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🔔 When is a bubble not a bubble?
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OMG!!! HYPERINFLATION IS COMING!!
Let's cover today's inflation data in tweets...
10 MINUTES UNTIL THE CPI REPORT THAT MAY OR MAY NOT CHANGE EVERYTHING FOR THE REST OF YOUR LIVES— Joe Weisenthal (@TheStalwart) April 13, 2021
10 minutes later...
All the numbers a little warmer than expected
CPI ex-food and energy rises 0.3% from last month vs. the 0.2% expected.
On a year over year basis, core is up 1.6% from last year vs. 1.5% expected.
And on a headline basis it's 2.6% vs. 2.5% expected.https://t.co/MWDPmQqme9— Joe Weisenthal (@TheStalwart) April 13, 2021
Over to HSBC's Brent Donnelly for the final word...
I want so badly for CPI to be exciting tomorrow but I have a feeling we will look through it like we ignored NFP and ISM. The Fed does not care about data until at least the September releases (in October) so there is no transmission from the data to policy right now.— Brent Donnelly (@donnelly_brent) April 13, 2021
He's right too...
If you see anyone trying to sell the hyperinflation narrative, send them this thread 👇👇👇👇
The Hyperinflation Hype
This excellent article was written back in 2012 by @ObsoleteDogma
It's as relevant today as it was back then
Because everyone's attention spans have shortened since, here are the key points (thread)
1/8 https://t.co/TEaM7n65ei— Macrodesiac (@macrodesiac_) March 3, 2021
China's Deleveraging continued... Behold this chart, thine eyes doth not deceive thee 👇
@macro_daily
Pimco have a decent summary of China's Credit Curtail and the implications, in a nutshell it's this:
The move is part of Chinese policymakers’ renewed focus on risk control, which reflects a belief that in order to sustain high quality growth, market discipline must be brought to bear on the weakest parts of the economy, including some state-owned enterprises, local government financing vehicles, and over-leveraged property developers
Covered the China Deleveraging yesterday, and then this cropped up...
Huarong is not an ordinary company. Rather it is a central government-administrated state-owned financial enterprise.
At the end of last century, the company was set up to dispose of the nonperforming assets of state-owned Industrial and Commercial Bank of China Ltd.
Since 2006, it gradually expanded into a financial holding company. Huarong’s biggest shareholder is the Ministry of Finance, which holds a 61.25% stake.
Huarong has grown its business mainly by obtaining financing with a state guarantee.
In July 2014, the company started issuing bonds overseas, the outstanding value of which is more than $23 billion.
All of which spooked investors, sending Huarong's dollar bonds sharply lower 👇
and credit default swaps are ticking higher...
Huarong is symbolic of China's problems and this one line tells 80% of the story...
Huarong has grown its business mainly by obtaining financing with a state guarantee
ACTUAL FOOTAGE of China's state-backed companies
Bitcoin's at all-time highs: My proprietary contrarian indicator suggests further upside ahead 👇
Q. When is a bubble not a bubble?
A. When 74% of people still think it's a bubble, (duh)
We've all seen this chart before....
The problem with these bubbly charts? They're a bit err... rigid which is odd because bubbles are more curved an...
Anyway, you can easily make the case that we've had the full bubble cycle once already...
👇👇👇
So where are we now?
Institutional investors are now involved in the market...
If Bitcoin is to turn into a bubble we'll need to see it at six figures on the back of a big FOMO mania first...
As Soros said
'...bubbles don’t grow out of thin air. They have a solid basis in reality, but reality as distorted by a misconception'
CoInBaSe GoInG PuBlIc Is ThE tOp
Not for me and not for Moffett Nathanson (a “next generation” independent sell-side research boutique that I definitely didn't have to google)
MOFFETT: Initiates $COIN at Buy with $600 target. Cites "strong unit economics, demonstrated profitability, and likely a long growth runway .. That said, .. not for the faint of heart, as the business – and the stock – will likely see dramatic, potentially protracted, swings."— Carl Quintanilla (@carlquintanilla) April 13, 2021
Flip that BofA sentiment around and THEN we can talk about a bubble...
🚀🚀🚀