Lombardi Speaks To Characters?
At one of our recent SA missives, The 5:15? reader 153972 commented:
We Natter... Thank you for the kind words. Excellent synopsis of the situation replete with the master Lombardi. To answer the query, regarding the markets, so far its been a magnificent pump job and the PPT has nothing on this bunch.
The problem with all of this is at the foundation, no real jobs, lower real income, even less real spending to come. Lacking investment in real economic activity, the reflation of equities and housing IS the real economy, not the ancillary joke called the service sector which is dependent upon it. As in previous bubbles, those housing and equity ATM's ARE where the FLOW of money is coming from. Just as before, people are borrowing more and more at low cost of funds to maintain their lifestyle or get by.
As we Nattered recently, In Time?
Answer: The SAME thing that happened last time, and the time before that, and the time before that, ad infinitum. People forget, don't read their history, and the same "characters" keep doing the same thing over and again, so history inevitably repeats itself.
Regarding when will people and these"characters" learn? As the master Lombardi said:
IMO this is possibly your best missive since I started reading your thematic articles in mid-2015. It doesn't mince words or equivocate; there is no stay tuned, we shall see, etc.
Reading between the lines as they write about FED speak, does this mean in Naybob speak that you are guesstimating a 2016 or early 2017 Great Recession II or worst?
I have been waiting for an economic downturn, Great Recession II, or worst due to a bond bubble piercing because of widening defaults since February '16. I thought it had arrived after the US dismal Q1 '16 GDP forecast began to percolate downward then report a .5% growth at quarter end, which reminds me congrats on your Q1 '16 forecast and while it wasn't negative your call was damn close.
I also surmized giving the terrible PMI stats out of Japan and the lacklustre China PMI Manufacturing and Service sectors that rising financial and debt concerns would rear it's ugly head also but apparently not yet per the bounce back in both debt and equity markets across the globe in mid-Feb of this year.
In the meantime, Japanese and Chinese banks as well as China's shadow banking sector are at best treading water and most likely should be gasping their last breath before they have to write-off foreign and domestic investments. Similarly, W. Europe is barely holding onto growth given their PMI and GDP stats and their large banks are riddled with liquidity concerns. So I have to ask as the great Vince Lombardi querried?
We Natter... Thank you for the kind words. Excellent synopsis of the situation replete with the master Lombardi. To answer the query, regarding the markets, so far its been a magnificent pump job and the PPT has nothing on this bunch.
The problem with all of this is at the foundation, no real jobs, lower real income, even less real spending to come. Lacking investment in real economic activity, the reflation of equities and housing IS the real economy, not the ancillary joke called the service sector which is dependent upon it. As in previous bubbles, those housing and equity ATM's ARE where the FLOW of money is coming from. Just as before, people are borrowing more and more at low cost of funds to maintain their lifestyle or get by.
As we Nattered recently, In Time?
"[An] eighteen (18) month at ZERO% grace period could be the only thing holding the consumer credit tidal wave up for the time being."Without improvement on the real economic investment vs financialism and the jobs income side of the equation, what happens when and if those easy terms and/or more importantly, the source of income FLOWS dry up, without a solid economic foundation and NOTHING to fall back on? Run on sentence much?
Answer: The SAME thing that happened last time, and the time before that, and the time before that, ad infinitum. People forget, don't read their history, and the same "characters" keep doing the same thing over and again, so history inevitably repeats itself.
Regarding when will people and these"characters" learn? As the master Lombardi said:
“Once you learn to quit, it becomes a habit. Winning is a habit. Watch your thoughts, they become your beliefs. Watch your beliefs, they become your words. Watch your words, they become your actions. Watch your actions, they become your habits. Watch your habits, they become your character." - Vince LombardiOn the morrow, we will have a nice piece regarding a recent missive at Naked Capitalism by Yves Smith, one of our favs.
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