Is the stock market going to tank?

[J. Barron DeJong]

Kevo, I’ve set up a notification of our library system ever gets a copy of “The Price of Time”, but the fact it was the ‘Winner of the 2023 Hayek Book Prize’ leads me to believe I won’t be swayed by it’s arguments.

[4matic]

Another anecdotal snip. Young boomer was asking me if I owned crypto and I said I can’t stomach the risk. He owns XRP for no apparent reason other than line go up. Just another example of too much individual and indexed risk in speculative momentum.

[shroom]

reddit been fellating MSTR/MSTY blindfolded for a while

[Kevo]

Kevo, I’ve set up a notification of our library system ever gets a copy of “The Price of Time”, but the fact it was the ‘Winner of the 2023 Hayek Book Prize’ leads me to believe I won’t be swayed by it’s arguments.

It’s worth a read. Chancellor doesn’t necessarily fall in lockstep with Hayek and the Austrian school.

What don’t you like about Hayek or the Austrian school? I don’t agree with them on all points, but I am a believer in business cycle theory and I do think that the government and fed response to Covid was way too heavy handed and I also believe that interest rates were to too low for too long.

It is my opinion that the fed was morally wrong to purchase bonds and equities that enabled corporations to compete with labor in acquiring housing assets.

Edit- meant to say "too low for too long"

[fastfred]

Perpetually backstopping asset owners (which policy makers have done for decades now) is a moral hazard that creates massive wealth disparities and gives asset owners significant leverage over labor. It also encourages more leverage, which leads to more risk in the long term.

too big to fail
maybe next time people will say no more propping up these jack asses
but then the president signs a check for $1,500 and mails it to every tom dick and harry and they all shut up

I'm rooting for the stock market to eat it and all these companies leveraged to the gills to need a bail out
I wasn't like this six months ago

[J. Barron DeJong]

Kevo, I don’t believe in Austrian Business Cycle Theory, and I believe there’s plenty of evidence to refute it, which is why well respected economist across a range of ideologies do so. But the main reason is that during the Great Recession those espousing Hayek’s ideas turned out to be wrong, and those espousing Keynes’ ideas correct. You can enjoy Keynes vs. Hayek arguments in rap battle form here: https://youtu.be/d0nERTFo-Sk?si=C1lSdzjDikg_By2W

[J. Barron DeJong]

Krugman on Hayek during the Covid recession: https://archive.ph/1g6Zm

[J. Barron DeJong]

From 2010: “ A spectacular find: dueling letters from Keynes and associates, on one side, and Hayek and associates, on the other. Read them here (pdf).Three reactions.First, Hayek was as bad on the Depression as I thought. The claim that “many of the troubles of the world at the present time are due to imprudent borrowing and spending on the part of the public authorities” — in 1932! — is bizarre. The claim that barriers to trade and capital movement were what was preventing recovery is as crazy as … as .. claiming that we’re in a slump because workers decided to take a break in the face of prospective Obama tax hikes.Second, Keynes pretty much had the policy implications of the General Theory down long before he actually worked out the detailed analysis. I’m especially struck by the way he grasped, right from the start, the point that if higher private spending expands employment in a slump, so does higher public spending.Third, it’s deeply tragic that we’re having to have this debate all over again, as the world economy slides into deflation and stagnation.” https://archive.nytimes.com/krugman....us-hayek-1932/

[J. Barron DeJong]

Hayek though: “No one thinks that deflation is in itself desirable.”

[J. Barron DeJong]

Kevo, what do you think would have happened in the economy if the Fed had raised rates higher/earlier after the Great Recession?

[Kevo]

Kevo, what do you think would have happened in the economy if the Fed had raised rates higher/earlier after the Great Recession?

My concern was keeping rates too low following COVID. Inflation was cranking and real rates were deeply negative.

[J. Barron DeJong]

The Fed started raising rates in March 2022 and raised rates fairly rapidly: https://fred.stlouisfed.org/series/FEDFUNDS. In March 2022 inflation was just starting to appear: https://www.bls.gov/news.release/arc...i_04122022.pdf is there any reason the Fed should have thought about raising rates a year earlier, which is likely when they would have needed to have started to have any effect on the inflation spike (which was primarily a function of reopening after Covid)?

[J. Barron DeJong]

I take that back, I had the dates wrong and inflation was picking up earlier than March 2022.

[Name Redacted]

"Transitory"

[J. Barron DeJong]

Can’t post pics, but yes, transitory: https://fred.stlouisfed.org/series/BPCCRO1Q156NBEA

[liv2ski]

Kind of like "Deficits don't Matter".

[J. Barron DeJong]

No, deficits definitely matter. It just makes fiscal sense to deficit spend sometimes.

[Name Redacted]

There'll be no more debt ceiling now that the "Party of Fiscally Conservative Republicans" is now in charge of all aspects of our political machine.

[406]

Back to stocks, anyone think TSLA might finally tank? Seems like only thing they have going is political connection and charging network. Elon has to be alienating lots of customers, old models, and starting to have some competition. Maybe the TSLA short crowd just gave up?

[J. Barron DeJong]

The debt ceiling is stupid because it doesn’t do anything except allow irresponsible lawmakers to play a game of chicken with it. The Treasury HAS to issue debt to cover the shortfall between spending and taxing that lawmakers legislated into being.

[summit]

Deepseek spent a HALF A BILLION on NVDA chips despite their "cheap claims." Typical CCP pump and dump. And just like that QQQ back up.

[dan_pdx]

Re: TSLA, I think it will tank some day, but I'm not buying puts. Lots of richer and smarter people than me have come to grief trying to time that crash.

[up an down]

Summit.. What's the source for the 500 million cost?. Still a lot cheaper than the 65 billion that Zuckerberg said he plans to spend for AI.

[summit]

The FT article with the SemiAnalyis report is paywalled, but I have been a long time /. reader
https://tech.slashdot.org/story/25/0...ianalysis-says

[Bunion 2020]

China lied? No way.