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Global financial system implosion begins

Looking at that thread, I think he’s misinterpreting cause and effect to some extent. The companies with the biggest dividend rates are often those in industries where long term growth is not expected to be high, but there is an efficient production of profit in the here and now. An example would be tobacco — Imperial Tobacco, for example, have very high dividend rates. Valuations are implicitly the discounted value of the future dividends, which is based on current dividends and expected growth. So it’s not so much that companies aren’t justifying their valuations because they aren’t adding value, or that they aren’t justifying their dividends because they aren’t growing. It’s that they are worth a lot because and only because they are handling profit straight over to shareholders rather than using it for investment.
 
Artaxerxes said:
Interesting read, seems to me as if the next sub-prime mortgage crisis is entirely stock market based.

Click to expand...


Lots of the QE money has been sloshing around the stock market since the credit crunch looking for investment opportunities, leading to what's largely been a thirteen-year-long bull run that resulted in a great many colossally overvalued companies - Tesla was one of them (When it went in to the S&P 500 it had a PE ratio of about 800* which was the sort of crazy not-backed-by-what-the-company-can-actually-produce insanity that was seen back in the days of the dot com boom/bust. Many companies would be very lucky to hit a PE of 50). Desirable stocks become more desirable as investment opportunities so as long as the money continues to roll in, the prices keep going up.

Essentially because the money to buy them was there, lots of companies have been, IMHO, given unjustifiably high stock prices not borne out by what the companies can realistically turn in to profit even if given a decade; we've already seen a very strong contraction since the start of the ukranian invasion as confidence in the long-term outlook drops, and I feel it'll drop further once winter and the continued cost to industry and agriculture really sets in. Global inflation rates are still far from being controlled.

Whether it'll have as big an effect as the sub-prime mortgage crisis and derivatives remains to be seen of course - I don't think it'll be as bad, but then I didn't think the 2008 crash would be as bad as it was either (so don't take any investment advice from random dilettantes on the internet ;)).
 
That Murphy guy is starting to do my nut in. He’s always misrepresenting stuff to pander to his Twitter followers - his Surviing 2023 report that he published yesterday was barely coherent in parts - he comes across as someone who’ll smash out whatever on his keyboard as he knows most of his followers will give him a cheer and won’t actually analyse it.
 
Investors warn of ‘disconnect’ as markets price in early Fed rate cut
Some traders fear markets underestimate US central bank’s determination to stamp out inflation
20/08/22 archive.ph
“There’s this disconnect between the market and the Fed, and there’s this idea that the Fed is going to have to relent in its tightening programme to allow for weaker employment and slowing growth,” said Gregory Whiteley, a portfolio manager at DoubleLine. “That idea is really strongly embedded in markets.”

The recovery in stocks has eased financial conditions, making it easier for companies to borrow and hampering the Fed’s efforts to cool down the economy.
Click to expand...
 
At the risk of getting banned from this thread, this recent David Starkey video really rings true to me (except of course for the end where he accuses Sir Ed Davie of trying to take Britain into the Weimar Republic)
 
What the fuck is it with people sharing videos from absolute bellends recently? First Falun Gong, now that Starkey prick.
 
kabbes said:
Also, proper lol at the idea that Starkey’s uninformed opinions on macroeconomics are where you should look for insight.
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Actually his Youtube talk about inflation above reinforces views I have had - and propounded on Urban for several years.

I don't align myself in anyway with his views about BLM, riots or genocide - but I do think he had a point on accents.
It was Channel 4 who started the Mockney announcer syndrome - but BBC2 now has it too..

Starkey was interviewed by Ian Dale (on crutches) at the Edinburgh Festival yesterday (24th August 22). Starkey said a couple of interesting things (I thought). Main point at the end - he compared himself to Boris Johnson. He said just like Johnson he had been "getting away with it for years" - meaning in his own case causing offence as apart of an entertainment act. And as with Boris Johnson he said events finally caught up with him.

