The actual line from Shakespeare’s Macbeth is double, double, toil and trouble, fire burn, and cauldron bubble but for the purposes of analyzing what happens when authorities prop up market bubbles by directly buying assets, bubble, bubble, toil and trouble is also appropriate.
China’s authorities seem to have chanted Shakespeare’s magical incantation nonstop this year, as the Shenzhen and other Chinese stock market indices have more than doubled. This chart illustrates what the Chinese authorities were aiming for: a bubble that just keeps expanding and never pops:
There is growing evidence that deflation is winning the day. If deflation does indeed take over and swamp the official efforts at damage control, quite a lot of fantasy wealth in today’s stock, bond and real estate markets will be destroyed.
This means investors want to be positioned away from risk-based financial assets right now — with stocks and low & junk grade bonds are right at the top of that list:
“Most Americans have no real understanding of the operation of the international money lenders. The accounts of the Federal Reserve System have never been audited. It operates outside the control of Congress and manipulates the credit of the United States.”
We discuss the property bubble as a liberty-sacrificing delusion. In the second half, Max continues his interview with Michael Krieger of LibertyBlitzkrieg.com about #BankersLivesMatter and the two-tier justice system in America in relation to bankers and their crimes. They also discuss how it is that Colorado’s economy is booming.
Speculative bubbles that burst are often followed by an echo bubble, as many participants continue to believe that the crash was only a temporary setback.
The U.S. housing market is experiencing a classic echo bubble. Exhibit A is the Case-Shiller Housing Index for the San Francisco region, which has surged back to levels reached at the top of the first bubble:
- Bail-ins are a risk facing Greek savers and businesses - ‘The Economist’ warns bail-ins in Greece would be “extraordinarily counter-productive” - Capital controls choking small and medium size businesses - Greek liquidity crisis now a solvency crisis - ELA now provides more liquidity to the Greek banking sector than deposits do - Greece households and especially businesses worry about a “bail-in” of big deposits – above €100,000 - Financial interests of banks placed over those of small and medium businesses and taxpayersRead more ›
We discuss the fact that life’s but a walking shadow, a poor homeless schmuck that struts and frets his squeegee upon thy windshield, and then is heard no more. It is a tale told by an idiot tabloid, full of sound and fury, signifying nothing. In the second half Max interviews Michael Krieger of LibertyBlitzkrieg.com about #BankersLivesMatter and the two-tier justice system in America in relation to bankers and their crimes. They also ask, “where is Eric Holder now? Hmmm, I wonder.”