January 24, 2022

If Jeremy Grantham is talking about a US 'superbubble', we should listen

The Boston-based fund manager has hard-to-deny evidence to back up his prediction of a ‘wild rumpus’

https://www.theguardian.com/business/nils-pratley-on-finance/2022/jan/24/if-jeremy-grantham-is-talking-about-a-us-superbubble-we-should-listen

Jeremy Grantham’s warning that share prices are heading for a mighty fall is just part of the new year financial calendar, say his critics. On this occasion, however, the British co-founder of Boston-based fund manager GMO and highly regarded observer of stock market bubbles, may have got his timing spot-on.

Certainly “Let the Wild Rumpus Begin” was a terrific title for Grantham’s piece last week: a rumpus is roughly what we’re seeing, at least if one looks at the US, where the technology-heavy Nasdaq has lost 16% since the start of January. It was clobbered so severely on Monday that even the UK’s FTSE 100 index, a decidedly non-tech collection of stocks, was obliged to react to the apparent shift in investor sentiment. The Footsie lost 187 points, or 2.6%, even if a possible Russian invasion of Ukraine was also in the mix.

Grantham’s thesis is that US stocks are in a “superbubble”, an upgrade on last year’s diagnosis of “an epic bubble”, and that the US has seen only three other such extreme events in the past 100 years – the Wall Street crash of 1929, the turn-of-the-millennium dotcom mania and the housing market madness of 2006.

He ran through his checklist of a late-stage bubble, of which “the most important and hardest to define” is “the touchy-feely characteristic of crazy investor behaviour”. On that score, he has hard-to-dispute examples: the meme stock merriness of a year ago; dogecoin, a parody cryptocurrency, rising to a value of $90bn “because Elon Musk kept joking about it”; and shares in car hire firm Hertz soaring because the company said it would order some Teslas.

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LET THE WILD RUMPUS BEGIN

(Approaching the End of) The First U.S. Bubble Extravaganza: Housing, Equities, Bonds, and Commodities

https://www.gmo.com/europe/research-library/let-the-wild-rumpus-begin/

By Jeremy Grantham

Executive Summary

All 2-sigma equity bubbles in developed countries have broken back to trend. But before they did, a handful went on to become superbubbles of 3-sigma or greater: in the U.S. in 1929 and 2000 and in Japan in 1989. There were also superbubbles in housing in the U.S. in 2006 and Japan in 1989. All five of these superbubbles corrected all the way back to trend with much greater and longer pain than average. Today in the U.S. we are in the fourth superbubble of the last hundred years. Previous equity superbubbles had a series of distinct features that individually are rare and collectively are unique to these events. In each case, these shared characteristics have already occurred in this cycle. The checklist for a superbubble running through its phases is now complete and the wild rumpus can begin at any time.

Introduction

In a bubble, no one wants to hear the bear case. It is the worst kind of party-pooping. For bubbles, especially superbubbles where we are now, are often the most exhilarating financial experiences of a lifetime. I participated in a wonderful micro-cap fireworks display from 1968 to 1969, in which I made a small fortune (7 times the then full cost of a year at business school). My main stock, American Raceways, tripled while I was on vacation – $7 to $21 – then went to $100 by Christmas, only to lose it all even quicker by the following June, as almost all the fireworks exploded and crashed. This taught me a lesson, and it helped make me cautious. The experience also makes it easy for me to sympathize with the view that bearish advice in bubbles always comes from old fogeys who “just don’t get it,” because I received that old fogey advice back then and just didn’t listen. I doubt speculators in the current bubble will listen to me now; but giving this advice is my job and possibly the right thing to do. So, once more unto the breach, dear friends.

This time last year it looked like we might have a standard bubble with resulting standard pain for the economy. But during the year, the bubble advanced to the category of superbubble, one of only three in modern times in U.S. equities, and the potential pain has increased accordingly. Even more dangerously for all of us, the equity bubble, which last year was already accompanied by extreme low interest rates and high bond prices, has now been joined by a bubble in housing and an incipient bubble in commodities.

One of the main reasons I deplore superbubbles – and resent the Fed and other financial authorities for allowing and facilitating them – is the underrecognized damage that bubbles cause as they deflate and mark down our wealth. As bubbles form, they give us a ludicrously overstated view of our real wealth, which encourages us to spend accordingly. Then, as bubbles break, they crush most of those dreams and accelerate the negative economic forces on the way down. To allow bubbles, let alone help them along, is simply bad economic policy.

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January 24, 2022

Trump should have been 'vaporized' the moment he announced he won: Ann Coulter

https://www.rawstory.com/ann-coulter-donald-trump/



In an email to New York Times columnist Michelle Cottle, conservative gadfly Ann Coulter ramped up her attack on Donald Trump and dragged the former president's daughter and son-in-law into the fight. Before that she claimed the best thing that could have happened for the GOP would have been for Trump to have been "vaporized" after he was first elected.

