Yes, we are going to have a “hard landing.” Of course, Ure is not the only one saying this (I’ve been saying it for almost 2-years now!). Others, like the “smartest guy in the room” are saying it too. Witness The Odds of Avoiding a Downturn Have Dropped, Mohamed E-Erian Says. If you don’t follow his comments on X, you might want to have a reality check about how serious you are about making money… Not that El-Erian walks on water, but we notice his ankles are suspiciously dry.
Yes, we called the Wave 2 top at July 31, 2023 – and that has held ever since. Yes, the Fed might raise again at the end of the month. Yes, that implies that our outlook for markets being halved between now and year-end is still intact.
Now, can I just give a few details and go back to my Big Secret Project (BSP)?
Job Numbers Disposal
The ADP numbers were OK this week. But certainly not strong enough for the (idjit) administration to throw the door open for more – unneeded, unwanted, purchasing power diluting – open border stupidity. “You can always tell a democrat, but you can’t tell ’em much…” They make up money out of thin air which is why with 160 million actual workers in ‘Merica, we have a $33 Trillion Dollar National Debt – and that’s without counting interest!
If you haven’t penciled it out, your portion of the National Debt works out to something like this – each.
Which means, as uninformed non-consenting (not capitalized) partners with the U.S. Government Corporation, you are on the hook for about twice this amount, really. Because as we point out, this does NOT include interest. Think there’s no prepayment penalties? This is all a Land o’ Fiction, though, because Aliens are not going to show up with enough money to cover it all. Stupid doesn’t work in the multiverse. (Is there a futures market in loosh?)
Sure, we can refine the numbers a bit – 160-million workers is just a seat of the pants data grab. That’s where this morning’s Job Report comes in.
The only number that matters is the number of people actually working. But you’d never know that from the Number Salad which reads this way:
“Total nonfarm payroll employment rose by 336,000 in September, and the unemployment rate was unchanged at 3.8 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in leisure and hospitality; government; health care; professional, scientific, and
technical services; and social assistance.”
Here somes the “remedial math” help. The REAL number of people working may be seen in the BLS database which no one looks at (because they know most people are stupid and will buy all kinds of cockamamie shit). We, however, do:
So THE REAL GAIN was 90,000 more people working, not the blatantly misleading (bullshit) number to pimp markets. Which is seriously ‘ef’ed.
The second most fun number is the CES (current employment stats) Birth-Death Model. Because it tells us how much of this the government is just making up on the fly. (Based on semi-reasonable estimates, of course!)
585,000 jobs were just made-up. Estimated into existence to feed the Happy Talk Choir. Go read CES Net Birth-Death Model (bls.gov)
So, when you see bullshit headlines line, oh…
Remember the following:
- The public has Statistical Impairment and believe anything with a “number” attached.
- The media (and Wall St.) play you for a fool repeating whatever misleading crap is fed them.
- P.T. Barnum was wrong – more than one is “born every minute.”
But not everyone is so stupid. This is why stock futures dropped more than 200 after the release and why we are in Wave 3 down. Which we will get to in a second.
Keeping the US Economy (and the whole world) from blowing over comes down to an ongoing confidence game. As long as enough people keep working, borrowing, and spending, the musical chairs tune will be heard. When the music stops, how much “forward wealth” do you have on hand as the last note echos off into nothing?
Mechanics of Wave 3 Down’s Implosion
Drooling Simpleton George Ure (not to be confused with the drooler in the Oval) has been telling Peoplenomics subscribers the Market is going (more or less, +/- an RCH) here where the Big Yellow 3 shows:
As any damn fool (which yes, includes you) can see, we did a Wave 1 high-dive into fall 2022. Then a Rally like Hell to July 31 this year. Leaving us now in Wave 3 down. Which leads? You can read for yourself where our long-term forecast for Wave 3 down pointed:
Listen carefully now as our Tour Guide explains:
“As you can see, Wave 1 down was 338 days. The Rally was 292 days. It would not be unreasonable for the Wave 3 decline to last about the same as Wave 1. So, shit may continue hitting the fan until – July 3, 2024 (a Wednesday). Although “sell in May and Go Away” might be a useful way to remember high risk continues in this model through next Spring.
As Statistical Grand Inquisitor Ure (SGIU) reminds us, this Wave 3 Down will have its sub waves. Since this is likely to be a normal macro Wave 3 we are still in the (1) (iv) of this larger 3 down. When it breaks, 3 will become apparent and diapers will be needed.”
NATO should be imploding by then, more high crimes of Joe Burden’s family should be coming to light, and we will be scrambling to build American supply chains as Asia/China tightens its leash. Fun times will be had by all. Well, maybe not so much.
We’re Bond For Trouble
My near genius consigliere just can’t seem to hear me. In his periodic client memos, he insists on saying things like “We all know the bond market is MUCH bigger than the stock market….”
