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Stock Market Crash! (merged) Pt. 11

Discussions about the economic and financial ramifications of PEAK OIL

Re: Stock Market Crash! (merged) Pt. 11

Unread postby Armageddon » Tue 17 Dec 2019, 19:46:14

Repo Madness! QE 3 ($40b a month) vs. Repo ($500b in 2 weeks) Fed Chair Jerome Powell says it not QE, so let’s just call it REPO MADNESS (the surge in Fed activity surrounding the repo market).
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby shortonoil » Wed 18 Dec 2019, 14:39:50

On today’s doubleheader episode of Double Down, Max Keiser and Stacy Herbert talk to Chris Cook about the 2020 energy outlook.

As Saudi Arabia takes 1.5% of Saudi Aramco public, DOUBLE DOWN asks former energy market regulator, Chris Cook, whether or not this is the sign of peak oil. He says that, in fact, it is a sign of peak demand. There is an infinite amount of oil . . . at a price . . . but consumers cannot afford that price and alternatives are being found. Chris Cook expects that oil will never go much above $60 again for any length of time. Regarding the new QE which is not QE (‘Quantitative Easing’), he believes this is oil-related, the Fed is providing liquidity to monetize US shale reserves. Cook is saying that the US has essentially fixed the dollar against its shale reserves. Tune into Double Down to hear more on what Chris Cook has to say about his bold and radical predictions for energy markets in 2020.


Yes, this is "Peak Oil", and "Peak Everything Else". Peak Demand is Peak Production, and visa versa; they are two sides of the same coin. It all has to do with the quality of oil being produced, or its ability to deliver energy to the economy. The world's oil producers have been pumping from of the same puddle for the last 160 years, and they have always extracted the best that could be found. What remains isn't very useful. It's quality is too low to power a growing economy. The economy will slow until it has stopped without high quality oil to power it.

But, this is a double whammy that we are approaching! It is the end of the oil age, and it is also the end of the debt based monetary system. Like Peak Demand, and Peak Supply they are two sides of the same coin. A weakening economy from lower quality oil is driving an explosion in the debt load the monetary system must handle. That is now appearing in the monetary system as debt that is growing faster than the money supply.

During 2019 the debt grew faster than the GDP by $2.8 trillion per month. During 2020 it will grow faster by $4 trillion a month. To have funds to pay for the debt increase the central banks must create the difference out of thin air. The currency they create slows the velocity of money, which requires that even more currency needs to be injected into the system.

Because we now have a zombie economy with no real growth, except for the artificial growth in the money supply, past debt and its interest cost must be continuously rolled into new debt. Like the debt, the spread between the currency in circulation and the funds needed to finance the new debt is growing exponentially.

This will end in a crash when the debt formation rate becomes equal to the currency in circulation. On its present course that will be in 2022 when the debt formation process reaches $62 trillion per year. The energy to produce oil, and its products will have reached 64% of the total energy content that is found in the average barrel.

Because the debt will have to be expunged to continue any kind of a functioning economy the world will go into a very deep depression. Most of the world's wealth is now held in debt, and that will be eliminated either by edict, or by the failure of the monetary system. The world's economy has been monetizing petroleum, and kicking the can as oil has been depleting. Without a functioning monetary system no one will be pumping any kind of oil, regardless of its quality.

The Etp function is a measure of petroleum depletion. Oil's depletion, and the debt are growing together in lock step.
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby rockdoc123 » Wed 18 Dec 2019, 15:51:38

Some headlines from the past week that aren't from the doomasphere

US housing starts rise more than expected, with permits at a 12-1/2-year high

U.S. homebuilding increased more than expected in November and permits for future home construction surged to a 12-1/2-year high.

Lower mortgage rates continued to boost the housing market and support the broader economy.
Housing starts rose 3.2% to 1.365 million units last month, with single-family construction racing to a 10-month high.

Activity in the volatile multifamily sector increased for a second straight month, the Commerce Department said.


Homebuilder confidence jumps to highest level in 20 years

Builder confidence in the newly built, single-family home market jumped 5 points in December to 76, the highest reading since June 1999.

Current sales conditions rose 7 points to 84, sales expectations in the next six months rose 1 point to 79 and buyer traffic increased 4 points to 58.

Regionally, on a three-month moving average, builder sentiment in the Northeast fell 2 points to 61, increased 5 points in the Midwest to 63, moved 1 point higher in the South to 76 and increased 3 points in the West to 84.


