Still think TITNC3: Return of the Iceberg was peak

Is that still self-immolation?

 

It's easiest to build a new building if you demolish the existing one first.

In this case we'll call the building fair and transparent markets with competent oversight and regulation.

 

Becoming "too big to fail" is every financial entitie's greatest fantasy.

 

https://twitter.com/fidelity/status/1565453797245308931?s=21&t=Z-3q3HsprXQSiHizm8HB7g

 

Well, maybe I spoke too soon.

https://www.nbcnews.com/business/co...-mortgage-first-time-buyers-details-rcna45662


I'm assuming this gets killed in court when someone points out open racism by banks running afoul of some law or regulation.


Edit: Doesn't require race to participate in program. So not openly racist, just marketing to wokesters.

I'm now assuming this leads to a ton of gentrification of these areas, pushing minorities out, as non-minorities crowd the field for these favorable loans.

 

That was my initial assessment after hearing about this too.

 

Didn't they do that from 2002-2008? Except it was for everyone. We all know how that worked out.

As far as the correction goes. The FED is gonna keep raising rates and trying to get liquidity out of the market. Don't forget they have a metric shit ton of debt they are unloading. Straight to Goldman, JP, BOA and so on. The less money the big boys have in the market the more they can help clear the FEDS books. Once that's done the FED starts a new round of quantitative easing the the next bull market begins.

 

I doubt they ever clear the balance sheet. No one wants that shit, and they'll need to add back on the next bad downturn.

Rate increases are well priced in at this point, the uncertainty is duration (hence the tantrum after Jackson Hole). We're gonna ping pong between 3800 and 4200 until there are moves toward easing whenever that may be.

 

IDK man. I think if company margins shrink next earnings it's gonna continue the sell-off. Labor will be a problem. That will force companies to up salaries. Add inflation and continued supply side issues and you get shrinking margins.

 

Also the supply chain thingies. Anybody tried ordering windows or well, anything lately? That's still a spaghetti mess for import inventory. My grocer still periodically has random shelves completely empty for a few days until shipments catch up

 

Its possible, but inflation isnt a one way street. They have pricing power to protect those margins as well.

 

They do have pricing power. But, they raise prices on goods and that helps inflation. Then people stop buying stuff and they have an inventory surplus.

Many things are possible right now. I hope I am wrong but my gut is telling me no bull run until mid-2023.

 

Construction is its own whole mess.

In the US we're down to supply chain inconveniences, but the essentials are all there.

The biggest unknown I wonder about is energy prices in Europe in the winter.

 

Heating oil has 3x'd in germany already and it's not even cold yet.

Stateside, there's severe backorder issues with PPE equipment (my relevant field)

 

Who knows? Could be 2024 or beyond.

Overall things look pretty good evonomically, but then there's weird shit like record low labor force participation and negative real interest rates going on.

We can (and do!) guess for fun, but this shit's wide open.

 

What did they call it recently, a "growth recession" or some dumb shit like that

 

I did see that term. Silly.

I think the politicians are going to great length to fuck with the optics, because when you say "recession" to anyone 40 or under, the only one they remember is GFC.

But many many recessions throughout history have been mild - the majority, in fact, which is why the Great Depression and GFC are so noteworthy.

Mid-term election year...

 

I think we get the big one this time. I just can't see a world where they keep continuing to kick this can of bullshit in perpetuity. The only out I see is another major global conflict where we go boots on the ground. And I definitely wouldn't put it past them as a stall tactic.

 

I agree and I think this time is a little different then the last recessions we’ve had. This time we have supply chain issues still lingering on top of all the “relief” being handed out and blindly printing trillions of dollars in the blink of an eye all in the name of “green”

 

Anyway here’s some interning things to think about: