Showing posts with label Bubble. Show all posts
Showing posts with label Bubble. Show all posts

February 22, 2024

Dinner in a Bubble

(Credit Photo: Andy Blumenthal)


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February 12, 2021

Forecast 2021 By Andy Blumenthal




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February 7, 2021

Did You Sell Your GameStop?


Well, I couldn't resist. 

Around midday today, I peaked my head into the local GameStop.

There wasn't 1 single customer in the store. 

Not 1!

There were two workers.

When I asked if they had any GameStop stock. 

The manager said he had been offered some when he got promoted, but unfortunately turned it down. 

Well the stock was a manic bubble for a short time these last few weeks, and it could've made him a bundle. 

Based on what you see today, do you think you should own GameStop?  ;-)

(Credit Photo: Andy Blumenthal)


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January 31, 2021

GameStop Is What I Call A Sh*t Store

For those of you who have been in GameStop, you know what I mean. 

Let's face it, it's a sh*t store!

They have videogames (some that I like) that you can buy online for half the price and crappy toys and collectables (i.e. "made in China" trinkets)!

Hey, I think you can get some action hero socks on sale for $5. 

The company makes nothing!

Their intellectual property is virtually nill!

Their assets are some leases in strip malls and shopping centers that have less and less traffic due to e-Commerce and Covid!

For those who drove the stock up from a year-low of $2.57 to a high this week of $483.98, congrats on showing that the market can be completely irrational and manipulated by the social media masses. 

Like right before the dot.com bubble of 2000, showoff your brokerage statements and brag about your beefy balances, I remember the local yocals from the barber shop doing the same back then--when everyone was a stock maven and becoming a multimillion from the likes of Pets.com.

But GameStop and AMC (another almost dead company unable to face Netflix, Amazon Prime movies, and all the other streaming plus Covid) are probably worth in concept less than good 'ol Pets.com or the Tulip Mania of the 17th century (at least flowers are beautiful). 

This will end in tears for the ever "greater fool" who's following the herd.  

Let's hope they and the spiraling, out of control national debt don't take down all of us with them!  ;-)

(Credit Photo: Andy Blumenthal)

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July 12, 2020

IMHO Warning: Stock Market MAJOR Correction Imminent

I went to the mall today.

This is a few weeks into reopening phase 2!

I expected people would have pent up demand and be swarming the stores even while keeping their social distance.

They weren't at the mall! 

The stores were nearly void of people.

The shelves were virtually empty of goods.

Whatever merchandise there was seemed to marked "sale, sale, sale" even on the already deeply-discounted clearance items.

It was completely frightening--like the economy is dead or on severe life support!

Most stores had 3 or more associates standing around or sitting twiddling their thumbs.

This while the stock market keeps ticking up and the NASDAQ is reaching new highs almost daily.

Coronavirus is surging again across much of the U.S. and there is almost 140,000 dead in the U.S. after just 5 months even though much of the population was in self-quarantine.

The economy looks to me in sh*t shape, despite the U.S. pumping $3 trillion dollars more of debt to artificially prop up the economy and the fed lending out money at super low rates.

It makes NO sense for the market to be hitting all time highs as if everything is all roses when the economy is still a true mess!

The New Yorker magazine wrote back in May of a post coronavirus "decade of depression" with an L shaped recovery, yet we keep seeing a V-shaped one and no one seems to be able to offer any plausible explanation for it.

Two-months ago, even before the recent stock run-up to higher levels, Business Insider reported that "the Stock Market is trading at its highest valuation in 18-years."

Last month, Forbes reported that "the stock market appears to be reaching unsustainable highs."

Yesterday again, Bloomberg reported that the "economic recovery is faltering."

Almost daily, I read that companies are laying off their workers (in Travel, Transportation, Entertainment, Retail, Energy, etc.) or declaring bankruptcy (e.g. Hertz, JC Penny, Neiman Marcus, Chesapeake Energy, and more).

This while we are still, in the best case scenario, maybe half a year away from the possibility of a tested, approved vaccine. And then it will still need to be mass produced and mass distributed to hundreds of millions of people in this country and billions globally.

