As we head into the end of 2022 we are reminded yet again of the sagacious wisdom of Louis Gave: Our investors pay us to ADAPT, NOT FORECAST. WALL STREET pundits have released a cacophony of 2023 predictions, and there’s always a race to ramp up all types of forecasts in an effort to make it to draw attention. The hills are alive with the echoes of Joseph Granville for the more outrageous the forecast the greater the chance for being elevated into the Pantheon of Oracles. If your off-the-chart predictions remain off the chart no one will ever remember, except SBF/FTX. The only certainty in 2023 is that the wisdom of MAO will be brought forward as IT TAKES A SINGLE SPARK TO START A PRAIRIE FIRE. There are several piles of dry tinder waiting to be lit. One of the most critical is the growing debt in the US that needs to be financed.
Posts Tagged ‘Federal Reserve’
Notes From Underground: US Debt, Never A Problem?
December 13, 2022Notes From Underground: Wow, My Sweet November
December 1, 2022First and foremost, I apologize for any confusion with the efforts to get some money flow to Santa Mike at Marillac St. Vincent Family Services. I put in the wrong contact/email for Mike Sturch (mikees@sbcglobal.net). Mike has been raising money to feed the hungry, clothe the naked and educate the inner city youth in Chicago providing pre-school programs to raise the level of learning for those suffering at the lower rung of the socioeconomic ladder. Every dime goes to meet the needs and my friend Mike has been doing this for more than 50 years. Today’s inflation is situation is creating extra stress for those in need. Thanks for your indulgence.
Notes From Underground: Cui Bono? (Who Stands to Gain?)
November 28, 2022When it comes to making sense of the global financial system I always have to ask the question who is benefitting from monetary policy? The recent podcasts from the Financial Repression Authority has provided a good backdrop to understanding the importance of debt markets — and by default the significance of the US DOLLAR as the bulwark of the financial system. The mobility of money or what serves the process of globalization has revealed many of the fragilities of the DOLLAR as a funding vehicle because of the FEDERAL RESERVE’S policies, which allowed all the other world’s central banks to sustain a prolonged period of zero and even NEGATIVE NOMINAL RATES.
Notes From Underground: Recapping the Last Two Weeks
November 20, 2022The day after the FED meeting I sat down with the FINANCIAL REPRESSION AUTHORITY and did a podcast with David Rosenberg and Peter Boockvar. The discussion is still relevant as it speaks a great deal about bond, equity and, in particular, currency valuations. Then on Monday, November 7 Richard Bonugli hosted an hourlong discussion with Brent Johnson and myself, which was also about currency valuations and the precarious global situation of massive debt overhang. Finally, I recorded a third podcast with FRA and Eric Peters about crypto and the possible fallout from the collapse of FTX. There’s lots to digest here but as always I remind readers that the only relevance for traders/investors is to find meaningful trades or investments. Otherwise we are just talking to hear ourselves talk, which is in the very real sense meaningless. Also, it is not always what you make through relevant ideas but the capital preserved by not following the herd.
Click to listen to the Nov. 4 podcast with David Rosenberg and Peter Boockvar.
Click to listen to the Nov. 7 podcast with Brent Johnson.
Notes From Underground: Hu’s Out First, Li’s Out Second, and Xi, I don’t Know
October 25, 2022There is a great deal of political noise reverberating out of the Chinese political system as President Xi has asserted his Mao-like vice grip over China’s political, social and military reins of power. The rule of the DENG XIAO PING — HIDE AND BIDE — is officially closed. China, through XI, has revealed it will no longer HIDE its wealth/power or bide its time. The newest threat to the Bretton Woods HEGEMON has stepped to the fore to directly compete with the US Empire. The outcomes of Xi’s newest maneuvers will not be revealed for a time period but be assured that changes are afoot in the Pacific Region. How the wealth outcomes are determined will take a long time but if the competition is violent the destruction will be vast. Hopefully, the world — including the US — will engage in firm but friendly competition rising the standards of construction to new and enhanced levels for the entire globe.
Notes From Underground: Conversing With Dr. Anas Alhajji
September 25, 2022As I go into hiatus I am posting a PODCAST recorded on September 20 with world renown Professor Dr. Alhajji, in which we discuss global energy and its implications on global politics and finance. The Financial Repression Authority, under the auspices of Richard Bonugli, has provided a wonderful platform for allowing me to discuss the most relevant global macro topics with the leading thinkers in the realm. The wisdom of Mr. Bonugli allows for ferreting out investment ideas — both long and short — to help provide insight and profit for readers of NOTES FROM UNDERGROUND. Enjoy the podcast and I look forward to writing after the period of the Jewish Holidays as I’m in need of deep introspection. Wishing those who celebrate a coming year of health, peace and prosperity, and for those of other beliefs I wish you the same.
— Yra
Notes From Underground: Take Jerome With a Big Grain of Salt
September 20, 2022A quick view on Wednesday’s FEDERAL RESERVE‘s meeting: According to the newest Fed stenographer, Nick Timiraos, look for the central bank to raise rates 75 basis points in an effort to get ahead of the curse of HEADLINE inflation. This level is baked into the present market values. Look to see if there is any discussion of slowing the FED FUNDS increases as the FED tries to get a handle on the impact of $95 billion a month balance sheet unwind and a DOLLAR that has risen 14% since the beginning of the year, and more than 20% versus the Japanese yen.
Notes From Underground: Another Day, Another Podcast
September 14, 2022It was a fortuitous day that Richard Bonugli arranged a podcast with Joseph Wang, author of the Fed Guy and an former employee of the New York Fed’s System Open Market Account (SOMA). The podcast was recorded 90 minutes after the release of Tuesday’s CPI data so there was much to discuss in real time about FED policy, the recent moves in the SPOOs, dollar, commodities and precious metals were all reversed because the MARKETS seemed to have been caught off guard by a much higher number than Wall Street pundits anticipated.
Notes From Underground: Dear Jerome
August 24, 2022I have not been a fan of yours since your January 2019 “Powell Pivot,” when you allowed yourself to be fooled by the markets. In an effort to rein in Ben Bernanke and Janet Yellen’s QE programs you went for what Stan Druckenmiller called the “double shotgun approach” and raised interest rates while reducing the Fed’s balance sheet — what Peter Boockvar called Quantitative Tightening (QT).
Notes From Underground: Neutral
August 16, 2022On Friday I sat down with Richard Bonugli at the Financial Repression Authority and Doomberg to discuss the current situation in global energy and tried to peek into the future as to where Europe and the US are going to find the means to provide dependable and affordable energy to power economic growth. Enjoy the podcast and hopefully it will lead to more high levels of discussion on all things global macro.