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**Guest** · March 28, 2009, 03:04 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Very thought provoking idea. Tough and even unpleasant to deal with on a weekend! Because probably the majority of iTulipers are feeling quite comfortable now in defensive positions mostly outside of the markets - and such ideas create "weekend angst" as people have to again chew their fingernails wondering if their premises are rock solid.

It is healthy to repeatedly re-question all of ones adherences to the straight "one size fits all" iTulip positions. Real estate has years more downside. US equities have years more downside before any lasting resurgence.

These things are profoundly uncomfortable to have to re-question. There is comfort in having "made a decision long ago to stay out" and so one does not have to do any more soul searching. I continue to think we have a massive multi year bull market ready to kick off soon in the US indexes that will completely surprise all the most carefully thought out logic which iTulip has built to conclude that this cannot happen yet for several more years.

However, this POOM was iTulip's own thesis - we are merely talking about it's start date! If iTulip's poom in equities (alt energy!) arrives early, it will sneak in just like this - at a time when posts such as Nero3's above cause almost universal incredulity.

Meanwhile, Bart's work, Armstrong's work, David Bensimon's work, the 60 year commodity cycle postulated by multiple others (remember the commodities crash of 1948?) - all of these are pointing to a very important turn in multiple markets occurring in March-April-May-June of 2009. We are right in the cusp of it now, and what do we note? The complexion of the markets is changing. Nero3 is pointing out some highly subversive things to ponder here.

Some people here may feel a heightened sense of irritation at anyone posting theses run too insistently contrary to the iTulip script. This is a reaction of questionable value in a community which purports to be constantly re-challenging it's own premises.

The fact that very few people are takers for these notions Nero3 is putting down, should be reason enough to take note of the remarkable consensus of opinion here as to how this "must" play out. My expectation is that by this fall, the North American markets have taken on some degree of a persistently bullish tone - and my bet is also that if we get to that point, the majority of iTulipers will conveniently have forgotten that there was a nearly uniform disdain for this idea in the spring of 2009.

**nero3** · March 28, 2009, 03:43 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Originally posted by Lukester;87277

The fact that very few people are takers for these notions Nero3 is putting down, should be reason enough to take note of the [U

remarkable consensus of opinion here[/u] as to how this "must" play out. My expectation is that by this fall, the North American markets have taken on some degree of a persistently bullish tone - and my bet is also that if we get to that point, the majority of iTulipers will conveniently have forgotten that there was a nearly uniform disdain for this idea in the spring of 2009.

In grahams book, the intelligent investor, there is a list of stocks from 1971, that shows pretty much the price level back then. According to some graphs on this site, stocks appear more expensive now than in 1971, but anyone that opens that book, look at the stocks, compare those stocks, compare the data on those stocks that are around today, will see that stocks today are, or at least was at around 50 % off the 1971 level quoted in grahams book.

**ricket** · March 28, 2009, 04:06 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Originally posted by Lukester View Post

These things are profoundly uncomfortable to have to re-question. There is comfort in having "made a decision long ago to stay out" and so one does not have to do any more soul searching. I continue to think we have a massive multi year bull market ready to kick off soon in the US indexes that will completely surprise all the most carefully thought out logic which iTulip has built to conclude that this cannot happen yet for several more years.

However, this POOM was iTulip's own thesis - we are merely talking about it's start date! If iTulip's poom in equities (alt energy!) arrives early, it will sneak in just like this - at a time when posts such as Nero3's above cause almost universal incredulity.

Lukester, you seem to be of the mentality that just because it goes "against the grain" then it just might be right. You seem to conclude that just because you and nero are "outside the norm" here in the iTulip community, that that somehow means you have some sort of credibility (I'm not discounting your credibility in any way by this statement btw). All I'm saying is that you seem to think that the only reason the iTulip community thinks that it has an accurate forecast is because the mainstream media is telling us that everything is OK or that "this is it". I don't ascribe the truth of any thesis to the mere fact that someone says it's wrong. I credit the accuracy of a forecast when it actually proves to be correct.

Here's my analysis of our current situation, and this is what models my investment portfolio: The American public is being robbed of their future earnings by the leeching banksters who made alot of bad bets with other people's money (ie deposits, 401ks, etc) in a system that is highly susceptible to corruption, malsfeance, and cronyism (ie the FIRE economy). Until that system changes or goes bust, which it should do if true free market principles are adhered to, then the markets will be highly unpredictable to any non-insiders and any "rally" will be used as a way to deceive people back into the market only to allow it to crash again so that the banks can recover more of their lost assets and sell while equity prices are artificially high. I stay out of any investment that I do not have 100% control over or cannot trust that I will have 100% control over if outside entities somehow enact or lobby for corrupt legislation for seizing my assets without my permission.