In the meantime, we certainly could be up for a second wave of Coronavirus on top of the flu in the fall/winter. And then the Coronavirus may mutate and become more virulent requiring annual vaccines like the flu shot--more hit or miss.

All this while U.S.-China trade war is imperiling our economy further, and arch-enemies Iran and North Korea remain national security threats.

To me this all points to that we are nowhere near out of the woods and perhaps that there is a wildfire raging and no one seems to be paying any attention!

The stock market euphoria is a common trap and is the definition of "irrational exuberance" but comes after investors have been robotically indoctrinated to buy the dips!

IMHO, buyer beware, beware, beware. ;-)

(Credit Photo: Andy Blumenthal)
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May 11, 2020

Stock Market Pinocchio Style


Look folks, Pinocchio's nose is getting longer by the minute.

The market continues on a tear, even while the economy is heading in the other direction. 

I know people have been conditioned to buy on the dips, but I'm not sure that applies while we're in the middle (or maybe still just in the beginning) of a pandemic that has claimed 286,000 lives in just over 2 months (and that's with a global shutdown)!

Somehow, there is a notion that when things start to reopen that all the problems will just magically go away, including the $3 trillion we just added to our national debt, all the bankruptcies being declared, and all the job losses that are becoming permanent. 

If you believe this, perhaps you'd like to buy the Brooklyn Bridge.

The greater fool theory is alive and well.  ;-)

(Credit Graphic: Andy Blumenthal)
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April 18, 2020

Not That Great!

I like this quote from former Israel prime minister, Golda Meir:
Don't be so humble; you're not that great!

Nice way to pop someone's oversized bubble of an ego and tell them to put a cork in it. 

Or as my dad used to say:
He's not a big shot; he's a big sh*t! 

Anyway, she had a sharp mind (like my dad) and was an amazing leader that Golda.  ;-)

(Credit Photo: Andy Blumenthal)
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January 6, 2019

From Tulips to Cryptocurrency

There always seem to be another mania. 

From the Tulips Mania in 1637, when a tulip went for more than 10x what a skilled workman earned in an entire year!

To Cryptocurrency in 2018, which is down about 80% from its $20,000 peak losing $700,000,000,000. 

In between, we had the gold rush, the great depression, the tech/dot-com bubble, and the housing/mortgage crisis, and many more I am sure. 

There seems to always be something for people to get excited about in an "irrational exuberance" type of way, as former Federal Reserve Chair, Alan Greenspan put it.

Is it boredom, big dreams, unadulterated greed, the desire to "get rich quick" and easy, the belief that you've discovered the Holy Grail or is it just people being stupid. 

Either way, we have a way of getting ourselves in trouble, some "losing their shirts."

Not sure who said it, but there isn't an easy fix to your life. 

There are small and big problems, and then there is you trying to fix them (with G-d's help). 

As to bitcoins and tulips, they ain't worth what you think they are. ;-)

(Source Graphic: Andy Blumenthal with photos from Pixabay). 
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June 7, 2018

That's Some Pricey Garbage Art


So we stopped in this gallery in Palm Beach.

And there lay this piece of "art".

Well, I'm not sure--is this really art?

The proprietor explained that this is made up of scrap pieces of metal from the garbage dump like from old discarded automobiles. 

The artist welded the garbage together, painted it, and voila there it is--some very pricey art. 

Who pricey you ask.

Take a guess.

No really. 

No, you're too low. 

Try again. 

No, you're still too low.

Not even in the ballpark. 

Okay, I'll tell you, but only because you asked so nicely.

It starts with a 95.  

No, not $9,500.

No, not $95,000 either. 

That's right $950,000!!!

All this "art" can be yours if the price is right. 

Can anyone say "irrational exuberance" again? ;-)

(Source Photo: Andy Blumenthal)
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November 29, 2017

Dysfunction Society

So the world is continuing to go nuts--and it's like everyone is behaving like Negan from The Walking Dead!

North Korea has achieved ICBM capability with a missile launch yesterday to 2,800 miles altitude—11 times higher than the International Space Station—giving Axis of Evil, North Korea the ability to now hit Washington, D.C.!

