UK

This has nothing to do with US, but I think it is very interesting real time experiment with rates and inflation:) https://www.bloomberg.com/news/articles/2022-12-05/erdogan-s-fastest-inflation-is-set-for-first-fall-in-over-a-year?srnd=premium-europe

https://www.bloomberg.com/news/articles/2022-12-03/stock-strategist-is-bracing-for-5-inflation-for-the-next-decade?srnd=premium-europe Q: So they’ll get rid of that 2% target for now? A: Yes. And that wouldn’t be the worst thing in the world. And that’s my point. If you look back at the history of the 2% target, it’s a made-up number. It came from a press conference in New Zealand in the late eighties. There’s no scientific backing behind the 2%. If you look at the distribution of inflation and growth in the US, you’ll actually notice that growth has been actually faster -- real economic growth -- when inflation has been in the 4%-5% range. You can very well make the case that what really hurts is when you have inflation above 10%, or really unpredictable inflation, because this is when agents can’t plan for the future, investments don’t get made, people hoard stuff. But as long as you have stable, somewhat moderate inflation, whether it’s 2% or 4% or 5% doesn’t really change things. And I think that’s the way most Americans also feel -- most Americans don’t even know what the Fed does, they don’t know about the 2% inflation. They just think of inflation as whatever happened in the past. So that’s where the inflation expectation channel comes in. So the three factors that made it so easy for us to achieve that 2% inflation are gone -- cheap labor, cheap goods, cheap capital. So it would be a lot harder to get down to 2%. I mean, I’m sure we could, like, if Powell wanted to be Volcker and he gets the fed funds right to 10%, we get to 2%. But what’s the point? Why would you want to destroy the labor market?

I think, even on general level US housing does not look very overpriced or as scary as some other places. In the longer term, there is still healthy demand, favourable demographics, stronger economy. In the short term, some other also good and previously hot places, like Canada, Australia or Scandinavia and other EU cuntries looks much more overpriced and dangerous, especially markete with large part of variable rate mortgages. Then I think there is quite a big differences in US itself, with some places perhaps much more overpriced and maybe in biger risk to suffer from all this easy money bubble burst, residual WFH movement, unfavourable tax policies etc.

Thanks for the answer!

May I ask why are you selling Fairfax?

https://www.bloomberg.com/opinion/articles/2022-11-30/federal-reserve-s-chief-jawboner-powell-slows-down-to-let-data-do-the-talking?srnd=premium-europe&leadSource=uverify wall Speaking at a Brookings Institution event on Wednesday, Powell checked the shock and awe at the door and instead offered one of his most candid assessments yet of how little he knew about the path forward. Responding to a question about why the Fed hadn’t chosen a more aggressive path, he said: We’re in a position where the right thing to do is to move really quickly, as we have, and now slow down and get to that place where we think we need to be. And by the way, there’s high uncertainty around that. You know we have a broad set of thoughts about where that destination might be, but we could be wrong. It could be higher than that, it could even be lower than that. We’ll have to see. Seems like suggestion from Powell himself not to be so sure about either scenario anymore:)

https://www.bloomberg.com/news/articles/2022-11-28/us-housing-enters-deep-freeze-with-sellers-and-buyers-sidelined?srnd=premium-europe

https://www.reuters.com/world/russia-us-have-ways-manage-nuclear-risks-ria-cites-us-diplomat-2022-11-28/ "The United States has channels for managing risk with the Russian Federation, particularly nuclear risks and that was the purpose of CIA director Burns' meeting with his Russian counterpart," Rood said in a video on RIA's Telegram channel.

