@RaoulGMI identified the following factors contributing to a crisis, before Coronavirus:
- Stocks: Largest Equity Bubble of All Time: (Pension Crisis & Buyback Bubble)
- Largest Retiree Wave, all wanting to sell stocks and bonds at the same time
- Millennials are too poor and indebted (make 20% less than parents)
- Corporate Credit: Largest Credit Bubble of All Time
- ($10 Trillion + Off balance Sheet = 75% of GDP)
- Student Loan Bubble:
- $1.6 Trillion
- Auto Loan Bubble
- ($1.2 Trillion)
- Indexation Bubble
- ETF/Market Structure Bubble
- Foreign Borrowings (Dollar Standard Bubble)
- Monetary Policy Bubble (The Central Bank Bubble)
- EU Banking Crisis
- why they hired Christine Lagarde, for her political negotiating skills to deal with the nationalization of the European banks (which are facing insolvency) not for her economic or financial skills
- A Trade War:
- The Trade Wars “shattered” supply chains
- Largest Supply & Demand Shocks of all Time
Central Banks have been fighting for the last 20 years:
- Full Scale Debt Deflation and a Solvency Crisis
- A loss of confidence in the Dollar Standard and the Entire Financial Architecture
Dimon, Iger, Cook, Nadella, Pichai, Fink … they’re not founders like Gates or Bezos. They’re not investors like Buffett or Dalio. They’re management. And now they’re billionaires. And all their captains and lesser brethren are centimillionaires. And all their lieutenants and subalterns are decamillionaires.
And everyone is perfectly fine with this. No one even notices that this is happening or that it’s different or that it’s a sea change in how we organize wealth in our society. It’s not good or bad or deserved or undeserved. It just IS. This is our Zeitgeist.
This Is Water
One day we will recognize the defining Zeitgeist of the Obama/Trump years for what it is: an unparalleled transfer of wealth to the managerial class.
It’s the triumph of the manager over the steward. The triumph of the manager over the entrepreneur. The triumph of the manager over the founder. The triumph of the manager over ALL.
If TXN is the poster child of financialization, where are the owners? Who should be voting against all this bullshit? Where’s the corporate raider coming in to unlock shareholder value.
Here’s a quick google search.
Mutual fund holders 51.33%
Other institutional 37.52%
Individual stakeholders 0.55%
The finance industry is having it’s own “god is dead and we have killed him” moment.
Many speculate what the end game of “passive” investing looks like.
This is a preview.
But that’s what everyone in finance does. Don’t look at individual investments, build a portfolio. Hurray indexing. Hurray diversification. Hurray diversified portfolio across asset classes because you can’t make alpha without private information.
Are you investing in a way that supports more of this shit? Then going to your favorite forum “let’s ban buybacks”.
Don’t buy TXN stock(directly or indirectly).
Question for Ben: Is there any TXN under your management?
Money has flooded into the cheapest, largest passive index funds. In an interview with Bloomberg, Michael Burry, who successfully predicted the Dot Com Bubble and US Housing Bubble, says this has created an Index Bubble. In this video, we explore some of his comments from the interview and see whether it describes an investment opportunity.