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Latest Comments16 Comments
The Great Oil Deception: Part Two
So easy to manipulate this environment with simple inflammatory posts.
The reality is that science simply does not support the notion that we have suddenly fast forwarded 1 century and oil is now nearly run out.
The problem is that:
1) doomsayers, the scourge of all humanity really, WANT this to be true and so scream about it 24x7
2) greens/alternative energy idealists/et al (note, I said idealists and not realists - alternative energy is great as long as you're not delusional in your expectations) WANT this to be true and so also scream about it 24x7
3) greed powered speculators having destroyed the credit markets with their artificial inflation of real estate value are now moving to commodities - with all of the bullshit on this forum, no one mentions that SPECULATORS consume MORE OIL than CHINA daily - eat that for breakfast. These speculators WANT badly for the "doom" to be "true" so they can keep making money on futures.
4) politicians fall solidly into the pockets of either 2 or 3, so they will make sure that people keep thinking the DOOM is true
This is the reality of our current situation. Historian WILL look back on this in 200 years (contrary to what the idiots who fall into camp 1 believe) and say "wow, what a back of selfish, reactionary, idiots there were polluting the chance for real progress back then"
I think what will ultimately get us out of this is some common sense and the average person deciding to finally just start ignoring every idiot that has a loud voice and a soap box.
Alternative energy should be encouraged (tax incentive) and utilized where possible, but wind and solar are no panacea and never will be - anyone who understand the science will know this.
Exotic alternative energy is something we have to hope we discover in the next century before oil REALLY starts to run out. We ease the slope by using alternatives where we can (and relatively clean nuclear and relatively clean coal MUST be part of this - the greens MUST be ignored here) in the meantime
Oil must be treated with the respect it deserves as the ABSOLUTE foundation commodity for human civilization and speculation must be DISALLOWED. No swaps bullshit exception for JUST OIL the ONE commodity that SHOULDNT have a swaps clause!
All of this noise and the 800lb elephant in the room gets ignored conveniently in favor of more black helicopter and armegedon bullshit. But of course it IS seeking alpha I suppose - maybe lots of oil futures folks here playing a part and stirring the pot!
The Bear Market Has Just Begun
I think, rational or not, a lot will depend on public mood following the election.
There is also a need for real regulatory action on the commodities side (ie - limit or eliminate swaps) Not sure how likely that is to happen though
Housing Market Shows No Signs of Life
Expect the prices to continue to contract until US home median settles down to 1999 levels plus some realistic growth adjustment 99-2008. Then expect, most likely, a return to realistic growth moving forward.
"Housing is dead" in the short term certainly (3-5 years), but clearly "housing" is never "dead" unless civilization is over. Despite the hype of those with an agenda, there will always be people who dont want to be piled like rats into a megalopolis. Once prices return to rationality, you will start seeing the inventories return to healthy levels.
Did We Learn Anything Over the Past Two Years?
The Triple Play: Oil Addicts, The Credit Crunch and Deflation
Its funny how everyone, once again, wants to turn a blind eye to an obvious case of collusion and price fixing. Subprime happened, we let it happen - let the sharks bleed the system and yelled "MARXIST!!!" at anyone who suggested intense regulatory reform was needed.
Now everyone is running in a panic predicting the end of days and meanwhile, oil SOARS irrationally. And what happens? Some suggest that MAYBE the cartel of 9 figure investors manipulating oil futures should be reigned in and BAM... "MARXIST!!!"
We reap what we sow all right. The vast majority of us idiots keep supporting the protection of 8 and 9 figure net worth individuals buying into the bullshit that it will trickle down and believing the delusion that "some day, we'll get there too! thats what the USA is all about!"
Its high time that the vast majority of us (any loser like me working for a living - even in a deep six figure job - and posting on a board like this) dropped the delusions of grandeur and realized that the deliberate manipulation of the global credit market, and now commodities markets, by billionaires and institutions isnt something the free market can continue to allow if it plans to survive.
We're heading for a model where the top 1% hold 100% of the wealth and the rest of us are foraging for food or, perhaps, we return to feudalism.
The answer is increased regulation and more tools in the hands of the fed. And possibly some criminal prosecutions and 8 and 9 figure fines against individuals for the credit meltdown.
Carl Icahn May Rekindle Yahoo-Microsoft Deal
I, for one, am really hoping they are wrong. Yahoo is a dog and would mire MSFT down with integration challenges that would go on for years and cost a ton. In the meantime, the combined entity would still have no chance of catching Google. As a MSFT shareholder, this deal stinks.
Is an iPhone Air Hybrid in the Works?
Apple has a good racket. Release existing tech with an Apple logo and be hailed as making a market. Because so many people buy into it, its a self fulfilling prophecy. There are a number of subnotebooks with cellular radios built in already and all of them are more interesting than the Air, but web pundits seem not to care.
Housing Starts Rebound?
I think anyone who has any level of real economic understanding recognizes that we are going to be deflating for a good long while in housing. I expect new home starts to trend down for at least a few more years and the median US home price to continue to drop until we have given up roughly 35% of the record highs of the past couple of years.
Dollar Falls on Lowest Consumer Sentiment in 28 Years
Their largest CDS partner was JPMC. Banks were starting to shut Bear out and their ability to meet their obligations was coming into serious question.
If nothing had been done at all, Bear *would* have slipped into bankruptcy and defaulted on ALL of its obligations including trillions in CDS exposure.
The real problem is that most people ranting and raving about these issues, and weighing in as "experts" and even some of those making policy, have NO CLUE what any of it means much less how one would beging to unravel this ball of string.
