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User Info Yes, Rates Are STILL Going Higher in forum [Market-Ticker]
Dxd1200
Posts: 9
Incept: 2021-05-01

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Jobs rolling over is what has me nervous...I'm not over leveraged at all, but would like to retire one day in the not so distant future. Everywhere around me is madness though. New 3000 square foot houses on 7500 square foot lots starting at a cool million dollars in Pierce County, WA - that's just insanity. So many Ford Raptors on the roads around here, you'd think it was the official truck of the south Puget Sound. Even small pockets that used to be sane have gone off the rails. I saw a house just listed in Sumner, WA for $950k. This is going to end so badly for so many.

I saw two of my former employers have begun quiet layoffs, but both have cut close to 1000k jobs since January. There's going to be an IndyMac moment soon, the domino that starts the avalanche of layoffs. I'm just not certain where it will be. I know that a certain online retailer has been cutting back hours of their operations workers, doling out unpaid time off when things slow down. Still busy, but not so busy they have to keep the machinery cranked to 11 at all times.

Eoinw
Posts: 81
Incept: 2021-07-14

Canada
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@ TG & Franco Thanks for the replies.

I can't agree with the "staying alive" concern. As I see it, deflation will be caused by those in power saving the currency. After all, government spending is what gives them control of citizens. Without dollars, they have no influence - can't even pay for the army/police to protect them.

Therefore I expect them to raise rates to save the dollar and remain in power. In theory this should mean avoiding a Mad Max scenario. Of course, they are so incompetent and corrupt they might do one thing right and still lose control.

Even the Bee Gees didn't live forever. Cest la vie!
Eoinw
Posts: 81
Incept: 2021-07-14

Canada
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I appreciate the defence of the youngest generation. It's so easy to project the sins of society on them. Yet they've had the least influence in shaping our Sodom & Gomorrah society.

I've been fine with the kids I work with. Most are not afraid of work. However the generation which came before is another matter. The people now in the 30-40 age group turned up with attitude and a very selective work ethic. Rather spoiled so the Boomer generation gets no pass for raising them that way.

Remember the Boomers? Suppose to be the elders of society guiding everyone through a crisis. Instead they were the first to go into ***** hysterics.

Doesn't give young people much chance. Fingers crossed that they prove to be much better than the generations which preceded them.
Erroldo
Posts: 585
Incept: 2013-09-12

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The BIIIG clue to what is coming is IN THE STOCK MATRKET people!!
A recession is certain. we already started one. The stock market look ahead 6-12 months. And it is DOWWWWWN. Not from some b;ack swan event like ***** in 2020. Down on fundamentals bubble bursting. The housing market is next. Mark my word. I was around in 2000(just in the work force a few years then) and in 2007. The stock market looks ahead. This downtrend started in Nov. Rotation into the big few names push the market higher. Now they are out selling everything from Tsla to AAPL to GM. AMZN, that has more down to go. it was a garage for a while. now the mercedes of ,money is leaving this garage empty. Any bounce, i will raise more cash in my 201k. Selling a rental is also on the docks. was thinking of passing on to kids, but to hell with that idea. I think raising cash is better, since some here sees deflation to follow this inflation. In deflation, cash is god, not king.
Happyapricot
Posts: 89
Incept: 2019-07-06

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My question is what did they spend the money on?

Bush, Obama, Trump, and Biden spent close to 20 trillion dollars. Where did the money go?

Did poverty end? World peace? Homelessness End? Find a cure for cancer?

What did the politicians do with the money?

Freewill
Posts: 254
Incept: 2021-08-31

Illinois
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For what it is worth, gas prices are between $4.60 and $4.90 per gallon in my corner of the world. That is insane, and it is doubly insane that this is occurring before summer-driving season has even started. It is not even Memorial Day yet, and I can't imagine how it is in California. Oil prices are down from their recent highs and are expected to go lower: https://www.wsj.com/market-data/quotes/f.... So maybe this will ease up into fall (but it may not matter by then).

People with low incomes will not be able to afford to go to work soon, let alone pay for rising food prices, rising utility prices, and rising mortage/rent prices.

