Why a book you might not have heard of is more important than ever right now

[Ward Smith + 6,615]

5 hours ago, Dan Warnick said:

What major bank will be the first to fall?  And how many may follow?  Or are the bailouts designed to stop that this time around?

Bailouts are always designed to take care of the big boys, but some will be left in the lurch. I believe Wells Fargo will fall first. Any banks heavily exposed to California real estate will have problems. 

At the microeconomics level heres what's happening. The socialist states on the Left Coast have all passed illegal takings legislation designed to harm landlords. As a landlord, the only arrow in your quiver is eviction. What these states have done is made it virtually impossible to evict a tenant. Now if the landlord isn't collecting rents, how is he going to pay the bank mortgage? Also he'll stop paying the property taxes, which the states did nothing to deserve, quite the opposite in fact with their illegal takings. So California, Oregon, Washington will have hordes of squatters in rapidly disintegrating "projects" where beautiful buildings once stood. 

Edited May 13, 2020 by Ward Smith

[Ward Smith + 6,615]

5 minutes ago, BradleyPNW said:

I was mocking the idea that billionaires are authorities on subjects based on the fact they are billionaires. 

And I was just mocking you. Here's a hint, if you want to learn something about money you're much more likely to learn it from a billionaire than a barrista. 

It's not appeal to authority to say you should take that 100 page contract to a lawyer rather than a logger. 

[Ward Smith + 6,615]

14 minutes ago, BradleyPNW said:

Historians and sociologists use methodology analogous to science.

Hilarious! Comedy gold! Are you going to be here all week? 

[El Nikko + 2,145]

16 minutes ago, Ward Smith said:

Bailouts are always designed to take care of the big boys, but some will be left in the lurch. I believe Wells Fargo will fall first. Any banks heavily exposed to California real estate will have problems. 

At the microeconomics level hers what's happening. The socialist states on the Left Coast have all passed illegal takings legislation designed to harm landlords. As a landlord, the only arrow in your quiver is eviction. What these states have done is made it virtually impossible to evict a tenant. Now if the landlord isn't collecting rents, how is he going to pay the bank mortgage? Also he'll stop paying the property taxes, which the states did nothing to deserve, quite the opposite in fact with their illegal takings. So California, Oregon, Washington will have hordes of squatters in rapidly disintegrating "projects" where beautiful buildings once stood. 

Our government was quite cunning with the 'bailouts'. They gave the money to people who obviously are then going to use it to pay down their credit cards, loans and mortages so it ends up in the hands of the banks anyway and the government can claim they were 'generous' with our future tax receipts.

And they did use the word 'generous' by the way...it's almost funny

 

Edited May 13, 2020 by El Nikko

[Dan Warnick + 6,100]

1 hour ago, El Nikko said:

Deutsche Bank has to be a candidate

(Deleted - just read Ward's comment)

Edited May 13, 2020 by Dan Warnick
Deleted: Wells Fargo

[Dan Warnick + 6,100]

I think I'd fxxxxng retire too!

AT&T boss retires with $274,000 a month for life

AT&T (T) honcho Randall Stephenson landed a complimentary insult from the chief executive of the United States two weeks ago when he announced he was standing down at 59. Great News! Randall Stephenson, the CEO of heavily indebted AT&T, which owns and presides over Fake News @CNN, is leaving, or was forced out,” tweeted the commander in chief of the armed forces.

[Dan Warnick + 6,100]

My earlier deleted comment was because I had raised the question about Wells Fargo, and then saw that @Ward Smith had already mentioned them.

So, here is the latest headline regarding our friends at Wells Fargo:

Wells Fargo Stock Offers Potential 21.95% Return For Bearish Option Traders

Wells Fargo stock has had a tough run recently. It all started with the fake accounts scandal in 2016.

That incident didn't actually impact the stock price too much, but it seems investors have finally had enough. This includes Warren Buffett, who reduced his stake in Wells Fargo (WFC) by nearly 15% in the last quarter of 2019.

