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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 Yonnipun » Sun 20 Oct 2019, 02:46:17

The stock market does exactly what it is supposed to do; it moves money from one pocket to the pocket of someone else, and it consistently moves it to fewer and fewer pockets.


The biggest crybabies after current pension reform were the bankers. Suddenly they started to care about poor people and said if the poor take out all the money and spend it then they will never get a proper pension. An average amount of additional pension from funds to the state pension for average joe is about 10-15000 dollars that is divided to years they expect you to live after reaching to pension age. About 20-30 dollars additional to state pension per month. Can you see how pointless is this? What can you buy with 20 dollars 30 year from now? A cup of tea?
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Yoshua » Sun 20 Oct 2019, 04:19:10

"FED'S KAPLAN SAYS IF YOU CAN'T BORROW SHORT AND LEND LONG, YOU'RE EVENTUALLY GOING TO SEE CONDITIONS TIGHTEN"

The Fed is cutting rates, doing repo operations and buying short term treasuries to bring down short term yields after the yield curve inverted.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Yoshua » Sun 20 Oct 2019, 05:33:55

After the GFC the Fed started its QE program to bring long term treasury yields and mortgage rates down by buying long term treasuries and mortgage back securities.

As the 10 year treasury yield started to fall towards zero and lead to a inverted yield curve, the Fed decided to start selling long term treasuries trough its QT program.

The QT program worked, but as the 10 year treasury yield started to rise above 3 percent…the markets started to crash last year.

The Fed had to abandon the QT program and the idea of raising long term yields…and instead starting to buy short term treasuries, to bring down short term yields to fix the inverted yield curve. So far it looks as if it working, the yield curve is steepening again.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby shortonoil » Sun 20 Oct 2019, 08:26:30

"There Is A Global Crisis" - Israel Diamond Industry Collapses Amid Faltering Demand

Macroeconomic headwinds are developing across the world. At least 90% of all countries are experiencing a slowdown in growth that has stumped central bankers and policymakers. No one at the moment can figure out how to restart the global economy. With the risk of a worldwide trade recession soaring for 2020, if not has already arrived, consumers are pulling back on spending, which has contributed to a collapse in the global diamond industry, something that we've been documenting this year.

https://www.zerohedge.com/markets/there ... al-turmoil

The simple, and obvious explanation for the global slowdown in growth is that there is no leverage remaining in the system. In 2003 the leverage from oil (C&C) was 9.9:1. 1 additional Gb of production generated $9.9 trillion in additional GDP. Including Shale that leverage has now fallen to 1.2:1. There will be no restarting of the global economy until a substitute for oil has arrived.

If the central bankers are expecting their activities to reboost the global economy they are hallucinating about their capabilities. The are pushing on the proverbial string with a religious zeal. Interest rates will continue to decline, the velocity of money will continue to fall, and the debt will continue to grow on its exponential path. The oil age is ending, and the central bankers can't figure that out! Without an undated, and improved energy production system their actions will be nothing but an exercise in futility. Once again physics trumps economics. The Masters of the universe are not the masters; they barely even rate as the bus boys.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Armageddon » Sun 20 Oct 2019, 10:20:56

Official U.S. Federal Budget Deficit today: $1.025T
Projected Budget Deficit in just 4 years: $2.218T

Debt to GDP ratio today: 106%
Debt to GDP ratio 2023: 121%

These # are based on today's spending, not based on any UBI or MMT scheme we could see from the next Administration.


My thoughts????

1) Govt spending will be MUCH higher
2) Tax receipts will be MUCH lower
3) 2.21T will be twice that number
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby rockdoc123 » Sun 20 Oct 2019, 10:23:31

Schlumberger posts a USD 11 Billion loss in Q3


In typical fashion you posted this hoping it would substantiate your doom and gloom, disaster is around the corner view on life. SLB results are the exact opposite of that. If you bothered to read the article it actually states:

The pretax charge, driven by market conditions, is almost entirely non-cash and primarily relates to goodwill, intangible assets, and fixed assets, said Schlumberger, which also flagged continued slowdown in North America’s drilling growth.


as I have pointed out numerous times you need to separate out non-cash from cash items in order to understand how well a company is performing and this is especially true when you are looking at individual quarters.

The fact SLB is doing OK shows up in the details of their financial documents in support of the 3rd quarter:

In detail the quarter shows revenue of $8.5 billion and impairments of $12.7 billion (impairments are non-cash). Their cash-only income would have been ~$1.2 billion (revenue minus cash costs). Overall revenue was almost exactly the same year on year for this quarter…$8.54 billion in 2019 and $8.50 billion in 2018. Revenues were down in North America but up substantially elsewhere.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby shortonoil » Sun 20 Oct 2019, 13:22:49

My thoughts????

