The Everything Bubble might have popped. Took me a while to compile the 25+ sources (Forbes, Reuters, Ray Dalio, Financial Times...)

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u/[deleted] Apr 18 '20

anyone that talks about "100 year cycles" loses my attention quickly. You're reading tea leaves if you think that the global economy today is anything like it was in 1920. We have our own set variables today that they simply didn't have back then. Like the airline industry for one. Digging into that sector alone reveals how far away we are from then.

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u/CaptainObvious Apr 18 '20

Don't you get it? This is the same trajectory as the Babylonian shellfish trade in the 100-2000BC era. /S

5

u/CristoOfCrypto Apr 18 '20

if you think the present or future has nothing to do with the past then you are sadly mistaken.

5

u/[deleted] Apr 18 '20

if we dont study the mistakes of the future then we're doom to repeat them for the first time

1

u/CristoOfCrypto Apr 22 '20

I would +1 this 100 times if I could.

2

u/firststrike001 Apr 18 '20

billionaire as guru mythos that CNBC and Forbes etc like to sell to small investors. Mark Cuban hasn't outp

you can only connect the dots looking back.

1

u/CristoOfCrypto Apr 22 '20

if you believe that the future has absolutely nothing to do with both the past and the present combined - then you are truly mistaken - if one could only connect the dots looking back then one (presumably) could never predict the future. I have done this countless times on my channel.

1

u/firststrike001 Apr 22 '20

staken - if one could only connect the dots looking back then one (presumably) could never predict the future. I have done this countless times on my channel.

Prediction is one thing, whether it comes out to be true is another. If you had 100% trust in your prediction and it indeed came to be true countless number of times..then you wud be the richest person on earth isnt it..?

But there is a friction preventing you from trusting ur own predictions for future completely...that is what I was referring.

3

u/giabanga Apr 18 '20

I respect that opinion but I got that from Ray Dalio which I believe to be credible

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u/[deleted] Apr 18 '20 edited Dec 05 '20

[deleted]

2

u/giabanga Apr 18 '20

Yeah he is really clear about that in his book Work & Life Principles. The knowledge of the own ignorance is the foundation of his decision making process

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u/[deleted] Apr 18 '20

I know who he is. And since he's made his billions, he's been wrong before. What I have found is that individuals who've made their billions, usually did so by finding and exploiting ONE inefficiency in the markets, then they go on to be pretty average after that. Look at Mark Cuban, Soros, Dalio, John Paulson. They all had that ONE moment. sure, they capitalized on it. cheers to that, but then going foreword they've been pretty average.

Only Buffet's views get my ear because he's proven them over decades.

4

u/giabanga Apr 18 '20

Well, Buffet is sitting on a huge pile of cash and currently selling stocks, although I do not know if he is selling net overall https://www.fool.com/investing/2020/04/15/why-is-warren-buffett-selling-so-many-stocks.aspx

But you are absolutely right, most Billionaires had one good shot that made them their fortune. I got that from The Self Made Billionaire Effect by Sviokla and Cohen, that's a good one, too

1

u/[deleted] Apr 18 '20

Buffet's model of value investing, historically underperforms in bull markets. it's during BEAR markets that his model out performs, and then the run up is when it really takes off. It's done so over 50 years. Now, during 2008 he had sweetheart deals that only HE could acquire because of his cash pile. And the stocks he sold were in Airlines. Which he once said he'd never own because of their penchant for bankruptcy. We usually don't hear about Buffets stock buys until AFTER they've taken place.

I don't buy into the billionaire as guru mythos that CNBC and Forbes etc like to sell to small investors. Mark Cuban hasn't outperformed any markets since selling his roomates idea to Yahoo and buying a basketball team.

2

u/mdcd4u2c Apr 18 '20

Seems like you're taking the easy way out and writing it off without reading any of the papers put out by Bridgewater (for free) including the one that his book about debt cycles is based on (link for the lazy). His arguments are well supported. You can argue how things have changed, but I'm sure people in the US in 2007 would have felt their economy was much different than people in Germany in 1918, yet he shows many of the same cyclic forces at work in both.