The thing that freaked everyone out about a recession is now moving in the opposite direction

The spread between the 2-year Treasury yield and that of the 10-year note climbed to its highest level since November 2018. The so-called yield curve is steepening.

“The Fed is on hold, the economy is doing well, and trade tensions aren’t increasing. In such a world, a steeper curve follows intuitively,” said Ian Lyngen, BMO’s head of U.S. rates.

The benchmark 10-year yield has risen about 40 basis points since the beginning of October
as investors fled safe-haven assets on easing trade tensions.


‘Bond King’ Gundlach says a recession is ‘very unlikely’ in 2020

DoubleLine’s Jeffrey Gundlach thinks a recession will be avoided in 2020 as leading economic indicators are bound to improve moving forward.

“We’ve never had a recession without negative leading indicators,” he says.
Gundlach made his comments even though he thinks a U.S.-China trade deal will not take place until after the U.S. election.


So good reasons to enjoy a rising stock market and a Merry Christmas!
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby Outcast_Searcher » Wed 18 Dec 2019, 15:58:33

Meanwhile in the real world, citing real economists:

The economy is looking better, reflected by the yield curve, and the odds of a 2020 recession are looking lower.

The thing that freaked everyone out about a recession is now moving in the opposite direction

KEY POINTS

    The spread between the 2-year Treasury yield and that of the 10-year note climbed to its highest level since November 2018. The so-called yield curve is steepening.

    “The Fed is on hold, the economy is doing well, and trade tensions aren’t increasing. In such a world, a steeper curve follows intuitively,” said Ian Lyngen, BMO’s head of U.S. rates.

    The benchmark 10-year yield has risen about 40 basis points since the beginning of October as investors fled safe-haven assets on easing trade tensions.


“A resilient consumer will continue to drive moderate levels of growth and recession risks remain muted,” Michael Fredericks, head of income investing at BlackRock, said in a note Wednesday.

The chance of recession in the next year fell to the lowest level since June, according to respondents to the December CNBC Fed Survey. GDP is forecast to remain at 2% over the next two years, the survey, which polled 43 fund managers, strategists and economists, showed.


Blue font mine, for emphasis.

https://www.cnbc.com/2019/12/18/the-thi ... ction.html

But the folks like armageddon and shorty always have plenty of babblespeak and name calling on their side, so it's financial doom tomorrow for sure. :roll:

Sorry rock, for duping one of your positive articles. When I began my post, yours hadn't shown up yet.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby Outcast_Searcher » Wed 18 Dec 2019, 16:08:03

Armageddon wrote:Repo Madness! QE 3 ($40b a month) vs. Repo ($500b in 2 weeks) Fed Chair Jerome Powell says it not QE, so let’s just call it REPO MADNESS (the surge in Fed activity surrounding the repo market).

Tremendous source/citation, as per usual. :roll:

Meanwhile in the real world the increase in the Fed balance sheet is moderating, so of course, it's uncited FUD-orama from you. :shock:

So how's that out of control many $trillions the Fed had to expand the balance sheet starting in November going, re the Youtube clown you were jumping up and down about and claiming as a seer in October re this issue?

But I know -- when you're dead wrong, it's just pretend you weren't, jingle more keys, and insist that we should listen to you NEXT time.

Endlessly.

Doesn't always flapping your arms in hysteria make you tired at some point?
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby rockdoc123 » Wed 18 Dec 2019, 16:09:13

Sorry rock, for duping one of your positive articles. When I began my post, yours hadn't shown up yet.


what do they say...Imitation is the greatest form of flattery. :-D :P
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby Armageddon » Thu 19 Dec 2019, 08:40:05

Philly Fed Tumbles In December Back Near 2019 Lows
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby shortonoil » Thu 19 Dec 2019, 11:06:46

Repo Madness! QE 3 ($40b a month) vs. Repo ($500b in 2 weeks) Fed Chair Jerome Powell says it not QE, so let’s just call it REPO MADNESS (the surge in Fed activity surrounding the repo market).


Did anyone find the $1.4 trillion in excess reserves that the banks lost?? Maybe it fell into the seat of the car? It's easy to lose the car keys, but you would think that $1.4 trillion would show up some where!! Maybe the repo man found it when he picked up the car?

The currency destruction from the debt explosion will keep growing, and the FED will keep trying to stuff freshly printed wampum down a rat hole. The banks will go illiquid as the money keeps disappearing, interest rates will keep falling as the debt keeps growing, and no will be be lending because there is no money to be make at zero percent interest when they are totally illiquid to begin with. BBB rated bonds (junk) are now trading at an astounding 39 bps above IG. The central banks are buying gold because they know that their days of swapping confetti’s to the natives for a 9 to 5 stint are almost over.