We can only continue to "make money from having money" (economic rent) for so long and we must return to an industry and production based economy for any sustainable recovery to take place. To continue to attempt restarting the FIRE economy is to pretend that we can continue to *grow* our way out of this mess if we can only "finance" our way out of it instead of actually producing something of value. Any rally will be meaningless until the real problems in our economy are addressed (over-indebtedness, poor production capability and overcapacity, artificially high prices in real estate, etc). To believe that just because a certain amount of corporate bankruptcies have taken place and a few debts have been flushed from the system means that the other debts are now somehow sustainable...well that's just foolish. I'd rather miss the boat for getting rich than catch the train to being financially ruined.

**rjwjr** · March 28, 2009, 04:10 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Originally posted by Lukester View Post

Very thought provoking idea. Tough and even unpleasant to deal with on a weekend! Because probably the majority of iTulipers are feeling quite comfortable now in defensive positions mostly outside of the markets - and such ideas create "weekend angst" as people have to again chew their fingernails wondering if their premises are rock solid.

It is healthy to repeatedly re-question all of ones adherences to the straight "one size fits all" iTulip positions. Real estate has years more downside. US equities have years more downside before any lasting resurgence.

These things are profoundly uncomfortable to have to re-question. There is comfort in having "made a decision long ago to stay out" and so one does not have to do any more soul searching. I continue to think we have a massive multi year bull market ready to kick off soon in the US indexes that will completely surprise all the most carefully thought out logic which iTulip has built to conclude that this cannot happen yet for several more years.

However, this POOM was iTulip's own thesis - we are merely talking about it's start date! If iTulip's poom in equities (alt energy!) arrives early, it will sneak in just like this - at a time when posts such as Nero3's above cause almost universal incredulity.

Meanwhile, Bart's work, Armstrong's work, David Bensimon's work, the 60 year commodity cycle postulated by multiple others (remember the commodities crash of 1948?) - all of these are pointing to a very important turn in multiple markets occurring in March-April-May-June of 2009. We are right in the cusp of it now, and what do we note? The complexion of the markets is changing. Nero3 is pointing out some highly subversive things to ponder here.

Some people here may feel a heightened sense of irritation at anyone posting theses run too insistently contrary to the iTulip script. This is a reaction of questionable value in a community which purports to be constantly re-challenging it's own premises.

The fact that very few people are takers for these notions Nero3 is putting down, should be reason enough to take note of the remarkable consensus of opinion here as to how this "must" play out. My expectation is that by this fall, the North American markets have taken on some degree of a persistently bullish tone - and my bet is also that if we get to that point, the majority of iTulipers will conveniently have forgotten that there was a nearly uniform disdain for this idea in the spring of 2009.

Lukester,

I appreciate your contrarian point of view and, from the short time I have been on iTulip, I think you are wrong about the typical iTuliper being uncomfortable with questioning the popular wisdom and/or being a leming type community. In this sense, I think you are seeing a "majority conclusion" (defensive positions as you call them) that has been well though-out, researched, and discussed and confusing it with something along the lines of a brainless herd-mentality.

It is not a surprise that you may miss this distinction because, again from the short time I have been on this site, I have noticed your tendency to be somewhat of a romantic antagonist. What I mean by that is you seem to get a thrill out of taking the non-majority view and questioning the majority opinion. Nothing wrong with this, and it certainly doesn't make you a bad person, I just simply digest your opinion with that view in mind since you are almost exclusively contrarian/anti-majority.

As for your quasi-agreement with nero's position, I disagree with your minority opinion and will continue to place my trust in the prevailing defensive stance of the iTulip community. One of these days though, you will make a terrific contrarian call, then you can tell me "I told you so". Keep those posts coming.

**rjwjr** · March 28, 2009, 04:13 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Originally posted by ricket View Post

Lukester, you seem to be of the mentality that just because it goes "against the grain" then it just might be right. You seem to conclude that just because you and nero are "outside the norm" here in the iTulip community, that that somehow means you have some sort of credibility (I'm not discounting your credibility in any way by this statement btw). All I'm saying is that you seem to think that the only reason the iTulip community thinks that it has an accurate forecast is because the mainstream media is telling us that everything is OK or that "this is it". I don't ascribe the truth of any thesis to the mere fact that someone says it's wrong. I credit the accuracy of a forecast when it actually proves to be correct.

