Global financial system implosion begins

[kabbes]

.


An NFT transaction uses as much energy as me driving to Berlin for lolz

Yes, the whole thing needs to die. But not on some technical basis about inherent use value.

 

[NoXion]

And yet that hasn’t happened and never will. Its value is purely an abstracted one for what it represents.

I dunno about never, how long does a rug last in warehouse conditions? Might still be in good enough condition to stick in a museum or raffle them off, should enough people decide on a more sensible economic system.

Why does it bother you? No-one is forcing you to buy one, or converting your savings into one. If you don't think it will hold its value and allow you to purchase future haircuts and burgers then don't buy one.

What not-bono-ever said. Plus it's a fucking scam as far as I'm concerned, and scammers should not be allowed to operate freely, even if their marks are rich idiots.

 

[kabbes]

I dunno about never, how long does a rug last in warehouse conditions? Might still be in good enough condition to stick in a museum or raffle them off, should enough people decide on a more sensible economic system.

Did you not read what I wrote about the Metropolitan Museum of Art? They haven't looked at their rug collection in decades. It's a huge operation to unwarehouse them, find the one they want and rewarehouse the rest and the cost of doing this is prohibitive. In pragmatic terms, they are basically lost to the world. This is how the fine arts world functions.

Look, we can carry on looking at the specifics in ever finer detail but the basic point is this: there are a lot of things in the world whose value is abstracted from their use case and are seen as a store of value, not as 'useful things' in their own right. It doesn't matter if they could theoretically be used because even if they were used, that use would not justify the value. The value is in the cultural weight placed upon their existence, not their use. To this end, placing value on the cultural weight of the first tweet is not much different in principle to placing value on the cultural weight of the rug that once existed in a sultan's palace. Somebody in this case has found a way of stripping that abstracted value from the object itself. If others want to play the game of assigning the cultural value to the abstract token then I see this as being very much following the same form. I wouldn't risk playing this game myself but then, I wouldn't risk spending a fortune on art to store in a vault either.

The bit about this whole NFT business that I actually object to is not the underlying philosophical concept of how you place value on cultural importance and whether trade in that abstracted cultural value is meaningful or not. I have no dog in that fight. The bit I object to is that the mechanism that has been created for the trade is ecologically catastrophic. I don't know how it can happen in practice, but I'd love to see this blockchain technology regulated to hell to prevent it being used unless there is clear life-and-death need.

 

[not-bono-ever]

The last thing we need on a planet that is slowly cooking itself is a an energy leech that has apparent use except to justify its own existence.

 

[NoXion]

The last thing we need on a planet that is slowly cooking itself is a an energy leech that has apparent use except to justify its own existence.

BitCoin's defenders claim that it's useful. Regardless of the truth of that claim, BitCoin should still be killed.

The bit about this whole NFT business that I actually object to is not the underlying philosophical concept of how you place value on cultural importance and whether trade in that abstracted cultural value is meaningful or not. I have no dog in that fight. The bit I object to is that the mechanism that has been created for the trade is ecologically catastrophic. I don't know how it can happen in practice, but I'd love to see this blockchain technology regulated to hell to prevent it being used unless there is clear life-and-death need.

I think the problem is with both, and that they are linked. The ecological damage is a direct consequence of this abstraction. Not just ecological but social too.

 

[Idaho]

The last thing we need on a planet that is slowly cooking itself is a an energy leech that has apparent use except to justify its own existence.

..he tapped into his smartphone, then checked his social media. Then scrolled through the Google news feed...

 

[Idaho]

It is a representation of goods, service and labour. It only works because the vast majority of the population accept its value.

It really doesn't require a majority at all. In fact a small minority can happily use something as money between themselves. Some national currencies are miniscule on a global scale. Many aren't even the preferred method of exchange within their own borders.

 

[DaveCinzano]

The satirist is not dead - he's now taking the piss out of NFT

 

[Idaho]

NFTs make only slightly less sense than the bond market right now.

Will Powell be able to support bonds, stocks, wages, stimulus and deftly dodge inflation - or will we look back and see the wheels coming off as inevitable?

 

[pesh]

This is all just horseshit now.

