Finding the Frankenstein monster
Risk will come home to roost
In the aftermath of 2008, the world silently drifted into the era of the "silent depression." Many want to find the next "big short" thesis. But in this world, where economic crises have become the norm rather than the exception, one might wonder, does it even matter anymore?
We already have had:
2022 UK gilt market crisis
2023 United States banking crisis
The real monster is Stagflation.
I'm a fucking ruffle fish on the internet. I can say it out loud: (The talking heads can't say it; it is the end of the world for them).
Stagflation.
We are already in a way worse situation than stagflation. Let’s call it BizarroCon:
Bizarre + Economy = Soaring financial markets and the deteriorating quality of work, products, and general economic health. It paints a scenario so absurd that it's as if society collectively turns a blind eye, encapsulating a world where logic and sense have vacated, leaving us in a gamble as unpredictable as flipping a coin in a casino.
Bizarroflation: An economic cycle characterized by high unemployment, rampant speculation, and moral hazard, where debt levels continue to escalate.
My thesis from the beginning has been:
“Safe” assets and speculative bets bad = Lose (Cash, bonds, currencies, overvalued stocks, nonprofit companies)
Hard assets = Winning (Bitcoin, Gold, Commodities, Robust business)
What about the long-term rates? Should they skyrocket? Maybe yield curve control? Everything is crazy, so who knows? Hopefully, I am totally wrong. It would be wonderful to restore the legitimacy of institutions and society. That would mean hard work, hard decisions, fuck wars, and a little bit of common sense.
It is just so hard to see any other road how we will not get more inflation and debasement.
The money supply continues to go down, combined with the severe recession. This with severe austerity policies with huge tax raises?
The worst possibility would be the stagflation/inflationary recession with monetary illusions (Intrinsic value fucked up).
Will commodities go higher, or will stock valuation come down?
How will this be recorded in the history books? 2020 - 2030? Seriously?
I care only one thing, and that’s making me a mofo who is immune to this bullshit.
You can still buy the hardest digital asset on the planet.
Bitcoin.
Or you can try to survive by gambling.
Sources:
https://twitter.com/APompliano/status/1772977839924449674
https://x.com/biancoresearch/status/1774127910414119054?s=20
https://www.longtermtrends.net/stocks-commodities-ratio/
https://www.zerohedge.com/markets/easing-middle-persistent-inflation-may-worsen-stagflation-risk
https://www.forbes.com/sites/ralphbenko/2013/12/23/keynes-and-copernicus-the-debasement-of-money-overthrows-the-social-order-and-governments/