I don’t know how many times I have told him “Hold ‘er Newt!” Sure, back when, but not since Modern Marketing sucked in the Public. Because (1):
“As of 2021, the size of the bond market (total debt outstanding) is estimated to be at $119 trillion worldwide and $46 trillion for the US market, according to the Securities Industry and Financial Markets Association (SIFMA).”
“The U.S. equity markets are the largest in the world and continue to be among the deepest, most liquid and most efficient, representing 42.5% of the $108.6 trillion global equity market cap in 2023, or $46.2 trillion. This is 3.8x the next largest (stock) market, EU.”
Which actually makes my job (as Statistical Grand Inquisitor) a lot easier.
The mental model we hold involves Two Crooked Casinos, side-by-side with a slightly different clientele. Cowardly, risk averse, long-tail analysis addicts pretending at capital preservation play bonds. It’s a slow-motion game. The embrace greed, risk loving, no analysis needed, let’s call it gambling crowd is over in the other casino playing stock games.
Both get clipped (shorn, haircut, pilloried) because the Bankster Mob owns both casinos. Early days of Hunter S. Vegas, right?
There WAS a time when my consigliere was right. But this was back when he attended law school with Daniel Webster. (Dartmouth, 1797 wasn’t it?)
[He might also be correct if you include compound interest due on bonds. But as the SGIU we stick to transactional values. We do cut him some slack, though. Because CPAs have special health risks which may impact their assessments. Such as EBITDA virus, as well as learning disabilities including MACRS and Accruals Deficit Disorders. Easily treated most times with single malt ETOH.]
Building out the Police State is right on schedule: POLICE STATE: FBI Quietly Created New Category of Extremism Ahead of 2024 Election to Include Trump-MAGA Supporters. Meantime, Trump plays at king-making in Donald Trump endorses Ohio Rep. Jim Jordan to take over from Kevin McCarthy as House speaker | Fortune. Even as Trump’s fortunes are falling: Donald Trump falls off Forbes 400 list of richest Americans, here’s why. Is that a pant load of circularity, or what?
The real question, though, is “If loose lips sink ships, what about submarines?“ Trump reportedly shared nuclear sub secrets with Australian. Is it like, you know, a requirement everyone going to Washington loses their judgement? Please, God, don’t tell me this is another one of those Trump hate allegations by someone who wasn’t present…just out for a bash.
Now let’s talk democrat bunglers: Sam Bankman-Fried’s trial to resume with testimony from ex-FTX executive | Reuters. (This should have read bundlers but the typo seemed to fit nicely.)
It IS a war, you know. And civilians are fair game… Hroza, Ukraine missile strike: No military targets in village hit by ‘inhuman’ Russian attack, officials say.
New and improved killing is just ahead with a nuclear powered cruise missile with 14,000 mile range. Code Skyfall in Moscow: Firing of NATO’s non-interceptible 9M730 supermissile Burevestnik – Putin: “No one will survive if Russia is attacked”. The problem with such missiles is they can come in from any direction. Which gets me to harking back to my “good old” days up in BMEWS country where the high-powered ack radars only looked in one direction. Ah, simpler times, back when the Cold War was not so bad, eh?
Great Marketing Ploys dept: Alien Hunter: Amazon to pay Ring security camera users over $1mn for footages of aliens.
Planning to visit Niger? We’d crank these two items into your travel plans: France to begin pulling out troops from Niger this week. Along with Niger junta rejects transition plan as 29 soldiers are killed in insurgent attack.
Might we interest you in visiting Gabon, instead? “Oil-rich and biodiverse” sure sounds like a tourism pitch, doesn’t it? What life is like in Gabon — a month after a military takeover.
Trip to Syria, then? Syria mourns scores killed in drone attack on military academy | Reuters. OK, maybe not there, then. (You are seeing the reason Elaine, and I don’t travel much, anymore?)
Even cruise ships have lost some of their luster for us as The US government is required to publish reports of criminal activity on cruise ships every quarter. They haven’t all year. Hmm…which part of not surprised are we?
And if that’s not reason enough? Vacationing in busy, polluted cities for just 5 days could shorten your life – Study Finds. Home is where the heart (and the food, drones, comms, ivermectin, and guns) are.
But let’s wrap on a positive note: American Apocalypse? 71% Don’t Trust U.S. Government To Prevent Doomsday – Study Finds. Which means only 29 percent are delusional. Better than I’d expect!
Around the Ranch: Drone Dummy 1
My “keeps going back into compass calibration mode” drone smacked into the 25-foot level of a tree Thursday morning. Damn thing was stuck and wouldn’t come down.
So, I chopped it down.
A fascinating photo-essay for ShopTalk Sunday this week. Today I begin cutting up 50 feet of firewood. But the drone was undamaged, so all’s well that falls well, I suppose.
With a high tomorrow of only 70, we might be able to get some real work done out in the shop this weekend.
Write when you get rich,