A lot of other investors have followed suit and the stock price has plunged from 52 down to 24. There is significant distribution in Wells Fargo stock and it still seems too early to try and pick the bottom here.

Edited May 13, 2020 by Dan Warnick
Duh

[Marcin2 + 726]

-

Edited May 19, 2020 by Marcin2
-

[Ward Smith + 6,615]

5 hours ago, Marcin2 said:

I would try to summarize this article and my opinion:

1. Most of it is about dishonest, even criminal actions taken in 2008-2020 in US to make 0.1% of Americans richer and 99.9% poorer. This I agree.

2. But conclusion what would happen next reminds me Book of Revelation by John Apostle. Extinction of human race ? This is extreme conclusion not backed by the facts. Due to oligarchic actions in US, Americans could be just poorer, but would still be rich enough to live relatively comfortable life. Such people do not take part in any Armageddon.

Your 2 above assumes Americans taking it up the rear end will just learn to lie back and enjoy it. The British thought the same thing back in 1775.

[El Nikko + 2,145]

30 minutes ago, Ward Smith said:

Your 2 above assumes Americans taking it up the rear end will just learn to lie back and enjoy it. The British thought the same thing back in 1775.

Realistically what do you think could happen?

There has definitely been a significant uptick in people searching for videos on youtube that talk about things like civil war (not so much the full blown shooty kind), economic collapse and other cheery subjects and I do think tensions in many western countries are getting higher especially with the political polarisation.

This virus crisis could really trigger something when the economic pain starts to set in. I hope not but I still cannot get my head around how we can just print money without consequence and the UK I believe has just added an astronomical 15-20% to it's debt to GDP ratio which is crazy.

I'm really glad I listened to my gut feeling 4 years ago and moved out of the city because if the economy tanks I would expect crime to go through the roof.

Also does anyone expect significant inflation at all in the next year?

[Ward Smith + 6,615]

1 hour ago, El Nikko said:

Realistically what do you think could happen?

There has definitely been a significant uptick in people searching for videos on youtube that talk about things like civil war (not so much the full blown shooty kind), economic collapse and other cheery subjects and I do think tensions in many western countries are getting higher especially with the political polarisation.

This virus crisis could really trigger something when the economic pain starts to set in. I hope not but I still cannot get my head around how we can just print money without consequence and the UK I believe has just added an astronomical 15-20% to it's debt to GDP ratio which is crazy.

I'm really glad I listened to my gut feeling 4 years ago and moved out of the city because if the economy tanks I would expect crime to go through the roof.

Also does anyone expect significant inflation at all in the next year?

The article was very US centered but Britain is in a similar boat. There can be simultaneous deflation (assets like real estate) and inflation (food etc). Besides the "usual suspects" of criminals being released from custody for "health" reasons, there's a good chance that a whole slew of previously law abiding citizens will start being pushed into criminal acts out of economic desperation. 

[El Nikko + 2,145]

5 hours ago, Ward Smith said:

The article was very US centered but Britain is in a similar boat. There can be simultaneous deflation (assets like real estate) and inflation (food etc). Besides the "usual suspects" of criminals being released from custody for "health" reasons, there's a good chance that a whole slew of previously law abiding citizens will start being pushed into criminal acts out of economic desperation. 

I would say Britain is in a far worse situation Ward, we don't have a constitution and our so called conservative (Marxist) government has just realised that people will readily give up what few remaining rights we have to feel safe. On top of that should there be any huge wave in crime we don't have the means to protect ourselves either. Yes contrary to what some people believe you can own guns in the UK but it is heavily licenced, self protection is not a reason to have a licence and they must be locked up at all times unless being used. Unlike the US there are very few dissenting voices fighting for the lockdown to be lifted, there are no protests and people seem quite content and no one I have spoken to understands the economic consequences that will come down the line.

