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Michael Clark

Michael Clark
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  • Will Canadian Real Estate Crash? [View article]
    Very interesting article. I look forward to part II, stocks/bonds in Canada to short. I like options, so I'd like some issues that trade options.

    I'm not sure what the metrics in Canada are like, probably much like in America. Historically, RE gains 1- 1/2% a year in America. So the 400% gains in some parts of the US in three years do seem out of character. The pull back in prices, before QE et al was a step in the right direction. But QE (the FED) put an unnatural floor under this RE correction; we still have a long way to fall. Unless we have a FED that decides to go all in, and push NIRP as an alternative to a healthy real correction, and then it might be possible to get the banks to buy more RE for us, as the price escallates again, before the currency evaporates and returns to zero.

    Look forward to your next installment.
    Aug 2, 2015. 01:21 AM | Likes Like |Link to Comment
  • Proper Seasonal Gold Chart [View article]
    Thank you, Moon.
    Jul 28, 2015. 01:39 AM | Likes Like |Link to Comment
  • Market Update: Current View Of The 'Secular Bull Market' Amidst The Backdrop Of Fear In The Markets, A View Of The Past, Present And Future [View article]
    FGT: Thanks for responding. I'm not really arguing for pessimism. I guess I'm arguing for a dose of realism. And for perception as an art form. What is 'causing' this bull market? My argument would be that the FED is buying this bull market. In other words, the taxpayers are paying for it. When ZIRP is demolished (you can't have both Economic Recovery and ZIRP, the two arguments cancel each other out -- we are either recovering, so rates should not be held down, or we are not recovering, and rates need to be held down -- this is not a win-win situation -- there never has been a win-win situation -- when someone wins, somewone loses) we will see what this Bull Market is made of. My view is that this Bull Market is a paper tiger, without constant manipulation by the FED. I think this is a rather sad understanding, because once the Federal government can manipulate markets to get a desired end, then that is the end of the free market. What is to stop Federal authorities from continuing to manipulate end-results for ever?

    Anyway, I do appreciate you perspective. Why fight the FED, indeed? You and I are paying for this Bull Market, why not participate. I have also been participating. My sense of justice does not feel especially justified however, since I see the invisible hand tipping the scales -- the illusion of the free market has never had so much bile in its after-taste.

    I believe that optimisim is the fuel of spiritual growth. I also believe that seeing things as they truly are is necessary for real optimism. I see that the Old World is destroying itself for the sake of self-preservation but I am optimistic that life will go on. And that out of destruction comes, always, the Creative Energy that allows us to overcome our follies. I would argue that this Bull Market is one of these follies -- what Schumpeter might have called a 'creative destruction'.

    We create the world. When it becomes too corrupt a body to inhabit, we destroy it so we can rebuild a purer model, and have a new life, in a fresh idea.
    Jul 26, 2015. 03:40 PM | 2 Likes Like |Link to Comment
  • China Completes Another Head-Fake [View article]
    Yes, Salmo: that is a wonderful quote, filled with insight.
    Jul 26, 2015. 01:16 AM | 3 Likes Like |Link to Comment
  • Political Rhetoric And Unsupportable Economic Statements [View article]
    I think the real problem with capitalism is that, like everything else in the universe, it expires and transforms into something else. Capitalism seems to be transforming before our very eyes into something medieval: feudalism.

    I agree with you that we need land and tools. In a post last week I showed a chart showing the population of Rome in history: like a horseshoe, sort of. 3/4 down the page:

    The counryside gets abandoned and the cities fill up. Then (at Night) this process reverses. And the cities empty out. That is when we know that the GOTHIC SEEDTIME will prevail, and give us another chance, after a long period of gestation (1080 years) -- Nature will come back into fashion.
    Jul 26, 2015. 01:06 AM | 1 Like Like |Link to Comment
  • Political Rhetoric And Unsupportable Economic Statements [View article]
    Of course, if history travels in cycles (circles), Jan's vision may be a description of our future whether we like it or not.

    The idea that history travels in a straight line (progress?) is a prejudice of our age -- we can begin this at the enlightenment if you like -- but it might be a kind of clean vision of reality just before the light begins to bend.

    No civilization in history just kept getting better and more enlightened and more tolerant for ever. Did it? Vico believed history went through Kings, Aristocrats, Democracies and into Chaos; then back out into Kings.... Kings order the Chaos.