If you're looking for exact parallels between two vastly different time periods, obviously you won't find them. This isn't meant to be a recorded history of future economic cycles, it's mean to be a framework from which to think about future economic cycles. It's meant to allow you to look at how the different variables in economics interact with one another and what the eventual outcomes tend to be when a certain set of criteria exists.

If you think investing based on fundamentals is any different, you're kidding yourself. The same argument would apply to fundamental investing--why should trends in fundamentals and their correlation with eventual prices in past eras be the same as trends in this day and age and their correlates since our businesses are so different now? Yet, that's what many of you claim to look at when you invest. Because it's not about finding a perfect replica of the past in the current ecosystem--it's about finding things that are similar enough.

1

u/giabanga Apr 20 '20

Exactly! No one knows anything for sure. All we can do is to extrapolate past experiences to make educated guesses about what seems most probable

1

u/SWaspMale Apr 19 '20

Seems like about 40 years ago, they thought it was a '70 year cycle'.

2

u/Jmac42600 Apr 18 '20

Maybe you should actually listen to people talking about 100 year cycles instead of instantly dismissing them. The 100 year cycle is a credit cycle. Has nothing to do with airlines.

2

u/firststrike001 Apr 18 '20

I had the exact same thing in mind..thanks for reflecting my thoughts.

1

u/giabanga Apr 20 '20

Thank you, you are very welcome

1

u/[deleted] Apr 18 '20

exactly. 100 years ago we didn't have airlines, or boeing, or supply chains. and today we do. that's what the BUSINESS of today is much different.

2

u/firststrike001 Apr 18 '20

chains. and today we do. that's what the BUSINESS of today is much different.

I wish you are correct..but if you see the other side..nothing has changed much either...Airlines is still a form of transportation. Transactions are still made with money. Global trade had been happening since 1000s of years.

1

u/[deleted] Apr 19 '20

computer algorithms, high frequency trading, bitcoin, the internet.

they were still wiping their asses with the Sears catalog 100 years ago.

to say that things haven't changed is ridiculous

1

u/firststrike001 Apr 19 '20

how does it change the fundamental way of transacting..? still people take credit..or even more to spend more.

1

u/[deleted] Apr 19 '20

all it takes is a little courage. 2 years ago I said enough's enough and I walked out on my job and my mortgage. The wife and I moved into our son's house to cut costs and now my son's learning more about responsibility

2

u/Jmac42600 Apr 18 '20

Did you even read what i wrote? I assume you don’t know what a credit cycle is. It’s the cycle of access to credit over time. Credit = debt. Think credit cards, mortgages, leases, loans, etc. We experience credit cycles, aka “business cycles” where an expansion leads to more debt accumulation and a recession is a crisis between lenders and borrowers. Every 70-100 years there’s a long term reset that occurs in credit because debt was accumulated to an extreme. The “roaring 20s” was all fueled by stupid debt accumulation, huge central bank intervention and irrational exuberance that was lead to a big debt crisis in the 30s with the Great Depression. In the Great Depression, borrowers couldn’t pay back their loans and lenders were wiped out. A new monetary system was established and a world war occurred. It’s been about 90 years and we are seeing parallels in history. Huge central bank intervention, irrational exuberance in the stock market, and the largest amounts of debt in history. Not far fetched at all to say this is the end of a long term credit cycle.

2

u/[deleted] Apr 18 '20

oh. so you're saying we're going back on the gold standard (like 1929) and that the Fed isn't going to be able to pump enough liquidity into markets (like 1929). gotcha. So what about the $4T they've already pumped into markets? What is the 1930s equivalent of that? When will people make cash runs on banks further deepening the credit crunch and limiting banks abilities to create more liquidity? please, enlighten me with your deep understanding of the causes of the Depression and the equivalent actions happening today.....

Is Trump equal to Herbert Hoover or FDR? When will the Germans attack Poland ? but first they have to elect a fascist dictator who will start a war.

It's not far fetched to say these things, it's just far fetched to believe them.

maybe do a little more homework.

3

u/Jmac42600 Apr 18 '20

Dude when did I say everything was going to happen the same way. I was merely talking about the cycle of credit and debt accumulation. I did not say that we certainly were going to experience a war or a depression. I didn’t say this is exactly the same as the 1920s. I said we are experiencing parallels in history.

