Comments by "" (@jmitterii2) on "PensionCraft"
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@thejoshman3843 No he hasn't. At least not yet... tariffs put in place by Trump have remained even now of the is commenty 7/31/22.
What you're seeing is companies that had a mad rush to highs in fomo stupidity and leverage cheap as O2 go to the moon, those exposed to more international revenue sources get hammered. Those selling to domestic markets don't. And to be frank, all markets other than the US have a worse domestic market picture;:
China: insolvent developers and debt burden and loss of individual/family savings/investment.
Japan: Malaise persisting.
S Korea: Massive debt trap by both companies and individuals.
EU zone nations: malaise in an energy shortage and monetary policy inflationary stupidity with their own debt problems more located in their businesses than among individuals in most of the EU nations.
UK: drab miserable island that has prior to the Brexit stuff, sold of much of its industrial capacity. Instead shifting to financial sector... selling hopes and farts in a jar and any other silly hustle that might float the boat, until it doesn't.
BRICs nations as a whole have long since had a diminishing economy where long term low interest rates stimulus failed completely and only caused a debt collapse.
Australia: Heavily dependent on China for vast majority of its exports of commodities... so if China doesn't stimulate or can't or even becomes insolvent over time on foreign reserves (which could be the case) or in their desperate gasp to maintain some sort of self imagined dominance, China invades Taiwan.... We lost the borrower of last resort that the world had in 2008... and Australia would suffer the greatest.
Globalization, colonialism, imperialism etc. nothing new. Really, it's the same stupidity over and over since recorded history, one very ancient period was the late bronze age collapse... trade becomes twisted into a pretzel all on the crux of exploiting various regions labor ( outright slave labor in this period of time and many other periods of time)... it's held together with debasement of money and acid of resentment of the vast majority of people (or in this case human chattel) in our case sweat shop workers... you get a complete resentment of the system. One by one, the most vulnerable nations start to go on war campaigns to distract or acquire more resources in hopes of propping up their own regimes popularity or at least diminish the resentment from mass of people.
But you just end up showing the vulnerability of supply chains that get stretched beyond authentic comparative advantage, and are only there due to inauthentic comparative advantage (forced labor, national subsidies to the moon, exploited labor yet cannot actual provide the goods at any reasonable quality level, etc.).
War and civil war busts the entire thing up into one big collapse.
This cycle repeats so often throughout recorded history, it's amazing humans are that insane to keep repeating it over and over and over again.
1929 was the last time similar stupidity had its complete shit the fan moment.
The irony the buzz your nether region word used to describe the "this time is different" idiocy, is the same buzz your nether region word globalization... word firstly introduced in 1870's, but used all thru the 1920's.
This time we didn't even get a new fancy word to con us into insanity of repeating the same thing over and over and over and over again.
We got a hand me down word.
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No. Because the oligarchs no the peasantry are shit out of "disposable" income, that in fact they're addicts on debt just to get basics, screw ability to save. Worse in the US, but UK and Europe not far behind. Korea already insane on this camp. And Japan... well they've given up long ago. China... they lose it in lots of swindle stupidity: their equity bubble 2015 and now the ghost city real-estate decades long insolvency mess.
So the only way to for the oligarch to syphon all incomes from the peasantry that have a smaller and smaller pot to piss in, is to monetize bad debt from banks, pump the chicken on all assets, particularly inelastic basic need things like housing and utilities with frills catering to a few morons who think they're rich, but really are playing debt bing them selves to keep up with the oligarchs they think they've become... so things like TSLA or AAPL over priced junk and to the point of pure unadulterated con... vapor ware.
So make home prices high along with rents and that preserves a cash flow from the peasantry to thine pockets.
Easy to do when you've bought all media outlets and have propounded various idiot notions that favor you and completely screw the peasantry... similar to the churches of old did. A con that has tested challenges of time.
This way, with both hands the peasantry give up their citizenship of being the government and hand it squarely over to you and your few plutocrats.
USA it's fantastic. WE don't have a central bank, rather a private banking cartel that has anointments of the government via some Congressional: "Oh you private cartel can F us and F us hard... so long it's (us) is the peasantry, and we're getting a little in our pockets while the rabbits are doing their thing."
It's stupid on stupid to the perspective to us peasantry. To the oligarchy it's brilliant with one potential draw back... and that's the race to Sri Lanka. But that's where embracing one of their less hated demagogue that pretends to favor the needs of the masses yet with the BS BDSM methods that F the masses hard while ensuring a steady if not huge income stream into the fews' pockets.
