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Vietnamese rice crackers. Where to get in Pattaya or Bangkok?
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A Generational Stock Market High, December 2024
It is my opinion the US equity market hit a generational high in the last full month of the Biden Administration, in December 2024. I suspect we will not see those highs breached for 25 years*. *One caveat is if the Federal Reserve chooses to monetize the massive deficit and Depression the current POTUS will bring on, as money would be almost worthless, so stocks would be an inflation refuge of sorts. While over the very long term, equity markets tend to move higher, partly from actual growth and partly as a function of the fiat monetary system, the world has seen two generational highs in the last 100 years. One was the 1929 crash in the US, where the Dow did not achieve a new high until 1954. The other was in Japan, which hit a high of 38,915.87 on 28 December 1989, and took until 2024 to top that level. So we have two examples of a generational high lasting 25 years and 35 years. This time will be no different. Three things are necessary to achieve such an ignominious accomplishment. One is excess exuberance that blinds people to actual risk. The second is stupidity. The third is a change in the economic underpinnings of the market. There is often a fourth factor, which is fraud that has gone ignored or unnoticed. Markets have suffered from some of these factors, but not all of them at once, so sometimes scary market moves do not turn out to be generational highs. 1987 in the US was stupidity and excess exuberance. The stupidity evidenced itself in the idea of “portfolio insurance”, where market players thought they could immunize themselves from loss by shorting futures. They forgot that there had to be another side to that trade. Everyone tried to “immunize” themselves at the same time, but there were no buyers. The market fell 23% in one day. Because economic fundamentals were okay, the market recovered in a few months. Another example was 2000, but that was largely part of NASDAQ and the dot com bubble. Nonsense was weeded out, such as Pets.com, but Amazon, Google, etc. proved they had a viable business model, so they recovered and prospered. 2008 was another, and nearly a generational high, as the entire world’s financial system was on the brink of collapse. That period had all the hallmarks of a top---stupidity, fraud, weak fundamentals and excess exuberance---but the bailout orchestrated by Obama in 2009 saved the system by backstopping banks and insurers, forcing banks to issue equity and slash leverage, and getting help from the Fed and its ZIRP. Confidence was restored (and banks bonused themselves undeservedly). Who can ever forget Synthetic CDO Squareds with a CDS kicker? Today, there is excess exuberance (high P/Es), plus a belief---built from extrapolating limited experience into the future---that one is “always” rewarded for buying dips. There may well be fraud, too, but that will not evidence itself until a crash occurs. Like 2008, it’s probably in the $750 trillion in notional value of derivatives throughout the financial system. The other necessary factors are also here. Economic fundamentals are deteriorating by the day, exacerbated by the idiocy of the current Administration. The dollar has already fallen 10%. The flip flop on tariffs has introduced uncertainty that will have business sitting on its hands. Alienating allies has likely made funding the deficit much more difficult, as foreigners have been buyers of upwards of 30% of US Treasuries. Even the across-the-board 10% tariff that remains in place, coupled with the 10% fall in the dollar, means inflation is guaranteed to pick up. Considering the basket of goods the average consumer buys, higher priced imports will produce at least 8% inflation, and much higher if tariffs are upped after this 90 day retreat. What we clearly have in spades, which is a needed factor for a generational market high, is stupidity. It is abundantly clear POTUS has no clue what he has done, and has no realistic idea of where he intends to go. He is the proverbial dog chasing a car, with no plan what to do if he catches it. His idea of building everything in the US is patently absurd. The US lacks some of the key resources required in the modern technological world, so has no choice but to rely on others. Also, even if the US wanted to produce TVs and phones and other things domestically, factories take years to build and get into production. Besides, there’s no way a US-produced TV or iPhone can compete with foreign brands or production in terms of cost. People might pay $1500 for an iPhone, but few would pay $3500, which is the estimate of the cost if built in the US. Foreign producers may also realize the tariff is less than what it would cost to build in the US. China holds far more cards than the US or POTUS, but he is too stupid to know. He also lies about the size of the trade gap, which is not the $1 trillion per year he claims, but was $295 billion in 2024, and about $260 billion after adjustment for services. The US is now only 15% of China trade, as China has diversified. China has the power to affect US interest rates by selling USTs or simply going on a buyer’s strike. China can withhold key things such as chips, aircraft parts and rare earths. China could nationalize all US investments in the Middle Kingdom, too. If the US halts grain sales to China, China will source elsewhere, as it did with soybeans under POTUS 45, which required POTUS to go “Socialist” and bail out US farmers. All of these things point to a generational high in the US equity market. That’s going to hurt 401ks, corporate pensions, and insurance company portfolios. Heaven forbid a natural disaster hits and insurance policy payouts are required. The last factor missing in setting a generational high was stupidity, but with this POTUS, we have more than enough of that. It will probably be Joe Kernen III who finally announces a new market high in 2050 or so….if we get lucky. -
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Thai State Audit Building Collapse Unveils Alleged Extravagance
Some of the money taken from construction spent on high end furniture. The "Watch Dog Operation" post, which cites information from the "STRONG Anti-Corruption Club of Thailand", detailed a list of allegedly inflated furniture prices, including: Conference room chairs upholstered in imported Italian leather: 97,900 baht each. The Governor's office desk: 105,500 baht. Reception room sofas: 165,000 baht, with one sofa featuring imported Italian gold leaf. A dining table for the Governor and SAO Board Chairman: 90,000 baht (excluding chairs). A 6 x 5.5-metre carpet: 165,000 baht. https://www.nationthailand.com/news/general/40048132 -
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Tattooed Tourist Assaulted in Songkran Soaking Incident
63 baht !! 😆 Try 7-11, open 24 hours a day - where I got one. -
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Swede's Split-Second Distraction Triggers Buriram Accident
As pointed out... when slowing, anything that has rolled into the footwell, can also roll under the pedals.... There's a strong argument to suggest it should be retrieved as quickly as possible (though the accident itself contradicts this)... ... this is a case of 'damned if you do, damned if you don't' - the link below highlights an accident where a thermos rolled under the pedals, perhaps there's an argument to suggest the drive 'should have' retrieved the flask ASAP. Its easy to judge with 20/20 hindsight. IMO - thats rather poor hindsight - should those judgemental enough to suggest they have never made a mistake on the road not instead suggest that nothing should be present to roll into the drivers footwell in the first place instead of suggesting he slowed to a halt ? Additionally: this incident could have occurred in many other ways. Had the driver stopped to retrieve the item and was rear ended by a truck, would those with 20/20 hindsight not then suggest he should have retrieved the item quickly to avoid stopping and becoming a hazard. Too many variables of course - the non-variable are the 'experts' forgetting they too are human and that mistakes are made. https://metro.co.uk/2019/02/21/deadly-bus-crash-was-caused-by-drivers-thermos-getting-stuck-under-brake-pedal-8706682/ -
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Joe Biden has reentered the public eye with a pointed rebuke of the Trump administration
The ~260 deportees were not primarily “rounded up off the street” in random sweeps but were apprehended through a mix of targeted detentions, existing immigration processes, and some arbitrary encounters -
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Good Thing Trump Isn't Basing His Actions on Flagrantly False Numbers...oh wait a minute...
Just ask AI... "why did trump casinos fail"... typical Trump BS, lies and cunning. https://www.nytimes.com/2016/06/12/nyregion/donald-trump-atlantic-city.html?unlocked_article_code=1.AU8.JDEG.PYl9c3fKNTlK&smid=url-share
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