Here's my analysis of our current situation, and this is what models my investment portfolio: The American public is being robbed of their future earnings by the leeching banksters who made alot of bad bets with other people's money (ie deposits, 401ks, etc) in a system that is highly susceptible to corruption, malsfeance, and cronyism (ie the FIRE economy). Until that system changes or goes bust, which it should do if true free market principles are adhered to, then the markets will be highly unpredictable to any non-insiders and any "rally" will be used as a way to deceive people back into the market only to allow it to crash again so that the banks can recover more of their lost assets and sell while equity prices are artificially high. I stay out of any investment that I do not have 100% control over or cannot trust that I will have 100% control over if outside entities somehow enact or lobby for corrupt legislation for seizing my assets without my permission.

We can only continue to "make money from having money" (economic rent) for so long and we must return to an industry and production based economy for any sustainable recovery to take place. To continue to attempt restarting the FIRE economy is to pretend that we can continue to *grow* our way out of this mess if we can only "finance" our way out of it instead of actually producing something of value. Any rally will be meaningless until the real problems in our economy are addressed (over-indebtedness, poor production capability and overcapacity, artificially high prices in real estate, etc). To believe that just because a certain amount of corporate bankruptcies have taken place and a few debts have been flushed from the system means that the other debts are now somehow sustainable...well that's just foolish. I'd rather miss the boat for getting rich than catch the train to being financially ruined.

Wow, ricket and I were making almost the identical point at the identical time. Spooky.

**Guest** · March 28, 2009, 05:22 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Originally posted by ricket View Post

You seem to conclude that just because you and nero are "outside the norm" here in the iTulip community, that that somehow means you have some sort of credibility.

No. Just putting forward some alternate ideas, and noting that everyone else seems to be sitting uniformly on the other side of the boat. You know what is said about too many people sitting uniformly on one side of the boat, right?

Originally posted by ricket View Post

you seem to think that the only reason the iTulip community thinks that it has an accurate forecast is because the mainstream media is telling us that everything is OK or that "this is it"..

Absolutely not what I am saying. I'm not by any mean suggesting iTuliper's are influenced by the mainstream media. That is obviously not the case. As noted above, only noting that there is a very broad, maybe 90%++ consensus here as to the future of equities, the dollar and commodities on these pages, which denotes a certain complacency in the thesis risks setting in.

Originally posted by ricket View Post

The American public is being robbed of their future earnings by the leeching banksters who made alot of bad bets with other people's money (ie deposits, 401ks, etc) in a system that is highly susceptible to corruption, malsfeance, and cronyism (ie the FIRE economy). .

Of course this is true.

Originally posted by ricket View Post

markets will be highly unpredictable to any non-insiders and any "rally" will be used as a way to deceive people back into the market only to allow it to crash again so that the banks can recover more of their lost assets and sell while equity prices are artificially high.

The time compression of this collapse ranks (according to Gann Global's historic database) as the absolute # 1 decline in three centuries by **time compression** to date.

That, along with iTulip's own tracking already evidences that indexes have been acellerating towards their trendlines. At what point will we be finessing whether they overshoot or not? And that would be in a world of the most significant globalized quantitative easing in history.

It may be this market has some serious unfinished business to the downside but notice how you summarily discount the necessity for a raging "escape valve" to appear here in the not too distant future in the equities? This is plausible if only due to what's happening and scheduled to amplify with quantitative easing both here and worldwide. Or do you find the "eruption of a boil" in one stock market or another in this global environment to be completely implausible?

Throw in increasing potential for oil to summarily snap back to $80 in the blink of an eye, and you've just installed a powerful new cash earnings spigot in all the commodity producer nations. Oil price is the locomotive for all commodities pricing. The *direct* locomotive.

And why does the USD need to disintegrate visibly before the equities reflect it? The equities might anticipate the USD disintegration by several years, no?

Originally posted by ricket View Post

I stay out of any investment that I do not have 100% control over or cannot trust that I will have 100% control over if outside entities somehow enact or lobby for corrupt legislation for seizing my assets.

If you were truly adhering to this rule you'd be perpetually out of all markets.

Originally posted by ricket View Post

We can only continue to "make money from having money" (economic rent) for so long and we must return to an industry and production based economy for any sustainable recovery to take place. .

I've always been a skeptic here at iTulip of the notion that the US has "invented" the practice of institutionalized economic rent extraction. Someone correct me if I'm wrong, but doesn't a wave at half of history show massive economic rent has been extracted within a great number of societies? It's obviously advanced to diseased proportions within the US, but any wait for a majority abolition of this factor prior to rediscovering any economic vigor at all (this is a purist approach) maybe a long wait.