Now, this could lead to complete collapse or some really bad gangster insanity where oligarchs literally start eating each other... and I'm not the civil way via making investment bets against one another or talking crap about one another... but literally hiring countries and private militaries and thugs to.... make each other go away.
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I think you missed the point of these same day expiration options with market makers.
At first it causes that gamma squeeze; the problem has become that these market makers are required (or the go bust) to hedge. They do now with aids of computers; as delta goes up on the number of call options bought, they have to buy more stock, and as the price actually gets close to being at the strike or into the strike price of that option; they have to buy even more shares for the potential of being assigned.
Here's where this gets to become an unstable phenomena... as gamma squeezes to the upside happen, market makers are buying lots of stock causing stock prices to go up in the short term; the holders of these options contracts vast majority are not exercising them, therefore market makers are stuck with the shares they bought thinking they would need them with all the now in the money call options they wrote, they'll have to sell those shares to the option holders who would be exercising their call options.
BUT that's the problem. These options buyers are flipping them, with no intention of exercising these options... many retail traders don't even have the funds even in margin accounts to exercise their 100 contracts on say AAPL or some other stock... since they all get sold off, and whoever ends up with the bag can't exercise most if any; the market makers who bought driving the stock price up at some point no longer need those shares to hedge.
Since these gamma squeezes have been going on all since January and into Feb; lots of these options market makers kept their shares anyway; making the spikes up not as violent; lesser dramatic gamma squeezes... this in turn causes a depressed purchasing in call options... buyers of these options are deciding, okay gains are not as good or not even good.
Suddenly normal price action returns, and the stock prices start dipping. Market makers are holding lots of stock now, need to dump all their holdings realizing the parties over, and down we go big time.
And this can be triggered by many market makers unsure what their hedged positions really consist of.. they're not really sure who is really going to be exercising and therefore dumping their stocks... market makers really don't want to not be assigned; the entire goal of their model is to sell premium and if they need; have the stock purchased at least below the strike price and if they have to deliver the shares, that's great, they sold made some money on that end, and primarily made money on the premium for selling the call option. But if they're stuck holding bags of stocks that are rapidly now decreasing at cost they bought them... that's bad news. Market makers don't want to be holding the bag. That's their job to make others hold the bag. LOL!
Anyway this can cause a stampede if the stock naturally falls, or if market makers just can't make money because they're writes aren't being assigned (option buyers aren't actually exercising).
So you get two scenarios:
1) Natural pricing action not lead by market makers covering (gamma squeezes); prices fall forcing market makers to dump their shares.
2) As potent; market makers not making profits in this environment deciding to delta down, stop writing options and just dumping their shares to halt their operations so they can discern a better strategy that ensures profitable market making. So they dump all their shares that were hedging the call writes, and not selling anymore.
Both scenarios can lead to one another. And both make a down turn in the markets bigger.
And with all the gamma squeezes lately, market makers are sitting on huge piles of stocks. So a sell of with them would in turn become a big dump.
This could get more extreme if option buyers start purchasing puts. Causing a reverse gamma squeezes on the way down, so those few option market makers still trying to market make; still writing options start selling puts and need to cover their puts with cash, they too have to sell.
So this makes markets not stable at all. It becomes big rip up followed by big rip downs. And just small pressure one way or the other can trigger these drastic moves up or down.
I think the Volmageddon is that these market makers eventually give up, not able to cope with proper hedging and are losing money. So they just delta down, dump all holdings don't offer any options at all to reset their strategy. This would mean lots of dumping of stock. And that's what the one article that came out described might happen; market makers are sitting on huge piles of stocks right now; therefore at this time the risk is to the downside. Would be opposite if we were having reverse gamma squeezes due to this options activity with too many puts being purchased over and over and stock prices were spiking lower and lower over the past few months.
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Well, globalism, colonialism, mercantilism/feudalism, imperialism whatever you want to call it was never a good thing in history and always ends in civil war, war, and just pure misery for most.
And even the oligarchs who parasitical feast on the flesh of this exploitation setup eventually start eating themselves.
I mean this is just a faction of oligarchs warring with another faction now in Russian and Ukraine. The pressure on labor to be exploited more and more means aggregate demand declines... hence the 40 year lowering of interest rates to get the borrowing stupidity on full tilt to flood the system with artificial demand... because the intrinsic demand from workers producing was gone along ago and continues to decline in a race to the bottom for labor.
The trade trade itself is at that crux of inauthentic comparative advantage... they can force labor or pressure labor to work for next to nothing. Cheap labor.
