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Posts Tagged ‘the Great Depression’

Where Have We Been; Where Are We Going?

Where Have We Been; Where Are We Going?

clevelandCourtesy of James Howard Kunstler 

     Driving down the broad avenues of Cleveland, Ohio, was like flipping through the pages of a picture book about the rise and fall of our industrial empire. Where demolitions had not removed things — a lot was gone — stood the residue of a society so different from ours that you felt momentarily transported to another planet where a different race of beings had gone about their business. 

     Among the qualities most visible in the recent ruins of that lost society is the secure confidence expressed in its buildings. Even the most modest factory or business establishment built before the 20th century included decorations and motifs devised for no other reason but to be beautiful -- towers, swags, medallions, cartouches — as if to state we are joined proudly in a great enterprise to make good things happen in this world. This was true not just of Cleveland, of course, but the whole nation, for a while anyway. 

     Equally arresting are the changes visible in the collective demeanor from the mid-20th century, especially after the Second World War, when the adolescent panache of a rising economy had morphed into the grinding force of a place devoted to the production of anything. The memory of the Great Depression lingered like a metabolic disorder, and the spirit of the place was no longer caught up in the muscular exuberance of self-discovery but the sheer determination to stay powerful and alive. This phase didn’t last long.

     By the 1970s, signs of a new illness were clear. Production was moving someplace else, incomes and household security with it. An existential pall settled over the city as ominous symptoms of waning vitality showed up in the organs of production. Steel-making and car-making staggered. Even the Cuyahoga river caught on fire, as if fate was a practical joke. Major retail was moving elsewhere — to the suburban outlands — where so many of the people who worked in the downtown towers had already fled. The population that remained in the city center was made of recently uprooted agricultural quasi-serfs who had only just come up to the city a generation before to make better livings in the factories that were all of a sudden shutting down. It seemed like a kind of swindle and they were understandably angry about…
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Krugman Declares “Mission Accomplished,” Maginot Line Completed

Krugman Declares "Mission Accomplished," Maginot Line Completed

Courtesy of Jesse’s Café Américain

The triumph of financial engineering based on an analysis of the past. 

Conscience of a Liberal
The story so far, in one picture

By Paul Krugman
November 3, 2009

World industrial production in the Great Depression and now:

Jesse here. This chart is a bit deceptive because it compares two periods of time based on the start of the crisis. It would be interesting to compare the two crises from the start of the Fed’s expansion of the monetary base. As I recall, the early 20th century Fed did not react this way until 1931 and did so in two stages. Ok, Ben was quick out of the starting gate, and in a big way. Score one for the Fed. They are quick on the draw.

And there is little hazard that Ben will tighten prematurely out of fear of inflationary forces, having learned at least that lesson which is obvious enough as well.

It would be unjust to not note that the 1930′s Fed suffered a bit under multiple chairmen, and the difficulties of an entirely different type of commercial banking structure and the restraints of a gold standard. The challenge instead in this era of fiat currency will be to avoid the ‘zombification’ of the economy, the appearance of vitality with none of the self-sustaining growth.

Before this Administration declares "Mission Accomplished" and high fives its victory, they may wish to consider that they have done the obvious quickly in one dimension, but have done very little to change the dynamics of what created the crisis in the first place, choosing instead to support the status quo to a fault.

There are three traits that make a nominal bounce in production fueled by a record expansion in the monetary base a success: sustainable growth without subsidy, sustainable growth without subsidy, and sustainable growth without subsidy.

Our forecast is that Ben and Team Obama are failing badly because they are fighting the last war, in the almost classic style of incompeteng generals who lost the early stages of the Second World War because they were using the game plan from the First.

 


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Zero Hedge

The Burning Questions For 2015

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

The Burning Questions For 2015

By Louis-Vincent Gave, Gavekal Dragonomics

With two reports a day, and often more, readers sometimes complain that keeping tabs on the thoughts of the various Gavekal analysts can be a challenge. So as the year draws to a close, it may be helpful if we recap the main questions confronting investors and the themes we strongly believe in, region by region.

1. A Chinese Marshall Plan?

When we have conversations with clients about China – which typically we do between two and four times a day – the talk invariably ...



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Phil's Favorites

Russia Not Selling Gold, It's Buying; Reflections on Extremely Sloppy Reporting

Courtesy of Mish.

On December 17, ZeroHedge asked Will Putin's Next Step Be To Sell Gold?

