That is too many must have been selling LT OOM puts on real investments and gold... It's gonna get dicey as we approach the tipping point. Just focus on your progeny and you will make better decisions... invest in that which creates real value and a better future, not consumer facing synthetic finance rackets.
Too many people must have been selling LT OOM puts, which would have undermined the Protection Racket's synthetic profit stream. Continue exiting all float scams (in fact you should be more aggressive about exiting because they'll need to spike VIX again soon) to raise cash and buy gold. Don't lever up, but instead use their leveraged anti fundamental positioning against them. Only as many puts in gold and real investments as you would buy of underlying. When they sell vol, use the puts in float scams to sell even more while selectively investing into companies building our domestic productive capacity, resiliency, and self sufficiency which is the proper way the markets can actually help to increase velocity of money, employment and improve the economy.
Great. You, along with all the members of the Growth Cartel and Protection Racket, should load up here so that all those who've been robbed via option manipulation, frontrunning and ETF stuffing can exit their positions at these absurd valuations while buying the real investments that have been suppressed by the games.
People, let them hold all the return free risk. Sell all float scams to raise cash and buy gold.
The option algos ate about to be exterminated. MF and HF managers now broadly understand how they've been robbed by the protection racket. The market moves are the prices of unwinding b completely upside down positioning.
While it was a good article, Paul overlooked the bigger impact. The entire capital Mather subsidy is premised on AMZN increasing prices and margins after having knocked out competition... thus, the transition to monopolist from monopsonist. But, focusing on the books was a mistake. Books were the ideal category for online commerce. High value density, non perishable, huge supply chain inefficiency, etc. It created a lot of relative value there. But, the Capital Committee of the Protection Racket has subsidized its expansion into virtually all categories, a great many of which do not make fundamental economic sense because if vastly different category economics (low value density, frequent purchase, etc), while penalizing traditional retailers, even those with equally or more efficient cost structures (albeit more labor intensive ones) for retail. The net effect has been to artificially accelerate the elimination of retail jobs. For those capable of understanding systems and flows, AMZN is the most destructive company in the world to local economies as it seeks to create unnecessary and redundant distribution infrastructure OUTSIDE of the communities it sells to and employ the fewest people possible... it had the lowest community level content possible and maximizes the flow of value OUT of the community (minimizes the local/community content).
Worse, it is the capital market consumer/finance ponzi driving it, not fundamental economics. The fundamental economic tradeoff in retail versus etail is driven by fuel (delivery), interest rates (inventoty carrying cost) and labor rates. All of those have moved against etail since the last bubble... which is why Amazon's fundamentals have degraded. But, financial sector games are driving malinvestment that ACTIVELY UNDERMINES the health of the real economy. We must exterminate those running the Protection Rackets and the malinvestment they engender. All "growth" is not good growth...
The best part about all of this is that real INVESTORS can use MARKETS to send PRICE SIGNALS to make it all happen. Sell all float scams and NEVER buy any call in any float scam again (which are simply protection rackets engaged in glorified theft and create no value), raise cash (a real option without expiration), buy some physical gold (real inflation hedge with no expiration), and sell LT OOM puts in real investments in domestic companies that increase our productive capacity, resiliency, velocity of money and employment. Use the consumption ponzi to profit from restoring balance and a better future for your progeny. Eliminate the parasites running the protection rackets that are distorting market signals and encouraging malinvestment... it will restore integrity to the market and a more robust, resilient market as well.
