2020 Collapse

Discussion in 'Markets & Economies' started by TreasureHunter, Dec 8, 2019.

  1. leo25

    leo25 Well-Known Member Silver Stacker

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    https://www.zerohedge.com/markets/hundreds-billions-gold-and-cash-are-quietly-disappearing

    Ok so who here is pulling all the cash out of the banks? They are starting to notice.
     
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  2. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Yes if you're lucky, it mostly means inflation erodes PPM the majority of the time though.

    Buffet/Munger will only make money when they spend that cash, so whilst they hold it they're losing money (smart accounting/tax practices aside). Currently it's about 18% of their portfolio which means 82% of their holdings are not cash, presumably they're held in assets that are returning an income stream and they're banking on a correction presenting a buying opportunity at some time in the next 12 - 24 months.

    None of this is new knowledge, but if anyone holds cash there is an opportunity cost that they're gambling on waiting for a future event. That's fine if that person also holds assets that return an income (Buffet and Munger), but anyone that cashes out their assets and then hoards it is taking a huge risk on a future event that either may not unfold or one that they can't time, or they're cuckoo. Most doomsdayers are cuckoo.

    I guess hoarding gold, cash, ammunition and jars of preserves gives them some focus in life. Probably healthier than hookers and blow. :cool:
     
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  3. JohnnyBravo300

    JohnnyBravo300 Well-Known Member

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    Hookers and blow would have great barter power.
    Maybe stack some blow up dolls? They dont eat so much.
     
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  4. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Personal experience?
     
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  5. TreasureHunter

    TreasureHunter Well-Known Member

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    It's amazing: an online collapse is going to happen. I've been predicting this since around 2011-2012.

    The ebusiness world is over-inflated. Countless service-providers, over-advertising.

    The main reasons why I think an online business collapse is going to happen:

    1) overgrown competition: too many actors on the market are cannibalizing each other (any "idiot" can launch a blog and sell anything)

    2) exposure is easier, anyone can have exposure: everyone is there, it's terribly difficult to differentiate and be different and stick your head out of the crowd

    3) over-advertising affects the costs: publishers of ads earn less and less on ads they sell (affiliate publishers, ad sellers), but ads cost more and more for advertisers (precisely because the competition keeps increasing), this is unsustainable and will implode (imagine a stock market where stocks cost more and more and dividend yields are smaller and smaller)

    4) launching an online business is VERY EASY today: everyone is doing the same thing, the offer is increasing, but the market itself is not increasing by the same pace: too many people are selling the same thing again and again to the same market

    5) countless tools, instruments are helping online businesses (Google Analytics, Marketo, HubSpot etc.) and it backfires: every "kid" can learn to do it and thus, they affect the market (competition, prices, offers etc.), yet they don't necessarily add value to the market - it's easier to do the same thing, it's like playing video games

    6) conversion rate optimizations are very sophisticated, optimizations help sales: it's much easier to make sales - everyone is doing this, but at some point everything tanks precisely because things are just going so well, after a pinnacle point, you just can't make more sales (even if you're Amazon.com), at some point you'll "hit the wall"

    7) ebusiness is in a bubble: advertising, ecommerce... blogging, vlogging... it's a bubble (too much suffocating content, too many offers, variations on the same theme - too much to consume!), it's more greed-driven than hunger-driven: make something and try to make money on it, even if people don't need it: create pseudo-values, fool people into believing that they really need it - it will collapse

    8) people are getting immune to ads: it's most visible when you study the CTR (click-through rates) and Conversion Rates (rates for sales/subscriptions/leads/etc.) - people click less on ads and they convert harder and harder - one thing everyone knows is that banner ads convert a lot worse than back in 2003

    9) people keep installing "ad block" programs to block the ads from suffocating them

    10) the digital market is saturated with everything: offers, discounts, products, advertisers, advertisements, publishers... it's full, there's a lot more of everything than anyone knows and you know what that means - abundance leads to lower value

    ...etc.

    Online collapse. Not sure whether I should draw a parallel to the "dotcom bubble", but it's a bubble.

    This is happening now.

    Facebook could become the next MySpace...
     
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  6. 66rounds

    66rounds Well-Known Member Silver Stacker

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  7. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    About a 30-40% chance of a recession, but it’s not his most likely outcome.
     
    Last edited: Dec 21, 2019
  8. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    From the AAII sentiment survey:

     
  9. alor

    alor Well-Known Member Silver Stacker

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  10. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Wrong thread mate: post here.

    The Muslim world should firstly get their shit together regarding Islamic extremism and an increasingly obsolete religion before worrying about the effects that the USD may have on the nations of this planet.
     
    Last edited: Dec 21, 2019
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  11. TreasureHunter

    TreasureHunter Well-Known Member

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    Any new information on whether the Saudis have started selling oil in Yuan or not?