He said he had been taken aback by losing most of his honorary positions - and on reflection understood that he had been wrong on many of the points. He didn't seem particularly sorry for himself though. He also claimed his friends had all stood by him except for one - a wealthy person who had a villa in Italy and didn't want the oprobiom of been seen to invite Starkey to a party there - so he cancelled the invitation. Not sure who that was.
 
CH1 said:
Actually his Youtube talk about inflation above reinforces views I have had - and propounded on Urban for several years.

I don't align myself in anyway with his views about BLM, riots or genocide - but I do think he had a point on accents.
It was Channel 4 who started the Mockney announcer syndrome - but BBC2 now has it too..

Starkey was interviewed by Ian Dale (on crutches) at the Edinburgh Festival yesterday (24th August 22). Starkey said a couple of interesting things (I thought). Main point at the end - he compared himself to Boris Johnson. He said just like Johnson he had been "getting away with it for years" - meaning in his own case causing offence as apart of an entertainment act. And as with Boris Johnson he said events finally caught up with him.

He said he had been taken aback by losing most of his honorary positions - and on reflection understood that he had been wrong on many of the points. He didn't seem particularly sorry for himself though. He also claimed his friends had all stood by him except for one - a wealthy person who had a villa in Italy and didn't want the oprobiom of been seen to invite Starkey to a party there - so he cancelled the invitation. Not sure who that was.
Click to expand...
Or, to summarise, Starkey is a prick and nobody should be giving him any attention.
 
CH1 said:
Actually his Youtube talk about inflation above reinforces views I have had - and propounded on Urban for several years.
Click to expand...
Well then you'll be able to summarise them and what you agree with Starkey on. You've posted a half hour video surely you can summarise the key points.
 
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So as I can't sleep thought I'd do a U75 public service and watch this video. Really don't bother. Whatever you thought of Starkey at one time he could at least make some sort of coherent point. The ramblings here are like an oxbridge Abe Simpson after a few rounds

Anyway what parts of this ramble do you agree with CH1 ?
  • That COVID was a piddling little issue? A 'phoney' war? That locking down was bad?
  • That civil servants - non-creatives! - need to work in an office not staying at home getting paid for doing nothing?
  • That we need to 'get people back into work'?
  • The fact that the 'phoney war' of COVID has caused inflation because of increasing the money supply?
  • That the recent price rises are due to multiplication of the money supply?
  • That rising inflation is 'because quite simply we had furlough'?
  • That people were giving money when they had nothing to spend it on?
  • That Gordon Brown invented quantitative easing?
  • The QE caused an inflation of asset prices and then into the wider economy?
  • The the war in Ukraine war/disruptions to supply trains has caused a genuine price rise rather than inflation
  • That no one is talking about the problems of QE?
  • That the 'Liberal Party' (meaning the LibDems) is a proxy for socialists?
  • That Sunak, Starmer, Reeves, Johnson, Martin Lewis, the BBC, the Times and the Mail 'were all in it" supporting lockdowns.
That is half an hour of my life that I'm not getting back
 
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redsquirrel said:
So as I can't sleep thought I'd do a U75 public service and watch this video. Really don't bother. Whatever you thought of Starkey at one time he could at least make some sort of coherent point. The ramblings here are like an oxbridge Abe Simpson after a few rounds

