by Summary:
The numbers continue to get weaker. Economy set to slow.
Topics:
Mike Norman considers the following as important:
This could be interesting, too:
The numbers continue to get weaker. Economy set to slow.
Topics:
Mike Norman considers the following as important:
This could be interesting, too:
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| The numbers continue to get weaker. Economy set to slow. |
Quick. Double the unemployment assistance payments and double the taxes on employed individuals to pay for non earners and save the economy.
No Homes, that's not how it works. The federal government doesn't need to levy taxes to "pay for" unemployment assistance or any other program. The federal government is monetarily sovereign and the sole issuer of US currency — which it can do without limit until inflation becomes an issue — which it hasn't been for decades. The Fed cannot even hit its inflation target of 2%. Same for central banks world over. Look at Japan, they've been unsuccessfully trying to hit their inflation target for 30 years. They can't spend enough. If you prefer empirical evidence to theory — look at military spending. It is far, far greater than the DoD budget — trillions annually. Yet no one has ever asked, "How will we pay for military spending?" The only issue is one of societal priorities. Do we want to let people starve or do we want to support all of our citizens as the Constitution mandates.
Bought the dip in TLT today with conviction.
@Jay M if there's a slowdown TLT should do well.
@Jay M look at charts. Study what happened at the start of Covid in 2020.
@A Manzella Maybe… I'd say its highly probable.
@R O Y G B I V > look at charts..
Ok, I see it went from 140's to 160's. Thx
@Jay M Yep. Reading charts isnt that hard it's just learning to read the tea leaves and build your risk management plan from there.
The stock market is over-valued. What a fucking surprise.
overvalued relative to what? Cash?
It is probably not. Keep this thought in check more than you keep your ego in check, or it will ruin you.
Do you believe that real estate is over-valued too?
Prices are controlled and can keep increase to infinity until certain buttons are pressed, and can also decline to zero until certain buttons are pressed and the timing is controlled too.
Tapping into credit explains a lot of it. Without additional stimulus there has to be a slowdown.
Mike all due respect the economy isn’t just about government spending. You’re neglecting the other components that make up GDP. Granted, government spending is indeed important nowadays but again it’s not the only thing. Consumption, investment and next exports are the other components of GDP
GDP is outdated. Nobody cares about that anymore.
Guys, we haven't seen any big level of fiscal slowing yet. On June 30th, the deficit YoY will be the lowest point because of tax day getting delayed last year. Mike will say the end is near on that day, and then the following three weeks the deficit YoY will shoot back up.
Both public and private credit growth are driving the economy. However private credit is limited by capital requirements and the amount of creditworthy customers. Whereas public credit (gov deficits) is limited only by inflation.
@Oliver Tilk good point. Wait til August. Fall has more volume.
@Jari Rutanen That’s how I think about loans vs deficit spending too. Which is why it makes sense that fiscal flows are the most important thing.
Fed buying MBS so they can loan out 9x to the other banks to buy more MBS
I can see a sell off by late August
I also think there will be a delay of a couple months till we see a sell off
It’s all about the fiscal
watching silver and gold make a nice dip.. could make a bull run soon .. All it needs is some news to blast it off.
They're both looking weak & ready to plunge once again
I agree 🙂
Consider TLT instead
Oh that's why watching the reserve ratio and all that stuff is important it effects loan growth, that was like a massive realization for me. Thanks Make you are da Man!
Thanks Mike for your insightful analysis of the issue!
Mike, Will the upcoming monthly child tax credit increase the fiscal flows?
With Biden President , we are all screwed
@Lynda Smith Grow up
What type of collateral does the FED is lend against? Who determines the value of the collateral? How much does it charge on the loan?
i am looking forward to a dip, want to pick some Ethereum up
Wanna take your biden vote back Mike? ha ha, he sucks!!! Trump WON !!
The focus on the Fed is insane indeed
I used the zombie reaction to add to 30 yr treasury plan to hold for next 12 months.