    The particular metaphor I like most is that kingdoms go through Dawn, High Noon (Enlightenment), Dusk, and Midnight. Dawn is the Renaissance, High Noon is Empire, Dusk is Romanticism, which is a form of the 'return to Nature movement'. Midnight is an historical Dark Age, which, in its larger form lasts for 1008 years (think of the European Dark Age after Rome), and which is its smaller form lasts for 18 years, coming always after 18 years of expansion.

    Dawn marks the passage out of the right brain (the collective brain) back into the left brain (the individual-fate brain), which reaches its maximum power at High Noon -- Empire -- Empiricism -- Enlightenment -- and then begins transitioning back toward Dusk: right brain again, the Dream-Brain, causality giving way to metaphor again, as it always does. Midnight is Chaos, the total triumph of right brain. If you are not in the Dream-Brain when total chaos hits, you pretty much have no chance of surviving. It's like being awake when everything else in the universe is asleep.

    Jan may be several years too early; but the vision she is seeing I can also see. Of course, if one's right-brain has decayed from disuse, misuse, or from repression -- the left brain is a notorious reductionist, rationalizer, and debunker -- debunking is usually a defense mechanism to protect one's lack of understanding of the right-brain nature, in fact -- or from debilitating obsession with electronic gadgets, then the dream-language will always remain invisible, unattainable, and its visions 'forgotten' even before being experienced.

    History has a waking reality -- but this is not a permanent state. It is merely dominance by the left brain. But then it fades; and the dream returns. And then the right brain takes over again.

    The straight line is an illusion. The straight line is like the diameter of the circle, which runs from one side of the circle (Dawn) to the other side of the circle (Dusk) and then is reabsorbed back into the circle itself. Hello right brain, nice to see you again.
    Jul 26, 2015. 12:52 AM | Likes Like |Link to Comment
  • Market Update: Current View Of The 'Secular Bull Market' Amidst The Backdrop Of Fear In The Markets, A View Of The Past, Present And Future [View article]
    F&G, I am amazed by your relentless optimism. You don't talk much about the markets addiction to ZIRP. ZIRP is NOT a natural or a normal state of affairs. ZIRP is a gift to and a feast for the Speculator Class. What happens when the feast ends? My view is that the economy has two main seasons, the Spending Season (1911-1929; 1947-1965; 1985-2001) and the Saving Season (1929-1947; 1965-1983; 2001-2019...). The Saving Season is how a heavily indebted nation (and the nation's individuals) pays its bills.

    The Central Banks have forsaken the Saving Season (it's not good for GDP to save money...that is a wonderful rationalization). Time will tell if this is a mistake. The assumption that debt is good, so more debt is even better might not be proven correct. It was not with Greece. Of course, most countries can depreciate their currency to pay for their mistakes, like too much debt, until the currency dies from being undercut with depreciation for too long.

    I'm convinced what passes for reason in our world today is simply rationalization. This is a kind of prayer by which sides attempt to bully each other using the powers of rationalization. Is the world rational? I'm not sure that it is. Stocks are being propped up by governments using other people's money to make sure stocks don't crash. But this is NOT a sustainable model. It is heading for falsification.

    My view is that we are in a Bear Market, which began in 2001 and will run through 2019. The other real Bear Markets this century have been 1929-1947 and 1965-2003. The fact that the FED is robbing Peter (the taxpayer) to feed Paul (the asset markets) simply means that money is being stolen from the future to try to camouflage this Bear Market. Remove the trillions the FED has pumped into the market and remove ZIRP -- which has stolen trillions more from savers -- and you will have a stock market that moves sideways. That's what Bear Markets are, a sideways market. A loss of about 1% a year over the 18 years of the Bear Market. A loss of about 18%. We're not man enough to take that, so we lie and cheat and steal and rationalize to pretend everythings is still good.

    Rationalization. Nothing is what it seems. Companies are lying and rationalizing about earnings; using ZIRP to camouflage earnings losses, and to cashing in on escallating stock values driven up by their own buying...what happens when they cash out and run away? What do they leave behind for the next generation to clean up?

    As I say, I'm impressed by your relentless optimism. But without the deep pockets of the FED to finance this 'last stand' of capitalism (run amok), your rationale would be as hollow as it has seemed to me since...well, 2001. The biggest bankbook is, indeed, a powerful, rational argument.