 

[CH1]

Interesting analysis here of operations of Greensill and Credit Suisse.
Greensill seems to have had bizarre conflicts of interest which were ingnored because it was a private company not subject to normal regulatory standards.
Vodophone, Softbank and Gupta group have all been investors in Greensill - so in effect Greensitll was lending them their own money.
Vodophon'e's corporate treasurer liked the arrangement so much he joined Greensill as Finance Director.

Investing Resources - Behind The Balance Sheet

Investor content hub Become A Better Investor For Free Want free learning resources from Behind The Balance Sheet and some of investing’s sharpest minds? You’re in the right place! Includes free video training from Steve Clapham. Free Training We are in the business of selling investing...

www.behindthebalancesheet.com

This sort of scenario also fits the Prince of Darkness - Mendelssohn's Tory clone.

 

[kabbes]

How the FTSE 100 could get propelled to 10,000

It would have seemed crazy just months ago, but British blue-chip stocks are about to get a big boost that could take the FTSE 100 index to 10,000, says Matthew Lynn.

moneyweek.com

Counterpoint: but it won’t.

They do have a point, though that dividend yields in the FTSE 100 are very high, at 3.1%. By comparison, even very long bond yields in equivalent companies would likely be half of that. Dividend yields in the DAX, which is probably the closest comparator, are 2.1%. In the S&P 500, they are only 1.5%. Dividend yields would only need to drop to 2.33% — still way above these other indices — to see a FTSE 100 value of 9000.

The difference is how much growth people see in future dividends. The difference between the FTSE 100 and the DAX can basically be viewed as a growth premium for the DAX companies over the FTSE companies. At the moment, based on my mental arithmetic alone (so take that with a pinch of salt), I t’s like saying that the DAX companies will grow 5-10% faster per year than the FTSE 100 companies. If people continue to believe that, the FTSE dividend yield will remain high compared with everybody else.

ETA: nothing stopping it going the other way too, of course. If treasuries start rising, all these dividend yields would eventually follow and the values would go the other way.

 

[CH1]

The only point on record Parliament has considered Greensill - so far.

Written questions and answers - Written questions, answers and statements - UK Parliament

Information from UK Parliament on written questions & answers, written statements and daily reports.

questions-statements.parliament.uk

 

[Artaxerxes]

So how about that Suez

 

[not-bono-ever]

Nationalise it

 

[brogdale]

So how about that Suez

Black swan.

 

[not-bono-ever]

Hedge fund collapse. Could be major

 

[teqniq]

Something to do with this? I notice no-one is naming the hedge fund.

Banks warn of 'significant losses' as they exit positions with large U.S. hedge fund

Credit Suisse and Nomura warned of "significant" hits to first-quarter results after they began exiting positions with a large U.S. hedge fund.

www.cnbc.com

 

[not-bono-ever]

It’s named. It’s been known that nomura were keeping this quiet until it broke. Cheap money in search of a return - lots of credit to ropey outfits - watch this.

 

[magneze]

Any link to GameStop?

 

[not-bono-ever]

Not a punting outfit, Chinese tech

 

[Idaho]

A good overview:

Goldman Sachs' u-turn on hedge fund manager puts bank at nexus of margin call mayhem

NEW YORK (BLOOMBERG) - Bill Hwang, a former hedge fund manager who'd pleaded guilty to insider trading, was deemed such a risk by Goldman Sachs Group that as recently as late 2018 the firm refused to do business with him. Read more at straitstimes.com.

www.straitstimes.com

Usual story. Banks don't like risky, dodgy dealing person... Then that person starts making mega billions and they change their mind... Then it all blows up.

 

[yield]

‘This crisis is different’: the dramatic rebound in the global economy
April 09, 2021 Outline - Read & annotate without distractions
From an economic point of view, it is almost as if the last year was just a bad dream.

As recently as October, the IMF was warning that coronavirus will cause “lasting damage” to living standards across the world with any recovery likely to be “long, uneven and uncertain”.

Yet the forecast it released this week is very different. By 2024, the IMF now believes, the US economy is likely to be stronger than it had predicted before the pandemic. For most advanced economies, it says, there will be only limited scars from the crisis.