Synthetic instruments have become increasingly abstracted from anything approaching real value and the govt has allowed that to happen. Now there isnt enough physical capital in circulation to cover the leverage exposure. Simply allowing everything to organically meltdown so you can say there is "NO CORPORATE WELFARE" would lead to an outcome I dont think many people would like even if they are too stupid to realize it.
Rather than talking in broad conspiracies and making loose historical connections that are, when examined in detail, really vaporous, more people should take the time to try to really learn what is going on here and what lead to it.
NAR Home Sales Report Shows Some Nasty Declines
My thinking is it will take 3-5 years to find the real bottom of this and then things will settle back into the *normal* pattern of growth. Possibly even slower than normal for another 5 or so depending on the health of the broader economy. Hopefully we'll never return to the unsustainable and ludicrious bubble growth.
John Hussman: Home Price Erosion Will Continue
I think it is a good thing and it would be disastrous to try to prevent it. Not to mention, it wont work. Home values were artificially inflated, institutional investors were ridiculously overleveredged with synthetic instruments, and the average schmuck was carrying a criminally irresponsible debt load and covering it with artificial "equity".
This deflation is needed. So is MUCH tighter regulation on the banks and investment banks (and any other institution that wants to start to act like a bank). Some forward thinking regulation might be nice also to catch the wave of CDO pirates who are now retreating into commodities and helping to create a bubble there rather than seeking to invest in the creation of real value.
Homebuilder ETF Rises Despite More Bad Housing News
A lot of folks these days, I think, are just trolling financial forums to hear themselves rant and have it validated by other commenters. Its like a support group and these guys are like the guy on the corner with the "WORLD IS ENDING" cardboard sign.
Its simple really. Either the world is ending or it isnt. If you are like me and karchad, start consdering buying sectors that are right now highly depressed for the long haul.
If you believe the world IS over, stop blogging and ranting about it, turn off the computer, start taking physical delivery of commodities, and go dig a bunker.
There really isnt any other option here. Things are either going to recover AT SOME POINT, or they're not. Endlessly predicting the Great Depression 2.0 only now 5x worse is pretty much a waste of time.
Demographics of Jobless Claims
So the apocalypse looms. What is the point of talking about it exactly? Contrary to the "refreshing to hear" angle, I would say "give it a rest already".
All I see is article after article by "professional bloggers" talking about how the world is now at an end.
What I see *no one* offering is a solution. If the commenters here, Shedlock, and all folks of like mind believe we are essentially at the end of times and there *is* no solution, then doesnt blogging about it and moaning about it on the web seems particularly idiotic? There is really nothing to be gained.
Why arent you folks out taking physical delivery of commodities and digging a bunker somewhere?
Break yourselves out of the self congratulatory cycle of doom prediction and martyrdom and ask what you plan to do exactly when the global meltdown you are so proud to be predicting comes to pass. I doubt anyone posting here on "seeking alpha" knows how to live off the land.
Either provide some solutions, or STFU to be quite blunt. The only thing *more* obnoxious than the spin doctors manipulating reports to show "everything is fine", are the crazed soothesayers predicting endless and unavoidable doom with not even the faintest hint of ANY kind of solution.
How Much Will Jerry Yang's Ego Cost Yahoo Shareholders?
If there is one thing more distasteful than rappacious greed, it is certainly irrational ideological zealotry. Thats what happened here. Yang got his way, stuck SB in the eye, and is now the shining hero of the LAMP holy warriors. He still has HIS billions and, well, whatever happens to Yahoo down the road doesnt really have any personal impact on him now does it? He can always rationalize it for himself by blaming the rank and file.
And for the guy who feels it is silly to "personalize"... this? MAN do you need a clue! I mean do you have ANY experience with the workings of corporate politics at all?
Housing Data: Crybabies and Deceivers
I had been selling but, guess what? I decided to pull the property and rent it instead. WHY would I absorb a valuation hit for the commercial banking industry?
I mean net this out... What is the point of these articles? That real estate is now past the point of recovery, will only continue to sink, and is effectively dead? Yeah ok. Thats why my EU friends are snapping up the prime stuff in NYC and FL.
It sounds to me that the overly pessimistic articles are every bit as self serving as the NAR articles. You say that b/c this is "seekingalpha&quo... your "bias" is well known.
No it isnt. You could be writing predictions of "doom" because it is a GREAT way to get clicks today. You could be caught up in the "world is over" cycle and, at this point are preaching. You may be frustrated that a property YOU have been eyeing just stubbornly... wont... come down... enough... LOTS of people I know in NY are in this category. Ranting and raving about how "stupid people" dont realize that THE WORLD IS OVER. When I explore, their evidence is that the condo they've been obsessing over just WONT drop below $1M.
We do have some serious economic challenges, but the press is on a FEEDING FRENZY of doom. If you guys believe the future is so bleak, are you writing these articles from China after having disolved all of your domestic ties, investments and positions? Did you sell your home recently? I mean afterall, its in a valuation freefall that will NEVER stop no? Better unload now!
If someone has a job (MOST people still do you know, or in the frenzy, have we forgotten that), they dont NEED to sell most likely. Why wouldnt they let the foreclosure wave settle and, in the meantime, keep their property listed at what they want to get?
If we think that day will NEVER come and real estate has completely lost its ability to yield a return (funny - a tangible, precious and FINITE commodity being killed thanks to amoral misconduct between institutions trading a synthetic, abstract and essentially valueless paper instrument?) then we should be learning Chinese and packing. When I see that happening among the glib commentators, Ill worry about the long term outlook of US real estate.