On December 18, ZeroHedge answered his own question wrongly with Russia Has Begun Selling Its Gold, According To SocGen.

I did not believe that when I saw it yesterday, and I sure don't today after viewing a few charts from Nick at Gold Charts "R" Us.

Russia Gold Reserves Up 600,000 Ounces for November

...



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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Insider Scoop

Oppenheimer Initiates Coverage On Twitter, Believes Stock Is Appropriately Priced At Current Levels

Courtesy of Benzinga.

Analysts at Oppenheimer initiated coverage of Twitter Inc (NYSE: TWTR) Friday by issuing a Perform rating and setting a $36.00 price target. Twitter is a global social networking platform with over 280 million active users.

The Numbers

While Oppenheimer analysts fully recognize the strength in Twitter as a company, they believe that Twitter’s stock is appropriately priced at current levels. “While TWTR is the best Internet platform for real-time content discovery, we believe that the stock’s current valuation of 10x 2015E sales, a 52% premium to peers, fully reflects future prospects based on current growth rates.”

Insider Dumping

Between November and December 2014, Twitter insiders have sold more than $...



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Chart School

Relief Bounce in Markets

Courtesy of Declan.

Those who took advantage of markets at Fib levels were rewarded.  However, this looked more a 'dead cat' style bounce than a genuine bottom forming low.  This can of course change, and one thing I will want to see is narrow action near today's high. Volume was a little light, but with Christmas fast approaching I would expect this trend to continue.

The S&P inched above 2,009, but I would like to see any subsequent weakness hold the 38.2% Fib level at 1,989.


The Nasdaq offered itself more as a support bounce, with a picture perfect play off its 38.2% Fib level. Unlike the S&P, volume did climb in confirmed accumulation. The next upside c...

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Digital Currencies

Chart o' the Day: Don't "Invest" in Stupid Sh*t

Joshua commented on the QZ article I posted a couple days ago and perfectly summarized the take-home message into an Investing Lesson. 

Chart o’ the Day: Don’t “Invest” in Stupid Sh*t

Courtesy of 

The chart above comes from Matt Phillips at Quartz and is a good reminder of why you shouldn’t invest in s...



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OpTrader

Swing trading portfolio - week of December 15th, 2014

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Sabrient

Sector Detector: Energy sector rains on bulls' parade, but skies may clear soon

Reminder: Sabrient is available to chat with Members, comments are found below each post.

Courtesy of Scott Martindale of Sabrient Systems and Gradient Analytics

Stocks have needed a reason to take a breather and pull back in this long-standing ultra-bullish climate, with strong economic data and seasonality providing impressive tailwinds -- and plummeting oil prices certainly have given it to them. But this minor pullback was fully expected and indeed desirable for market health. The future remains bright for the U.S. economy and corporate profits despite the collapse in oil, and now the overbought technical condition has been relieved. While most sectors are gathering fundamental support and our sector rotation model remains bullish, the Energy sector looks fundamentally weak and continues to ran...



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Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW, comments are found below each post.

Here's this week's Stock World Weekly.

Click here and sign in with your user name and password. 

 

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Option Review

SPX Call Spread Eyes Fresh Record Highs By Year End

Stocks got off to a rocky start on the first trading day in December, with the S&P 500 Index slipping just below 2050 on Monday. Based on one large bullish SPX options trade executed on Wednesday, however, such price action is not likely to break the trend of strong gains observed in the benchmark index since mid-October. It looks like one options market participant purchased 25,000 of the 31Dec’14 2105/2115 call spreads at a net premium of $2.70 each. The trade cost $6.75mm to put on, and represents the maximum potential loss on the position should the 2105 calls expire worthless at the end of December. The call spread could reap profits of as much as $7.30 per spread, or $18.25mm, in the event that the SPX ends the year above 2115. The index would need to rally 2.0% over the current level...



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Market Shadows

Official Moves in the Market Shadows' Virtual Portfolio

By Ilene 

I officially bought 250 shares of EZCH at $18.76 and sold 300 shares of IGT at $17.09 in Market Shadows' Virtual Portfolio yesterday (Fri. 11-21).

Click here for Thursday's post where I was thinking about buying EZCH. After further reading, I decided to add it to the virtual portfolio and to sell IGT and several other stocks, which we'll be saying goodbye to next week.

Notes

1. th...



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Pharmboy

Biotechs & Bubbles

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Well PSW Subscribers....I am still here, barely.  From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.

First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices.  Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment.  Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer.  For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...



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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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