Already it is becoming clear that onces the furlough scheme comes to an end many employers will lay off large numbers of staff and cut wages. I believe that supermarkets have increased their prices by as much as 7% for an average shop, the housing market is probably going to crash through the floor and we are just a few weeks away from the payment holidays for mortgages and loans coming to an end.

I suppose the one and only positive is that interest rates will stay low (or will they?) but it does seem strange how we've become accustomed to close to zero percent interest rates, it doesn't seem normal for a healthy economy.

[Dan Warnick + 6,100]

6 minutes ago, El Nikko said:

I would say Britain is in a far worse situation Ward, we don't have a constitution and our so called conservative (Marxist) government has just realised that people will readily give up what few remaining rights we have to feel safe. On top of that should there be any huge wave in crime we don't have the means to protect ourselves either. Yes contrary to what some people believe you can own guns in the UK but it is heavily licenced, self protection is not a reason to have a licence and they must be locked up at all times unless being used. Unlike the US there are very few dissenting voices fighting for the lockdown to be lifted, there are no protests and people seem quite content and no one I have spoken to understands the economic consequences that will come down the line.

Already it is becoming clear that onces the furlough scheme comes to an end many employers will lay off large numbers of staff and cut wages. I believe that supermarkets have increased their prices by as much as 7% for an average shop, the housing market is probably going to crash through the floor and we are just a few weeks away from the payment holidays for mortgages and loans coming to an end.

I suppose the one and only positive is that interest rates will stay low (or will they?) but it does seem strange how we've become accustomed to close to zero percent interest rates, it doesn't seem normal for a healthy economy.

Hi @El Nikko.  Might be like I typed on the other thread (at least in the States):

I was just making coffee and I had an epiphany.  This is the ultimate "Bums for votes disease"!  The dems want to get the deplorable's votes (at least what they think are the deplorables).  You see, they figure, if they give all the bums an excuse to stay home from work AND keep getting paid, they'll vote against the guy that says go back to work and vote for the guy that says they can stay home and recieve a fat check every month sufficient (I have to be careful with big words like sufficient) to buy beer, weed, food and gas.

It is a brilliant ploy!  In Demland.

[Yoshiro Kamamura + 274]

You guys could use a few slashes with the Occam's razor, all those "democrat-China-neomarxist" alliances resemble 17th century Rosencrucians and 19th century illuminati all too much. 

The simplest model with least number of axioms and clearly defined interactions is usually the one to stick with. In this case, the key word of today's first world problems is "sustainability". Western economies with excessive consumption and needless, wasteful production of redundant goods accompanied by blind, stupid destruction of the biological and ecological systems we directly depend on is unsustainable. This virus is only a tiny aspect of that unsustainability - we have pushed other species into too small space where they are in too close contact, which makes inter-species virus transitions and new hybrids and mutations more likely and often. Other aspect is the climate change caused by various gas emissions and fossil fuel burning, another is limited availability of these fuels we are still depending on, as well as economic doctrine that pretends the economy can grow above any bounds while utilizing the limited resources provided by a spherical object called the planet Earth. 

It is just not possible - such system must crash eventually, and the harder the faster it's moving. The virus actually forced the economy to slow down, which is a good thing - it can teach people to distinguish between essential and non-essential, and encourages more humane and just distribution of wealth (the 1% of top psychopaths do not have to own 95 percent of wealth, it really does not makes things any better). 

So - instead of looking for a scapegoat with the silly man called Trump, this crisis should be used as an impulse to transition to a system that would be actually more sustainable than the current mad, "short term profit above all" blind frenzy. 

[0R0 + 6,251]

2 hours ago, Yoshiro Kamamura said:

You guys could use a few slashes with the Occam's razor, all those "democrat-China-neomarxist" alliances resemble 17th century Rosencrucians and 19th century illuminati all too much. 

