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Stock Market Crash! (merged) Pt. 10

Discussions about the economic and financial ramifications of PEAK OIL

Re: Stock Market Crash! (merged) Pt. 10

Unread postby shortonoil » Sat 05 Oct 2019, 09:34:58

"Dor's article is outstanding. This is consistent with the great theoretical economics of the late Stanford economist Ronald McKinnon who argued that even before interest rates fall below zero, the counterproductive feedback loops outweigh the benefits of the lower rates even if the interest rates are lower in real as well as nominal terms. If you are not familiar with McKinnon's economics, I strongly urge you to do so."

https://www.zerohedge.com/economics/mis ... -ecb-doing

There is another possibility, and it has been discussed repeatedly. They are planning on issuing a new currency, and they must get rid of the old one first. It is pretty obvious that with $330 trillion in debt on the books that the present one is way past its "good until" date.

"One ring to rule them all, and in the darkness bind them."
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Outcast_Searcher » Sat 05 Oct 2019, 11:25:20

shortonoil wrote:
some man's debt is another man's credit.
The bigger the economy, the bigger the debt.


When in fear, when in doubt, spew out some consoling, lame platitude! We can all feel so much better now!

Now see -- if you had SOME credibility -- if you showed over time that you had SOME CLUE re economics, then such babbling might mean something. It might make people with a brain and some economic knowledge concerned.

But it's you. :lol:

The fact that folks like you and armageddon COMPLETELY ignore the overall size of the global economy and constantly talk about debt in isolation says it all. And when someone points this OBVIOUS and SIMPLE fact out, all you can do is falsely whine that it's just a platitude. :roll:

What now? Go to name calling and throw out a score or two of zero hedge links and perhaps a cherry picked stat or three?

Re the title of this thread BTW, and the usual fear mongering / celebrating re the market Tuesday and Wednesday, the market seems to be back to UN-crashing Thursday and Friday. No doubt that's some conspiracy re the "plunge protection team", or some such conspiracy theory right? Because for fast crash doomers here, nothing like resorting to a conspiracy theory when facts don't go their way. :idea:

Just like the flat earth theory et. al., such theories/logic make me throw away all experience, stop looking at overall facts and data, and just KNOW in my heart that they must be right. :roll:
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. 10

Unread postby marmico » Sat 05 Oct 2019, 11:51:37

The fact that folks like you and armageddon COMPLETELY ignore the overall size of the global economy and constantly talk about debt in isolation says it all. And when someone points this OBVIOUS and SIMPLE fact out, all you can do is falsely whine that it's just a platitude. :roll:


Yep. The growth rate of all sector US debt in the last 10 years has been the lowest in the last 70 years.

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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Outcast_Searcher » Sat 05 Oct 2019, 12:14:30

marmico wrote:
The fact that folks like you and armageddon COMPLETELY ignore the overall size of the global economy and constantly talk about debt in isolation says it all. And when someone points this OBVIOUS and SIMPLE fact out, all you can do is falsely whine that it's just a platitude. :roll:


Yep. The growth rate of all sector US debt in the last 10 years has been the lowest in the last 70 years.

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Thanks for the data point Marm. It's nice to try and have an adult conversation about facts, data, and trends.

When I look at the National Debt level, it does continue to rise as a percentage of GDP over time, (although, perhaps ironically given all the wailing about Trump and debt catastrophe), it is relatively flat since 2016.

https://www.thebalance.com/national-deb ... ts-3306287


Here's an estimate, re government debt, for the decade ahead, from the CBO budget outlook:

https://www.cbo.gov/publication/54918

For the purpose of this discussion and simplicity, I chose the visual summary, re the second blue link under "Data and Supplemental Information":

https://www.cbo.gov/system/files/2019-0 ... mary_0.pdf

(Note, the doom patrol will object that the CBO uses rational professional economists rather than cherry picking FUD, re their 2020-2019 forecasting mechanism, but I'll go with the CBO every time).

...

My interpretation is that it isn't pretty, and it could certainly be far better re paying for what we spend, but it sure isn't short term doom either.
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. 10

Unread postby Yoshua » Sat 05 Oct 2019, 13:20:38

Money allows you to burn some fossil fuels...or... fossil fuels allows you to burn some money...or...
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby shortonoil » Sat 05 Oct 2019, 17:12:23

There is another possibility, and it has been discussed repeatedly. They are planning on issuing a new currency, and they must get rid of the old one first. It is pretty obvious that with $330 trillion in debt on the books that the present one is way past its "good until" date.


