Comments by "Curious Crow" (@CuriousCrow-mp4cx) on "Eurodollar University"
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It's not zero inflation at all. You can't have zero inflation because of two things: Fear and Greed. Yes, producers set prices, but their motivation is not to provide a charity, but to produce profit. And people like getting wealthy. But not even producers can control events. Everything was OK until globalisation broke down because of Fear and Greed in 2008. That greed led to the Eurodollar Offshore Capital Market getting bent out of shape, and becoming really risk adverse. The truth is Fear of being ripped off again means liquidity needs to pumped in to persuade Eurodollar lenders to lend. The trust is gone, and when ygat happens their a premium to pay, and the only people that can find that money to stop the global financial system seizing up is the US government. But who are they subsidising? U.S. Banks. Back in the 2000's it was expected that profits from banking would decline, and there would be some rationalisation, because the banking sector is too big. You have too many banks all chasing the same money, and what's worse is that the banks stopped investing in the real economy. They've moved over to speculation, asset bubbles, the Stock Market, and derivatives. And the non-bank financial institutions are going down the same route. Hoarding money kills economies, but... People like getting wealthy. Wealthy enough to buy the politicians, the media, and everything else that's supposed to protect the masses. And the Fed ireal mandate is to deflect attention from the things that are rotting the global financial system - Increasing wealth inequality, economic colonialism, and climate change. And what's worse is that the big kajhunas running the show know the way things are is not sustainable, but they won't admit it that. The Fed can't fix global supply chains, or geopolitical tensions, or climate change, and all of those are drivers of inflation external to the US. Elites will never admit they screwed us up good because of their own fear and greed. So the Fed has to be seen to tidying up the whoopsies left on the carpet. S OK unemployment has to go up, and inflation has to burn through, because there is less opportunity to fiddle the currency value to offset it, because the global economy is interlinked, and liquidity is in low supply. Frank Baum was right about the Fed being the Wizard of Oz, or as Jeff calls it, the Janitor.
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Jeff is speaking as a big perspective macreconomist. From that perspective, it's churn. But as a human being, he understands your question really well, but as his knowledge is his only asset, and as he can't rewrite the rules of the game, he's sticking to that. And I can't blame him for that. I dunno if you watched Succession, but there's a quote from Season 1 that has stayed with me. And it's something like, "America was created as a factory to turn suffering into gold." Historically, that is absolutely correct for the 16th Century, where Europe began colonising the world. And the American Dream was erected over bones of who suffered to create its foundation. But despite everything, the suffering of new people and new generations over time, always seeped into its fabric. The Dream was just that. A dream, not a guarantee, or a social contract. And that's a bitter pill to swallow. But it might be good medicine nevertheless. Why? Perhaps a stakeholder democracy might be better than one based on a failing meritocracy. One where we ensure everyone has the basics and if you make more you can keep as much as is possible. We support each other and we try not to be divided. We look after our communities, where we live and work, and we don't tolerate throwing each other under the bus,and we take money out of politics. But hey, that just might be a dream itself. But we don't know until we try.
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You are confusing two different things. When they inflation is down, they are talking in aggregate terms that the pace of price increases has fallen. Because it's being seen in the aggregate, prices for individual goods and services will vary in how they respond. You don't buy a car daily, so you won't notice if those prices aren't rising as fast, or are even falling. But, you will notice it in your grocery shopping and your insurance costs. And depending on what you buy, your personal inflation might not be slowing or falling. So, your mileage will vary, and so will everyone else's. Inflation are like rats and mice. You may not see them, but you know when and where they're in your house. Suppliers set prices, and perhaps only two things force them to raise prices and that's Fear or Greed. And when it shifts from greed to fear, and the fear gets strong enough that's when unemployment starts creeping up. Shrinkflation - smaller package sizes for the same price - is a strategy used by suppliers when they know the consumer can't pay higher prices. So... Fear has been getting stronger for a while. Don't expect to see net price falls in consumer non-discretionary spending until things get really dire. Before that prices for discretionary spending will come down in price as demand for them shrinks. So car sales are down, luxury spending is down, takeout food spending is down, along with air travel and holiday spending. It's starting to hit the well-heeled, so the signs are there, but don't expect too many bargains right now.
