***** denotes well-worth reading in full at source (even if excerpted extensively here)
Economic and Market Fare:
Analysts have picked apart a string of hot reports on economic growth, the labor market and inflation
Kolanovic: 1970s and Risk of a Second Wave, Elections and Markets, Positioning, via TheBondBeat
.... We believe Investors should be open-minded that there is a scenario in which rates need to stay higher for longer, and the Fed may need to tighten financial conditions. The ~25% stock market rally since October was predicated on a repricing of the Fed (from cutting only 2 times in 2024, to cutting ~7 times in January). While most of those incremental cuts are now priced out, the stock market did not correct at all. Volatility has been unusually low, and risk positioning has increased substantially over the past year (see below). Many investors pursue momentum strategies on a cross-asset basis (e.g. heavily overweight equity), or cross-sector momentum themes (such as long mag 7 and short Russell 2000). While momentum strategies most of times make money, reversion points can erase years or performance in short periods of time.
The Nasdaq 100 rallied 3.01% today and closed at a new all-time high.
The last time the index had a one-day gain of more than 3% to finish at an all-time high was...wait for it...3/22/2000.
March 2000 certainly wasn't a good day to suddenly turn bullish on the Nasdaq, but some context is in order.
While 3/22/2000 was the last time the Nasdaq 100 had a day like today, it actually had 22 similar days during a stretch from June 1998-March 2000, and it happened plenty of times during the index's entire 1990s run starting in 1991.
Bubble Fare:
The current situation with Nvidia and AI isn’t nearly as extreme as the dot-com era, but the prospect of cheaper money on Fed rate cuts could add fuel.
Quotes of the Week:
“As goes Nvidia, so goes the market,” said Kim Forrest, chief investment officer of Bokeh Capital Partners LLC. “It does confirm the narrative that AI is going to continue to be strong for the foreseeable future. This narrative supported the markets last year, why wouldn’t it do the same this year?”
Charts:
1:
The question remains whether a bullish broadening will lead to an outperformance of the “everything else” trade vs. the Mag 7. The jury is out on that one. Ultimately, relative performance comes down to relative earnings, as the chart shows. The rest of the world can be dirt… pic.twitter.com/nmnIakXb4c
— Jurrien Timmer (@TimmerFidelity) February 23, 2024
(not just) for the ESG crowd:
A ruthless dissector of unwarranted assumptions takes on environmental catastrophists and techno-optimists.
................................. Smil is a ruthless dissector of what he believes to be unwarranted assumptions, and not just those of eighteenth-century Anglo-Irish satirical novelists. The first book of his that I read, twenty years ago, was “Energy at the Crossroads,” published by the M.I.T. Press, in which he wrote that the power under the direct control of an affluent American household, including its vehicles, “would have been available only to a Roman latifundia owner of about 6,000 strong slaves, or to a nineteenth-century landlord employing 3,000 workers and 400 big draft horses.” He was making a characteristically vivid point about the impact of modern access to energy, most of it produced by burning fossil fuels. No one can doubt that twenty-first-century Americans’ lives are easier, healthier, longer, and more mobile than the lives of our ancestors, but Smil’s comparison makes it clear that most of us underestimate, by orders of magnitude, the scale of the energy transformations that have made our comforts possible.
More recently, Smil has written about ongoing efforts to address climate change, and about the feasibility of achieving “net zero” by 2050. In “How the World Really Works,” published in 2022, he writes that, in the first two decades of the twenty-first century, “despite extensive and expensive expansion of renewable energies, the share of fossil fuels in the world’s primary energy supply fell only marginally”—from eighty-six per cent to eighty-two per cent—and that, during the same period, global consumption of fossil fuels actually increased, by forty-five per cent. Those numbers surprise people whose sense of environmental progress is shaped by car commercials and by news stories about breakthroughs in solar panels, algae-based fuels, and organisms that turn carbon dioxide into stone. ............
Toward the end of “How the World Really Works,” he quotes a line, usually attributed to Descartes, that could serve as his own guiding principle: de omnibus dubitandum. Doubt everything. .............
Smil has written a great deal about renewable-energy technologies, and he has said that their implementation cannot continue to grow quickly enough to fully negate the global increase in over-all energy demand during the next two or three decades. Unrealistic expectations for such technologies, he has written, arise in part from inappropriate extrapolation from the extraordinarily fast and sustained evolution of solid-state electronics ..........
