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We are on the Verge of Economic Catastrophe

Jimmy Higgins said:
The market is in denial. PPI up, import prices rising. CPI is going to be an issue and alongside with job numbers trending downward, the economic outlook feels bumpy. But the market just wants to pretend it isn't going to happen. The economy otherwise doesn't appear to be in bad shape which is in part why the market wants to stay up, but Trump is sabotaging it.
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Yeah. But they’re struggling to find their way forward. The data will start coming in soon and they can’t stop it at that point. Even if Trump tries to Manipulate the numbers he can’t stop companies from failing.
 
SLD said:
Even if Trump tries to Manipulate the numbers he can’t stop companies from failing.
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Yabut he’ll say they’re thriving and 70 million morons will believe him.

The PPI shot up about FORTY PERCENT in July over same year 2024. Market shrugs.
 
Jimmy Higgins said:
The market is in denial. PPI up, import prices rising. CPI is going to be an issue and alongside with job numbers trending downward, the economic outlook feels bumpy. But the market just wants to pretend it isn't going to happen. The economy otherwise doesn't appear to be in bad shape which is in part why the market wants to stay up, but Trump is sabotaging it.
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Market pundits seem to be pushing two main messages:

(1) A large portion of stock market gains are concentrated in a small number of giant tech firms, most notably NVIDIA which is now 12X the price it had January 2023. Meanwhile some venerable DJIA stocks like JNJ, PG, Nike, Honeywell and Disney are selling below their 2021 highs.

(2) Market valuations ARE irrationally high. BUT the pundits STILL recommend buying in this bull market! History has shown that "irrationally" high valuations can persist for years. (For example SPDR was 73 in December 1996 when Greenspan spoke of "irrational exuberance", but was DOUBLE that barely three years later.) Buy buy buy while the Bull is King, but keep one finger next to the SELL button and be ready to stomp on it when the inevitable crash eventually comes.
 
Elixir said:
SLD said:
Even if Trump tries to Manipulate the numbers he can’t stop companies from failing.
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Yabut he’ll say they’re thriving and 70 million morons will believe him.

The PPI shot up about FORTY PERCENT in July over same year 2024. Market shrugs.
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Do you have a cite? FRED offers no less than 40 data series for PPI components. I checked several and none showed anything remotely like that.
And
bls.gov said:
On an unadjusted basis, the [Producer Price I]ndex for final demand moved up 3.3 percent for the 12 months ended in July [2025].
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Savor this datum from BLS. It may be the last true fact they are permitted to publish.
 
Swammerdami said:
Market valuations ARE irrationally high. BUT the pundits STILL recommend buying in this bull market! History has shown that "irrationally" high valuations can persist for years. (For example SPDR was 73 in December 1996 when Greenspan spoke of "irrational exuberance", but was DOUBLE that barely three years later.) Buy buy buy while the Bull is King, but keep one finger next to the SELL button.
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I don’t know but would think that a boilerplate, moderately aggressive portfolio would be somewhere near the value that one could realize by selling at the time that a large “correction” becomes obvious in the next six months. I’m sticking with my November prediction.
There have been a few moments I’ve wanted to tell my broker to sellout completely but I have no bright ideas. It does seem odd that the speculative stocks I bought myself have kicked ass vs the brokerage account, and continue to do so as the markets “climb the wall of worry”.
My prediction - it will look ugly and be even uglier. GDP will have shit for growth, inflation will be in your face.
The Trump Regime toadies will claim 12% growth and zero inflation. All reliance by other Countries on “official US”economic data will vanish entirely, further devaluing the dollar vs other currencies.
Probably the recovery will be led by real estate, as Vulture Capitol swoops in to devour the wounded (at least it seems like that’s how it usually goes).
But AI will create a utopian paradise wherein people literally create their own universe, and there’s no reason to vote.
 
Swammerdami said:
Do you have a cite? FRED offers no less than 40 data series for PPI components. I checked several and none showed anything remotely like that.
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My bad! Can you scrub that post?
It was the “acceleration rate” not the absolute number of course. And just fresh good iiuc.
AI:
“A recent Reuters report indicates that food prices have jumped 40%, contributing significantly to overall goods price increases. This surge is largely driven by a 38.9% acceleration in the cost of fresh and dry vegetables, according to Reuters. The rise in vegetable prices is attributed to worker shortages on farms, stemming from recent government actions. Wholesale beef prices also saw a notable increase, rising 4.6%.
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In the old days, a run on the banks was usually the first tremor that signaled the start of a crash. This always started with long lines at the teller's window, all people wanting to withdraw as much as they could.