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Perhaps you shouldha'e bought an ETF that you didn't understand the underlying asset. A clue is in the name of the ETF - iShares 20+ treasuries. Do you understand how long-term treasuries provide a profit and to whom? Certainly not retail buyers, because they trade over the short-term and at most the medium term. Long-term treasuries - those whose maturity is 10 years or more - is for institutional lenders who use them to structure their long-term liabilities, like insurance companies, pension funds, and mutual funds, or long maturity trust funds. You as a retail investor, have shown in all your posts in this channel no knowledge of this. That's why $61bn went into TLT just last week. And it's not retail buyers going into TLT. And you show no knowledge of that. So, I suspect your client is at fault. You know nothing about the asset. You don't even understand the trading patterns, which are for an asset that will payoff over years down the line. That's why you're claiming fraud, when you, a mere pawn in the middle, are just following orders, right? Mr Van Metre's business has only one complaint, and an investigation takes 6 months, and he's still trading. No-one has shut his business down to date. I suggest you tell your client to wait until the decision has been made on their claim. If he has proof, and it's credible, then he will get his compensation. Until then, he innocent until proven guilty. Happy Holidays!
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No: Look at Gross Domestic Income (GDI), which is the money actually earned for the stuff produced in GDP. Its that what is available to pay wages, and returns for investors. GDP is an accounting estimated value of economic output; GDI is the money that is actually got for the goods and setvices. GDP should equal GDI, but as an estimate ahead of being paid, it often doesn't. GDI measures what's actually in the till to spend. Hence all the revisions of GDP, because it takes longer to get the GDI figure. Likewise, look up the Labor Share of GDP, which again is an estimate of how much economic output value is spent on paying workers. The US IRS doesnt have a real time payroll tracker yet, and relies on surveys so payroll data eventually has to revise this figure further down the line. And you might notice the slice of GDP paid to Labor as a percentage has been shrinking for decades. These statistics explain why America can grow Billionaires, faster than wages. And why Consumerism and financialisation may have to die as as ways to sustainably develop economies. Along with the old model and the expectations it created, there is a change coming, as American oligarchs try to deal with the mistakes they made over several decades. And its ordinary people who is footing the bill for that.
Magical Market Thinking - the real MMT you should be worried about - of the last 5 decades or so has had unforeseen consequences. Certain chickens are coming home to roost, because the US being the global Lender of Last Resort to keep the US dollar King of The Hill is becoming unsustainable for the US, mainly because it entails issuing debt. And they can't afford to do so anymore, because there is more competition, and financial institutions aren't immune to greed or folly. Why? Because they're made up of people. And rich people aren't public intellectuals or philosopher kings. They're people who are good at making money and hoarding it, but not much else. And that has economic, political, and social consequences for everyone else on the planet. Things are changing because of these. Like having toothache, there are only two ways to treat it - with anaesthetic or without. But it's still going to hurt some, because of correcting the greedy and the foolish amongst us. Such is Life.
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What use is blame when you don't take accountability for the absurdities you are choosing to believe and the atrocities you, and others commit on yourself and other people as a consequence? When will you stop, shed your shoulds, and come to terms with what is? Why do people come to a channel that is teaching how the global financial system has been arranged since the Post-World War II, looking for advice trading on the stock market? Then complain - often violently and resentfully - when they don't get that advice? How absurd can that misguided sense of entitlement be? Instead, of admitting they are in the wrong place, and that they don't know what they really need, they keep on looking for a one stop shop or a panacea to solve a problem so complex that it impacts everyone on the planet. And what's worse, a solution unsuited for their needs? As the solution is far beyond just trading in the stockmarket or any market to solve. Markets are not taps that if you jusr turn them in the right way, assets will flow into your bucket. Markets are human institutions that reflect the nature of humans, for both good or ill. They are complex, often operating with other institutions in contradictory ways, and produce results that are contradictory and has negative effects. Markets are not playgrounds. They are more like Roman Ampitheatres, where blood letting is the means to stave off social disorder, whilst sacrificing those who can't afford to be in the audience but end up in the circus. Jeff is describing the machinery behind the process, which if you can't afford his courses, is a pretty strong indicator it's not a tool you can use. . Instead, you could be looking elsewhere. And listening to advice people like Warren Buffet gave for engaging in the stock market, which was, K. I. S. S., by buying index funds, and start early, because the rug pulls won't give you carpet burns. You could be developing alternative streams of income and assets, because the value of a 9-to-5 job is being eroded over time, and you have to have skills people want to pay for, and those with the money to buy them becoming more restricted as time goes on. You also have to be honest with yourself about your priorities, because they always come with problems. If you aren't happy to deal those problems, you have to change your priorities. You have to be prepared to adapt and keep on adapting. Don't play in the water unless you are prepare to learn to swim, and to find the right people to teach you. Stop expecting to be rescued when you don't.
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