President Biden's first term in office

[Coughdrop addict]

I read it, and disagree with most of it.

As a liberal Democrat I can sort of see where the author is coming from. It's important to recognize our own irrational tribalism and all that. But the author makes the mistake I see in some liberal circles of assuming ALL opinions are equally valid/correct and no actions are in and of themselves foolish/deplorable.

When someone's opinion is that people with certain skin tones aren't really people and shouldn't have rights, or that their candidate won the election even when they didn't, it should be okay to say that person is wrong.

If someone is taken in by a con that everyone but them spots easily (such as someone calling them up claiming to be Barron Trump and demanding money), it should be okay to laugh at their stupidity.

And if someone's reaction to people not voting for their side is "We need to stop them from voting.", it should be okay to say they are deplorable.

[enoch]

Please leave the nuance, complexity and acceptance of reality out of it dude.

[Forward Observer]

Breaking news after the May report of another record consumer price index (inflation) hike of .6% after an .8% jump in April.

This just in from the White House

Biden to investigate inflation

Cheers

[enoch]

Breaking news after the May report of another record consumer price index (inflation) hike of .6% after an .8% jump in April.

This just in from the White House

Biden to investigate inflation

Cheers

Ah, the low rent The Onion. Shouldn't this be in the TD?

[Exarch]

Biden's economics aint looking so hot, runaway inflation is turning into hyperinflation.

Better start buying gold and crypto, gents; otherwise get ready to bring a wheelbarrow of Benjamins to buy your toilet paper.

[enoch]

What's it like not understanding what words mean?

[Exarch]

Biden's admin is starting to look a lot like Weimerica.

[conon394]

Biden's economics aint looking so hot, runaway inflation is turning into hyperinflation.

Better start buying gold and crypto, gents; otherwise get ready to bring a wheelbarrow of Benjamins to buy your toilet paper.

Err what hyper inflation?

Random supply side shocks are not a doomsday.

[swabian]

So, I'm certainly not in league with any CCP shills, but...

Err what hyper inflation?

Random supply side shocks are not a doomsday.

Yeah, it's not random at all. It's very, very obviously caused by the pandemic. It's also not merely a supply-side shock, but also demand-side and it has far reaching consequences for occupation and wages. But most importantly, the FED has been caught lying or downplaying the inflation rates many times over. It's now admitting that it's at 4.2% (not 2%), but this is already outdated. It's pretty certain that we will see more significant dollar inflation in the future. Hyperinflation is probably not likely, but possible.

Investing a portion of your dollars in stable assets makes sense currently.

[conon394]

Yeah, it's not random at all. It's very, very obviously caused by the pandemic. It's also not merely a supply-side shock, but also demand-side and it has far reaching consequences for occupation and wages. But most importantly, the FED has been caught lying or downplaying the inflation rates many times over. It's now admitting that it's at 4.2% (not 2%), but this is already outdated. It's pretty certain that we will see more significant dollar inflation in the future. Hyperinflation is probably not likely, but possible.

Investing a portion of your dollars in stable assets makes sense currently.

Still not seeing the worry. Gasp wage inflation OMG profits have to handed out to workers vs stock buy backs or CEO salary. But the a close read still puts the spicks in mostly supply side issues. The Fed needs to be careful and I do think the US housing price is starting toward bubble that needs to watched closely. After that they could likely start walking back purchases. Although I would favor the big banks first and not municipalities.

Where do you see the FED lying on inflation? What is wrong with 4.5% if wages are actually rising.

[Cookiegod]

conon there has been no productivity increase outside of Asia. Meaning the increased money hand outs did not purchase that many more goods created in our western hemisphere. The money from government handouts across the West had to go somewhere.

It first and foremost went into stonks, cryptoBS and into housing. Housing of course is primarily a local issue varying wildly across regions. Here in Copenhagen the price increase is quite real.

The absolutely ridiculous stonk performances of e.g. Tesla are also the result of lots of dumb money having been pushed into the system, with not enough valid start-ups present as investment opportunities. And about cryptoBS I want so say no more.

All those three investment areas had in common that they increased as a result of most people being aware what has happened to our currencies. An absolutely ridiculous percentage of dollars in existence now were printed within the last year.

In other words the only reason why the inflation hasn't hit us yet, even though productivity went down whilst the amount of money available increased, is simply because most of that money was stored away. This cannot and will not last forever.

[enoch]

conon there has been no productivity increase outside of Asia. Meaning the increased money hand outs did not purchase that many more goods created in our western hemisphere. The money from government handouts across the West had to go somewhere.

It first and foremost went into stonks, cryptoBS and into housing. Housing of course is primarily a local issue varying wildly across regions. Here in Copenhagen the price increase is quite real.

The absolutely ridiculous stonk performances of e.g. Tesla are also the result of lots of dumb money having been pushed into the system, with not enough valid start-ups present as investment opportunities. And about cryptoBS I want so say no more.