In the book’s preface, Smil writes that most growth processes—“of organisms, artifacts, or complex systems”—can be plotted on a so-called S-shaped, or sigmoid, growth curve, meaning that the rate of change increases slowly at first, then increases rapidly, then levels off. An error that humans make with similarly predictable regularity is to assume that the nearly vertical middle segment of an S-shaped curve can continue at that angle indefinitely (the price of Dutch tulips in the seventeenth century, the price of bitcoin in the twenty-first). One of his conclusions is that the steady, unceasing economic expansion that economists and politicians dream of is not sustainable, and that the relentless pursuit of growth is environmentally disastrous. Smil has often said that he doesn’t make forecasts—“a pathetically and inexorably ever-failing endeavor on any level,” he told me—but predictions of a kind are implicit in much of his work. In “Growth” ’s coda, he writes, “Continuous material growth, based on ever greater extraction of the Earth’s inorganic and organic resources and on increased degradation of the biosphere’s finite stocks and services, is impossible”—a principle that, in various forms, animates almost all his work ............
Smil wrote, “The problem is that rather than take a clear-eyed look at the enormous challenges of phasing out the fossil fuels that are the basis of modern industrial economies, we have ricocheted between catastrophism on one hand and the magical thinking of ‘techno-optimism’ on the other.” Smil has described himself as neither an optimist nor a pessimist, but merely as someone who presents “correct statistics and engineering realities.” Yet he also told me that “upholding rationality in an utterly mad world leads nowhere” and that he sees “no point in throwing more dry peas against the wall of ignorance and self-satisfied but grossly misinformed ‘greenness.’ ” .........
- ADNOC CEO Al-Jaber: the current trajectory of rapid energy demand growth is unsustainable.
- According to ADNOC CEO Al-Jaber, it is unlikely that global carbon reduction targets can be met unless the world cuts energy demand.
- Exxon Mobil sees global oil demand peaking in just a decade, though it has predicted that oil will remain the world’s most dominant form of primary energy by 2050.
worth checking out even if only for the pics:
Scientists who studied the region’s arid past warned this drought was coming. Thirst for growth won out. A Tyee special report.
The true cost of cleaning up mine pollution in B.C. is growing, an investigation by The Globe and Mail and The Narwhal has found. If disaster strikes, taxpayers could be stuck with covering the costs
Public Citizen’s comment on CFTC’s draft guidance on carbon credits is spot on.
Geopolitical Fare:
At this point in history the most effective way for westerners to fight the empire and build support for revolutionary change is to undermine public support for western status quo systems and institutions. One does this by using every means at their disposal to help people see that the power structures which rule over us don’t serve our interests, and that they are in fact profoundly evil and destructive.
It takes a flash of insight for a westerner to be able to really see the perniciousness of the US-centralized empire in all its blood-soaked glory. This is because westerners spend their entire lives marinating in empire propaganda from childhood, which has normalized and manufactured their consent for the murderous, exploitative and oppressive power structure we live under. The current status quo is all they’ve ever known, and the idea that something better might be possible is alien to them.
Teachers of spiritual enlightenment point students to the truth of their being in as many ways as possible in an effort to facilitate a flash of insight into reality. The reason they do that rather than saying the same words over and over again from day to day is because everyone’s mind is unique and ever-changing, and what knocks things home for one student one day will just be useless noise to another student who will later pop open at something completely different. The receptivity to insight varies from person to person.
Similarly, a westerner who’s been swimming in empire propaganda their whole life won’t have their moment of insight into the depraved nature of the empire until something lands for them that they are personally receptive to. ...
The difference between Republicans and Democrats is that if a Republican president were to back a genocide it would be an evil and unforgivable atrocity, whereas when a Democrat president backs a genocide it’s a minor foible that you’d better shut up about unless you want Trump to win. ...
The difference between Republicans and Democrats is that Republicans argue in support of wars, militarism, capitalism and oppression using right-wing language, whereas Democrats argue in support of wars, militarism, capitalism and oppression using left-wing language. .........
Welsh: The Level Of American Foreign Policy Incompetence
Sci Fare:
Is breathtaking. Brzezinski was Carter’s National Security Adviser. In 1997 he wrote, not long after the fall of USSR, that:
Potentially the most dangerous scenario would be a grand coalition of China, Russia and perhaps Iran, an ‘anti-hegemonic’ coalition, united not by ideology but by complementary grievances. . . . Averting this contingency . . . will require a display of US geostrategic skill on the western, eastern and southern perimeters of Eurasia simultaneously.” — Zbigniew Brzezinski
It’s sort of hard to do commentary on this, because of the jaw dropping, head-banging stupidity of it all.
I don’t like US foreign policy after WWII thru the late 60s, but it wasn’t brain-dead. Evil, often, but not stunningly stupid. Nixon was a terrible person, but his “opening of China” was smart and policy after him thru to Bush the Elder was, while not good, or smart, was at least not always stupid.
But since then American policy has been brain-dead. ......
American and Western elites in general aren’t suited to run lemonade stand, let alone countries or an Empire. ...
Sci Fare:
but only in those unfamiliar with math
Pics of the Week:
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