Please note "economic rent" is extracted to even a greater extent in some EU countries, and I'm not confining myself to the dysfunctional CLUB MED countries either. Or consider half the kleptocracies or autocracies of the world at an even more dysfunctional level - these are economic rent extractors, yet their GDP's historically continue to grow - even grow like beanstalks in some case.

Look across the past decade's explosion of global developing economies - half of them are egregious economic rent extractors in their own ways - money sluices into different directions, but the vitality sapping effect is not distinguishable from that in the US. What may be distinguishable, is the American propensity for wallowing in debt, while these other peoples are more fearful of the consequence. To chalk that all up to the bankers while assigning no responsibility to the people's ethos seems to me an unequal attribution.

How does this axiom survive the paradox these rapidily emerging economies with rabid rent extraction mechanisms of their own?

In the EU countries, a good portion of it is fed back into some public services, but in a highly dilute way even then. Their budgets creak and groan, but in a global resurgence they catch a little wind in their sails regardless. I think this "economic rent is why we have GDP complete collapse in the US" bandwagon here at iTulip is positively creaking with the load of people who subscribe to it in completely black and white unqualified terms.

I would not presume to question it's core validity, but it is at least subject to considerable flexing one way or the other, depending on things like unprecedented global quantitative easing, no? Not predicting an immediate a global cyclical upswing here (unless and until oil starts to rise seriously - which is a game changer) but the "obscene levels of economic rent" thingy sort of recedes once again into the second tier of concerns when the developing nations catch a strong wind from the reappearance of $150 oil, no?

Originally posted by ricket View Post

To continue to attempt restarting the FIRE economy is to pretend that we can continue to *grow* our way out of this mess if we can only "finance" our way out of it instead of actually producing something of value. .

Too parochial an argument Ricket ( constantly make the same error myself thinking about the value of things like gold at present.). How many S&P 500 US corporations derive a large part of their real revenue from international sales? Who suddenly is flush with cash again if oil decides to shoot back up to $80? Is oil's price a purely financial event?

The fact that so many people here insist that the entire stock market is moribund unless and until the US is back to full vigor - once again - seems to me to be suspiciously monolithic with regard to what may or may not permit an equities resurgence.

Seems to me the same proponents can then turn around and casually accept as self evident that in "other countries" afflicted by hyperinflation, regardless of their internal banana republic economic fundamentls, the stock markets squirt up every time. It must be 'different this time" for the US case, eh?

Originally posted by ricket View Post

Any rally will be meaningless until the real problems in our economy are addressed (over-indebtedness, poor production capability and overcapacity, artificially high prices in real estate, etc). .

Global economic growth may remain tethered to the US, but don't imagine that the global growth encountered in the past decade is an event stopped in it's tracks in perpetuity by the US boat. The global economy has some appointments with it's own future to keep - there are a lot of US businesses who have stepped out into those global markets - and most notably of all - what happens to the price of petroleum will have a huge effect upon the solvency of half the world's emerging nations.

I certainly defer to the great majority of iTulip thinking on almost all of the macro story - but I don't abdicate my right to discern one or two points where I think iTulip's thesis may be less than all encompassing. Why should any of us not wish to stray from the thesis here in fact quite regularly to test out other theories?

You might ask yourself this question - does the price of petroleum proceed from here entirely as a factor of the US dollar? Some viewpoints here will argue that it has, and it must in the future. Another question: does a sharply rising price of petroleum decouple a lot of nations gdp's from that of the US?

That last one is a notion that I have not read iTulip explore. Maybe they have and I have missed it. In that case I'll read their coverage with great interest. If soaring oil causes a chain reaction of global wealth redistribution, particularly in the absence of a gold standard anywhere, all of the John Steinbeck "Grapes of Wrath" miasma hanging over the viewpoints here at iTulip may find itself doing a rapid 180 degree turn not too far out from now.

Originally posted by ricket View Post

I'd rather miss the boat for getting rich than catch the train to being financially ruined.

Wouldn't we all?

**Guest** · March 28, 2009, 07:05 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Originally posted by rjwjr View Post

Keep those posts coming.

Thanks for that rjwr. Nice to get a repreive from the rebukes normally collected whenever I stray off the iTulip rational game plan, which admittedly is often. Nero3 has a lot of interesting ideas. Others may call them "provocative to a well thought out general consensus here" but that's essentially implying the same thing. "Different viewpoint on the question" essentially describes "interesting".

