week must be Michael Burry’s 13F filing. It is reported that he has positioned himself on a bearish outlook for the SPX and NDX indices using put options on SPY and QQQ. It is the largest position he has put on over the past few years. First, we do not know the expiration dates of these options. Second, we do not know the strike prices of these options. Most important of all, we do not really know if it is just a short term trade for a normal market correction which many pros expected, or a conviction trade that Burry thinks that something way worse is coming.

So no point to speculate why he is doing that. And more importantly, you can’t mimic what he does without more details. I am positioned since July on a major pullback for the big techs. I even posted charts on Twitter with the reasons and the expected downside targets. It is not that hard to figure this out.

An interesting discussion of our ever increasing demand of electricity by Patrick Boyle. His takes on EV and electrify everything are very reasonable and the expected eventual taxing on everything electric will come sooner than later. Here is my warning to anyone who think EV is the future, think of the flooding in China – the moment the power grid is down, all things electric are f$#ked.

Just search online for portable solar electric car charger and you will see all kinds of “promises” that in the future, it will become possible, but not now. I think the better answer is never. Many months ago I discussed this topic in detail from the astrology view point. In short, better expect a completely new energy source being developed than to believe whatever we have now will solve this forever increase in demand of electricity problem.

The doomers are thinking the sky is falling – an honest discussion of what to expect in the near future on the economic front.

And of course, there is David Hunter, who tells everyone that the melt up has not happened yet, and that sky is the limit for gold.

In a way, I agree with him, as long as the “one-two punch” I always refer to has not happened, the only solution for the governments and central banks worldwide is to keep printing. So hyperinflation will persist and of course, all risk assets will go through the roof.

Another busy weekend for me – can’t even take a break in the cottage country here the whole summer so far … I miss my cottage.

Have a great weekend all!

Second quarter of 2023 ended with a bang printing another new year high for S&P500. How high can it go is the buzz all over this weekend.

Macro guys like Alf are bearish for a good reason. However, without better timing, many macro players are deep in red and can only hope the recession will eventually arrive.

Some others, like Prof. Hanke, raised an interesting point about the population issue.

As usual I don’t agree with many of these videos I link to but then being able to see what others are thinking can help me discover any blind spot that I have not thought about.

One of the biggest news in financial world this week was the flood of applications to create bitcoin ETFs by several big names. Well, all of them are rejected for now. But it does not mean that these firms will not try again after they improve their applications. This development will significantly impact the crypto space so if you trade or invest in cryptos, remember to stay on top of this.

Eurodollar university has a new video up on China’s yuan. It matters because China is the second biggest economy in the world. Any shock in Yuan’s value relative to other major currencies can create a ripple effect shocking all the major financial markets. This problem is still unfolding and can be a catalyst in forcing the US stock markets to correct suddenly.

This is first of the month. So it is chores time in addition to my normal workload. Back to work for me.

Happy Canada Day to my fellow Canadians!

Another interesting week has passed with the US stock market continues to be trapped inside a tight range. Bulls believe we are going to see a new high soon because of whatever reason they can come up with. Bears insist that so far this is a dead cat bounce and reality will hammer the market back down. Maybe, it is something else all together – like we have reached an equilibrium for which the next major move has nothing to do with the current state of the market at all but some external events that will decide the outcome.

Of course people don’t like to see things this way because everyone wants their own predictions come true. Both sides have a chance to win. What matters most is that when they are wrong, can they survive for the next play?

A very interesting topic to me, “Is reality discrete or continuous?”, discussed by none other than Stephen Wolfram.

Here it is with Hugh Hendry again. This time he has a conversation with Russell Clark who has an opposite view of TLT from Hendry.

We don’t get a lot on YouTube with Doomberg as they are mainly active on Twitter only. Here is a great overview of what Doomberg thinks about various markets and the future.

Got to go.

Enjoy your weekend all!

End of first quarter of 2023 gave us a rally that destroyed most of the bears, just like what happened last year, multiple times. The signs of the squeeze was coming are there – very bearish sentiment, hedge funds all loaded up on the short side, etc. So it is not a surprise at all if you truly understand how the financial markets really work. It is just a game that the major players trying their best to mess with the gullible ones.

Haven’t seen Robert Shiller for a long while. Here is his take on US housing market.

This podcast with Darius Dale on the macro outlook for the near term is very interesting and on point thanks to Darius’ articulate narrative of all the areas he covered.

Another great interview by David Lin with E.B. Tucker. Tucker raised a few important points that everyone should pay attention to. Here is the latest article wrote by Tucker. It is a fun read.

For those of you asking what the outlook for this quarter will be, my take is that real risk is not priced into the stock market at all. I even mentioned that on my twitter. Real risk means major natural disaster, alien invasion, etc. If such risks are priced in, as in the ancient past in human history, the stock market would not be parking at the current level at all.

Thus it is not the serial outlook or trend that matters. Because one second ago, your holding was valued at certain price. But by this second, it is worthless already due to the “long predicted disaster” finally happened. How can any valuation method provide the correct price at the moment?

Got to get back to work.

Have a great weekend all!