The Bank of England Shit-Show
- Thread starter The_Krakenite
- Start date
Shit show? Nowhere else could you generate such large returns in the past several days on the sell-off and subsequent squeeze up from 1.04 levels to 1.11 levels. No in cryptos, not stocks, not commodities, not fixed income. And all that in perfectly orderly and liquid markets at razor thin spreads and transaction cost.
In the stock market you deal with dozen shit shows all at once: bank analysts hyping or killing a stock, sudden large unexplained moves, insider trading, dividends, company announcements about changes in capital structure or other market impacting events, short selling rules, borrow fees, having borrowed shares called, stock splits, take over announcements, limited trading hours,...uptick rules, short selling prohibitions,...
In the stock market you deal with dozen shit shows all at once: bank analysts hyping or killing a stock, sudden large unexplained moves, insider trading, dividends, company announcements about changes in capital structure or other market impacting events, short selling rules, borrow fees, having borrowed shares called, stock splits, take over announcements, limited trading hours,...uptick rules, short selling prohibitions,...
Add economic data and the FED
I feel you. This made me quit swing trading equities and switch to daytrading futures.
This same shitshow is coming to the US if we don't turn this around. The biggest issue in the UK is the steady increase in entitlement and support payments over the last 15 years, and the same thing has happened in the US.
No one argues that we should not establish, maintain and deploy safety nets for our most vulnerable and marginalized. That was the point of these systems when they were created in the 1930s in this country. But today the level of public subsidy is astonishingly high and far reaching in terms of the numbers AND the ability of those people to earn a decent living in the absence of subsidies. And who is paying for the 2M that have walked over the border in the last 18 months? Where are they? Some are likely working but almost none are paying taxes and most are probably collecting Federal and state benefits. How many of those additional kids are now in our schools?
Even if no one had crossed the border in the last 10 years, overall gov't payouts to Americans have increased dramatically both in real dollar terms and as a percentage of GDP. The UK is having their day of reckoning from this imbalance and the US is headed in the same direction.
No one argues that we should not establish, maintain and deploy safety nets for our most vulnerable and marginalized. That was the point of these systems when they were created in the 1930s in this country. But today the level of public subsidy is astonishingly high and far reaching in terms of the numbers AND the ability of those people to earn a decent living in the absence of subsidies. And who is paying for the 2M that have walked over the border in the last 18 months? Where are they? Some are likely working but almost none are paying taxes and most are probably collecting Federal and state benefits. How many of those additional kids are now in our schools?
Even if no one had crossed the border in the last 10 years, overall gov't payouts to Americans have increased dramatically both in real dollar terms and as a percentage of GDP. The UK is having their day of reckoning from this imbalance and the US is headed in the same direction.
Certainly one factor is increased longevity due to fewer heavy smokers, better nutrition, better control of chronic disease -- diabetes, heart, asthma -- and increased survival rates for cancer. Putting entitlements on a sound footing would require increasing the payroll and self employment taxes. The Trustees of the various entitlement Trust funds have for a long time been calling for increased contribution rates. Getting Congress to enact such seems almost an impossibility. Initially it was just one cent on the dollar split between employer and employee, but as years go by with the need unaddressed the required contribution rate increase continues to rise.
Of course the elephant in the room is medicare and medical costs in general. Few stand up and explain why Medical care can never fit a capitalist mold; when they do, nobody listens.. Other developed, capitalist countries recognized the fundamental misfit problem years ago. Meanwhile, in the U.S. we continue trying to force a square peg into a round hole. As a result we have created the text book example of a Regulatory Captured, Rent Seeking industry --- 100% higher costs than the next most expensive and 36th in quality of care. Quite an accomplishment! It's truly amazing that anything so bad can be so expensive. Medical costs cannot continue on the present path so it is only a matter of time before yet another scheme is tried. Of course there are any number of better schemes out there. All we'd have to do is copy the best one. (France?) But of course we can never do that because if we did thousands of medical procedure coders, hospital attorneys, and insurance administrators would have to find new employment. In my town it would be even worse, the hospital would have no slush money left to pay for planting the street medians with flowers.
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This is a prime topic. One of the strongest topics to focus on. This thread should be pinned.
Socialist govts and policies are WHAT WE are trying to move away from. THEY BORROW, THEN SPEND AND SPEND. The central banks have been an extension of socialism now since 2000. Socialists in both US and UK have used power within govt to push the central banks deep into business stimulus, consumer stimulus, business subsidy and straight bailout of banks/business whom GIVE FREE LOANS/FINANCING TO THE UNQUALIFIED.
Finally, after 20 years, the Fed has been forced to unwind artificial social/business support structure. AND THE MINUTE UK FEELS PAIN, BANK OF ENGLAND COMES IN WITH STIMULUS. This, at a time of desperate need to tighten money around the world. AND THE MARKET KILLED THEM .
The market understands what central banks don't understand. If you let this inflation get outta control..it will kill business as we know it. Central banks have never understood business. Central banks only understand political power and abstract, very questionable economic theory. So, to rely on central banks now is very dangerous. Markets need to take control right now and punish foolish central bank behavior. And punish they did to Bank of England and politician Kwasi Kwarteng. And markets are punishing Japan for the same reason. Japan central bank actually started this whole game of borrow/print/spend/support/bailout back in the 1990s. Japan probably wont survive the end game in this. UK may not survive as we know it. But, its crucial that US learns and understands whats going on here...or we wont survive this either.
This is very tradable... very nice returns if you understand whats happening here.
Socialist govts and policies are WHAT WE are trying to move away from. THEY BORROW, THEN SPEND AND SPEND. The central banks have been an extension of socialism now since 2000. Socialists in both US and UK have used power within govt to push the central banks deep into business stimulus, consumer stimulus, business subsidy and straight bailout of banks/business whom GIVE FREE LOANS/FINANCING TO THE UNQUALIFIED.
Finally, after 20 years, the Fed has been forced to unwind artificial social/business support structure. AND THE MINUTE UK FEELS PAIN, BANK OF ENGLAND COMES IN WITH STIMULUS. This, at a time of desperate need to tighten money around the world. AND THE MARKET KILLED THEM .
The market understands what central banks don't understand. If you let this inflation get outta control..it will kill business as we know it. Central banks have never understood business. Central banks only understand political power and abstract, very questionable economic theory. So, to rely on central banks now is very dangerous. Markets need to take control right now and punish foolish central bank behavior. And punish they did to Bank of England and politician Kwasi Kwarteng. And markets are punishing Japan for the same reason. Japan central bank actually started this whole game of borrow/print/spend/support/bailout back in the 1990s. Japan probably wont survive the end game in this. UK may not survive as we know it. But, its crucial that US learns and understands whats going on here...or we wont survive this either.
This is very tradable... very nice returns if you understand whats happening here.
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If Liz cant get it right...the markets will force her to make adjustments. Bank of England also beholden to the markets. Let the markets speak. And hope they follow the heed. At this point the very financial health is at stake.