Share
82 Posts.
lightbulb Created with Sketch. 22
clock Created with Sketch.
10/10/22
21:10
Share
Originally posted by Tekvest:
↑
I've always been bemused by charts because they reflect and predict behaviour but also rely on confidence and belief. I think the predictors may have been stronger when ZIP was among the ASX200. Conversely, some people who read the fundamentals think there's not much going on. Maybe the combination is enough to confound the charts?
Expand
How it plays out - Small nations are not being able to buy fuel or food. The natives get upset and kick the management out. The management usually doesn't want to go, and so another round of mayhem begins. This is already playing out in some countries, while many others are still trying to renegotiate their debt. Global supply disruptions and labor-market pressures are feeding supply side inflation. Trying to reduce inflation by raising interest rates, along with financial market stress, is having consequences (see Sri Lanka etc) . Instead of focusing on reducing consumption, policymakers should be figuring out how to boost production. Improving productivity and capital allocation are critical for poverty reduction.
Originally posted by bedger:
↑
Been warning of this mayhem on HC myself since "transitory' exited the lips of Powell in April 2021, and yet the US market of course rallied hard until December 2021. Central banks balance sheets don't behave by the same rules as investment banks. They almost literally just print more money/assets simply speaking and that will see lower f/x rates vs those Central Banks that don't => continued strong dollar. I am not having a go Goodfella, the monetary distortion the ECB, BoJ and finally the Fed have practiced since 2008 is going to finally see a reckoning, but I'd be curious to your explanation of them being insolvent and how you think that plays out. They certainly have a truck load of debt on their books at terrible levels from all the completely reckless excessive bond buying in the last 10 years, which as at odds at their ability to control price stability now yields way higher. But literally the big boys like the BoJ/BoE/ECB cannot go bust....they will just print and buy more assets and their balance sheets really the ultimate act of accounting fantasy, with some analogies to the never ending dilutive printing of shares by companies en masse historically across global companies gross. It goes to the very fundamental theory of debt driven capital mkts, so often misunderstood conceptually. Central Banks, as they so often have historically, got it wrong again. The inflation crisis we are in is as much them pumping cash (demand) into supply constrained economies as the supply side itself, but its not so easy to predict how that will unfold with Central banks (likely a long period of economic misery in my opinion as the ECB and BoJ distorted capital markets and risk pricing that now has to return to normal mkt function with inflation and without their ability to distort with low rates/bond buying). Conversely, for all the 2008 analogies springing forward (and I've been warning the ECB/BoJ action would always end in tears eventually since 2008) the US and European investment and retail banks are actually very well capitalised. The debt burden has literally been transferred from the private to the public sector by the Central Banks since the GFC. Oh I am back in ZIP as of today, so probably on these threads to counter the more stupid down-rampers. I see desperate longs futilely blaming shorters is more prevalent right now, despite shorts having net fallen since May. I was all out of ZIP by $1 last time round. I did warn ASX200 removal was inevitable and is a lot to do with this push back down to recent lows again as much as its business/debt outlook.
Expand