1. Chicken Little is a 2005 American 3D computer-animated science fiction comedy film produced by Walt Disney. Chicken Little rings the school bell and warns everyone to run for their lives. This sends the whole town into a frenzied panic... (src: Wikipedia)
2. Last week a shock wave was detonated by Game Stop and wall street started to worry the aftershock may collapse some Gamma Hedge Funds and blowout the financial system just like the drama of LTCM ($126 billion in asset reduced to zero overnight) in 1998 when Bill Clinton was US President and Alan Greenspan was Fed's chairman.
3. Just like 1998, the history will repeat itself as the the financial system is flushed with liquidities and the Game Stop's Gamma Squeeze will only be a pinch of salt in the Pacific Ocean. Basically, economically Biden will bring American back to Clinton's good time :)
4. US is not in crisis mode but a victim of her own success. Big tech companies like Google, Amazon, Apple, Facebook, Microsoft, Tesla etc dominated the world and this is the true reason why Fed's printing machine will not be able to devalue US currency. However, a strong US currency will crowd out other industries like Boeing or Ford as a strong currency will make their products expensive to oversea buyers and also a strong US currency will make it cheaper to buy consumer goods produced in China.
5. Next financial crisis will come from European Union and the scale could be unprecedentedly large.
2. Last week a shock wave was detonated by Game Stop and wall street started to worry the aftershock may collapse some Gamma Hedge Funds and blowout the financial system just like the drama of LTCM ($126 billion in asset reduced to zero overnight) in 1998 when Bill Clinton was US President and Alan Greenspan was Fed's chairman.
3. Just like 1998, the history will repeat itself as the the financial system is flushed with liquidities and the Game Stop's Gamma Squeeze will only be a pinch of salt in the Pacific Ocean. Basically, economically Biden will bring American back to Clinton's good time :)
4. US is not in crisis mode but a victim of her own success. Big tech companies like Google, Amazon, Apple, Facebook, Microsoft, Tesla etc dominated the world and this is the true reason why Fed's printing machine will not be able to devalue US currency. However, a strong US currency will crowd out other industries like Boeing or Ford as a strong currency will make their products expensive to oversea buyers and also a strong US currency will make it cheaper to buy consumer goods produced in China.
5. Next financial crisis will come from European Union and the scale could be unprecedentedly large.
Note
6. Textbook said the more money is printed, the lower the value of the currency but in real world it is more complicated than that. When the USD is printed, most of them will go to stock market or cryptocurrency or even venture capital. The higher the value of stocks or Bitcoin, the more the inflow of money to US so it becomes a self fulfilling cycle. 7. Trump said US economic problem is caused China but the actual fact is more complicated than that. See how much money Apple's iPhone is making for the country? With a strong USD most US companies will setup production oversea or else it will make no economic sense. With the drama of Game Stop, US government will wake up to the fact those big tech companies are the one in control of the US economy.
Note
8. In other words, Wall Street and US capital market are highly efficient and most of the new money printed are invested in productive sectors. Dotcom bubble was an exceptional case but this bubble also produced world class companies like Google and Facebook so we can have good bubble and bad bubble. Whether Bitcoin is bubble or not I am sure it's impact will be a far reaching one and must be considered as a good bubble eventually :)Note
9. It is true that endlessly printing money will create bubble but never in any textbook has mentioned there can be constructive bubble and destructive bubble. The creation of dotcom bubble actually strengthen US economy so we can say it is constructive bubble as it produced many world class tech companies. The creation of property bubble obviously is a bad one so we can say this is destructive bubble as it produced no positive future value. 10. Most people worry about inflation but the whole world including US just like Japan and most Asian countries actually entered a highly deflationary system due to the advancement of technology and breakdown in global communication barrier. Technology will create highly efficient green energy and crash the oil price to rock bottom and maybe one day electricity will be a free utility just like sunlight :)
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.