At the same time, a career civil servant tries to pull a fast one on the Trump Administration—challenging the President’s right to appoint an Acting Director over the Consumer Finance Protection Bureau, which is part of the Executive Branch of government—and hoping that the Senate then won’t confirm Trump’s new appointee for Director, all of which would leave her in charge of CFPB for the next 3 years!  Of course, the courts don’t see it her way, but as the Wall Street Journal noted her coup attempt is definitely something to take note of in democratic, America.

In the background, the Democrats and Republicans continue to beat each other silly and senseless, and not only with stalled legislation on almost every front from Healthcare to Immigration, but now minority leaders Schumer and Pelosi are even refusing to meet with the President over enacting a government budget leading us to another looming government shutdown in December…we can’t seem to keep the government functional or even running for the most powerful nation on Earth.   

Finally, Bitcoin—an artificial computer-generated currency, advanced 1,000-fold this year to hit $10,000! Talking about another financial bubble reminiscent of the manic investment in tulips in the 17th century. What’s the value of Bitcoin or sunflowers? Whatever you want it to be! It’s not about the technology, which may be great, but rather the phony valuing of cryptocurrency, which few understand, and we all know how these bubbles end.  

So overall, we have national security, the administration of our government, and economic stability all in grossly abnormal territory. 

When things get this crazy, eventually you can be sure that something will first start to crack and then potentialy really break, and when it does, will we see more Negan with his brain-bashing baseball bat, Lucille? ;-)

(Source Photo: Andy Blumenthal)
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July 26, 2016

Poverty Is An Illness

Poverty is not just a phenomenon of poor, homeless and hungry people. 

It is a social and economic epidemic, and here are some sobering statistics:

- "Nearly 1/2 of the world's population--more than 3 billion people--live on less than $2.50 a day."

- More than 1.3 billion people live in extreme poverty--less than $1.25 a day."

- "1 Billion children worldwide are living in poverty...and 165 million children under the age of 5 were stunted...due to malnutrition."

- "1/4 of all humans live without electricity."

- "80% of the world population lives on less than $10 a day."

Those empty stomachs, battered roofs, and tattered clothes are leaving indelible marks on so many impoverished people, yet many at the other end of the spectrum are living so high and mighty...it's a crazy contrast that fails to make any sense. 

Passing by the stronghold buildings of the World Bank in Washington, D.C., I found these striking "End Poverty" t-shirts that they had in their storefront--although I couldn't help think how far removed this place was from this sorry state of global poverty and chaotic and violent world affairs. 

We are living in an incredible bubble, and while I often hear how grateful people are to be here and have "all this," somehow I just don't think we fully get it what's going on out there! ;-)

(Source Photo: Andy Blumenthal)

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January 2, 2016

Market Watch 2016

I took this photo in the mall on New Years Day--yes, the stores were actually open on the holiday.

And Macy's was having a blowout sale with racks and racks of "80% Off Original Price[s]."

We were laughing saying what's next--99% Off and then even 100% off! 

So you think the economy is healthy with fire sales like these on the very first day of the new calendar year--when we still have another 364 days to make our year end sales quotas...

With turbulence around the globe brewing from Iran, Syria, Russia, North Korea, Yemen, Sudan, Nigeria, ISIS, and more...anyone care to say (pending) crisis.

How about commodities--my bet--that are in the toilet (and have been for years now)--do you really think no one needs iron, aluminum, nickel, lead, cooper, potash, oil, gas, coal, diamonds, and gold anymore? 

Then the Wall Street Journal warned again today about the overall investment marketplace, asking "How do you invest when everything is expensive? [at 25 times cyclically adjusted earnings--now that's a fancy term]?

We've been down this road before in the bubble bursts and recessions of 2001 and 2008.

Is now really the time for the Federal Reserve to be raising interest rates (and what a nifty ripple effect that will have in both slowing our economy down and raising our interest payments on our already ballooning $18 trillion national debt)?

Oh, technology to the rescue again and again...it's possible with everything from virtual reality to robotics and artificial intelligence on the cusp...or maybe not this time around. ;-)

(Source Photo: Andy Blumenthal)
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October 24, 2015

Where's The Value?

So I don't know how I feel about this or maybe I do. 

