Tag Archives: 5) Global Macro

Few seem alive to the potentially consequential financial risks arising from uncertainties evolving in China. One thing we know rather definitively is that markets don’t like uncertainty: uncertainty is Kryptonite to markets. Another thing we know is that the events unfolding in China are generating uncertainty on multiple levels.Whatever policy decisions are made, the potential consequences generate waves of profound uncertainty. Should authorities respond to...

Only when speculative sizzle attracts no buyers / marks will the bottom be in. There hasn’t been a truly organic bottom in stocks in decades. Fifteen years of relentless central bank manipulation since the 2008-09 Global Financial Meltdown has persuaded punters that central banks will always save us should the market turn down because relentless central bank suppression of interest rates and expansion of liquidity (a.k.a. free money for financiers) are now necessary...

Once assets are revealed as worth far less than claimed, insolvency is the inevitable result. If you haven’t plowed through dozens of post-collapse commentaries on FTX, I’m saving you the trouble: here’s a distillation of what matters going forward. If you’re seeking a forensic accounting of FTX, others have done this work already. If you’re seeking an ideological diatribe, you won’t find that here, either. What you will find is insight into the real innovation of...

You want to fix the world with finance? Then fix this: wages’ share of a financialized, globalized, speculative-bubble dependent economy have been falling for decades. Fix this and you really will change the world. Anything less changes nothing. Let’s start by stipulating my perspective on cryptocurrencies is neither positive nor negative in the usual context of “to the moon” or “worthless,” nor does it track any of the conventional narratives (decentralized finance...

When bubbles pop, it’s natural selection at its most unforgiving: “adapt or die,” and those who ignore or discount consequential asymmetries will have a very difficult time navigating the triage. After years of relative stability, it seems asymmetries, distortions and denial are playing out in unexpectedly destabilizing ways. These complex and often opaque dynamics are interacting with each other and reinforcing each other in difficult to predict ways. No wonder...

Liberation in the real world is the result of self-reliance and investing in our own well-being. Liberation has many contexts. It can mean being freed from imprisonment or servitude, freedom from gnawing want or oppression, or being liberated from prisons of the mind. Note that the first form of liberation is external / material, the second is internal / psychological / spiritual. Many confuse the two, blaming an oppressive system for their unhappiness rather than...

Everyone caught by surprise that the infinite road actually has an end will face a bewildering transition. The End of the “Growth” Road is upon us, though the consensus continues to hold fast to the endearing fantasy of infinite expansion of consumption. This fantasy has been supported for decades by the financial expansion of debt, which enabled more spending which pushed consumption, earnings, taxes, etc. higher. All the financial games are fun but “growth” boils...

So-called “cosmetic work” can cost tens of thousands of dollars. Now that housing is finally rolling over due to rising mortgage rates and bubble valuations, many of those who have been priced out of the market are hoping to take advantage of lower prices. In many cases, the most affordable segment is fixer-uppers, homes that are distressed for any number of reasons: a lack of maintenance; construction or drainage deficiencies; obsolete or defective foundations,...

In effect, authorities created two rat farms, both unintended: the sewers, and the private-sector rat-farms. The history of Rat Farms offers a valuable lesson in how markets and bureaucracies work. The story of how the colonial authorities in Hanoi came to establish two kinds of rat farms is highly instructive. The first rat farm was unintentional. French colonial authorities decided to modernize the French Quarter of Hanoi (where Westerners lived) by constructing a...

What nobody yet knows (or the few insiders who do know are keeping to themselves) is what will matter. Being a doom-and-gloom Bear stops being fun when the Bear Bar gets crowded. When everyone has moved to our side of the boat, the grizzled Bears get nervous, especially when they peer over at the Bull side of the boat and see a handful of dispirited Bulls ignoring the guy yelling at the bartender to “back up the truck.” The problem old-timers see is what everyone...