Long-time readers know how fond I am of metaphors and analogs. I have one to offer today, and it has to do with permafrost.
Permafrost
Slope of Hope Blog Posts
Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.
The Effect of Asset Inflation on Man-in-the-Moon Marigolds
A bicycle ride gave me some clarity, and I wanted to share those thoughts with you now. And the clarity wasn’t a total accident. I was going to run an errand on my bike, and I told myself as I got on, “I’m going to think about asset inflation on this ride.” In this absurdly controlled market, one has to strive to create decent content, so I decided to put my mind to work.
So I took off. I love my neighborhood. I took a few moments of video on my bike to show how pleasant it is. Just block after block of this:
USA Still Going Bananas
You see, it’s not a Trump thing. It’s an ‘America is so hopelessly indebted (as are other developed economies) that they have no choice now’ thing.
However the election shakes out – most likely Democrat president and congress, Republican senate – the stock market is cheering two things in my opinion. It is cheering US dollar compromising fiscal stimulus (Fed prints, politicians spend) and the coming of more US dollar compromising monetary policy (Fed prints, Fed monetizes bonds AKA debt, Fed screws with any other esoteric tool it can get its hands on in the age of MMT TMM, AKA Total Market Manipulation).
I have a still profitable position against the Euro that is about to tick un-profitable this morning. That was my hedge against a firming US dollar, which is the anti-market to the US stock market especially, but also to many global markets, because I am long US and global stocks. I may have to pull back to hedging stocks (including gold stocks) with high cash levels. So says the ongoing inflationary operation.
(more…)Gold Miners: Beautiful Pictures
After a well deserved correction of nearly 3 months the gold stock sector is still flashing positive signs beneath the surface, as the correction matures
The correction that began in August amid the ‘Buffett Buys a Gold Stock!‘ tout has now ground on for nearly 3 months. As noted in the NFTRH 626 Opening Notes segment:
“Thus far the correction in gold, silver and the miners is perfect, where perfection means long, drawn out and maddeningly frustrating to bulls (and bears thus far). That’s what corrections are, remedies to excitement, confidence and of course, greed.”
We are managing the technical details (and associated strategies) of the correction in HUI and individual gold stocks each week in NFTRH, but as a gold stock investor it has not been a time for making money since August. As a trader it has been a difficult time for making money as well, because of the lack of a definitive drop that the sector’s corrections are known for. It has been a grind, and in that annoying, time consuming process, it has been perfect.
(more…)Vicious Cycle?
Another little thought experiment – – and I welcome corrections or new insights on this.
The Fed has made it clear they want inflation. They want it at 2% or above, and they’re willing to let it go decently above that level for a while before they consider raising rates. They’ve said so repeatedly.
At the same time, trillions and trillions of new dollars are floating around out there. Adjunct to this, the world has never been so in debt. It hasn’t stung too much, because interest rates are so historically low that the burden of interest rate expense today isn’t much different in nominal terms than it was twenty years ago, even though we are dramatically deeper in debt. So the government is a bit spoiled by near-zero rates.