The simplest model with least number of axioms and clearly defined interactions is usually the one to stick with. In this case, the key word of today's first world problems is "sustainability". Western economies with excessive consumption and needless, wasteful production of redundant goods accompanied by blind, stupid destruction of the biological and ecological systems we directly depend on is unsustainable. This virus is only a tiny aspect of that unsustainability - we have pushed other species into too small space where they are in too close contact, which makes inter-species virus transitions and new hybrids and mutations more likely and often. Other aspect is the climate change caused by various gas emissions and fossil fuel burning, another is limited availability of these fuels we are still depending on, as well as economic doctrine that pretends the economy can grow above any bounds while utilizing the limited resources provided by a spherical object called the planet Earth. 

It is just not possible - such system must crash eventually, and the harder the faster it's moving. The virus actually forced the economy to slow down, which is a good thing - it can teach people to distinguish between essential and non-essential, and encourages more humane and just distribution of wealth (the 1% of top psychopaths do not have to own 95 percent of wealth, it really does not makes things any better). 

So - instead of looking for a scapegoat with the silly man called Trump, this crisis should be used as an impulse to transition to a system that would be actually more sustainable than the current mad, "short term profit above all" blind frenzy. 

We are already heading towards sustainability in OECD. The only substantial difference in resource consumption over the past 20 years is practically all China, coupled with infrastructure development in OECD for renewable energy. Peak babies in OECD was around 1960. Not long after that in China. 10 years ago in India and globally last year. The sustainability is the fact that you do not need to create fresh infrastructure for more people because they are not coming. After peak babies, you have peak schools, peak universities once you have gotten to a high percentage of college educated population. Then peak homes, and peak cars etc.. In Europe, only France has a stable population with a degree of growth. In aggregate, EU is consuming less since 2000. Same for Japan and Korea, which peaked earlier. And now it is going to be the same for China.

The wealth disparity came from the opening up of China to Western capital, thus disturbing the balance of relative supplies of labor and capital heavily towards the benefit of capital, which became relatively scarce. China is no longer supplying new labor, and hasn't for a decade. Because of its incredibly high savings rate and because of the huge savings of older people saving for retirement the balance of capital to labor has shifted towards labor's favor. What is more, a decade of capital flight out of Europe and China's capital export via reserve accumulation and then a torrent of capital flight since 2014, there is a huge accumulation of capital worldwide looking to invest for whatever real return it can obtain, even if it is negative. We just started the transition towards a higher labor share of incomes when the artificial economic collapse happened. Injecting money into the capital side of the economy was far faster and easier to do. Same as was the case in the GFC. 

We are approaching an era of nearly free energy from solar and less so wind in some areas, most notably in the US, where the potential is greatest. At this point, The energy breakeven to make a positive environmental difference is still in the range of a decade for an EV, A few years in Solar and less than a decade in Wind. Within this decade, if trends continue as they have, we will be past the point of consuming less fossil energy for creating renewables capacity, and on balance consuming less fossil fuels. 

The entire Malthusian point of view has been superseded by fact regardless of the question of global warming. There is no population explosion. There is no world where we run out of everything. You are stuck in the 1970s, just like your boomer professors.  

[Douglas Buckland + 6,308]

On 5/14/2020 at 11:31 AM, El Nikko said:

Realistically what do you think could happen?

There has definitely been a significant uptick in people searching for videos on youtube that talk about things like civil war (not so much the full blown shooty kind), economic collapse and other cheery subjects and I do think tensions in many western countries are getting higher especially with the political polarisation.

This virus crisis could really trigger something when the economic pain starts to set in. I hope not but I still cannot get my head around how we can just print money without consequence and the UK I believe has just added an astronomical 15-20% to it's debt to GDP ratio which is crazy.

I'm really glad I listened to my gut feeling 4 years ago and moved out of the city because if the economy tanks I would expect crime to go through the roof.

Also does anyone expect significant inflation at all in the next year?