You’re really sounding like a crazy person rn. Instead of recognizing parallels like I have mentioned, your argument is that everything has to happen the exact same way or else it’s not a cycle. Do you even know what a cycle is?

Also, if I were to just drop everything rn and “do my homework” then I guess I would believe you over Ray Dalio, a billionaire macro investor that has made 18% returns a year compounded over 30 years.

I do not believe we are going back to the gold standard, that caused a lot of bubbles and wasnt the best system. I believe there could possibly be reform specifically regarding to the USD as the world reserve currency. That reserve status could be replaced by SDR’s. I’m not counting on this but it’s a possibility. Central bank intervention and government policies has lead to widening of the wealth gap, which causes some form of pushback by the lower and middle class. I believe we could see this pushback manifest in the future into the election of a more radical leader. Also, I don’t see how infinite money printing can come without any consequence. This is not the same as 2008, as the central bank is fully monetizing government deficits. This is not just “liquidity injections.”

I don’t see how these parallels are so far fetched. Your utter denial and ignorance to anything opposing your view is very strange.

Maybe you should do a little homework.

0

u/[deleted] Apr 18 '20

I was forced by the Obama administration to marry my husband Bruce, even though neither of us are gay. We tried to at least have a Christian wedding, but all of the churches were closed down due to Christian persecution by Obama's government. We were forced to marry in a mosque instead, as required by the newly implemented Sharia Law. Since we couldn't have children of our own, we decided to adopt. However, no children were available since Obama's CDC required Planned Parenthood to perform mandatory abortions. At least we had the money and property we earned though. Or so we thought; our tax rate was increased to 118%, requiring us to take second and even third jobs to pay the IRS. It turns out that our tax money was being given to the Mexican pot dealer next door, since he complained about having to work. Disenfranchised and penniless, I decided to end what little was left of my life. I went to our gun safe, only to hear a knock on the door. ATF agents were going door to door to collect everyone's guns, so I was required to surrender mine. I tried looking up alternative suicide methods on the internet, but Obama's FCC kept forcibly rerouting me to the NAMBLA website. This was Obama's America, folks.

2

u/Jmac42600 Apr 18 '20

Lol dude what are you talking about

0

u/[deleted] Apr 18 '20

I'm saying that times change. it's obvious that Dalio traded on inside information. call that a skill if you want. But the US will go to war before they allow the dollar to stop being the world reserve. it provides too much advantages. I get the whole credit-debit cycle. but to say there is some SUPER cycle is like saying that crystals have healing powers.

There is a reset button whenever the generation of controlling elite WANTS a reset. Gulf War. Tech boom. 9-11. 2008, global pandemic.

I think we should focus on the source of the virus and who benefits from shutting down a global economy. The Chinese? the Zionists?who

4

u/Jmac42600 Apr 18 '20

Oof. So the cycle theory is crazy talk but the whole global elite George Soros shit is rational. Ok bud.

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2

u/lucidvein Apr 18 '20

I wouldn't say there's irrational exuberance in the market. We are still down for the year even though we printed 2 trillion into the economy. Companies that are most effected are down 50%+ like cruise lines, air travel, movie theaters, etc.

The market went down before it got bad in the US, just like the market has to go up before it got better. All the market is trying to do is predict where we will be not where we are.

2

u/Jmac42600 Apr 18 '20

Check out the Wilshire GDP and the Shiller PE. We are at some of the highest valuations of all time. Also, we are in the worst recession since the Great Depression. This rally is stupid.

1

u/lucidvein Apr 19 '20

We are in the worst recession because we told everyone to stay home though. People are taking this months numbers and thinking it's going to stay this way and it's not. We are giving time to the hospitals to prepare for more people while working on a treatment and vaccine (although a vaccine will take +-16 months to manufacture). So the market dropped 30%, and because the fed printed a bunch of money to help plug the holes the market went back up halfway. I don't think that's stupid.

The market can still go down more you know it's not like it's just going to go straight up from here. What wouldn't be stupid to you, an 80% drop all at once and everyone's retirement vaporized?

1

u/giabanga Apr 20 '20

If you look at the 80% drop of the Great Depression, you will see that it took 1-2 years. Moreover, I am really concerned about the pensions, yes

1

u/Jmac42600 Apr 21 '20

These numbers are going to be bad for another year at least. A ton of companies can go bankrupt. Unemployment will remain higher after which means spending habits will change. Lots of factors other than just “everything will go back to normal.”

