A World of Hurt
There’s almost a tsunami coming through
Most of my jokes end up being premonitions:
Can’t wait for taxpayers to bail out Ripple!
“Wall Street strategist Tom Lee is aiming to create the MicroStrategy of Ethereum”
“BlackRock's Rieder expects two Fed rate cuts this year.”
I'm glad I'm not alone in seeing through Rick Rieder's bullsh*t.
Here’s Ben Hunt in May 2024:
"The people who benefit from cutting interest rates are the people on Wall Street who own financial assets."
US banks announce big shareholder payouts as Fed eases stress tests
This will enable the banks to pay higher speaking fees to ex-FOMC members.
The Fed Balance sheet is - as I write this - $2.337 TRILLION higher than when Janet Yellen said this in June 2017:
“Since our 2014 normalization principles, that we wanted to reduce our balance sheet in a gradual and predictable way. And we have tried systematically to communicate more about how we would do that as our plans have evolved…My hope and expectation is that when we decide to go forward with this plan, that there will be very little reaction to it, that it’s clear how we intend to proceed, and that this is something that will just run quietly in the background over a number of years”
Core PCE - "the Fed’s preferred gauge" - has now been above 2.5% YOY since April 2021.
They're not even close to their made-up ‘2% target,’ much less their actual mandate of "stable prices.
And still we get propaganda like this:
CPI Nonsense #34,293
The BLS CPI weighting for "Health Insurance" - my biggest expense after taxes, which are not in the CPI - is 0.79.
The BLS CPI weighting for "Housekeeping supplies" is 0.81.
Their legal mandate is 0%.
Central banks are the enemy of most people.
No normal person on Earth worries that their annual cost of living increase might “undershoot” some PhD’s made-up “target.”
This is something Greg Weldon has been harping on for ages…
"Ulysses S. Grant and the Panic of 1873"
President "Grant did not bail anyone out, including his brother-in-law, which was consistent with the way he approached national finance in general; namely, by focusing on the real economy without regard to the consequences to speculative finance or any special interest, including partisan politics."
Boy, do we need this kind of leadership today!
Calandro notes that “the monetary base more than doubled from 1860 to 1865 (compounding at 20 percent).”
I note that the monetary base doubled from $3.2T in September 2019 to $6.4T by September 2021 - a Civil War-level monetary inflation, in just two years.
“These Soviet newspapers, they painted a rosy picture until the very end…media was used as a propaganda tool and no one believed it anymore.”
"The rules are simple: they lie to us, we know they’re lying, they know we know they’re lying but they keep lying anyway, and we keep pretending to believe them." -
Elena Gorokhova, A Mountain of Crumbs: A Memoir
Plenty of thought-provoking anecdotes below - some would say “too many,” as the most common reason paid subscribers give for un-subscribing is “time.”
You don’t have to click every link. I just do what I do, and post things that catch my eye during the week, and if that interests you, super, and if not, that’s ok too. I’ve been doing this format now since 2009 (the last few years on Substack), and since I search these often as a sort of database, I'd probably keep doing it with no readers.
Below the fold we’ve got some government data charts - for what those are worth, some music, the exodus, or non-exodus, from U.S. investments, bonds - which apparently some people own, CRE unpleasantness, some discussion of “overvaluation”- which sounds communist to me, various sober warnings everyone will ignore, H-1B visas (MAGA!!), Housing(!), Cape Coral, Melody Wright, Mike Green/Harley Bassman/John Comiskey, some guy who thinks American needs to lever up (into private credit!), hedge funds getting into private credit(!), the usual complacency, bailing out Peter Thiel again (probably), solar stills, and more.
There’s nothing new under the Sun.
Keep reading with a 7-day free trial
Subscribe to A Havenstein Moment. to keep reading this post and get 7 days of free access to the full post archives.