Additionally, many nations will subsidize the raw material costs of inputs. Cheap labor and cheap inputs.
Additionally, many nations will forgo normalized social expenses such as pollution controls, infrastructure expenses, etc.
Cheap labor, subsidies taxes, subsidized inputs... you can then make a spaghetti of cost ineffective, and thermodynamic expensive trade networks that make utter nonsense, costing a fortune... only because of the temporary misery factors of the desperate and oppressed labor, the always crumbling infrastructure or lack thereof, and the credit/debt hole of subsidized taxes and adding insult to injury the subsidy of input purchases. A supply chain that is actually insanely expensive.
The cost of diminishing authentic demand in aggregate demand slump mixed with the increased cost of the trade as described has to be paid back.
There is no free lunch.
As always, this structure of economics eventually collapses.
This type of setup whatever buzz word you want to call it is self refuting and defeating, generally ends catastrophically.
First use was the late bronze age collapse. Very sudden (however doesn't need to be a sudden calamity, it can linger in a state of malaise) and apparently catastrophic.
It's always ends catastrophically... about 80% it's sudden and history shows 20% it can linger on for a century or four.
But we saw this with Classical Greece collapse, and the Roman Empire collapse... smaller regional examples goes to the Assyrian collapse.
And we can go through all through the AD/CE periods and see the same thing. Over and over and over again.
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First person to really hear from the financial sector screaming deregulation is a risk... here in the USA it's always the other way around... deregulate! LOL! Let markets go completely bat nuts crazy for short term bonus money and other quick profits, who cares that the LLC or publically traded company is limping into insolvency and bankruptcy... so long as we got in, did our little pump and dumped it all over the tax payers heads.
And that is exactly what happens with deregulation. One notable was the Financial Modernization Act of 1998... essentially repealing Glass-Steagall Act that kept deposit banking separate from investment banking firewall... and a decade later we got 2008, a super levered real-estate stupidity; pumping the price of dirt via leveraging and idiot CDO market; so banks didn't care about the quality of the loans, and loved that assets were going up largely due to other banks doing the same pumping those prices up; a way to lend even more out to sell to the CDO market... until that became illiquid nobody wanted to buy them as they were toxic resulting in the Fed's QE debasing currency and reinflating the same assets this time adding car loans into the equation; many new car loans are over $1K a month. And that's spooky even at $600 a month for a car payment here in the states. And now also rents and home payments are $1,200 to $1,600 while even nominal wages/salaries haven't really done anything... and again people taking out adjustable rate mortgages and arms to boot.
Big quagmire in the banking sector. Particularly with the Fed not being the primary collateralized Debt Obligation buyer; removing that from the banks' balance sheets so they can dump those loans for money and some of the interest for profits, to turn out more loans. Now they're stuck holding the bags. And hoping other banks are interested in buying their CDO's because the biggest and often only buyer, the Fed, isn't buying; there was a reason Powell decided instead of selling those CDO's on the Fed's balance sheet into the CDO market, they instead opted to just let them "mature" get repaid, and thus fall off the Fed balance sheet; not add more selling of CDO's that already were happening. Many with the same problem with treasuries... mortgages and auto loans at original principle amount well beyond what is likely to be the case thus underwater collateral, at very low rates... while new loans are now 6% or higher... so nobody will want the old stuff at low yields... while both being equally vulnerable to having negative collateral in the bubble origination amounts of car prices and home prices.
All we need to do is keep doing the same thing, and we'll all be insane. As per the definition of insanity... keep doing the same thing over and over and expecting different results... but the mantra in the states continues to be... deregulate, "get rid of red tape". Just means... screw tax payers, investors, depositors, and buyers of these assets like cars or homes, pump those prices get them upside down, and worse lend to those at highest risk of default doesn't matter... so long as we make that loan and dump it on the CDO market... we'll make money right away... and leave the bank and everyone else on the verge of insolvency. And more and more people unable to let alone buy a house, unable to afford rent, living in their car or RV at some camp ground that's filled to the brim already not taking reservations. And developers scarred from 2008, reluctant to buy the over priced land, and build units without a buyer that's attached right away... thus slow to build new housing units. Which over the past 2 years now.... sort of went out the window; a new multidweling housing boom has developed; much needed housing capacity. But all of it at inflated prices due to risky levered lending... that is unlikely to be sustainable by those footing the bill, the mortgage holder and renter; as again, wages have really gone nowhere while this inflationary bubble was pushed up via yet again a stampede of borrowing speculation.
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