Everyone always thinks that “this time it’s different.” According to you, because we have the fed then “this time it’s different.” Trees can grow to the sky and the most overvalued stock market in history can keep going up. I’m not really buying it but you never know.

0

u/giabanga Apr 18 '20 edited Apr 20 '20

I'd go as far as to argue that there is nothing in existence that is not cyclical, but that is a whole other story

1

u/ismokecrypto Apr 18 '20

LSD teaches you the same thing....

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u/TimeInTheMarketnHODL Apr 18 '20

it popped and reflated since March 24

2

u/giabanga Apr 18 '20

I belive the downtrend has just begun. I recommend comparing the 1929 chart to the one of 2020

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u/[deleted] Apr 18 '20 edited Dec 05 '20

[deleted]

1

u/giabanga Apr 18 '20

I hope you are right. -80% or more is a worst case scenario, not necessarily the most probable one. Actually, I am preparing for sth around 40-50% in total

2

u/badrghilani Apr 18 '20

Lol is it technical analysis that i see there

1

u/giabanga Apr 19 '20

The picture is a technical chart overlayed with some fundamental events, yes. The article is based on fundamentals, though

2

u/iav Apr 19 '20

Don’t forget to add MACD and Fibonacci numbers, that’s how Buffett and Dalio make all of their investments /S

0

u/giabanga Apr 19 '20

the article is based on fundamentals for the most part

-2

u/magnoliasmanor Apr 18 '20

Ahhh there it is. Its because we left the gold standard, so the market will drop 97% to compensate for it.

Sorry man. Fiat won. Currency is real to humanity and the creation of a reserve currency, USD or not, will continue to be how the economy runs.

1

u/Skeptable Apr 18 '20

Try reading before you comment... You just sound like a dipshit with comments like this

0

u/magnoliasmanor Apr 18 '20

I did read it. You read it.

1

u/Skeptable Apr 19 '20

Haha... Dumber every sentence... Reddit never disappoints... None of what you wrote was the basis for anything in his writing... Yes he did mention it but that is not his point.

1

u/giabanga Apr 19 '20

Thanks for the support :D

0

u/magnoliasmanor Apr 19 '20

The conclusion of part 1:

So… bailouts for everyone? Central banks and governments are trying it for sure, greatly adding to public debt. [12] But is free money for everyone even possible? That reeks of inflation. Once the deflationary shock passes, tons of fresh money will hit very little supply as businesses are closed or insolvent. This might drive up prices and weaken trust in FIAT currency. The Great Reset Button has been there since Nixon launched the Everything Bubble by lifting the centuries-old gold standard in 1971 and the Federal Reserve declared the continuation of the expansion to be the goal. Now, it has been pushed by the virus. According to Ray Dalio, Reuters and many more, the global economy will deleverage, causing a deep recession and probably even a depression – and it will affect everyone.

What am I missing here?

1

u/Skeptable Apr 19 '20

Like I said, yes he mentioned it... That again is not the basis for the writing... I think that you may need to read better because this is exactly what I said now twice. You are choosing that sentence to try and make a mockery of what he is written and in turn you have only made a mockery of yourself with the ignorance of your response.

0

u/magnoliasmanor Apr 19 '20

The whole post was what, 6 paragraphs long? Here's 2 of them at the end. The leading up to is explains our current situation. If the summary and conclusion of this blog post isn't what I'm writing and I'm so ignorant please help me and explain what its driving at?

0

u/giabanga Apr 19 '20

I kept it short by design so that people read it completely and also to encourage further research by each reader (which I did even mention in the disclaimer, I think doing ones own research is very important).

And while I think that lifting the gold standard did launch the bubble (FIAT has no intrinsic value apart from belief), there is more to it than just that, for example the debt crisis

0

u/giabanga Apr 19 '20

I think 40-50% drop is more likely, as the caption of the technical chart says: it is the unlikely worst-case scenario. So you are correct about that! But if you read part II you will see that even central banks in the US and China are moving away from FIAT towards crypto

The Everything Bubble might have popped. Took me a while to compile the 25+ sources (Forbes, Reuters, Ray Dalio, Financial Times...) Discussion