These days, with online banking and everyone's phone has internet access, there doesn't need to be a line at the bank to signal a bank run.

The same thing applies to the stock market. There's no longer any need to get your broker on the phone when selling becomes desperate. This drastically reduces the time allowed for the government and banks to intervene with hope of alleviating a stock market crash. When, not if, it hits, it's going to be faster than every before.
 
Not everyone is praising the stock market. Read the gifted article if you want.

https://www.nytimes.com/2025/08/15/...e_code=1.ek8.RMKE.4zVhFRDlejzs&smid=url-share

Stock markets regularly go to irrational extremes, and their volatility has caused economic hardship and financial pain. Now, jubilant investors are pushing our market to historic highs despite President Trump’s tariffs and tax and spending policies that will increase the level of unsustainable budget deficits.

No one can know for sure where the stock market will go next. But there are worrisome signs that investor optimism may have gotten out of hand. The recent exuberance of investors raises the question of whether they are making the same mistakes they made in the past — errors that could prove very costly down the line. If history is repeating itself, what can we do to protect our financial futures?

In the stock market bubble of the late 1990s, investors believed that the internet would usher in a golden period of extraordinary economic growth — until they didn’t, sparking a recession and a roughly 40 percent decline in the S&P 500 between 2000 and 2002. Less than a decade later, a housing bubble led to the worldwide financial crisis and the deepest recession since the 1930s. The S&P 500 lost roughly half its value. The financial wreckage to individuals’ retirement savings was so pervasive that some worried whether they ought to own equities at all.

This past spring, the stock market appeared to be in free fall as investors worried that Mr. Trump’s threatened tariffs, some almost as high as 150 percent, and future tax policy would crater the economy. The S&P 500 stock index dropped by about 12 percent in a single week following the April 2 “Liberation Day” tariff announcements.
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I've been trying to get Mr. Sohy to sell most of our stocks while we're up, other than the 2 that give good dividends. NVDA is even dropping again. This does remind me of the late 90s.
 
southernhybrid said:
Not everyone is praising the stock market. Read the gifted article if you want.

https://www.nytimes.com/2025/08/15/...e_code=1.ek8.RMKE.4zVhFRDlejzs&smid=url-share

Stock markets regularly go to irrational extremes, and their volatility has caused economic hardship and financial pain. Now, jubilant investors are pushing our market to historic highs despite President Trump’s tariffs and tax and spending policies that will increase the level of unsustainable budget deficits.

No one can know for sure where the stock market will go next. But there are worrisome signs that investor optimism may have gotten out of hand. The recent exuberance of investors raises the question of whether they are making the same mistakes they made in the past — errors that could prove very costly down the line. If history is repeating itself, what can we do to protect our financial futures?

In the stock market bubble of the late 1990s, investors believed that the internet would usher in a golden period of extraordinary economic growth — until they didn’t, sparking a recession and a roughly 40 percent decline in the S&P 500 between 2000 and 2002. Less than a decade later, a housing bubble led to the worldwide financial crisis and the deepest recession since the 1930s. The S&P 500 lost roughly half its value. The financial wreckage to individuals’ retirement savings was so pervasive that some worried whether they ought to own equities at all.

This past spring, the stock market appeared to be in free fall as investors worried that Mr. Trump’s threatened tariffs, some almost as high as 150 percent, and future tax policy would crater the economy. The S&P 500 stock index dropped by about 12 percent in a single week following the April 2 “Liberation Day” tariff announcements.
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I've been trying to get Mr. Sohy to sell most of our stocks while we're up, other than the 2 that give good dividends. NVDA is even dropping again. This does remind me of the late 90s.
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article (my emphasis) said:
In fact, an investor who bought a U.S. stock index fund the day after Alan Greenspan suggested that the stock market had “irrational exuberance” in December 1996 earned an average rate of return of almost 10 percent per year over the next 20 years, assuming they reinvested dividends. The lesson is clear. Market timing can ruin a well thought out investment plan. Just because the market is bipolar doesn’t mean you should be too.
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I invested in one company, took a bath with it for a while, and I'm about to be above the surface again... but I'm nervous about investing much more in it as we've got this inflation thing about to hit us a the tariffs are finally going to impact the economy both via inflation and higher costs. Granted, if the appeals court tells Trump to go *bleep* himself, then the worries evaporate, until they launch different tariffs with different justifications.
 