    There were various news reports about this "possibility" and the "intention" (perhaps even push) from China's side:
    https://www.reuters.com/article/sau...il-trades-to-stop-nopec-sources-idUKL8N21Q1HK
    https://www.cnbc.com/2017/10/11/chi...-and-thats-going-to-affect-the-us-dollar.html

    When that starts happening... the dollar will get a cataclismic slam. I think this will be a blow around as heavy as the 2008 crisis.

    It is hard to say whether this will ignite the "collapse" of the dollar immediately (heavily relying on the petrodollar system) or, whether it will just keep eroding the Dollar's strength over time (gradual loss of value vs other currencies, as a result of less and less Dollars being traded - due to lower petrodollar demand).

    THIS mere act (selling oil in Yuan) could trigger the next crisis. What do you think?
     
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  12. Slimey

    Slimey Active Member

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    And what are they going to buy with it? Plastic toys, souvenir boomerangs, Great Wall's?
    If you want wheat, corn, etc, etc....if you want to buy or invest in blue chip companies, if you want to buy bonds that can absorb the kind of capital they have to invest then there is no other choice.
    If you want to accept a currency that is still tightly controlled with limited global applications then the Yuan is a good choice.
     
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  13. 66rounds

    66rounds Well-Known Member Silver Stacker

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    That is the old world view. It started with the euro being used to settle more and more global trade. Slowly the rouble and the yuan are doing the same. In this way the dominance of the USD is decreasing whilst many players are accepting alternative currencies, in part due to the imposition of US tariffs unfairly. Surely if Saudi settles oil sales in Yuan they can buy Chinese gold in yuan. Likewise in roubles.
     
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  14. alor

    alor Well-Known Member Silver Stacker

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    there is oil for gold contracts, yuan gold... so there is fallacy in the old view, but there has been exchanges set up just for that purpose in the business for a few years now
    how did the RMB get into the Saudi balance sheet, as provided in their prospectus, when their only product is OIL
     
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  15. Slimey

    Slimey Active Member

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    All true.....but somewhere along the line....there is a reference to the dollar. Buying gold is buying U.S. dollar. As for other currencies, sure they will hold some but the bulk of past, present and future investment comes from only one currency. The U.S. is in economic disarray but it is far prettier than the other very, very ugly sisters you get to choose from.
     
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  16. alor

    alor Well-Known Member Silver Stacker

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    USD had been weaponized and unreliable for trades, hence people hated to use it
    it can be stolen, just like for Venezuela, their gold is taken by London
    it can be frozen just like NK or Iran
    it is stolen from the Saudi, sorry we need those for our national security interests in plunge protection team
     
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  17. alor

    alor Well-Known Member Silver Stacker

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  18. alor

    alor Well-Known Member Silver Stacker

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    whao, Russia is selling gas not in USD ??? after the gas flow to China...going to Europe

    Russia slams new U.S. sanctions against Nord Stream 2, TurkStream gas pipelines

    "The U.S. ideology of life on loan has shown its incompetence, which the U.S. Treasury regularly confirms by issuing new 'economic arrest warrants,'" Zakharova said.


    MOSCOW, Dec. 21 (Xinhua) -- Russian Foreign Ministry spokeswoman Maria Zakharova on Saturday accused the United States of prohibiting other countries from developing their economies, commenting on the recent sanctions against the Nord Stream 2 and TurkStream gas pipelines.

    "A country with a national debt of $22 trillion prohibits creditworthy countries from developing the real sector of their economy! The U.S. ideology of life on loan has shown its incompetence, which the U.S. Treasury regularly confirms by issuing new 'economic arrest warrants,'" Zakharova wrote on her Facebook account.

    "Soon they will demand to immediately stop breathing. And after all, many will do it," she added.

    On Friday, U.S. President Donald Trump signed a 738-billion-U.S.-dollar National Defense Authorization Act that includes sanctions against the Nord Stream 2 and TurkStream gas pipelines along with a range of other measures.

    According to the U.S. Department of the Treasury, the sanctions against the pipelines had already entered into force, and the immediate stop of construction-related activity of these projects is demanded.

    The Nord Stream 2, stretching 1,230 km from Russia to Germany via the Baltic Sea, is scheduled to start operation in the middle of 2020.

    The TurkStream pipeline consisting of two 930-km offshore gas pipelines is planned to start operation at the end of this year, crossing the Black Sea to Turkey. It is also expected to connect Russian gas reserves further to Bulgaria, Serbia and Italy. http://www.xinhuanet.com/english/20...zRQ1Yw8X8DnHv_gEksfKI4ALWVa4HCI_A1UH9JnOGG6I4
     
  19. TreasureHunter

    TreasureHunter Well-Known Member

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    The Chinese can give them access to something, obviously: if the Yuan gives the Saudis access to something they'd drool for, they will bite on it!

    Agricultural products, industrial products certainly could be included. But that would be insufficient for the high value of oil.

    Saudi oil certainly is worth a lot more than their own internal need for products (such as food, electronics, cars etc.).

    We can keep guessing what China's game will be. It's impossible to guess from outside, but for sure - it's brewing!
     
  20. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Wrong thread mate, see post #70.
     

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