Such a positive transformation in the global economic outlook within the space of just six months is extremely rare.

It has underpinned an upbeat mood at the virtual spring meetings of the IMF and World Bank even though everyone knows the pandemic is not yet over. The consensus view is that with the right policies in place, the world can beat Covid-19. A new spirit of international co-operation might even resolve longstanding conflicts over issues as thorny as the taxation of multinationals in a globalised world — a cause the Biden administration is now taking up.

“It’s remarkable how quickly the consensus has shifted in only six months,” said Neil Shearing, chief economist of Capital Economics, a consultancy. It is now becoming clear that the pessimism last autumn about the longer term outlook for advanced economies was an “intellectual failure”, he said, because most economists “reached back to the financial crisis and applied the lessons from that period, but this crisis is different”.

Not everything in the global economy is rosy, of course. Amid the new optimism, there is also concern that some poorer countries and some people within wealthier countries will not share in the improved outlook. In what is becoming something of a tradition, Kristalina Georgieva, the IMF managing director, borrowed this week from Russian literature to characterise the outlook. “Leo Tolstoy in Anna Karenina captures very well where the world economy is today,” she said, quoting the novelist: “All the variety of life is made up of light and shadow.”

"This time it's different." "there is also concern that some poorer countries and some people within wealthier countries will not share in the improved outlook."

 

[kabbes]

The reason for the apparent incompatibility in those statements surely must be that inequality in capitalism is not a bug but a design feature?

 

[yield]

Credit Suisse Scandal Toll Goes Ever Higher as Rivals Thrive

In an era of prosperity for investment banks, Credit Suisse Group AG is careening from one crisis to another and then another -- this time, with a $4.7 billion writedown tied to billionaire investor Bill Hwang’s trading blowout.

www.bloomberg.com

Another long-standing backer of the bank, Qatar’s former prime minister Sheikh Hamad bin Jassim Al Thani, stands to suffer a personal hit as well after vehicles linked to him invested about $200 million in funds Credit Suisse ran with Greensill, according to people familiar with the matter. As former head of the Qatar Investment Authority, Sheik Hamad had made Qatar one of the Swiss bank’s largest shareholders.

The dual hits from Archegos and Greensill have put the bank on track for its second straight quarterly loss, at a time when investment banks around the world are still focused on the windfall unleashed by the market turmoil of the coronavirus pandemic. The five largest U.S. firms boosted trading revenue by more than a third last year to the highest in at least a decade.

JPMorgan’s Wall Street unit generated its most fourth-quarter revenue and profit ever. Deutsche Bank is among firms that have said their investment banks are off to a strong start this year. And Jefferies Financial Group Inc. already reported an 81% jump in revenue from capital markets in the fiscal first quarter that ended Feb. 28.

The Zurich-based bank was one of several global investment banks to facilitate the leveraged bets of Archegos, and had tried to reach some sort of standstill to figure out how to unwind positions without sparking panic, people familiar with the matter have said. The strategy failed as rivals rushed to cut their losses.

“Almost two weeks in, it is still not clear how the bank managed to take a 4.4 billion-franc charge for one client in the prime brokerage business, which we estimate generates less than 1 billion francs per annum in revenues,” JPMorgan’s analysts wrote.

Among big banks that dealt with Archegos, only Nomura Holdings Inc. has signaled the potential to also take a multibillion-dollar hit, saying it could lose as much as $2 billion.

 

[redsquirrel]

‘This crisis is different’: the dramatic rebound in the global economy
April 09, 2021 Outline - Read & annotate without distractions
From an economic point of view, it is almost as if the last year was just a bad dream.



"This time it's different." "there is also concern that some poorer countries and some people within wealthier countries will not share in the improved outlook."

Cheers for that yield. Highlights the disconnect between economics and people's lives. As well as the commitment of the religious. I don't really like drawing parallels with the past because to me there are always as many differences as similarities. But the sort of crazy optimism in capitalism that this pieces summarises does put me in mind of 1900s - liberalism fiddling while not seeing the flames all around them.

 

[kabbes]

yield — does outline.com work for The Times? I can’t seem to get it to do anything.