The economy is dead as far as I am concerned. Whether "civil society" collapses as well is an open question.
Moconserv
Posts: 148
Incept: 2013-02-13

Central Missouri
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@Happyapricot - I'm guessing hookers & blow....

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Beyond pissed.....
Poer
Posts: 2754
Incept: 2008-09-28

'Eppur si muove!'
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@Happyapricot
Swish accounts, or Caman Island?? Epstein island?

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"The degree to which a man substitutes the judgment of others for his own, failing to look at reality directly, is the degree to which his mental processes are alienated from reality." Nathaniel Branden in Ayn Rands 'Capitalism The Unknown Ideal'
Bluto
Posts: 1436
Incept: 2021-07-10

Florida
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@Stoic
Quote:
While I agree that ostrich syndrome is a huge problem....


The Creator has a sensor of humor.

If you want to act like an ostrich and put your head in ground, it means you are on your knees, with your ass in the air ready for it.....

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"Your heart is free. Have the courage to follow it." -- Malcolm Wallace from "Braveheart"
Evergreen
Posts: 105
Incept: 2021-12-26

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So, if understood correctly, had the administration a proper understanding of things, it would have foregone economic embargoes of Russia and instead hugged it closer economically so as to export inflation.
Indianarube
Posts: 558
Incept: 2020-03-22

NW Indiana
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Tonight's earworm, courtesy of @Joancrawford.
Proverbs16.33
Posts: 103
Incept: 2021-10-22

WNC Foothills
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Quote:
What did the politicians do with the money?

same thing they always do with our money? into their pockets???
I can't even imagine literally having more money than I would know what to do with like some of them. I live pretty frugally, but I do have a "wish list" of things I would love to have when the money comes in (mostly farm infrastructure, equipment upgrades, etc). But these people with millions and billions of dollars, they're still not happy, and they have no idea what to do with it...sigh...
Tickerguy
Posts: 184126
Incept: 2007-06-26
A True American Patriot!
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They stole it.

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Civil Society requires 99%+ consent.
Stop consenting and it is forced to stop. Always.
No violence required.
Packetcap
Posts: 263
Incept: 2021-07-23

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@Freewill gas is about $6 a gallon in CA right now.

BTW who says there has to be a Summer Driving Season? With gas double the price, food going up, people might do some math and decide to stay home. If you are working for a marginal company you might be looking for work or saving money for the rainy days ahead. Or working the 2nd or 3rd job you need now due to inflation.

To me it is feeling like the .com bust or 2008, only worse due to the inflation. The only question is how long the downturn will last and if we see a societal meltdown to go with it. Riot Season coming up, it might be a good one. Can we get hunting licenses for the antifa animals?

Croumeli
Posts: 10
Incept: 2011-10-18

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@Tickerguy Do you predict we will have an inflationary or deflationary driven recession? Also what is your prediction with housing, when will we see declines in prices and by how much?
Goldbrick
Posts: 6509
Incept: 2008-01-23

Indiana
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Happytrail, the endless bush wars cost many trillions; add in the grifting on top of that and you're talking real money.

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"The higher I go, the crookeder it gets." --Michael Corleone. "We now live in a nation where doctors destroy health, lawyers destroy justice, universities destroy knowledge, governments destroy freedom, the press destroys information, religion destroys morals and our banks destroy the economy."--Chris Bray
Goldguy
Posts: 134
Incept: 2019-08-14

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Anyone interested in getting an additional 5k in I paper bonds, here is a link worth considering. Got all mine this year and last year, debating about the paper bonds here....

https://tipswatch.com/2022/05/08/ready-t....
Freewill
Posts: 254
Incept: 2021-08-31

Illinois
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@Packetcap

I didn't say there has to be a Summer Driving Season. I have actually always thought that summer is the worst time to travel (in terms of cost and crowdedness on the roadways). It is way too hot in most of the country anyway during that time. I have always preferred to travel during the fall.