A couple of computers, programmed by ex $2.00/ hr. Pakistani goat herders, are driving the market above heights that will never be ascended by mere mortals. The code is straight forward; if the FED prints the market goes up, if Trump doesn't tweet by noon the market goes down. If the Chinese show up for lunch it goes parabolic. Sick and dead pigs are ignored, along with saving, pensions and 401ks.

"When in fear, when in doubt, run in circles scream and shout!" If that doesn't work try:
REPO DESPERATION.
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby Armageddon » Thu 19 Dec 2019, 12:59:01

Household debt has now ballooned to its highest level EVER.. US citizens are now carrying their highest debt loads in recorded history and yes, they continue to borrow more...
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby dirtyharry » Thu 19 Dec 2019, 13:40:53

The President is impeached and the S&P touches a record of 3200 . Hey ,let us CENSORED the SOB and we will touch 6400 . Just F^^^^^^ insane .
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby Armageddon » Thu 19 Dec 2019, 13:52:24

dirtyharry wrote:The President is impeached and the S&P touches a record of 3200 . Hey ,let us CENSORED the SOB and we will touch 6400 . Just F^^^^^^ insane .




The markets only care what the FED does. Keep lowering rates, more QE and trillions of printed money, and we’ll see DOW 30K.
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby shortonoil » Thu 19 Dec 2019, 15:27:08

The President is impeached and the S&P touches a record of 3200 . Hey ,let us CENSORED the SOB and we will touch 6400 . Just F^^^^^^ insane


Not yet! The House doesn't vote on it until tomorrow. Then it has to go to the Senate, who has already said that they won't put it on the floor for a vote. But, yes, it is totally insane by any rational standard. The market now has absolutely no relationship to the economy. It is a computer that has never done one human thing. It is a bunch of electrical states that are randomly shuffling back and forth, then puke out a number. The CASS Freight index has been down for 12 months, auto are collapsing, banks are cutting back on loans, the FED financed Shale industry is firing people, etc. When the debt bomb goes off this coming year liquidity will evaporate; $30 to $40 trillion in cash will disappear. The debt is growing 16 times faster than the money supply. Cash will be KING. Then the day will arrive when the US Government puts its bonds on the market for sale; and no one shows up to buy them.
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby shortonoil » Thu 19 Dec 2019, 16:00:30

The FED won't see it coming; they didn't even response to the repo blow out until interest rates hit 12%. Those waiting for the FED to save their butts, are standing on the wrong side of the platform at the wrong train station. The last time the FED saw something in advance was in 1913 when they sold their upside down Robin Hood scheme to the nation.

Then JFK's executive order #1110 will be executed. The world will be holding a pile of very seriously discounted paper. Gold will go to $3000 before then. 50¢ on the dollar in the US. You will be declaring your gold to the IRS for taxes on the price change. Gold will again become a currency, just like it has been for the last 7,000 years.
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby Cog » Thu 19 Dec 2019, 16:14:58

dirtyharry wrote:The President is impeached and the S&P touches a record of 3200 . Hey ,let us CENSORED the SOB and we will touch 6400 . Just F^^^^^^ insane .


I do not know if you are an American or not but do not suggest shooting an American President again even in jest. The next time it happens, I will foward your post to the Secret Service and the board owner will get a subpoena for your IP address. I'm not kidding dude.
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby Armageddon » Thu 19 Dec 2019, 18:23:59

QE4 added $41.6 billion to the Fed's balance sheet last week, bring the total size to $4.137 trillion. The U.S. now has the most reckless combination of money and fiscal policy ever. If you think the economy was bad during the 1930s or 1970s, wait until you experience the 2020s!


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Re: Stock Market Crash! (merged) Pt. 11

Unread postby Armageddon » Thu 19 Dec 2019, 18:29:20

Rate of $1.3T per year. Sure. But the FED is not panicking
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby Outcast_Searcher » Thu 19 Dec 2019, 20:28:35

Cog wrote:
dirtyharry wrote:The President is impeached and the S&P touches a record of 3200 . Hey ,let us CENSORED the SOB and we will touch 6400 . Just F^^^^^^ insane .


I do not know if you are an American or not but do not suggest shooting an American President again even in jest. The next time it happens, I will foward your post to the Secret Service and the board owner will get a subpoena for your IP address. I'm not kidding dude.