1) Govt spending will be MUCH higher
2) Tax receipts will be MUCH lower
3) 2.21T will be twice that number


Without a doubt! The reports that we get are based on what are believed to be sporadic restraints; trade war, central bank activities, etc. What we are witnessing are deep rooted chronic problems that are not going away in a few months. When the only tool is a hammer, every problem looks like a nail.

According to psychologists, most people are poor intuitive problem solver They tend to
adopt a definition of a problem without having collected descriptive data on the situation. They
formulate hypotheses based upon incomplete data, and fail to seek out possible alternative
explanation. Even when information is available, it is often ignored if it does not support existing preferences and assumptions (Dawes, 1982).

http://www.rsareliability.com/chronic%20losses.pdf
http://web.mit.edu/eppinger/www/pdf/Tyr ... ov1995.pdf
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Yoshua » Sun 20 Oct 2019, 14:56:43

This year has seen violent protests all around the world due to economic hardship. It doesn't take much to ignite the flames. Molotov cocktails are flying all over the place.

Will someone point out that people seem to be just fine with paying for the gasoline for their Molotov cocktails?
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Armageddon » Sun 20 Oct 2019, 17:54:24

Central Banks Are Out Of Ammo - UN Head Demands Immediate Fiscal Stimulus To Save World From Crisis

Gee, I wonder who’s been saying that for the past year?

Hint: the same person who said they’d start cutting rates and bring on massive QE
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Armageddon » Sun 20 Oct 2019, 18:26:46

Goldman: The Fed Was The Main Driver Of Markets In 2019


No way. Who would have guessed that?
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Armageddon » Tue 22 Oct 2019, 13:39:52

The Federal Reserve Bank of New York injected $99.9 billion in temporary liquidity and $7.5 billion in permanent reserves into financial markets Tuesday.


This is getting crazy.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby shortonoil » Tue 22 Oct 2019, 15:40:50

Glad to see that you guys are back. Glad you got your code unscrambled.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby mmasters » Tue 22 Oct 2019, 15:52:07

Armageddon wrote:The Federal Reserve Bank of New York injected $99.9 billion in temporary liquidity and $7.5 billion in permanent reserves into financial markets Tuesday.


This is getting crazy.

It's all tactical fixes to an antiquated system and they have a lot of levers. The big thing is that people still have confidence in the markets and growth is happening.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Armageddon » Tue 22 Oct 2019, 16:12:51

mmasters wrote:
Armageddon wrote:The Federal Reserve Bank of New York injected $99.9 billion in temporary liquidity and $7.5 billion in permanent reserves into financial markets Tuesday.


This is getting crazy.

It's all tactical fixes to an antiquated system and they have a lot of levers. The big thing is that people still have confidence in the markets and growth is happening.



I think they are losing control
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Yoshua » Wed 23 Oct 2019, 01:30:48

I just read that the global Repo market is USD 5 Trillion daily operation.

The Fed just can't fix everything.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Yoshua » Wed 23 Oct 2019, 01:43:02

The riots are now spreading like a virus around the world.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby EnergyUnlimited » Wed 23 Oct 2019, 01:55:28

Yoshua wrote:The riots are now spreading like a virus around the world.

And as long as you are not there it is entertaining to watch.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Yoshua » Wed 23 Oct 2019, 02:26:35

The former head of Bank of England.

King said it was time for the Federal Reserve and other central banks to begin talks behind closed doors with politicians to make legislators aware of how vulnerable they would be in the event of another crisis.

He said: “Congress would be confronted with a choice between financial armageddon and a suspension of some of the rules that were introduced after the last crisis to limit the ability of the Fed to lend.”
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby Armageddon » Wed 23 Oct 2019, 07:04:58

Yoshua wrote:The former head of Bank of England.

King said it was time for the Federal Reserve and other central banks to begin talks behind closed doors with politicians to make legislators aware of how vulnerable they would be in the event of another crisis.

He said: “Congress would be confronted with a choice between financial armageddon and a suspension of some of the rules that were introduced after the last crisis to limit the ability of the Fed to lend.”



In other words, print to infinity.
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Re: Stock Market Crash! (merged) Pt. 10

Unread postby shortonoil » Wed 23 Oct 2019, 09:24:43

The riots are now spreading like a virus around the world.


Major protest are now taking place in 18 countries around the world. Social contracts are dissolving by the day. The world's socio-economic structure is coming unraveled. Oil is no longer acting as an agent for additional economic output; its leverage in the economy has fallen to 1:1. Existing social systems will not survive during a period of major declines in prosperity, and we have yet to even begin addressing the source of the problem.
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