Last week, Coulter made waves with a full-throated attack on Trump in a column where she wrote, "No one wants Trump. He’s fading faster than Sarah Palin did — and she was second place on a losing presidential ticket.” Not content to stop there, she responded to a request for additional comment from Cottle by going off on the president for damaging the Republican Party.

“Trump accomplished everything he was ever going to accomplish at 2 a.m.” [on election night in 2016] the columnist reported. “The best thing that could have happened to the Republican Party (and the country) would have been for him to be vaporized at the moment he was announcing his victory. Pence would have been afraid to betray Trump’s supporters. Trump wasn’t!”

Continuing in that vein, she attempted to make the case for Florida Gov Ron DeSantis to be the new face of the Republican Party, writing, "DeSantis is better than Trump, for many, many reasons, including: He won’t bring Jared and Ivanka into the White House.” She then added that she thinks the Florida Republican can dash Trump's hopes of re-election, writing, "He’s mostly just ignoring the 11-year-old. Unlike Trump, DeSantis has a day job.”

You can read more here.

January 23, 2022

Wait for it...

https://twitter.com/RexChapman/status/1485045564773384196

January 23, 2022

Omicron BA.2's running riot here in Sweden. 16 of our friends & family have it, all in the last week

or so.

In addition, all 3 students I tutor have it, over half (11 and counting, 2 more just texted me) of the 18 students I teach a uni class for have it, all of my team of 10 people at my job except for me and 2 others have it. Some already had Omicron BA.1. Others had Delta, etc etc in the past.

Many I talked to directly confirm it is BA.2. So far only 2 that I know of are in the hospital (not ICU, thank fuck), and both of them are over 70 years old (the parents of a close friend (an American who has been in Sweden for almost 25 years now, originally from Hawai'i) who has a family of 4 (wife (Swedish), him + their 2 children, 6 and 8, all who also have it). Almost list above are were fully vaxxed (not sure on some of my students unless they told me, which many did), many were boostered.

I am literally starting to lose track there are so many.

Look at the national chart here (and thus doesn't include the last 3 days (plus other days that will be back-filled in as the tests come back).

https://experience.arcgis.com/experience/09f821667ce64bf7be6f9f87457ed9aa

This is for the entire pandemic, it is from Folkhälsomyndigheten (our national health service):



the last 4 months



Stay safe, cuz this may be the US in a few weeks.

January 23, 2022

Fun To Watch 1960s Teenage Baby Boomers Who DIDN'T Rebel

David Hoffman
744K subscribers

In this video I am presenting clips from the classic 1966 documentary Sixteen At Webster Groves. it was produced by filmmaker Arthur Barron who I was honored to work for on several of his films. Webster Groves is clearly not typical as its teenagers were upper-middle-class. Remember that about 40% of the huge baby boomer generation say that they participated in the activities of the 1960s. This video presents the views of a portion of the 60% who didn't participate and who essentially looked forward to living just like their parents did. I would not call them typical teenagers but they are certainly representative of a group who was just fine in the 1950s. It would certainly be fascinating to talk to these people today but unfortunately, I don't have the names of any of the people who participated in this film. Hopefully some will watch this clip and choose to comment.

January 23, 2022

New Covid variant spreading like wildfire across UK and Scandinavia: BA.2 'stealth' mutation

now half of all new coronavirus cases in Denmark and rapidly pushing Omicron aside

https://www.cityam.com/new-covid-variant-is-spreading-like-wildfire-in-scandinavia-ba-2-stealth-mutation-now-half-of-all-coronavirus-cases-in-denmark-and-rapidly-pushing-omicron-aside/



Various media across Scandinavia and the UK are reporting the emergence of a new Covid variant that is so infectious and spreading so fast that nearly half of all cases in Denmark are now the new mutation, named BA.2, with more than 400 confirmed infections across the UK. The new mutation has reportedly also popped up in Norway, Sweden, Singapore and India.

Reuters reports that UK health authorities are investigating 426 confirmed cases of BA.2 in Britain, while officials in Denmark said that just over 45 per cent of all new infections in the country are now the new variant. WHO representatives have rushed to Copenhagen to investigate BA.2, nicknamed ‘stealth Omicron’ in Danish media as the mutation seems to be pushing the Omicron variant aside fairly quickly. Professionals point out that there is still much we do not know about BA.2 as it has only been arounds for a very short time. So what do we know so far?

BA.2 outpacing Omicron

The World Health Organization (WHO) classifies Omicron as B.1, On December 23, the WHO reported that over 99 per cent of the cases it sequenced were BA.1. However, the rise of BA.2 in Denmark and elsewhere suggests that BA.2 may outcompete BA.1. The country’s new Covid infections have shot to record highs in recent weeks. Denmark recorded over 30,000 new cases per day this week, 10 times more cases than during peaks in previous waves.



BA.2 infection after Omicron seen in Norway

Anders Fomsgaard, who is chief physician and virus researcher at the Statens Serum Institut (SSI), told Danish media that a few cases have been seen in Norway where people who have been infected with Omicron have subsequently been infected with BA.2. He reportedly called it “remarkable” that Omicron and BA.2 have significant differences when it comes to immunity and infection.