    Keep the spending going! That is the mantra. Keep spending money we don't have! GDP (God Doesn't Participate) requires it. The Landlord Class loves it. Rationalizers are compelled by it. But hear that! It is the sound of something breaking.
    Jul 25, 2015. 05:53 PM | 7 Likes Like |Link to Comment
  • The False Debate - Deficit Spending Vs. Austerity [View article]
    Moon: I actually agree with Keynes. The problem is that he (and most people) don't really understand how to spot the bottom in a downturn.

    We do need to stimulate a bottom of a downturn. By stimulate, he apparently meant lowering interest rates. But how does one recognize a downturn's bottom?

    1911: bottom of a downturn
    1947: bottom of a downturn
    1983: bottom of a downturn
    2019: bottom of a downturn

    The idea that we would 'stimulate' through the entire duration of a downturn (2001-2019) is ludicrous. A downturn is necessary and useful for an overheated (with debt) economy. It gets rid of all the waste and stupidity. The fact that Greenspan - Bernanke - Yellen have stimulated all the way through tells me they are working for the wasteful and stupid and that they want the wasteful and stupid not to get hurt -- and they are making the rest of us pay so that the wasteful and stupid do not get hurt.

    Simple arithmetic will help one spot the bottom of a downturn, once one understands that nature works in a very basic 36-year cycle.

    I agree with Keynes; I also agree with you.
    Jul 21, 2015. 03:44 PM | Likes Like |Link to Comment
  • The False Debate - Deficit Spending Vs. Austerity [View article]
    You won, David.
    Jul 21, 2015. 03:35 PM | 1 Like Like |Link to Comment
  • The False Debate - Deficit Spending Vs. Austerity [View article]
    Unfortunately, the US, yes with its guns, bullets and leadership, is effectively the only guarantor of somewhat free trade. Without the US, the world trade would be under the control of villains and parasites. We could all be back in 16th century, spending our doubloons on clearing land. No Porsche for you.
    With the US, and its guns and butter, world trade is now under the control of the villains and parasites that the US chooses and for which the US gets paid.

    Our control of world trade is so our corporations are the masters of the seas. But our corporations have no loyalty to the US. Only loyalty to profits. Why do the taxpayers foot the bill for military spending to protect multinational corporations that are off-shoring jobs and profits to avoid paying US taxes and US workers?
    Jul 21, 2015. 03:32 PM | Likes Like |Link to Comment
  • The False Debate - Deficit Spending Vs. Austerity [View article]
    Nice post, Stoner. Interesting read.
    Jul 21, 2015. 03:25 PM | Likes Like |Link to Comment
  • IDI dives 23.5% on bearish Seeking Alpha piece [View news story]
    Down 45%, still dropping.
    Jul 21, 2015. 03:19 PM | 2 Likes Like |Link to Comment
  • The False Debate - Deficit Spending Vs. Austerity [View article]
    Read "War and Peace" again with an eye to the ideas of history being a process of Day followed by Night, or War followed by Peace.

    Actually, the deep truths are found in literature, not in science. Science is the shallow ground, the shallow water, describing 'height', not 'depth'. Literature is an investigation of the 'depth'. We need more depth. We've mastered the 'height'. It's time to come down, and learn how to swim. We need to learn how to become a fish again.
    Jul 20, 2015. 03:32 PM | Likes Like |Link to Comment
  • The Bankruptcy Of The Planet Accelerates - 24 Nations Are Currently Facing A Debt Crisis [View article]
    Think of what a supercycle of rising interest rates will do to the refinance business. That was the basis of much 'economic growth' (GDP growth) over the last several decades. Massaging debt to generate income. That cash-generation from debt avenue will be gone.

    Think of what foreign debt taken on in US Dollars when the Dollar was weak now becomes as a cost to service now that the Dollar is strong and bound to get stronger with higher US interest rates.
    Jul 20, 2015. 03:22 PM | Likes Like |Link to Comment
  • 10 Scary Charts: July 16, 2015 Update [View article]
    Reductionism. Reduce all the forces in a complex system to one or two causes. It is a form of rationalization. It's ALL demographics. Well, it is demographics. But it is not ALL or JUST demographics.
    Jul 20, 2015. 03:14 PM | Likes Like |Link to Comment