If Summer Driving Season dies though, hotels, restaurants, airlines, and tourist destinations will suffer as a result for better or for worse.
Goldguy
Posts: 134
Incept: 2019-08-14

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Something else, this market is starting to feel like the 1973-1974 fiasco, only this time its going to be 2022-2023. When the market bottomed in 74, stocks were incredibly cheap. I remember it well, stocks went down daily and it was painful, obviously not with all the fan fair that is available now, I mean there wasn't any cable tv where I live. But, it was brutal...that is was I am preparing for.

And another thing while I am typing this, Gold has always done better relative to the sp500 during bear markets going all the way back to 1929, except once, during the 1980-82 time period when gold peaked.
Kwwilson
Posts: 36
Incept: 2022-03-02

N. PNW
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Tickerguy wrote..
The ****ty deal is that with the sanctions you couldn't trade that. I would have.
I did.
Like a freaking retard, I misjudged the likelihood that Id get screwed out of an ETN, and so bought august options for a rebound to below pre-invasion rates. Not a ton of money, but it sits now in my account, in jail, with value on paper, but a fat zero in reality. Same week I bet that some banks might take a loss on the nickel/commodity price spikes, then markets froze and Morgan bailed out their own counterparty. Seems the house always wins.
Not the first time Ive been taught that lesson, but sometimes I come out ahead, and then I forget that its a rigged game anytime it really counts.
I am realistic enough to understand that Im betting, not investing.
Doladin
Posts: 36
Incept: 2022-01-15

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Spot on, corporations have had a get out of jail free card for inefficiency and poor choices.
Let's hope those with diversity hires will fail first. ESG small hats won't be able to bail EVERYONE out.

I also want to add - while corporations have lived the good life in cheap credit, the middle class/consumers have had not just their savings but their incomes reduced from those policies. Add to that, the run into tangible assets that further raise the cost of living - in Australia, housing is a very profitable investment.

I welcome a paradigm where we return to 'buying what we need' and not 'buying what we WANT'. See "Century of the Self" on youtube, a BBC documentary on how Edward Bernays changed this thinking... along with other terrible actions, such as supporting the suffrage movement.
Rangeishot
Posts: 197
Incept: 2021-11-18

FL
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I don't see that my 401k has any better options than a Stable Value Fund, which I'm not sure is trustworthy in a truly serious crash. If there's a way to hold cash in my 401k, I can't find it in the company's ****ty offshore-maintained user interface.

Been fretting about having money "doing nothing" in the bank. We've got zero debt and a decent cash buffer (both physically and figures in the credit union computers). Several weeks ago we did the I-bond thing to the 10K limit for each of us, but last night I was thinking ... it costs $50 to create a New Mexico LLC and zero thereafter. Each LLC can buy up to 10K in I-bonds annually. As far as I can tell, this might be a route to park as much cash in bonds as you wish in exchange for doing a tiny bit of paperwork. Going to call the CPA later today to see if I'm overlooking any gotchas...

Tickerguy
Posts: 184126
Incept: 2007-06-26
A True American Patriot!
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@Rangeishot, don't try it. The rules on I-bonds are quite clear; it's $10k/person/year and an LLC is a disregarded entity and uses YOUR SSN for tax purposes. If they catch you (and they will) they'll void the transactions but it may take them weeks during which they have your money, and you don't nor will you get any interest. I would also be very concerned about them considering that an INTENTIONAL act intended to circumvent the limits, which would easily wind up with them closing your TD account and/or barring you from future purchases.

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Civil Society requires 99%+ consent.
Stop consenting and it is forced to stop. Always.
No violence required.
Mannfm11
Posts: 8119
Incept: 2009-02-28

DFW, Tx
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I think the $64K question is where is the capital? I believe this is what Karl is bringing out in his post. If you can force enough credit through the system, you can make a dead mule act alive. What happens when you need him to plow?

I'm loaded up with metals. Not because they are going to make me rich, but because they will survve and when this becomes apparent, there might not be any to be had.

If this turns to deflation, every instrument will be affected. Your bank account is tied to a pile of bad debt. No debits, no credits. Credit money doesn't work without debits behind it. One implies the other. I hear about buying bonds? How is that going to work? Karl mentioned the long bond trade available in 1981. My Dad bought at 9%. Looked like a mistake and it was for a few years. 14% beat the stock market and within 10 years you had a gain you could have put into the market, as 14% bonds are priced to yield 7% when the market is 7%. You buy bonds and they destroy money, you might get zero, because hyperinflation is the only way besides total collapse the government navigates this.