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January 22, 2022

Arizona Sues to Stop Treasury From Recouping Relief Funds

Gov. Doug Ducey has been using federal pandemic aid to undermine school mask requirements, which Treasury said violated the law.

https://www.nytimes.com/2022/01/21/us/politics/arizona-sues-covid-masks.html



WASHINGTON — Gov. Doug Ducey of Arizona sued the Biden administration on Friday to block its efforts to claw back pandemic relief money that the state has been using to undercut mask requirements in schools.

The lawsuit is the latest legal fight between a Republican-led state and the Biden administration over how the $350 billion in state and local pandemic aid that Congress allocated last year can be used. It follows a series of warnings from the Treasury Department that Arizona could lose some of the $4.2 billion that it was awarded in the rescue package.

The funds in question relate to two education programs that Mr. Ducey, a Republican, established last year in response to mask requirements that some school districts in the state enacted. The state tried unsuccessfully to enact a law banning school mask mandates last year, but Mr. Ducey continues to oppose rules that require them.

The state has used federal money to help schools and students get around the mandates. A $163 million program, funded by federal relief money, provides up to $1,800 per pupil to public and charter schools but excludes schools that require masks. A separate $10 million program funds vouchers worth up to $7,000 to help poor families leave districts that require face coverings or impose other Covid-related “constraints.”

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January 22, 2022

The original Mercedes 300SL should have been a failure - Revelations with Jason Cammisa Ep. 18

The Mercedes W194 300SL racing car was a recipe for failure, using heavy components from the S-Class luxury car.

And yet, in the summer of 1952, it took to the podium in the Mille Miglia, Bern Grand Prix, Le Mans, the Nürburgring, and then, that fall, the Carrera Panamericana, humiliating Porsches and Ferraris and everything else.

The 300SL became a legend in just a few months.

Convinced there was nothing left to win, Mercedes killed off the racing program, and the 300SL was set to be relegated to the history books.

Except that the brilliant Max Hoffman knew a legend when he saw it, and convinced Mercedes to make a roadgoing version. The W198 300SL was a barely modified version of the race car, with an even nicer, "Bordello on Wheels" interior and even more horsepower — thanks to the world's first direct-injected gasoline engine.

The 300SL's swing-axle rear suspension came straight from the S-Class, but was tuned for oversteer at the input of the talented race-car drivers who could control it. For less-skilled drivers, the 300SL's handling was fearsome — but those who survived were treated to what was unquestionably the best-driving sports GT of the 1950s. And of all time.

Only Mercedes, a company whose tagline is "The Best of Nothing" could start out with all the wrong parts and turn nothing into the best.

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January 22, 2022

A Viral Photo Helps Bring Syrian Refugee Family to Italy

A Syrian family portrayed in an award-winning photo has come to Italy for treatment and better lives.

https://www.nytimes.com/2022/01/21/world/europe/syrian-refugee-family-italy.html



SIENA, Italy — The award-winning photograph — of a man who had lost a leg in a bomb attack in Syria, hoisting into the air his son, born without limbs, another casualty of the country’s civil war — went viral last year in Italy.

On Friday, Munzir El Nezzel, the man in the picture, and his son Mustafa arrived in Italy after a remarkable effort by the organizers of the Siena International Photo Awards, to bring them and their family from Turkey, where they had fled after Syria.

“We are coming, thank you,” the 6-year-old Mustafa said, smiling broadly, in a video message recorded before he and his family — father, mother and his two sisters ages 1 and 4 — boarded a plane in Ankara on Thursday to fly to Italy. “We love Italia,” he added.

The picture of Mustafa and his father, both with loving smiles, which was taken in January 2021 by the Turkish photographer Mehmet Aslan, and called “Hardship of Life,” was declared photo of the year at the Siena awards last year.

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January 22, 2022

Saudi-Led Airstrikes Kill Scores at a Prison in Yemen

Source: NYT

The strikes, which also knocked out the country’s internet, came after Iran-backed Houthi rebels attacked the U.A.E., a key partner in the Saudi-led coalition that has been fighting in Yemen for years.

CAIRO — The seven-year-old war in Yemen intensified again on Friday when airstrikes by the Saudi-led military coalition on northern Yemen killed at least 70 people and knocked out the entire country’s internet, according to international aid groups and the rebels who control the area.

Capping a week in which rebel drones struck as far away as Abu Dhabi and Saudi bombs rained down across rebel-held northern Yemen, the hostilities were fresh proof of the conflict’s obstinacy a year after President Biden took office vowing to bring the war — and one of the world’s worst humanitarian disasters — to an end.

After months of territorial gains by the Houthis, the Iran-backed rebels who control northern Yemen, forces backed by Saudi Arabia and the United Arab Emirates have managed to claw back some territory and shift the momentum of the war. Those offensives have snarled international efforts to push the two sides toward peace.

Read more: https://www.nytimes.com/2022/01/21/world/middleeast/yemen-saudi-arabia-airstrike.html