Anyway what parts of this ramble do you agree with CH1 ?
  • That COVID was a piddling little issue? A 'phoney' war? That locking down was bad?
  • That civil servants - non-creatives! - need to work in an office not staying at home getting paid for doing nothing?
  • That we need to 'get people back into work'?
  • The fact that the 'phoney war' of COVID has caused inflation because of increasing the money supply?
  • That the recent price rises are due to multiplication of the money supply?
  • That rising inflation is 'because quite simply we had furlough'?
  • That people were giving money when they had nothing to spend it on?
  • That Gordon Brown invented quantitative easing?
  • The QE caused an inflation of asset prices and then into the wider economy?
  • The the war in Ukraine war/disruptions to supply trains has caused a genuine price rise rather than inflation
  • That no one is talking about the problems of QE?
  • That the 'Liberal Party' (meaning the LibDems) is a proxy for socialists?
  • That Sunak, Starmer, Reeves, Johnson, Martin Lewis, the BBC, the Times and the Mail 'were all in it" supporting lockdowns.
That is half an hour of my life that I'm not getting back
Click to expand...
Good tirade. Who DID invent quantitative easing then?
Investopedia suggests it was Japan in 1997.
Your view and his on money supply obviously differ. But surely Starkey is right in the sense that money supply increases - paying for government spending with money printing can lead to runaway inflation. Zimbabwe would be a good example of this - and probably Argentina.
The use of the word "Liberal" as abuse has been common for many years in both Labour and Tory circles. Rather like Tories call Labour "Socialists" which may be laughable to both socialists and New Labour etc.
I think you are right to say no-one is talking about QE - I've said this for years, but the vast majority of the population seem to be in debt and to prefer zero interest rate mortgages to savings.
I must check my private pension again. I have a £4,000 lump sum to invest - HL would give me £1000 cash + £180 PER YEAR - or no cash and £200 per year. This is the sort of return many will get as they retire having had their final salary pensions scrapped by Thatcher, Major AND Gordon Brown.
The best is yet to come!
 
CH1 said:
I think you are right to say no-one is talking about QE - I've said this for years, but the vast majority of the population seem to be in debt and to prefer zero interest rate mortgages to savings.
Click to expand...
I'm not saying that, I'm summarising what Starkey said. I've seen plenty of criticism of QE.

But from your post(s) I take it that you, like Starkey, believe the current crisis is due to QE? And that issues with supply chains (let alone capital profiteering) is a minor part?

And if QE is the problem does that mean - as Starkey - that you think furlough was wrong? That the large infrastructure projects Biden has pushed are bad?
 
CH1 said:
Good tirade. Who DID invent quantitative easing then?
Investopedia suggests it was Japan in 1997.
Your view and his on money supply obviously differ. But surely Starkey is right in the sense that money supply increases - paying for government spending with money printing can lead to runaway inflation. Zimbabwe would be a good example of this - and probably Argentina.
The use of the word "Liberal" as abuse has been common for many years in both Labour and Tory circles. Rather like Tories call Labour "Socialists" which may be laughable to both socialists and New Labour etc.
I think you are right to say no-one is talking about QE - I've said this for years, but the vast majority of the population seem to be in debt and to prefer zero interest rate mortgages to savings.
I must check my private pension again. I have a £4,000 lump sum to invest - HL would give me £1000 cash + £180 PER YEAR - or no cash and £200 per year. This is the sort of return many will get as they retire having had their final salary pensions scrapped by Thatcher, Major AND Gordon Brown.
The best is yet to come!
Click to expand...
“Can” is not the same as “will”
 
redsquirrel said:
I'm not saying that, I'm summarising what Starkey said. I've seen plenty of criticism of QE.

But from your post(s) I take it that you, like Starkey, believe the current crisis is due to QE? And that issues with supply chains (let alone capital profiteering) is a minor part?

And if QE is the problem does that mean - as Starkey - that you think furlough was wrong? That the large infrastructure projects Biden has pushed are bad?
Click to expand...
No - I don't think the current crisis is caused by QE.
I think the food price rises are partly around Ukraine/Russia in particular farm prices seem linked to this because of fertilizer etc.
I also think Lidl (which I used to mainly use) have taken advantage of the shortages and disorientation of customers to bump up prices - though this sems selective.
In your list of Starkey positions you seem to have left out the very low cost of consumer goods on a historical basis. This is of course a disaster waiting to happen - we are now accustomed to £250 48 inch smart TV sets from China - the supply of which might not be that secure. Like we may end up having £350 less reliable Beko TV sets from Turkey (seeing as "The City" has destroyed our own manufacturing capacity.
I'm sure Biden's infrastructure projects are valuable and necessary, but in order to get that through did he not link it to a check for $1000 for every family?