**Supercilious** · March 28, 2009, 07:40 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Originally posted by Lukester View Post

Meanwhile, Bart's work, Armstrong's work, David Bensimon's work, the 60 year commodity cycle postulated by multiple others (remember the commodities crash of 1948?) - all of these are pointing to a very important turn in multiple markets occurring in March-April-May-June of 2009. We are right in the cusp of it now, and what do we note? The complexion of the markets is changing.

You forgot to tell anything about the Fed's Hammer Drill Theory

I feel neglected

I got to same conclusion from a completely different point of view (although I believe we may get one or two more short term dips before the take off).

**Guest** · March 28, 2009, 08:00 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Hey let me take this opportunity to offer you a "new and improved" apology for lighting into you the other day. It got a little mean I guess. You are a fine addition to the iTulip zoo and menagerie (this animal farm would not be the same without the symbols-giraffe-dromedary) and I regret coming in there and hammering away at you.

So to commemorate that let me re-post the above with all the "appropriate" references:

Originally posted by $#* View Post

You forgot to tell anything about the Fed's Hammer Drill Theory

I feel neglected

I got to same conclusion from a completely different point of view (although I believe we may get one or two more short term dips before the take off).

Originally posted by Lukester View Post

Very thought provoking idea. Tough and even unpleasant to deal with on a weekend! Because probably the majority of iTulipers are feeling quite comfortable now in defensive positions mostly outside of the markets - and such ideas create "weekend angst" as people have to again chew their fingernails wondering if their premises are rock solid.

It is healthy to repeatedly re-question all of ones adherences to the straight "one size fits all" iTulip positions. Real estate has years more downside. US equities have years more downside before any lasting resurgence.

These things are profoundly uncomfortable to have to re-question. There is comfort in having "made a decision long ago to stay out" and so one does not have to do any more soul searching. I continue to think we have a massive multi year bull market ready to kick off soon in the US indexes that will completely surprise all the most carefully thought out logic which iTulip has built to conclude that this cannot happen yet for several more years.

However, this POOM was iTulip's own thesis - we are merely talking about it's start date! If iTulip's poom in equities (alt energy!) arrives early, it will sneak in just like this - at a time when posts such as Nero3's above cause almost universal incredulity.

Meanwhile, Bart's work, Armstrong's work, David Bensimon's work, the 60 year commodity cycle postulated by multiple others (remember the commodities crash of 1948?), and most of all, $#*'s ground breaking, audacious and recently patented "Fed-hammer-drill-theory" [ TM ], - all of these are pointing to a very important turn in multiple markets occurring in March-April-May-June of 2009. We are right in the cusp of it now, and what do we note? The complexion of the markets is changing. Nero3 is pointing out some highly subversive things to ponder here.

Some people here may feel a heightened sense of irritation at anyone posting theses run too insistently contrary to the iTulip script. This is a reaction of questionable value in a community which purports to be constantly re-challenging it's own premises.

The fact that very few people are takers for these notions Nero3 is putting down, should be reason enough to take note of the remarkable consensus of opinion here as to how this "must" play out. My expectation is that by this fall, the North American markets have taken on some degree of a persistently bullish tone - and my bet is also that if we get to that point, the majority of iTulipers will conveniently have forgotten that there was a nearly uniform disdain for this idea in the spring of 2009.

**Supercilious** · March 28, 2009, 08:28 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Originally posted by Lukester View Post

...and most of all, $#*'s ground breaking, audacious and recently patented "Fed-hammer-drill-theory" [ TM ]...

Ha ha ha ! this was a good one

I am $#* and I approve this message.

**GRG55** · March 28, 2009, 09:36 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Originally posted by $#* View Post

Ha ha ha ! this was a good one

I am $#* and I a approve this message.

Apparently no drill bits were harmed in the making of this infomercial...

**nero3** · March 29, 2009, 05:18 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Here is just one thing that I think many deflation believers ignore, that is: the market.

http://research.stlouisfed.org/fred2/series/DTP10J10

The TIPS market did signal deflation for a very short while, in the middle of the panic in November. I am confident that was a "false" reading, just as the reading when bear sterns collapsed in march was a false reading to, just in the other direction. The reading now, in tips, is pretty realistic I think, suggesting inflation going forward is now feared to be worse than what was the case as close as in 2007, before the credit crisis hit.

**Chomsky** · March 29, 2009, 05:48 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

You won't find too many deflationistas on this site.

**ThePythonicCow** · March 29, 2009, 06:01 PM

Re: Critism of http://www.calculatedriskblog.com and dshort.com

Originally posted by GRG55 View Post

Apparently no drill bits were harmed in the making of this infomercial...

I didn't realize oil guys worried about harming a few drill bits ;).

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