The Wall Street Journal reports today that from the 10 largest companies by market capitalization:

1) The top 3 are technology companies

- Apple $679B
- Alphabet (Google's Parent) $489B
- Microsoft $422B

2) Moreover, a full 5 (half) of the top 10 are technology companies

That includes the 3 above and the other 2 below:

- Facebook $288B
- Amazon $280B

As a technology person, I am thrilled at the impact that IT has on our society. 

We are no longer the same thanks to our Apple iPhones, Google Search, Microsoft's business tools like Outlook, Office and SharePoint, Facebook's social networking, and Amazon's online shopping. 

But to think that these information capabilities outweigh by value everything else in society that we need as people is somewhat astounding.

For example, the other 5 of the top 10 companies are:

- Exxon Mobil (Oil and Gas) $346B 
- Berkshire Hathaway (Insurance, Utilities, Clothing, Building Products, Retail, Flight Services) $340B
- General Electric (Power and Water, Oil and Gas, Energy Management, Aviation, Healthcare, Transportation) $298B
- Wells Fargo (World's Largest Bank) $280B
- Johnson and Johnson (Pharmaceuticals) $278B

So when you add these behemoths up--this is what we have:

The 5 top technology companies are worth $2.158T

Vs.

The top 5 traditional companies from all the other industries combined are worth only $1.542T

Net it out:

The largest representative IT companies are worth $616B or 40% more than the other major companies combined.

(In fact, just the top 3 IT companies at $1.56T are worth more than the top 5 other companies at $1.542T.) 

Sure IT growth has been on a tear for the last couple of decades and we love everything futuristic it brings us. 

But isn't it a little scary to think that the companies that meet all our other needs from food, clothing, shelter, medicine, transportation, energy, finance, retail, etc. isn't worth more to us than just the IT alone. 

Perhaps adding it up from a value perspective just doesn't add up in a real life perspective. 

I love technology and want more and more of it, but man does not live by technology alone. ;-)

(Source Photo: Andy Blumenthal)
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September 14, 2015

The Unbelievable Stupidity Of Raising Interest Rates

Interest rates have been near zero since the recession of 2008.

That supposedly to stimulate the economy. 

However, aside from a stock market bubble again, not sure we have a much stimulated economy.

We have a false low on the unemployment rate, while the the true percentage of the labor force working is the lowest in almost 40 years!

Moreover, manufacturing is down almost 40% from the 1979 peak with a loss of over 7.2M jobs

Commodities are at firesale prices as demand is sluggish and there is short-term oversupply. 

And innovation is facing a global slowdown

So people are out of work, we're not making things, demand is depressing prices, and even ideas are few and far between--not too rosy a picture, regardless of what some politicians may have you believe. 

Let's not forget that we have an over $18 trillion federal debt, and this is projected to grow ever greater as we borrow to fund social entitlements such as social security, medicare, etc. 

In this scenario, why would the Federal Reserve ever want to raise interest rates?

Well, if they don't raise rates, then they can't lower them later again when the economy really stalls out and goes into deep recession. 

Hence, this is seen as a tool for their financial toolkit--and if there are no tools with which to manipulate the economy, then there is no need for a (neutered) Federal Reserve. 

But think for a second what happens when the Fed raises rates, it's going to slow the economy even further than the chug chug chug economy that we are already dealing with. 

Maybe even more important, it will raise the amount of interest payments we must folk over on the trillions of dollars of debt we owe.  

Simply put, when we raise interest rates, we pay more interest on our already astronomically high national debt, and this pushes our national deficit up even higher as we borrow more to pay the interest on the previous debt. 

If you did this with your credit cards, you'd probably be looking at the equivalent of debtor's prison sooner or later. 

Rather than feed the Fed's toolbox with interest rate bumps and drops, why not keep rates low as long as they can stay low, reducing our interest payments, and curtailing our national deficit and debt. 

What about the stock bubble...that's a lesson investors will be learning about in their own good time--it's the stock market, stupid. ;-)

(Source Photo: Andy Blumenthal)
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August 1, 2015

Nothing Is Something AND Something Is Nothing


So the world financial markets continue to go haywire. 

The Uber glorified taxi service and app (with an almost half billion dollar operating loss) is now valued at--get this--over $50,000,000,000!