I am repeating myself, but I think at this point it is better not to stick to one of the scenarios (transitory or not) too strongly. There are valid arguments on both sides: labor costs is still increasing perhaps to much and it is a negative for inflation (however covid savings also are running out, so maybe bigger wages will only compensate for that?), while costs of goods/commodities and especially shelter are turning into obvious positives. But who knows for sure? And even if someone think he does I am afraid the world is too uncertain to deliver surely predicted outcomes. I turned over like 2/3 of my portfolio in the last 3 month, from very defensive and almost mostly shorter duration (value) to neutral on the defensiveness (+- fully invested) and ~50/50 on short (value) / long (growth), with no positions with large leverage in either bucket, and I think it is the best way to go for me at this point. Market as the whole is still really not cheap enough to become more aggressive, but it is also not to dangerously expensive I think and there are really good opportunities if you look at individual companies.

https://www.cnbc.com/2019/11/05/carrying-these-in-your-wallet-is-a-big-mistake-warns-fraud-expert-ex-con-artist-frank-abagnale.html

https://www.economist.com/the-americas/2022/11/27/president-joe-biden-starts-to-lift-sanctions-on-venezuela Venezuela sits on 18% of the world’s proven oil reserves, more than any other country. The war in Ukraine has made everyone more nervous about oil supplies, and therefore made the cost of isolating Venezuela seem higher. After decades of mismanagement Venezuela’s oil industry is too run-down to make much difference to global oil markets in the short term, but America and others are thinking about the long term.

https://apnews.com/article/russia-ukraine-europe-moscow-fa5db922708b22b212f546b2f84a7cfb “We must understand that the whole world is watching us. We are the largest state and when we do not have socks, shorts, doctors, intelligence, communications, or simply care for our children, questions arise that will be very difficult to answer,” he said.

https://www.bloomberg.com/news/articles/2022-11-27/china-covid-unrest-boils-over-as-citizens-defy-lockdown-efforts?srnd=premium-europe The widespread dissent has raised concern that the government may respond with a crackdown to stifle further protests. “I think a crackdown is predictable. I think that will happen,” said Link at the University of California. “The determination that a man like Xi Jinping has to fight back is ironclad. He'll go to the mat.”

Youtube is awesome:)

Yesterday I heard Oleksiy Arestovych interview on a radio and I understand that a lot of it was one sided and propaganda etc, but I think he also provided some interesting speculations about how this could end. So, as Xerxes suggest, he also sees a possible move by a "system", but is very skeptical, that the outcome of changing Putin would be any different and more likely even worse. So then he said the confidence in Russia's army and Putin is almost broken, but to end everything you have to break confidence in Russia itself and for that you have to make some more breakthroughs as in Kharkiv and better yet to take Crimea back. Then you would hope and watch for some regional fission in Russia itself. These were only speculations and for now all they want is, like no_free_lunch suggests, to Russian army from Ukraine (not negotiating until then) and the only thing they need for that is more western weapons arriving faster, because currently they are still delivered too slowly, forcing them to stop/accumulate before major moves ant allowing Russians to take a breath/regroup. And on possible use of tactical nuclear weapons, he said that Russians recently were informed very clearly about possible consequences of doing this, and said that one of them is that Putin himself then would become a target and therefore he thinks that he clearly got the message on this subject.

https://www.bloomberg.com/news/articles/2022-11-24/kremlin-faces-rising-ire-from-wives-mothers-of-mobilized-troops?srnd=premium-europe In a video appeal posted by Verstka on Nov. 9, the wife of one those mobilized said his company commander revealed that only about 30 out of 200 men had made it to safety after they came under fire in Luhansk, eastern Ukraine. In another video posted a day later by a group of 20 women on the Russian border with Ukraine, they vowed to go to the front line to recover their husbands and sons and brothers. “If they don’t come out and help us, we’ll go, including a pregnant girl,” one of them said, adding that their relatives were without body armor or helmets and dragging wounded comrades with them.

Try this version: https://youtu.be/aon40XWsRwU

https://www.bloomberg.com/news/articles/2022-11-24/china-regulator-s-new-buzzword-fuels-buying-spree-in-state-firms?leadSource=uverify wall A new term coined by China’s securities chief has investors debating whether it implies a premium for state-owned firms and companies better aligned with national goals. A “valuation system with Chinese characteristics” has become the latest buzzword, after China Securities Regulatory Commission Chairman Yi Huiman devised the term during a speech this week and proposed a new method of valuing state, private and foreign controlled firms.