Yup. In America it's cool to say you don't agree with politician X's policies or that you don't like politician X. That's free speech. It's a COMPLETELY different thing to say "let's just shoot" politician X, or anyone else. And of course, when X is the POTUS, it's just asking for trouble.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby Outcast_Searcher » Thu 19 Dec 2019, 20:43:27

Armageddon wrote:QE4 added $41.6 billion to the Fed's balance sheet last week, bring the total size to $4.137 trillion. The U.S. now has the most reckless combination of money and fiscal policy ever. If you think the economy was bad during the 1930s or 1970s, wait until you experience the 2020s!

Twitter

Great adult citation, there. "Twitter" LOL

Meanwhile in the real world, one week doesn't make a year long trend, now does it? The week ending Nov. 20th, the balance sheet amount DECREASED about $17.5 billion.

I'm sure you were all over that, since you try to be balanced and not distort things. :roll:

https://fred.stlouisfed.org/series/WALCL

https://www.federalreserve.gov/releases/h41/20191121/

And note I use real sources with adult reporting and data, not "Twitter".

Meanwhile, the Fed paints a rather different picture than you. Even though you think you are an economics expert, I'll go with the Fed. :lol:

https://www.cnbc.com/2019/12/18/feds-wi ... eeded.html

Fed’s Williams says repo operations working well and should stay in place ‘just as long’ as needed

KEY POINTS

    New York Fed President John Williams said the short-term funding market is functioning smoothly and the Fed should continue its repo operations just as long as needed.

    The New York Fed president also said the central bank was continuing outreach and surveys of financial institutions to assess the amount of reserves needed in the system after past surveys led it to underestimate the amount of reserves.

    “We’re offering repo operations and T-bill purchases in order to provide reserves to the system. Right now, that’s working really well, and we look for that to work through year end and into January,” Williams said in an interview with CNBC’s Steve Liesman

Only someone as devoid of economic reality as you would claim the Fed is "panicking" when the rates it want to see calm look like this, showing, as they say, their program is working fine.

https://apps.newyorkfed.org/markets/autorates/sofr
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby Armageddon » Thu 19 Dec 2019, 22:13:21

Outcast_Searcher wrote:
Armageddon wrote:QE4 added $41.6 billion to the Fed's balance sheet last week, bring the total size to $4.137 trillion. The U.S. now has the most reckless combination of money and fiscal policy ever. If you think the economy was bad during the 1930s or 1970s, wait until you experience the 2020s!

Twitter

Great adult citation, there. "Twitter" LOL

Meanwhile in the real world, one week doesn't make a year long trend, now does it? The week ending Nov. 20th, the balance sheet amount DECREASED about $17.5 billion.

I'm sure you were all over that, since you try to be balanced and not distort things. :roll:

https://fred.stlouisfed.org/series/WALCL

https://www.federalreserve.gov/releases/h41/20191121/

And note I use real sources with adult reporting and data, not "Twitter".

Meanwhile, the Fed paints a rather different picture than you. Even though you think you are an economics expert, I'll go with the Fed. :lol:

https://www.cnbc.com/2019/12/18/feds-wi ... eeded.html

Fed’s Williams says repo operations working well and should stay in place ‘just as long’ as needed

KEY POINTS

    New York Fed President John Williams said the short-term funding market is functioning smoothly and the Fed should continue its repo operations just as long as needed.

    The New York Fed president also said the central bank was continuing outreach and surveys of financial institutions to assess the amount of reserves needed in the system after past surveys led it to underestimate the amount of reserves.

    “We’re offering repo operations and T-bill purchases in order to provide reserves to the system. Right now, that’s working really well, and we look for that to work through year end and into January,” Williams said in an interview with CNBC’s Steve Liesman

Only someone as devoid of economic reality as you would claim the Fed is "panicking" when the rates it want to see calm look like this, showing, as they say, their program is working fine.

https://apps.newyorkfed.org/markets/autorates/sofr




If you don’t agree the numbers, prove them wrong
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Re: Stock Market Crash! (merged) Pt. 11

Unread postby dirtyharry » Fri 20 Dec 2019, 01:42:00

^[*]^We’re offering repo operations and T-bill purchases in order to provide reserves to the system. Right now, that’s working really well, and we look for that to work through year end and into January,” Williams said in an interview with CNBC’s Steve Liesman^^]

Yes,they all work very well ,until they don^t . :-D
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