And commodities--you know the precious materials that REAL things are made off (gold, silver, copper, aluminum, oil, gas, coal, wheat, cotton, corn, soybeans, cotton, cocoa, coffee, sugar, beef, and more) hit a 13 year low. 

When the nothings of this world like a basic cab service become invaluable and the real things that power our homes, technology, transportation, and manufacturing become valueless--then we know a day of painful financial reckoning is coming. 

The markets can stand on their head for only so long before the blood rushes in and people become dizzy and see spots.

A reversion to the mean is the one something here that is inevitable, along with a pretty decent recession to boot. ;-)

(Source Photos: Andy Blumenthal)
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March 22, 2015

10 Reasons In Just 1 Week To Fear Government Breakdown

When I saw this in the store, I knew it was a true sign of the times, as they say. 

When the government that is supposed to sustain order and usher in social and economic progress is dysfunctional and broken, instead we have:


"Chaos, Panic, [and] Disorder"


Here's some news highlights from just this last week:


SPREADING BASE OF WORLDWIDE TERRORISM


1) ISIS murdered 137 and wounded over 300 in suicide bombings at mosques in Yemen.


2) Al Qaeda / Islamic State killed 23 mostly European tourists and injured over 50 at attack on the National Bardo Museum in Tunisia.


3) Iraq's battle to take back Tikrit from ISIS slows as ISIS continues to hold territory in Iraq and Syria larger than many countries--this after the last U.S. troops left Iraq in 2011. 


AGGRESSIVE POWER AND LAND GRABS:


4) Russia annexes South Ossetia from Georgia, just a year after annexing Crimea from Ukraine.


5) China starts up the Asian Infrastructure Investment Bank (AIIB) with support from key European Countries as well as Australia and South Korea, challenging American dominance via the International Monetary Fund (IMF)--this shortly after China surpasses America as the world largest economy.


PROLIFERATION OF WMD:


6) Iran says "Nuclear deal within reach," while their neighbors in the Middle East shutter and warn of impending nuclear arms race.


FORESAKING STALWART ALLIES AND MIDDLE EAST PEACE:


7) The Administration threatens to back United Nations against Israel, imposing a 2 state solution rather than a negotiated peace and security for the region. 


ECONOMIC MESS:


8) U.S. economic forecast by the Fed was downgraded to just 2.5%, despite years of near-zero interest rates that were supposed to spark growth, but instead has simply driven stocks into overdrive and set us up for another bursting of the financial bubble


HEALTHCARE SHAMBLES:


9) Upcoming Supreme Court decision on Obamacare could see 8 million people lose subsidies and ultimately their health insurance coverage.


ENVORNMENTAL CRISIS:


10) 2014 as the hottest year on record and 13 of the 14 hottest years are in the 21st century so far, this as even Chinese officials acknowledge looming fallout ahead in terms of climate change and disasters


If this is just one (more) week with the current breakdown of government,  those causing it all, as the sign states, can proclaim:


"My Work Here Is [Almost] Done."
 ;-)

(Source Photo: Andy Blumenthal)

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January 27, 2015

Trouble In Protection Land

The Secret Service is one of the finest agencies in the Federal government, but unfortunately, the "recreational" drone crash landing at the White House was a protection disaster this week.

(And it comes on the heels of knife-wielding assailants running wild through the front doors of the White House, people taking pot shots at the White House, and even planes crash landing there). 

This time it was perhaps, a small drone innocently passing low without a significant radar signature unto the White House grounds, but next time it may be a miniaturized drone the size of an insect that attacks the President or his senior staff in the White House itself. 

This could happen with a pin prick of poison or a small drone carrying explosives, biological, or chemical weapons. 

We are entering a new dimension of threats that are not easily addressed with existing technology. 

It is said the the President is proverbially protected by a bubble of defenses around him, but where we are going is that this bubble may need to become an actual physical bubble that nothing, not even an insect drone can get through. 

It may sound ridiculous, but it may be the only way (for now) to really protect against these threats that literally fly beneath our radar!

Perhaps at some future time, we will have our swarms of defensive drones that go after any attack drone, no matter how small or how many, but in the meantime, we must protect our critical leadership and assets. 

Almost two years ago, I blogged about robots, drones, and commandos in exoskeletons attacking the White House and our not being prepared with adequate defenses and counter-measures.