All those three investment areas had in common that they increased as a result of most people being aware what has happened to our currencies. An absolutely ridiculous percentage of dollars in existence now were printed within the last year.

In other words the only reason why the inflation hasn't hit us yet, even though productivity went down whilst the amount of money available increased, is simply because most of that money was stored away. This cannot and will not last forever.

Yet even if every cent was brought to the consumer market it still would not result in hyperinflation. Only someone with Zero understanding of global economics would even consider hyperinflation possible. Why it is being shilled to the lowest denominator fools through the interwebs.

[swabian]

Still not seeing the worry. Gasp wage inflation OMG profits have to handed out to workers vs stock buy backs or CEO salary. But the a close read still puts the spicks in mostly supply side issues. The Fed needs to be careful and I do think the US housing price is starting toward bubble that needs to watched closely.

While I may be more skeptic towards the FED and maybe overall a little more worried about the inflation than you (being a private investor and active trader), I don't think you're of a fundamentally different opinion. *shrug
Wage inflation doesn't have a medium/long term effect on real wages, though. At least not once workers have noticed their lower purchasing power and demand higher wages.

After that they could likely start walking back purchases. Although I would favor the big banks first and not municipalities.

How is that supposed to happen. The FED is lending money to the big banks first and not directly to municipal banks, or? Not sure right now.

Where do you see the FED lying on inflation? What is wrong with 4.5% if wages are actually rising.

The FED rarely if ever hit the sweet spot and often made things worse in the end. It happened before, for example in the 80's. In the end, they had to radically raise interests to prevent hyperinflation, which crashed the economy.
Something around 4.5% should be the targeted inflation, as I understand it. That the FED keeps increasing the dollar supply can mean that they have no choice and are deceptive about it, because the situation is worse than it looks. Or it could mean that the current chairman, like those before him, simply doesn't care about events unfolding beyond his term of office, which would imply that the FED under Powell is only looking on the success of short term measures and is using brute force to achieve that goal and doesn't care about the possibility of a crash, because they know there will be a tomorrow anyway, and so the cycle repeats itself.

conon there has been no productivity increase outside of Asia. Meaning the increased money hand outs did not purchase that many more goods created in our western hemisphere. The money from government handouts across the West had to go somewhere.

As far as I know, there is no sufficient data about that yet. While people with high and moderate income will survive the crisis anyway without much existential struggle, the low income population crucially depends on this help to cover their daily needs and they will certainly not have invested that money. The emergency handouts are actually mostly intended to help people on the low end of the income spectrum.

It first and foremost went into stonks, cryptoBS and into housing. Housing of course is primarily a local issue varying wildly across regions. Here in Copenhagen the price increase is quite real.

The emergency support is not there to fight the inflation rate. The current inflation is fully intended, the problem is, that the FED is likely to overdo it as it has before. Also, immediate spending coming from medium and high income individuals would only result in a short term effect. It's not required that the emergency money is immediately spent to have a stabilizing effect on the economy. If money is stored or invested, it will only be spent later on and with greater effect, either in form of yields or in form of a higher incentive to take risks.

The absolutely ridiculous stonk performances of e.g. Tesla are also the result of lots of dumb money having been pushed into the system, with not enough valid start-ups present as investment opportunities. And about cryptoBS I want so say no more.

No, it's exactly the opposite. It's mainly smart money that invests manifested magic money from the FED in stocks and shares, because they know it will otherwise lose its value quickly. Also, there is nothing fundamentally wrong with Tesla or crypto currencies, disregarding Musk being a smug, manipulative douchebag with aspergers who hopefully will get kicked out of Tesla soon. Crypto currencies are a different animal, I don't wanna discuss that here either, but so few people have a significant amount invested in crypto currencies and the crypto market cap is below 2 trillion, so nothing really significant yet. If some people invest a bit of their emergency handouts in crypto, that doesn't have an effect at all.

In other words the only reason why the inflation hasn't hit us yet, even though productivity went down whilst the amount of money available increased, is simply because most of that money was stored away. This cannot and will not last forever.

Nonsense, it wasn't simply stored away lol It was invested, mainly in stocks and real estate, which is why you see the housing prices and rents go up.

[swabian]

Yet even if every cent was brought to the consumer market it still would not result in hyperinflation. Only someone with Zero understanding of global economics would even consider hyperinflation possible. Why it is being shilled to the lowest denominator fools through the interwebs.

Haha, stomping down on third party opinions from the unsubstantiated high horse, aren't we? To my knowledge, only Jeremy Grantham - who certainly isn't a finance analphabet or an idiot - expects a Weimar style "hyperinflation" and a crash. The term is vague but very justified if it is used in a sensible way. Nowadays 20% annual inflation for example is often considered hyperinflation. Grantham still thinks it's gonna be Weimar II. While I disagree, I would not sink so low and slap my dick into the face of one of the most successful investors in modern history because I think I knew better without demonstrating imagined superior intellectual powers, like a halfwit who's lacking character.