This will be a debt swap at about 20¢ on the dollar. For specifics contact the IMF? How they plan on devaluing the currency by 80%, and not creating a depression -- they don't. Someone thinks that only half an economy would only burn half the oil? That may be true, but it doesn't get rid of the debt. The New Currency will be designed to do just that. A digital currency has that capability.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Yoshua » Sun 06 Oct 2019, 02:52:12

After ISM crashed...High Yield spreads will rise. When credit dries up, defaults and bankruptcies begins.

The Fed will be forced to step in, but will it help? China isn't responding to stimulus. Europe isn't responding to stimulus. The energy isn't perhaps there anymore.

https://pbs.twimg.com/media/EEqknj_W4AE ... ame=medium
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Tuike » Sun 06 Oct 2019, 11:02:14

There's a story in Finnish msm about Lebanese ATM's, that have stopped dispensing USD, because of dollar shortage. Locals are getting restless, because they need dollars in addition to their local currency.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby GHung » Sun 06 Oct 2019, 11:50:18

Tuike wrote:There's a story in Finnish msm about Lebanese ATM's, that have stopped dispensing USD, because of dollar shortage. Locals are getting restless, because they need dollars in addition to their local currency.


In Beirut, I can no longer get American dollars out of the ATM. This is what it tells me about Lebanon’s economy

The US is still trying to destroy the Assad regime in Syria and the Islamic Republic of Iran. Is this what underlays the frightening economic undertow?

......... I sniffed something was wrong in Lebanon when the central bank governor Riad Salame announced to us all that there were plenty of dollars in the system. No shortages. No tightening of the purse strings. I still have the papers with his announcement on page one.

Both before, during and after the 1975-1990 civil war, you’ve been able to pay for anything here in Lebanon in US dollars: dinner bills, rent, militias, guns (during the war), cars, airline tickets, groceries. The Lebanese pound fell amid the conflict but settled afterwards – courtesy of the country’s billionaire prime minister Rafiq Hariri – at 1,500 “lebs” to the dollar.

And everyone was happy. You knew that the cheerful local currency, splashed with colourful cedar trees, Roman ruins and Phoenician figurines, was interchangeable with the greenback. General Grant’s face was equal to 75,000 lebs. We even combined them in our change.

Until I walked up the road to my local ATM last week, inserted my bank card, demanded $400, was given the usual warning that this would attract an extra $5 from the machine – and was then presented with a terse voice message: “Your transaction has been cancelled.” The accent was American, of course.

I tried again, at $200. Same problem. ..........
https://www.independent.co.uk/voices/be ... 36066.html
Blessed are the Meek, for they shall inherit nothing but their Souls. - Anonymous Ghung Person
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Armageddon » Mon 07 Oct 2019, 09:40:38

US Auto Sales Stalling Below 1999-2000 Levels

davidstockmanscontracorner.com/us-auto-sales-…


Horrible, considering the extremely low interest rates, longer loans and huge incentives
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Yoshua » Mon 07 Oct 2019, 09:51:21

There's still something wrong with the Repo that the Fed didn't manage to fix on a yearly basis.

https://pbs.twimg.com/media/EGEA5PQWoAE ... name=small

Here's the calculation: It's the implied value of the 1-day y-e turn (in bps) for FF.

ie: 100 * (11/20 * FFX9 - 31/20 * FFZ9 + 31/29 * FFF0 - 2/29 * FFG0)
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Outcast_Searcher » Mon 07 Oct 2019, 10:40:07

Yoshua wrote:There's still something wrong with the Repo that the Fed didn't manage to fix on a yearly basis.

https://pbs.twimg.com/media/EGEA5PQWoAE ... name=small

Here's the calculation: It's the implied value of the 1-day y-e turn (in bps) for FF.

ie: 100 * (11/20 * FFX9 - 31/20 * FFZ9 + 31/29 * FFF0 - 2/29 * FFG0)

Well, you could go to the source, re the rates, instead of posting undocumented, babblespeak without any explanation of your terms.

Of course, that wouldn't imply FUD, now would it? :roll:

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

As I've said upthread, the rates have been VERY well behaved after the 9/17-9/18 spike, aside from the little move month end, which was expected given all the normal quarter end financing needs (for people looking for data and trends, instead of doom hunting).
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. 10

Unread postby StarvingLion » Mon 07 Oct 2019, 12:52:00

Harley-Davidson is on the brink of TOTAL COLLAPSE.

The stock (HOG) has gone from $70 to $34 in the past 5 years.

Ulta Beauty Inc., formerly known as Ulta Salon, Cosmetics & Fragrance Inc., is an American chain of beauty stores in the United States,...

ULTA stock has gone from $370 to $244 in just 3 months.