This week's drone crash should be making the alarm bells go off on this issue big time now!

We must move past reactive steps and a failure to anticipate and become true forward-thinkers, strategists, planners, enterprise architects, and futurists. 

The protection of our leaders, institutions, critical infrastructure, and people depend upon true out of the box thinking, not doing the same thing but on a different day. 

The time is now to think about protections from much more than traditional attack patterns to the wildest and craziest we can imagine--because our enemies are not hampered by the past and won't rest until they see what we won't. ;-)

(Source Photo: here with attribution to David Illig)
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January 12, 2015

Laser Defense Offense


Similar to the U.S.'s new laser defense being deployed aboard the USS Ponce in the Gulf, there is a promising new missile defense technology--"Iron Beam"--using lasers from Rafael in Israel. 

This augments Israel's "Iron Dome" anti-missile defense system using intercept missiles. 

Iron Beam functions with air defense radars and thermal camera tracking that identifies incoming targets and uses 2 lasers with 100's of kilowatts of directed energy to destroy the attacking projectiles with 90% success rate. 

For a more surgical, faster, and economically capable military--next up laser defense goes offense. 

It's got to, we've all seen the movie. ;-)
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August 19, 2014

Panic, Technology To Rescue

Who us panic?

- ISIS is threatening the West with "dangerous new extremism"

- Syria's death toll tops 170,000 with more than 10,000 believed tortured to death. 
- Boko Haram is still abducting young girls (and boys).
- Iran says no deal on nukes
- Ebola is "out of control."
- China is emergent as the U.S. pivots east and space becomes militarized with anti-satellite weapons. 
- Russia is resurgent (Crimea is history to Ukraine).
- The national deficit only hints at the true extent of our unfunded liabilities from entitelements.
- The economy is bubbling over the top again, warns Robert Shiller.
- Racial and income inequality continues to divide America (case in point, Ferguson MO).
- Nearly 1 in 3 American adults has an arrest record.
- Almost half the world--3 billion people--live in poverty on less then $2.50 a day. 

Ah, if only technology could solve all our global problems--and this is a big list and not by any means comprehensive.


It's a race of the "world is exploding all over" with technology trying to make it better with more and better information, innovation, productivity, security, and cures.


Almost like the war of good over evil--we may lose the battle, but hopefully (let's pray) in the end, we will win the war. ;-)


(Source Photo: Andy Blumenthal)

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January 21, 2014

Care To Be Curious?

Here's three topics for the curious of mind today:

- Are we technologically safer?  As we attempt to beef up IT security, we continue to be technologically insecure. Just this last week, BBC reported how a fridge was part of 100,000 devices used to send out 750,000 pieces of spam. Yes, a fridge, and there was also a television involved--sounds like the beginning of a bad joke, right? But this is our reality these days...Proofpoint, a cloud computing and security company said "Many of these devices are poorly protected at best, and consumers have virtually no way to detect or fix infections when they do occur."

- Is our economy healing or hurting? As unemployment fell from 7% to 6.7% last week--an impressive reduction--the overall labor force participation rate didn't rise, but rather sank to 62.8%--its lowest level in 35 years! And while, the Wall Street Journal explains that U.S. employment is simply not keeping up with population growth, the S&P 500 hit a new record high just last Wednesday. Meanwhile, the Fed continues to pour money into the economy, although at a slowing rate (expected to go down next week to only $65B a month), speculation is building whether we have another real bubble brewing, and this one of our own making, perhaps. 

- Is this the lead up to peace or war with Iran? As we continue to seek a long-term deal with Iran on their dangerous nuclear weapons foray, we read from Bret Stephens that Iranian President Rouhani said during his presidential campaign, "Saying 'Death to America" is easy...We need to express 'Death to America' with action." If we are getting a good deal that can truly lead to WMD disarmament of Iran, why did Rouhani tweet, "In #Geneva agreement world powers surrendered to Iranian nation's will." Curious, whether this is for political consumption in Iran or whether he sees the deal as just a stalling tactic leading to a breakout capability in nuclear weapons as well as a way to get some goodies in terms of sanctions relief for his country in the meantime.

What does little kitty cat say about these? ;-)

(Source Photo: Andy Blumenthal)
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