The sad fact is, in this day and age, people seem to WANT to be victims and actually WANT the government to take care of them! When did people become such sheep! I find it disgusting and embarrassing.

[Dan Warnick + 6,100]

1 minute ago, Douglas Buckland said:

The sad fact is, in this day and age, people seem to WANT to be victims and actually WANT the government to take care of them! When did people become such sheep! I find it disgusting and embarrassing.

People were raised to be sheeple by our peers, Douglas.  The last vestige of hard work, responsibilities and gumption, raised a generation of entitled little lambs.  In other words, we spoiled the shit out of them and what did we think was going to happen?  LOL!

[Douglas Buckland + 6,308]

19 minutes ago, Dan Warnick said:

People were raised to be sheeple by our peers, Douglas.  The last vestige of hard work, responsibilities and gumption, raised a generation of entitled little lambs.  In other words, we spoiled the shit out of them and what did we think was going to happen?  LOL!

Something happened to the American work ethic, can do attitude and the independent streak!

I think you are correct. The past few generations have had everything handed to them, they have not been allowed to fail and have come to believe that money grows on trees.

[SUZNV + 1,197]

In their defense, life are much tougher for young people, as least in the suburban. Barrier to entry higher with more competition and more college degrees requirement (and the students debts are much higher than the past, inflation adjusted), higher healthcare cost, higher house prices in big cities so they either mortgage from banks with higher risk or pay rent to landlord and unable to save much. Mating-Dating ages in big cities make them more materialistic (kind of investment for a good marriage candidates), which make them deep deep down feel insecure and not confident and tempted to Left policies like free healthcare (so they don't need to depend on employers),  student loan forgiveness etc. But they are too proud to reflect on themselves,  so they tend to think they are liberals and  entitled to benefits, no mortgage is a new way of life, are fighters for equality, human rights, they are the future bosses of the country etc. Mainstream & Dem did a good job in making them feel themselves  important and lead them focus on their rights than their responsibilities, stirring up their emotions for blind hate and  turn them into sheep/goat following their "liberal champion" which are Judas sheep/goat. When they move out of big cities, have a stable job, a house and family, then there will be a good chance they will wake up and becoming Red (but some of them stay Blue forever if no reflection).

Whenever mainstream mention :"Adults with college degree vote for Democrats" simply  means younger generations tend to vote for democrats, as these generations have more college degrees while previous generation can have job after high school and upgrade  their careers from jobs. I think woman tends to vote Dem because they are emotional driven.

Edited May 15, 2020 by SUZNV

[Douglas Buckland + 6,308]

There is no excuse for being a materialistic, spoiled brat. At some point you have to wake up and smell reality as an adult. Not everyone can afford to earn a college degree, whining about it isn’t going to help. If you can’t afford college, go to Plan B. A trade or the military are viable alternatives.

How many entitled twits actually go to college, do their homework, and pursue degrees which will actually allow them to pay off their student loans? How many simply go to college and pursue a degree in basket weaving or gender counseling, and are surprised when they can’t find meaningful employment or afford a house in the suburbs or that new BMW?

As adults, you are responsible for your actions...full stop!

I knew roughnecks and roustabouts on the rigs who used their heads, watched their lifestyles and expectations and became millionaires.

Nobody owes these kids a damn thing. The quicker they realize this, the quicker they can get on with life!

Edited May 15, 2020 by Douglas Buckland

[Dan Warnick + 6,100]

