Which is worse, the great depression or the financial crisis? Taleb, has a definite answer.
(Bloomberg News)
Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data, ability to repeat discredited memes, and lack of respect for scientific knowledge. Also, be sure to create straw men and argue against things I have neither said nor even implied. Any irrelevancies you can mention will also be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.
"When the Fed is the bartender everybody drinks until they fall down." —Paul McCulley
Retail Sales in Jan rose .4% headline m/o/m, .7% ex auto's, .6% ex auto's and gasoline and .7% at the core. The headline figure was less than expected while the rest were slightly better. But, with respect to non headline sales, because Dec figures were revised lower, taking the two months together were about in line with forecasts overall. Sales rose in electronics, building materials, food/beverages, clothing, sporting goods, dept stores and restaurant/bars and fell interestingly for online retailers, health/personal care, furniture and motor vehicle/parts. Bottom line, headline sales were below expectations due to the greater than expected fall m/o/m...
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May 14th, 2009 at 10:16 am
I appreciate Taleb as a seeker of truth. And someone who understands the limits of quantitative finance. But when it comes to understanding economics, he’s completely wrong on copper and gold. Both are headed much lower. Gold could be a buy again but likely at $400-ish. Copper will likely bust.
May 14th, 2009 at 11:07 am
I hate these “headline videos” that don’t have the speaker. No context. When he says gold and copper could rally massively, what time frame is he talking about? Months, Years?
I also think that we have more deflation before inflation.
May 14th, 2009 at 11:17 am
bdg123 – I agree that Taleb is good at poking holes, mostly terrible on investing advice. But I think he’s got it right here – there’s so much monetary stimulus, which won’t have a broad impact on prices, but will show up in those most sensitive to changes in growth – namely commodities. I expect wages, goods and rents to stay challenged for quite some time, but I fear that here we go on energy and commodities again!!
May 14th, 2009 at 11:39 am
Gold may certainly rally, however copper is actually used in any number of products and, with manufacturing stalling across the globe, demand (and thus prices) will likely drop/remain relatively stable.
I think a rally in various foods are more likely…
May 14th, 2009 at 12:13 pm
Ain’t no way the government can inflate their way out of this. There is zero historical precedence of any government ever being able to stimulate themselves out of deflation. Zero. Please don’t use Germany or Zimbabwe either. If you do, you show your lack of understanding of what happened and what is happening now. Oil busts, copper busts, food stuffs bust. The commodity scam sold as a supercycle is over.
May 14th, 2009 at 2:13 pm
@bdg123: They CAN inflate their way out of it, but Congress probably will not allow it unless we approach 15% unemployment and 25% U-6. We will have a cycle of busts and reflationary bubblets, Japan-style. We are in a bubblet now and due to bust soon. Oil and copper have been accumulated of late and we are approaching storage saturation. They will bust. Food stuffs, not so sure. Driving is optional, eating, not so much.
May 14th, 2009 at 2:29 pm
A zero Fed funds rate fuels real and speculative activity. Actual cost of credit has been pulling in as credit crisis eases. There is massive and UNPRECEDENTED fiscal stimulus as well, including transportation spending, energy improvements, etc. I’m not saying we are out of the woods by any stretch. But the economy is not a monolith. As I stated above, wages, goods, rents and housing prices will all be pressured downward. But there will also be pockets of growth, and I expect select energy, commodities and food prices to experience pretty significant upward pressure.
May 14th, 2009 at 3:02 pm
When you can explain to me how global central bankers can print enough money to absorb $250 trillion in global debt when $50 trillion in wealth has been erased and more is coming, you let me know. There is something called the market. And, the Fed and government can’t flip the bird at whomever they want to print that much money. There were no bubblets in Japan. I have very close relatives from Japan and am intimately familiar with their economic tide over the last twenty years. Inflationistas are completely and utterly clueless. The closest we could ever get is a one time revaluation of the currency. Something that would likely cause outright revolt.
May 15th, 2009 at 2:33 am
And now we have to bail out the insurance industry?
http://www.thestreet.com/story/10501500/1/life-insurers-get-ok-for-tarp-funds.html?puc=_breitbart&cm_ven=BREITBART&cm_cat=Free&cm_pla=Feed&cm_ite=Feed&puc=breitbart&
all while tax revenues collapse…
http://www.businessinsider.com/federal-borrowing-quadruples-2009-4
Hyper Stagflation!
http://bluelori.blogspot.com/2009/05/hyper-staglation.html