The game has changed. We are seeing it right now. The keynesian spend your way to riches has failed. I recall Karl recently supporting the theory and I agree with the theory, but the real compound math destroys the theory, unless you run the surpluses first. Europe committed suicide with the Euro and the climate scam. The US gooses the economy, instead of it getting the US economy high, it gets China and the associated corporations high and the multiplier flows out as trade deficits and money to push asset bubbles. The money isn't respent into the economy. Germany tried this in the early 1920's, but then again, money was still tied to gold. Money is nothing but credits backed by debits today. If everything becomes free there will be nothing.

I read about half of Mises' Theory of Money and Credit. He spoke of inflation saying it shows up first in the stock market. That tells me those who do the inflating have a head start on the rest, not to mention extra money would naturally show up there. If that is true, they also know when the well has run dry and the resulting slowdown then shows up in fact. Inflation would go to zero fast, if they stopped inflating tomorrow. I think that hypothesis is true, unless something systematic happens, like in 2008. The CDO's were found out and the dog **** didn't make it out of the yard. If there is something systematic today, it is likely so many have never seen the fundementals changes in the way they are now facing.

Not only have we endured a long period of having captial returns determined by fake interest rates, but we have entered a period of government totalitarianism, market destruction and economic interference that has no precedent. At no time in modern history has a government, or in this case a group of governments worked to destroy the supply of energy and crucial byproducts associated with such energy sources. What has transpired equates to the 1973 Arab embargo, except that ended when the embargo ended. There are no replacement supplies, just delusions. We are likely in a situation where supplies will not only not support economic growth, but threaten food supplies and we may have fallen so far behind the curve that there will merely be running in place.

To boot, we face a shortage of housing, while official policy has allowed a mass invasion of immigrants. The western world has nothing to sell but debt. We are seeing the potential of collapse at funds rates still below 1%. There is no electric shock coming to revive the patient.

Once people and business have to bid for funds, those in debt will not be able to increase profits at a time when values are greatly determined by the prospects of future growth. As Karl points out, we have hasd 40 years where debt has become cheaper and the penalty has been lessened. A return to semi normal rates will destroy profits for years.

For me, energy is a necessity. 100 gallons a month is a good estimate of my consumption. Electricity and natural gas are up 30% or more at delivery. Those 2 factors show a minimum $300 a month change from a year ago. I have surplus income, so it isn't yet an emergency, but what about the people who were already broke at the end of the month? What goes? The car, the cable, the movies, Netflix, the iPhone or the high cost plan? The bar or restaurant? The dog or cat?

What happens when the Teslas take down the grid on hot days? The US and the west have been skimping on a lot of capital investment. States have used inflated assets to keep their finances rolling. Does California default this time, having rolled the dice again with taxes derived from inflated tech stock? The amount of explicit and implicit debt is massive. The only thing that helps this situation is higher bond rates lessen the corpus of a pension.

The death of the western consumer likely takes down the world. China is also a bubble, the result of the American credit bubble that financed it. The US was in such a position in the 1920's and pouring just a little inflation into the system blew a massive bubble.

Seeming benign inflation created this bubble. It was really created by credit that provided money to a starving world. What happens to this system, if the western consumers are no longer able to consume on the previous scale? The various problems will feed the collapse.


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The only function of economic forecasting is to make astrology look respectable.---John Kenneth Galbraith
Flappingeagle
Posts: 4582
Incept: 2011-04-14

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My pickup was just below 1/4 tank yesterday so I filled up. The pump stopped at $75. The good news LOL! is that it probably was about ready to shut off anyway as the gauge reads full.

Flap

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Here are my predictions for everyone to see:
S&P 500 at 320, DOW at 2200, Gold $300/oz, and Corn $2/bu.
No sign that housing, equities, or farmland are in a bubble- Yellen 11/14/13
Trying to leave the Rat Race to the rats...
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