I guess Starkey does imbibe the right-wing bias prevalent in some American commentary which is why he does mention "Woke" BLM etc. Can't really see why he gets into all that - except he might be a knee-jerk racist. I think we should ask the new Bishop of Croydon.
 
kabbes said:
“Can” is not the same as “will”
Click to expand...
Clearly it is all a matter of degree. For many years there was this German myth/factoid that they liked a strong Deutschmark because of the Weimar inflation. And that this led to unacceptable rigidities in the Euro set-up (remember "Grexit"). I think that was another Gordon Brownism actually.
If GB had not blocked GB going into the Euro Brexit would have crash-landed before take-off like Grexit!
 
CH1 said:
No - I don't think the current crisis is caused by QE.
Click to expand...
Then why did you post that video and claim that "Actually his Youtube talk about inflation above reinforces views I have had - and propounded on Urban for several years.". His central thesis is that the current inflation is down to QE - and thus that furlough, spending on infrastructure etc was wrong.

If you reject that point then I'm not sure what the you do agree with Starkey on? Can you state, clearly, what are the views on inflation you have propounded for several years?
Besides goods being too cheap (a rather conservative view that implicitly argues for workers living conditions to be worse)

CH1 said:
Clearly it is all a matter of degree. For many years there was this German myth/factoid that they liked a strong Deutschmark because of the Weimar inflation. And that this led to unacceptable rigidities in the Euro set-up (remember "Grexit"). I think that was another Gordon Brownism actually.
If GB had not blocked GB going into the Euro Brexit would have crash-landed before take-off like Grexit!
Click to expand...
I'm having trouble parsing this. Are you claiming that the ECBs actions, in a large part pushed/directed by Germany, did not lead to austerity and increased poverty in Greece, Italy, Ireland, Spain etc?
 
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redsquirrel said:
Then why did you post that video and claim that "Actually his Youtube talk about inflation above reinforces views I have had - and propounded on Urban for several years.". His central thesis is that the current inflation is down to QE - and thus that furlough, spending on infrastructure etc was wrong.

If you reject that point then I'm not sure what the you do agree with Starkey on? Can you state, clearly, what are the views on inflation you have propounded for several years?
Besides goods being too cheap (a rather conservative view that implicitly argues for workers living conditions to be worse)


I'm having trouble parsing this. Are you claiming that the ECBs actions, in a large part pushed/directed by Germany, did not lead to austerity and increased poverty in Greece, Italy, Ireland, Spain etc?
Click to expand...
What is parsing? Surely Germany lending money Greece to buy Mercedes is similar to QE?
For the benefit of Germany.

I comment that Starkey has a point about inflation and now we are on austerity in Ireland.
Aren't you the fan of Kate Hoey and Red Rum Lisa?
In other words an argumentative Class War twat?
 
CH1 said:
What is parsing? Surely Germany lending money Greece to buy Mercedes is similar to QE?
For the benefit of Germany.
Click to expand...
It was about bailing out the banks.
Greece's sovereign-debt crisis
15/04/2010
Our debts, your problem

Yet the alternative to a bail-out—default—is too grisly to contemplate, not least because of the dire consequences for Europe's banking system. Banks in Greece hold €38.4 billion-worth of the government's bonds, according to Deutsche Bank. This amounts to almost 8% of their total assets. A big write-down in the value of those bonds would leave the banks crippled. But around 70% of Greek government bonds, €213 billion-worth, are held abroad, mainly elsewhere in Europe.
Click to expand...
Greekgov.gif
 
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CH1 said:
What is parsing? Surely Germany lending money Greece to buy Mercedes is similar to QE?
For the benefit of Germany.
Click to expand...
Parsing = understanding, i.e. I have no idea what this means "If GB had not blocked GB going into the Euro Brexit would have crash-landed before take-off like Grexit!"
CH1 said:
I comment that Starkey has a point about inflation and now we are on austerity in Ireland.
Aren't you the fan of Kate Hoey and Red Rum Lisa?
In other words an argumentative Class War twat?
Click to expand...
Lovely. If you are asking that if I believe that the fundamental driving force of capitalist societies is class war yes I do subscribe to that philosophy.
Though as an archaist and a communist I'm no fan of Hoey. I've no idea who Red Rum Lisa is.

Now can you actually answer the question I asked - what are the views on inflation you have propounded for several years and how are they related to what Starkey was saying.
Or are we going just to have more incoherent shite.
 
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