With respect, what you wrote @SUZNV sounds pretty much like the nightmare of early adult life I went through.  One difference was I went to the city after university and by the second year I was looking for a way back out.  At 2.5 years I found my opening and took it.  It felt like the first time I had breathed in 2.5 years.  The opening I was fortunate enough to find, with the guidance/help of some people who recognized I was going to be wasted in cubicle-land (and maybe because I begged 😉), was in field service.  After a few short years I was able to pay off my student loans and other debt, while my peers were still saddled with theirs, and was FREE of debt.  Still single, travelling and living mostly around Asia in the beginning and feeling like I was making a difference (real world vs cubicle-land).  To Doug's point, it's no excuse, IF you want to get out of the traps many fall into.  On the other hand, as I've said ever since I could see it play out over and over again: a country boy can go live and work in the city, but city folk really seem to struggle with the feeling that "there's nothing t do out here" (sob, it's what you make it, but I empathized).  I did work in cities most of my career because that's where the work was, but the difference was the type of jobs: independance, responsibilities, making a difference on the job and in people's lives around me.  Now I am able to contract my services and have been working remote, mostly from home, for the last 7-odd years.

Edited May 15, 2020 by Dan Warnick

[Douglas Buckland + 6,308]

Once I had my first degree, and the associated debt, I couldn’t find work in the States and ended up on an offshore rig, off the coast of Brazil!

Did I want to leave the States...no! But I had bills to pay and had no other options.

That said, going to Brazil turned out to be a blessing in disguise! I have rarely worked in the US since then, 36 years ago!

[SUZNV + 1,197]

 

@Dan Warnick

I had similar experience when moved out of big cities and would not move back even if the salary were double.

@Douglas Buckland

I graduate in Great Recession time 2009 and could not find job until mid 2011 in a small town and got laid off after 1 year. 

--------------

Sometimes I appreciated unemployment time, it gave me appreciation to any job I can have now. But the liberals in large cities like San Francisco are not necessarily jobless. I just try to understand liberals in their points of view. They have good salary and In their minds, they are successful:

- High salary compares to average American households. Which means pay high federal taxes. And because they pay high tax, they see State or Federal's budget as an all-you-can-eat buffet.

-Working for Big Tech companies (Google, Facebook, Microsoft ect.)

-Live in a big cities. They are tech people. They are more advance in "technology".

Sometimes they are struggle internally and search for an answer and what they see:

-They are not alone, it is the new way of life and many big cities all over the world. It is the way it should be. In many books teach people to be rich, the first advice is mortgage a house is a waste of capital, they should invest. And after paying off student loan, they are debt free. They can afford high tech life style.

-Mainstream and Dem sing for them: young, smart, modern, has ideology (liberal), highly educated with college degrees, successful, future of USA. They have the responsibilities to fight for equality as the other side are half deplorable, racist, bullying, greedy, uneducated etc.

When they want their own house for family life or they have to move to other states for jobs, they bring their "ideology" above with them and they have to teach local people who they believe to live in the wrong way (but more comfortable than them). They know better, they are from bigger cities.

I think that is why Americans spited into 2  sides progressive vs conservative, urban vs rural.

I don't see much chance for conservative in the long run and every time Conservatives win an election, it is always very close. If Texas turn blue, then American middle class will suffer much much more. because Dem will need to have lots of regulations and a big central power and public factors , which very easy leads to corruption and less choices for The  People.

There is 2 things that are unexpected factors, both maybe disasters but give us some hope: Trump and Covid19. Trump attacked in the equilibrium of the political system and Covid19 attacked in the supa urban lifestyle.  

 

[Dan Warnick + 6,100]

@SUZNV You have some great insights that give me pause for thought.  I enjoy your posts.

[Ward Smith + 6,615]

@SUZNV, there's a lot of "college educated" folks on the left and right coasts of this country who have degrees in such scintillating topics as Women's Studies, Black Studies, White Patriarchal Studies, and other such claptrap. Other than qualifying one not at all to even serve lattes in a Starbucks, these degrees and the thousands more like them are completely worthless! However, those degrees are just what the doctor ordered when Demoncrats crow about more "college edumacated folks" voting for them versus the implied hicks who are so stupid they vote Republican. 

Tell me, which is stupid, spending upwards of $200k in college loans for a meaningless degree (and often taking 5 to 7 years to even compete That) or going to work right out of community college with an associates degree in welding, electronics or something in construction?