Can we get to 20%? I don't know, but I think there is an actual possibility, even though it's low. We can get to 10% annual inflation for sure and I don't think 10% annual loss of purchasing power over the next 10 years is any fun. Do the math if you can, Einstein.

None of this is the fault of the Biden administration, btw. I doubt the president can intervene in what the FED does (even indirectly) in a significant way.

[Cookiegod]

No, it's exactly the opposite. It's mainly smart money that invests manifested magic money from the FED in stocks and shares, because they know it will otherwise lose its value quickly. Also, there is nothing fundamentally wrong with Tesla or crypto currencies, disregarding Musk being a smug, manipulative douchebag with aspergers who hopefully will get kicked out of Tesla soon. Crypto currencies are a different animal, I don't wanna discuss that here either, but so few people have a significant amount invested in crypto currencies and the crypto market cap is below 2 trillion, so nothing really significant yet. If some people invest a bit of their emergency handouts in crypto, that doesn't have an effect at all.

Nonsense, it wasn't simply stored away lol It was invested, mainly in stocks and real estate, which is why you see the housing prices and rents go up.

You turn the words around in my mouth. I fully agree that smart people invest their money right now as the inflation can only increase. Hence why for example the housing prices increased rapidly. But given how both stocks and housing are somewhat limited in their availability on the market that creates a whole different risk of bubble. Which e.g. here in Denmark was close enough to be concerning, though we're probably not entirely there yet.

Anyway, a lot of those stimuli grants went into Robinhood and other cheap brokerages, and yeah, the reason why Tesla got a P/E of 1225 is exactly dumb money and nothing else. A lot of new money got pushed into the system, is what I'm saying, the reason we didn't have a matching increase in inflation is because most of that money got into stonks, real estate and crypto, which all saw corresponding sharp spikes in worth. A lot of that money was invested unwisely.

And in the long run this excess availability of stocks will be felt in the form of inflation. There's just no way it can go differently when the productivity stagnated.

[swabian]

You turn the words around in my mouth. I fully agree that smart people invest their money right now as the inflation can only increase.

I mean "smart money" in the classic sense, namely institutional money, namely mainly big banks.

Hence why for example the housing prices increased rapidly. But given how both stocks and housing are somewhat limited in their availability on the market that creates a whole different risk of bubble. Which e.g. here in Denmark was close enough to be concerning, though we're probably not entirely there yet.

Dumb money doesn't contribute to this at all, obviously. So what is your concern here?

Anyway, a lot of those stimuli grants went into Robinhood and other cheap brokerages, and yeah, the reason why Tesla got a P/E of 1225 is exactly dumb money and nothing else.

So you think that the lowly peasants have been granted undeserved money which they gambled away, all into the greedy black hole of Tesla, or what? Oh well... those must have been some rich peasantry.

A lot of new money got pushed into the system, is what I'm saying, the reason we didn't have a matching increase in inflation is because most of that money got into stonks, real estate and crypto, which all saw corresponding sharp spikes in worth. A lot of that money was invested unwisely.

I doubt it. Source, please.

And in the long run this excess availability of stocks will be felt in the form of inflation. There's just no way it can go differently when the productivity stagnated.

The country's internal stagnation of productivity is a decades old problem, and actually the same problem in every Western country. It's cause is outsourcing of working force in non Western countries. The perspective of 3rd world countries is that they can't pay their debts, because they struggle with development (I think we should cut as many debts as possible as soon as possible, but that is obviously not what the goodfellas at the IWF have in mind).

I can't really find a point of conflict here. But it's certainly true that there are serious problems for the world economy ahead.

By the way. I certainly don't want to spread fear, I'm just reasonably worried.

[enoch]

It never ceases to amaze me how people who haven’t spent their life in the world of finance somehow think Investor Gods are
1) not trying to manipulate markets with every word they utter in public
2) that they are confused with economists and banking bureaucrats
3) are somehow better at investing and not mostly just lucky/have access to large amounts of capital/did what most informed investors could have. It beggars the intellect. Better than the fools who think Dalio has their best interests in mind at least.

[swabian]

It beggars the intellect.

I'm sure it does

1) not trying to manipulate markets with every word they utter in public

So in your opinion market manipulation shouldn't be called out but submitted to.

2) that they are confused with economists and banking bureaucrats

What are you even rambling about.

3) are somehow better at investing and not mostly just lucky/have access to large

It's 20% knowledge, 20% luck and 60% insanity (risk tolerance). If you're not crazy enough to believe in your deluded crap to take advantage of an opportunity, you do not even have the very chance to score.

[enoch]

So in your opinion market manipulation shouldn't be called out but submitted to.

You cited Sir Jeremy as a solid source on hyperinflation and a crash not me. Definitionally submitting to market manipulation is what you did and openly stated while now agreeing you were manipulated. So yeah.

[swabian]

You cited Sir Jeremy as a solid source on hyperinflation and a crash not me. Definitionally submitting to market manipulation is what you did and openly stated while now agreeing you were manipulated. So yeah

Nope, not at all.