Albert Edwards Explains Why The S&P Will Eventually Fall Below The 2009 Lows
Are you feeling bullish this morning or are you otherwise relieved that after about seven straight days of unrelenting "covfefe" from Donald Trump we finally got to hear fromXi Jinping who, despite having enshrined himself into the autocrat hall of fame by effectively adorning himself "President For Life", is infinitely more stable than the (literal) WWE hall of fame inductee that occupies the Oval Office?
To be sure, lots of people are feeling pacified after Xi's "conciliatory" keynote addres
So many like Albert who are looking for a deflation event with gov’t bond collapsing (bond prices rising), credit spreads widening and equity VIX spiking, all like in 2008, may be looking in the wrong place as events tend not to repeat themselves the same way as last time. Next time, it might be sovereign bonds that blow up instead – especially at the state/muni level and in Europe as none of these can “print” money to repay debt.
^ typo:
“gov’t bond collapsing” —> “gov’t bond yields collapsing”
> “If China acts on its proposal to put on tariffs on soy exports to hit his base,
> or it switches from Boeing to Airbus, then you really know things are getting nasty.”
They already did that. And today so too did Chinese puppet state Malaysia (canceled Boeing 787 order and switched to Airbus A350). But, instead of getting more nasty, today Xi talked all nice on trade, and markets are happy for now (although there was was nothing new in Xi’s “talk” and no timeline was specified).
I am adding Lithium to the Gold/Silver insurance account. The world is far more interconnected than just 25 years ago, and ripples of any loses will be felt far and wide.
i am not a bear by personality, but if everyone is running to one side of the boat, I grab a life preserver.
I like uranium too. Lithium is also apparently useful as an antidepressant… lol.
I took a position in copper very recently at 2.95 as it’s a wave 2 of 5 imo and should outperform silver which should outperform gold. As spec plays, not long-term insurance.
Also, some of the rare earth minerals may be good long term insurance commodities. They’re 92% from China and about 5% in Russia, leaving only a few percent for the rest of the world. If China cut the REM supply, it’d truly be their “nuclear” option that few talk about (instead of China selling T-bonds which China won’t do anyway). Without REMs, modern life disappears in a year or two, the networks, power grids, computers, factories, and defense systems including the entire nuclear deterrent and missiles which require Chinese-REM powders to operate.