SIDE BETS – CAUSE ALL SUPER CRASHES AND DEPRESSIONS:
What is new in the market. Answer. Nothing. Side bets add zero to economic capacity. Side bets are Structured Assets – now Electronic Transfer Funds or ETF’s – which are just “agreements” as are all securities. THE IMF WARNED IN THE PAST 30 DAYS THE ETF SPECULATED BUBBLE MAY BE A SYSTEMIC RISK TO THE ENTIRE WORLD ORDER. The agreement in this space is a side bet on which way something will go in price a pure bet a speculation win or loose – a side bet . One does not buy assets and invest in economic capacity and output. The market that does THAT the equity and the bond markets are trading at around 2.7 trillion annually or up a bit from 2008. The side bet market has gone from 800 billion in 1999 Dec to 440 Trillion at leverage that is unregulated and morally bankrupt facilitating the worst financial future crash in global history. Nothing like it ever. Why?
Because the G 100 have lost regulatory control over speculation. The public has no clue how the market works. Today the DNA pool at the top has lost sufficient intelligence to have drank the LSD that there IS IN FACT DISKLESS RISK. That digital tools and digital tactics can moderate speculative profit making on both sides – up and down – to the trading rope. Also the profits in the speculative sector – say 4.5 trillion dollar BLACKROCK has almost half their assets now in the casino – ETF trading as if that is safe and bed rock – it is not – it is SUPER HIGH RISK and the returns never offset the losses about to materialize – and that tribe is the largest lobby in all nations to preclude regulations to bridle in the horrible speculation taking place in the side bet market space – manipulating everything and a hidden tax on everything – so that a few fantastically wealthy tribe members can further and even more fantastically enrich themselves only. Is this the way to run the world rodeo? It is truly insane folks and the notion of RISKLESS RISK investing is also insane and should be a felony. It was in 1999. But the DNA of law makers gets dumber faster than the rest of us.
Think if Blackrock and tribe with 100 trillion under management invested in land – development – mining – environment – new fuels – new power grids – new technology – new factories – with the 50% of their funds now in SIDE BET ECONOMICS CASINO CAPITALISM and structured asset pools- WHAT WOULD WORLD GROWTH BE LIKE REALLY.
Unless the G 100 make side bets a FELONY world wide – as it was in 1999 – the entire world will suffer repeating past history in todays global DELATION SPIRAL – via SUPER CRASH and world wide depression. Know what – its almost here as the defaults on debt begin the dominoes of destruction to DISKLESS RISK THEORETICAL MODELING and the ETF market crashes locks up liquidity and entire trade just stops – no circulation and liquidity – not anywhere. POOF the system is gone just like the IMF and WORLD bank have been screaming about to regulators who compete versus cooperate. Is that insane? I think so.
As with the last SUPER CRASH no one has tables studies or deflation data on what takes place if all values crash and keep on crashing. I do. What happens is the system locks up locks down and liquidity is gone instantly and the entire system folds in panic contagion and banks simply go bankrupt. Nations go bankrupt. The world balances its books and goes bankrupt. No one can pay their bills and everyone starts over. This typically resets ultimately with world war.
This pattern never ever economically speaking changes. Why do we repeat failed modeling? Because the DNA at the top thinks THIS TIME they have out smarted gravity and basic laws of prudent economics. Plus the GREED. The GREED just creates what I call the global BLIND HERD. The Blind herd is mindless and chases the next competitive profit taking at zero social consideration for the value risk to the world economic whole. No one has tables or what IF games to figure – wait just a minute. What if deflation is unstoppable and what if this now happens as asset prices in all classes decline with no recovery for decades.What happens? THAT IS WHAT WE ARE TALKING ABOUT and DEFLATION is here – and they have lost trying to beat it down with 100 trillion in investment globally to no effect on inflation and growth NONE. In fact they have made it worse. A G 100 Global Economic Constitutional Congress is the ONLY Possible solution but they won’t even explore having one called into order. Without the LARGEST RE THINK OF GLOBAL FINANCIAL REGULATION the power of economics 101 will deflate economics and rebalance the accounts. THAT IS SANITY.
The theories are long strings of calculous that work in some conditions. There are more one conditions where those long strings of numbers do not work and we are coming now to those conditions specifically. Creating in fact by those same long strings of numbers. When you ask them WHAT IF they look at you as if you are from Mars because what IF has not happened since the last depression in 1929. and before than in 1907. But they did happen. And they did happen because of these same side bets.
For the lay person – when the side bet market is many times the real market of stake holder buy in that makes an economy work, what happens is you have:
- Casino capitalism – one persons software is working trading against another software
- The market is rigged by software side bet trading there is no real market value anymore
- There is no real market any more – it sank into the casino
- The leverage is so fantastic it can not sustain itself in the upward spiral
- Deflation takes hold globally and the entire whirl wind up collapses and everyone is blown to dust inside the crashes as there is no real economic pillar under the foundation – which was eaten away by decades of debt and speculation.
People get so upset when I forecast 50% drop in real estate prices ( at least ) and real unemployment in the USA of 40% and in other nations 60% within a global depression worse than any society has ever known. In the last depression the bulk of economic activity was production of hard goods and services. Today the bulk of the economy is service and soft goods that have no value in a depression – there is no recovery – no one has spare money for anything but life essentials.
The quality of life we have known since world WAR II – 50 years or so – is the only period of this level of global social rise in the history of the world. It is a tiny time capsule unforgiving for abuse and we have so abused the global opportunity. The result is that the world, lacking a G 100 Economic Constitution to reset speculation trade and economics globally – must move back to the future in the most challenging suffering for masses of people due to system abuse in mankind history. America will be like a third world. All nations will equally suffer from the elite class who abused their station and trust for blind herd greed economics in asset classes that are casino side bets and add no value to economics really. INSANE ECONOMICS. I think so.
Given the weapons of this next war one would expect the massive population reduction world war would bring to reset economics planet wide. Is this the way? It is certainly the INSANE Way and we are following it. Does that mean we are insane. I think so.
Berny Dohrmann – Thinking through the future for you – 440 trillion side bet dollars to 2.7 trillion real market dollars – is that insane. I think so.