Shares jet upward when Fed Chairman suggests rate cut in September of 0.25% is possible and delusions in the market that people sell out of their 3% mortgages and drive the economy again.
 
An interesting article that can’t be ignored. Trump is living in lalaland. The question though is when will the price become due?

www.foreignaffairs.com

America’s Coming Crash

Will Washington’s debt addiction spark the next global crisis?
www.foreignaffairs.com www.foreignaffairs.com

This may be behind a paywall; but I think you can get a few articles for free. The gist is simple: our national debt is now about 100% of GDP and in the long run that is unsustainable and we are already seeing signs of debt fatigue. The consequences are going to be massive.

IMG_7995.webp

We will have some hard choices ahead, and we will need to find better ways to fund ourselves. I suspect they will issue a form of bitcoin as the article suggests. But it may not work.

In the meantime, Trump keeps projecting pie in the sky growth rates as the panacea to our national debt. What a fucking moron. We could be facing a serious economic collapse.
 
PCE edges up, near 3% (indicating inflation is remaining above the happy 2% line the Fed wants). Market thinks Fed will still cut the benchmark rate because they fear being fired and replaced by the dumbest economists Trump can find. So the market reacted kindly to the fact that inflation is needlessly above 2%.

ETA
...or maybe the market is falling.
 
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Well, Both Great Britain and France are talking about getting IMF bailout, otherwise economic catastrophe.
Germany is close too.
There are early signs of mass migration of brits to ..... Russia of all places.
 
robnisch said:
barbos said:
Well, Both Great Britain and France are talking about getting IMF bailout, otherwise economic catastrophe.
Germany is close too.
There are early signs of mass migration of brits to ..... Russia of all places.
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www.eui.eu

No return home: Russian emigration after the invasion with Emil Kamalov

A new report coauthored by Emil Kamalov, PhD researcher at the EUI, finds that many Russians who left after the 2022 invasion of Ukraine are not planning to r
www.eui.eu www.eui.eu
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How informative, "Many russians ....."
In reality, absolute majority who left, left because of the threat of mobilization. Considering that, there is no longer mobilization, many have returned, some stayed, because they found jobs abroad. In particular programmers, it is hard to remote from Russia because western companies banned working from Russia. So they kinda have to stay abroad.
And IT people are absolute majority among emigrants, and only small minority of them went to Western Europe, most went to border countries - Georgia, Serbia, Slovakia, Kazakhstan, Azerbaijan too (it was a mistake)
Lots of bloggers are stuck because they are under investigation for receiving money from foreign governments for their "critique" of Russian government.

As for brits and westerners in general moving to Russia (mostly to Moscow). They all say, that Moscow is clean, safe and cheaper than Europe. Also, there is no tiresome "progressive" BS. A lot of foreigners teach english and other languages in Moscow, people like to pay native speakers more for some reason. Economy wise it's no brainer.

GB economy is in extremely poor state. France is slightly better but both are applying for help from IMF. Third world countries usually get money from IMF.
 
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barbos said:
Well, Both Great Britain and France are talking about getting IMF bailout, otherwise economic catastrophe.
Germany is close too.
There are early signs of mass migration of brits to ..... Russia of all places.
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Yes, it's quick shocking and distrubing. A recent study showed that a shocking 37 British people have considered moving to Russia. That's what, about .00000000578% of 1% of their population!

eadaily.com

Dozens of British families are thinking about moving to Russia after Putin's decree: EADaily

EADaily, September 14th, 2024. In less than a month, 34 foreigners applied to the Russian Embassy in London and the Consulate General in Edinburgh for advice on the possible relocation to our country of people who share traditional values.
eadaily.com eadaily.com
 
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