Because we (especially combined with our neighbors to the North) have essentially all the resources we need to be self sufficient, we would do extraordinarily well (relatively speaking) in a world where financial assets get repriced in physical terms. As Sybs has correctly pointed out, you cannot eat gold, which is how we reverse the flow and get the Chinese to adjust the currency. Their objective function is domestic stability (ours will need to be soon if we don't start investing in the real economy again), which is why they continue to "invest" in excess production. But, the reality is food and energy are almost 40% of Chinese household budgets. The best way for China to increase stability is to reduce that... which can be done through a stronger currency. So, by taking gold aggressively higher in USD terms, we signal USD inflation. That will affect all of the USD priced inputs to China's export machine (again altering relative value added), but most importantly create real household food and energy pain for China. They'll be forced to do what is ultimately in the interest of the people... let the currency appreciate... it will ultimately be good for everyone -- we will again have more incentive to invest in our productive capacity, self sufficiency and resiliency, increasing employment, velocity of money and domestic content in that which we consume and China's people enjoy the higher standard of living (should have both a wealth and income effect from this) from their decades of investment) that should Kickstart their consumer economy.
I understand that there is 1 and 1 only semi stable path because I truly understand systems and fundamental economic flows. I also understand competitive strategy and what the G3 Central Banks were trying to accomplish with the money printing. But, ultimately their mistake was that the approach ceded strategic control to China, which had always been a non market economy and cannot get iut if its own way. The right answer is to focus on that which you control.
As I said before, we don't have to learn to take the longer view. The right approach is the one that focuses on what we control that can guarantee the outcome. Repricing real assets in $ will force China's hand to do what is ultimately in their interest as well.
We're taking the wrong path on oil as well. Sure, we can try the Saudi takedown route, but it will undermine domestic production and keep us ever dependent. Or, we can keep the price high enough to not only sustain domestic production from shale, but also bring online renewable transportation fuels that are fungible with gasoline/diesel (which could easily do 15% given that most cars still on the road could handle it... Have one pump for 10% for more than a decade old...) and thus reduce demand for imported oil by another 1MM BPD or so. Domestic content/value add increases. Domestic velocity of money increases. Domestic resiliency increases. OPEC and oil exporters face reduced quantity demanded of 1 MM barrels and have to fight the coordination problem. Layer on top of that a CO2 tax, which effectively increases the value pool in net energy consuming nations. It creates significant incentive to invest in energy efficiency (this elimininating unnecessary deadweight loss and MORE IMPORTANTLY providing real operating leverage for all that we produce from our domestic resources...). Taken together, we can strategic control of our energy future.
Just a humble anonymous servant of the people. It's time to restore integrity, trust and investment signal to the market. Focus on your progeny and you will make better decisions.
Bump. As I said, they like to lead with a big drop to spike IV to steal more premium for the Protection Racket. Once CMG IV gets killed, sell straight through it to raise cash and sell LT OOM puts on real investments, not bake destroying "investment" in consumption.
Thanks for the writing critique. .. Those that need to understand this message get it loud and clear. The issue isn't the dollar power se... it is the disconnect between all financial assets and real assets. They will come back into balance and there really is only one semi stable path, both for this nation and for the world. Those that would seek to control collapse should be exterminated.
Divergence had started. The rebalancing has begun. All the option manipulation created insane internal imbalance and disconnects. Imbalance creates its own instability and we will likely end up in a very different place due to the impossibility of controlling the emergent behavior of systems with a few very blunt tools.
Let them take on all the return free risk to try to hide what they've done (though they will not be able to do so). A market without integrity cannot function. This time, they will have to realize the losses, rather than shifting it to the people.
They've been stealing from investors for years, abusing asymmetric leverage and options to paint the tape, while positioning for the inevitable unwind (see UST positioning). You can restore balance, integrity and investment signal simply by exiting all float scams to raise cash, buy gold and sell LT OOM puts on real investments.
They are still running the vol/short squeeze racket (much lower put/call ratio), but option to underlying ratio is WAY too low to sustain this scam. Keep selling in volume. It will fail massively. Sell all float scams, raise cash, buy gold, sell LT OOM puts on gold and real investments.
They will continue to try to bully the market / intimidate because they are not in control and very scared. They need investors to capitulate rather than use judgement.
The "market" will become a market again and actually create value when integrity and investment signal return. All it requires is people using human judgement and prioritizing people.
You can restore balance and integrity while dramatically improving your risk/return profile. Make them take the return free risk on all sides. Sell all float scams, raise cash, sell LT OOM puts on gold and real investments.