Bridgewater Co-CIO Prince Calls the End of the Boom-Bust Cycle

You know we’re getting close when you hear crap like this.

"stock prices have reached what looks like a permanently high plateau" Iriving Fisher 1929

"This Time it's different"

The last statement by Mr. Prince is the money line - "Interest rates are unusually low, and they are so intentionally". Fed reserve should be held accountable.

Be sure to save/download this video for later "It's all fine" compilation videos!

When you hear someone like this say the rules have changed, it's time to run.

Saving my boxes from Amazon so I can have a kickass fort when this all blows up!

"They can't ease"? What does Prince mean? THEY ARE EASING AND HAVE BEEN EASING FOR THE PAST DECADE, from a monetary and fiscal policy perspectives. Currently, it has just been enhanced, the deficit has increase from $400B at the end of Obama to $1 Trillion in this administration. The balance sheet of the Federal Reserve has not decreased in size and Chairman Powell has taken to fruition the several requests to continue easing. After they tightened in 2018 and generated a reduction in economic activity and most of all, a reduction in the value of assets, they eased again. When Prince says the "it is the end of the boom and bust cycle", it reminds us of the famous expression by Yale economist Irving Fisher in 1929 that "the stock market has reached a level of high permanent plateau". The rest is history. It also resembles the title of the Rogoff/Reinhart book, "This time is different". It never is, it is just a question of when the normal economic cycle will manifest again. Nobody knows when, but it will definitively occur.

"new paradigm" -> market top incoming!

This entire conversation is completely divorced from the "real economy" -- i.e. investing in and creating value adding, wealth creating products and services -- it is a discussion about the reality of capital investment: there is way too much money out there chasing diminishing opportunities for returns. The value of capital is falling, steadily -- it is harder and harder to get someone to pay a premium (a high return...) to take your capital and use it. Hmmm...why would this be? Why is there a dearth of good, high-return, wealth creating investment opportunities relative to the amount of capital chasing them? Answer: there are fewer and fewer buyers out there with money to buy new products and services. This is a direct result of the huge concentration of wealth at the top, with the vast majority of people financially poor, and living from paycheck to paycheck and on credit. If the wealthy capture almost all of the gains from growth and productivity -- i.e. have all the money -- then, well...no one else will have any money buy stuff, create demand, and drive returns to investments.

“Stock prices have reached what looks like a permanently high plateau"

Gordon Brown, the prime minister of the UK at the time, said exactly this in 2008

1929 part two. Coming soon.

He has many personality characteristics of Ray.

Who’s here in June 2020 at ATH?

"No more busts" April economic data: I'm about to end this man's entire career

Thank God! For the last 5 years I thought we were heading for a economic meltdown. I'm now going to spend big and increase my debt levels.🤤

Just wanted to come by and laugh at this.

Whew, glad we’re through that crisis....going back to bed now.

Hahaha, We're screwed. Make sure your tables and chairs are in an upright and locked position and your seatbelts are securely fastened, rough ride ahead.