 

[yield]

Cheers for that yield. Highlights the disconnect between economics and people's lives. As well as the commitment of the religious. I don't really like drawing parallels with the past because to me there are always as many differences as similarities. But the sort of crazy optimism in capitalism that this pieces summarises does put me in mind of 1900s - liberalism fiddling while not seeing the flames all around them.

"What we see in the United States and some other economies is a statistical recovery and a human recession." Larry Summers, Davos, Jan 30, 2010

Investors have put more money into stocks in the last 5 months than the previous 12 years combined
CNBC. Apr 9, 2021

The latest wave of market enthusiasm has brought with it a stunning rush of money, in which more of investors’ cash has gone to stock-based funds in the last five months than the previous 12 years combined.

That statistic, from Bank of America, reflects a period in which the Dow Jones Industrial Average has risen more than 26%.

At the same time, the market has undergone some wild trends that included a massive influx to meme stocks such as GameStop and AMC Entertainment Holdings. Trading volume rose 40% in the first quarter from the previous three months, with investors snapping up sectors that performed poorly last year amid hopes for a pronounced economic rebound from the Covid-induced slide in 2020.

Amid the frenzy, some $569 billion has gone to global equity funds since November, compared with $452 billion in the previous 12 years that go back to the beginning of the longest bull market run in history, according to Bank of America’s chief investment strategist, Michael Hartnett.

Those numbers easily could exacerbate ongoing worries about financial market bubbles as valuations are around the same levels as just before the dot-com bubble popped in 2000. But these are not ordinary times.

yield — does outline.com work for The Times? I can’t seem to get it to do anything.

With the FT you need to put a fullstop after the .com. There maybe some workaround with the Times but I've not found it yet.

 

[Idaho]

QE causing inflation has turned out to be just fear-mongering. The commodity price changes over the last year are clearly nothing to worry about. 0% 10 year bond anyone?

Commodity Prices - Price Charts, Data, and News - IndexMundi

www.indexmundi.com

UK house prices increase at fastest rate since 2004

High demand and low supply could create conditions for housing super-boom, says Nationwide

www.theguardian.com

 

[yield]

One in two people globally lost income due to the pandemic - Gallup
The COVID-19 crisis has hit workers across the world, particularly women, who are over-represented in low-paid precarious sectors

NAIROBI, May 3 (Thomson Reuters Foundation) - One in two people worldwide saw their earnings drop due to the coronavirus, with people in low-income countries particularly hard hit by job losses or cuts to their working hours, research showed on Monday.

U.S.-based polling company Gallup, which surveyed 300,000 people across 117 countries, found that half of those with jobs earned less because of COVID-19 pandemic disruptions. This translated to 1.6 billion adults globally, it said.

"Worldwide, these percentages ranged from a high of 76% in Thailand to a low of 10% in Switzerland," said researchers in a statement.

In Bolivia, Myanmar, Kenya, Uganda, Indonesia, Honduras and Ecuador, more than 70% people polled said they took home less than before global health crisis. In the United States, this figure dropped to 34%.

The COVID-19 crisis has hit workers across the world, particularly women, who are over-represented in low-paid precarious sectors such as retail, tourism and food services.

A study by the international charity Oxfam on Thursday said the pandemic had cost women around the world $800 billion in lost income.

The Gallup poll found that more than half of those surveyed said they temporarily stopped working at their job or business - translating to about 1.7 billion adults globally.

In 57 countries including India, Zimbabwe, the Philippines, Kenya, Bangladesh, El Salvador, more than 65% of respondents said they stopped working for a time.

Countries where people were least likely to say they stopped working were predominantly developed, high-income countries.

Fewer than one in 10 of those who had jobs in Austria, Switzerland and Germany said they had stopped working temporarily. In the U.S., the figure was 39%, research showed.

The poll also showed that one in three people surveyed lost their job or business due to the pandemic - translating into just over one billion people globally.

These figures also varied across nations with lower income countries such as the Philippines, Kenya and Zimbabwe showing more than 60% of respondents lost their jobs or businesses, compared to 3% in Switzerland and 13% in the United States.