Devon Energy Corporation is a company engaged in hydrocarbon exploration in the United States. It is organized in Delaware and headquartered in the 50-story Devon Energy Center in Oklahoma City, Oklahoma

DVN stock has gone from $35 to $22 in just 6 months.

Iraq is FAILING BADLY...

https://www.aljazeera.com › iraq-protests-latest-updates-191004085506824

10 hours ago - At least 109 people killed and over 6000 wounded in less than a week of anti-government unrest, interior ministry says.

Cogs response: ""

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Cog's brain was in a jar left open and maggots ate it.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Armageddon » Mon 07 Oct 2019, 15:20:01

Trump: I would like a substantial interest rate cut


Dont worry Donnie, there are several coming.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby shortonoil » Mon 07 Oct 2019, 15:24:36

There's still something wrong with the Repo that the Fed didn't manage to fix on a yearly basis.


There appears to a growing, and world wide shortage of dollars, and it is showing up in the Repo market. The surge of dollars into, and out of the country is directly affecting the banks ability to secure short term funding. The dealers aren't very exited about the possibly of being paid back in pesos. As European banks continue to go on strike against the ECB's policies the volatility will only worsen, and US banks ability to write loans will decline. The economy is getting whipsawed to death! In the long run there is not much the FED can do about it except make more noises about shoring up the Repo. The market will believe that story line until they don't.
https://pbs.twimg.com/media/EGEA5PQWoAE ... name=small
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby mousepad » Mon 07 Oct 2019, 18:59:25

shortonoil wrote:There appears to a growing, and world wide shortage of dollars


That's strange. Didn't you preach the dollar to become worthless only a few post back?
Now there's a SHORTAGE??
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby shortonoil » Tue 08 Oct 2019, 08:21:20

housemouse said:
That's strange. Didn't you preach the dollar to become worthless only a few post back?
Now there's a SHORTAGE??


Do you make this crap up because you can't think of anything else to say?

The dollar represents 62% of all foreign held currency. The FED is repatriating its dollars at $4 trillion a year; according to the IMF. The US is the recipient of the world's capital outflows, and those come in dollars. The dollar will become worthless as the debt continues to explode exponentially, but it will be the last debt based fiat to remain standing. In the meantime the world continues on its way into a deflationary depression. Oil will fall to under $40, and the oil age will be over. With oil having lost 62% of its ability to power the economy there will be no recovery. The next energy source to power the world will have an EROI of 83,000 :1. Oil is now 7.9 :1.

Chances are you will never live to see it. A piece of bad cheese will do you in.

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Re: Stock Market Crash! (merged) Pt. 10

Unread postby mousepad » Tue 08 Oct 2019, 09:17:20

shortonoil wrote:The FED is repatriating its dollars at $4 trillion a year;

But how? To receive $$ you need to ship goods or services.
Didn't you say the US don't produce nothing no more?
Doesn't the US have a trade deficit? meaning $$$ are leaving the country?

With oil having lost 62% of its ability to power the economy there will be no recovery.

But why? To make up the loss in EROEI we can simply pump a little more. Don't ya think?
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby shortonoil » Tue 08 Oct 2019, 10:19:30

housemouse said
But how? To receive $$ you need to ship goods or services.


How? Investor sell their foreign sovereign bonds, and buy US Treasuries, and other US assets. The US Treasury bond is the only G7 bond that now pays a positive coupon. 2% on a relatively safe 30 year Treasury is better than -0.5% on a German Bund. Money goes where it brings the best return, and that is now the US.

Didn't you say the US don't produce nothing no more?


It looks like YOU said that.

Doesn't the US have a trade deficit? meaning $$$ are leaving the country?


The US trade deficit is $700 billion. Capital inflows are $4 trillion.

But why? To make up the loss in EROEI we can simply pump a little more. Don't ya think?


Between Venezuela and Iran the world has lost over 5 mb/d in the last couple of years. Shale production has increased 2.62 mb/d in the last 5 years. OPEC is trying to cut its production to keep the price up. If much more was pumped the price would fall until no one would be producing anything. The oil industry is not run as a charity.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Outcast_Searcher » Tue 08 Oct 2019, 11:17:40

shortonoil wrote:The oil industry is not run as a charity.

YOU said that.

And so you should be able to filter through that "amazing" brain of yours that the oil industry wouldn't deal in massive amounts of fracked LTO at a loss, year after year voluntarily. (Large profits for the industry, year after year, would also be a hint to someone able to absorb information).

But since you can't understand accounting, can't admit you're wrong, ignore the good inputs folks like rockdoc here patiently give you, you continue to endlessly spew the same nonsense.

Time to call me names, apparently, since that's all you have.
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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