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Old 11-22-2018, 05:28 PM
Danny B Danny B is offline
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Join Date: Oct 2012
Location: L.A. Ca.
Posts: 4,736
Hussman, second part

"The best place to watch for cracks in this narrative is not valuations; they are already extreme, and are uninformative about near-term outcomes. Rather, it’s essential to monitor the uniformity of market internals across a wide range of individual securities "
"We’ve already observed deterioration in our key measures of market internals, but I would still characterize that deterioration as “early.”
"The upshot is this. At present, U.S. investors are under the delusion that the $37.3 trillion of paper wealth in their equity portfolios represents durable purchasing power. Unfortunately, as in 2000 and 2007, they are likely to observe an evaporation of this paper wealth. Nobody will “get” that wealth. It will simply vanish."
"That’s how market capitalization works. Over the completion of this market cycle, we estimate that between $19.8 and $24.2 trillion in paper “wealth” will evaporate into thin air."
Deflation with a capital D

"While our immediate market outlook remains only moderately negative, based on the still-early deterioration we observe in market internals, recognize that from a valuation perspective, we are now witnessing the single most offensive speculative extreme in history."
"the correlation with subsequent market returns by accounting for variation in the embedded profit margin. The current extreme exceeds both the 1929 and 2000 highs."

"Already, the available corporate surplus is being primarily driven into dividend payouts, share buybacks, and mergers and acquisitions, rather than real investment."
The money will never flow into wages while China , et al enforce a global wage ceiling.
"Real economic growth is the sum of two components: employment growth plus productivity growth. That means growth in the number of employed workers, plus growth in the level of output per-worker."
NO NO NO. It is the growth of assets that matter.
"The labor force component of structural growth is largely baked in the cake due to demographics, which in the absence of a substantial increase in the rate of immigration, leaves productivity growth as the main factor that could raise structural U.S. growth."
Bring in unskilled immigrants does nothing for increasing growth.

"It’s worth noting that U.S. economic growth has expanded at a rate of 2.1% annually in the 7-year period since 2010 (I’ve chosen a 7-year period to confine growth to the recent expansion, without including data from the global financial crisis). What’s remarkable about this is that nearly half of this growth is attributable to a decline in the U.S. unemployment rate"
Yeah, so, what happens to your projections when you cut out the BS and look at the true unemployment rate?

"If our policy makers are interested in boosting long-term structural U.S. GDP growth, they should be providing direct and targeted tax incentives for real investment, education, research & development, and other factors that could, over time, increase our nation’s productive capacity."
NO MENTION of the crashing birth rate. Maybe we can increase our productive capacity but, NOT our consumptive capacity.
Side note, 11/22 Why are young people having so little sex? – Atlantic


[B]The article goes on to talk about Bitcoin.
https://www.hussmanfunds.com/comment/mmc171218/
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