Political Posts

[Blake Hampton]

Just now, Gregmal said:

Yea I don’t get it. It’s incredible the amount of people whom think this is going to lead to inflation. Staggering even. 

So you're saying Jamie Dimon, Warren Buffett, and Prem Watsa are all wrong then?

[Gregmal]

Just now, Blake Hampton said:

So you're saying Jamie Dimon, Warren Buffett, and Prem Watsa are all wrong then?

Appeal to authority. 
 

And yea. They’re probably wrong.

[73 Reds]

9 minutes ago, John Hjorth said:

lol :

 

Hmm, when the guy responsible for the drawdown tells you to buy......

[thepupil]

6 minutes ago, Gregmal said:

Yea I don’t get it. It’s incredible the amount of people whom think this is going to lead to inflation. Staggering even. 

 

I guess I'll put myself in the idiot camp. I believe this almost has to lead to a significant increase in the cost of many goods. That seems like inflation to me. Retailers must either raise prices or go out of business. they will praise prices. 

 

It can of course lead to deflation as the resulting excess in capacity from a seizing of global trade drastically slows down economic activity (too many goods chasing too few buyers)...this increases the burden of debt on levered producers and is what causes a deflationary depression. 

 

so on a 0 -12 month basis, I'd say its inflationary. as business default, people lose jobs, people default, I'd say it's likely to be deflationary.

 

that would be my naive way of viewing this policy and likley potential ramifications outside of significant (and very hopefully) changes to the current policy. 

 

what are your hypotheses and why do you think mine are "staggeringly" dumb? 

Edited April 9, 2025 by thepupil

[John Hjorth]

1 minute ago, Gregmal said:

Yea I don’t get it. It’s incredible the amount of people whom think this is going to lead to inflation. Staggering even. 

 

Yes, we all likely will have issues other than inflation to deal with, when the dust after all these chaotic events eventually has settled, - more of the same to come?

[Gregmal]

10 minutes ago, John Hjorth said:

lol :

 

I “think” I wanna die laughing, but honestly I have never seen anything like this and just don’t know what the proper response is. Pure circus 

[dwy000]

4 minutes ago, Blake Hampton said:

So you're saying Jamie Dimon, Warren Buffett, and Prem Watsa are all wrong then?

Theres no question it will lead to higher prices. Whether you want to qualify that as "inflation" because it's not the goods that are more expensive, it's the taxes on them, is somewhat semantic. The outcome is higher prices for consumers. 

[Blake Hampton]

1 minute ago, Gregmal said:

Appeal to authority. 
 

And yea. They’re probably wrong.

 

It's funny cause I was a pretty disruptive kid who used to get in trouble a lot. I don't appeal to authority; I appeal to those I perceive as brilliant.

 

They're not wrong; they're just early.

[Paarslaars]

Not sure about inflation but who cares, inflation isn't as bad as people make it out to be, at least not around these levels.

There are much worse things (recession, rise in unemployment and suicide rates, mortgage defaults, homelessness, bankruptcies, etc...) that can happen from an extreme tariff war that I would consider more concerning than a bit of inflation.

[Blake Hampton]

You guys aren't looking at the real problem here which is the Treasury market.

[gfp]

1 minute ago, Blake Hampton said:

You guys aren't looking at the real problem here which is the Treasury market.

 

For one day.  Real investors are glued to the ben watsa smoke show 

[rogermunibond]

Likely coming down and likewise overall market P/E 1 year from now

 

[Gregmal]

1 minute ago, Paarslaars said:

Not sure about inflation but who cares, inflation isn't as bad as people make it out to be, at least not around these levels.

There are much worse things (recession, rise in unemployment and suicide rates, mortgage defaults, homelessness, bankruptcies, etc...) that can happen from an extreme tariff war that I would consider more concerning than a bit of inflation.

Yup. If I take a product and raise prices and it sits on the shelf, people are free to call it inflation but the more realistic and actionable perspective is that I just cratered demand.

[thepupil]

Just now, Blake Hampton said:

You guys aren't looking at the real problem here which is the Treasury market.

 

I think it's quite early to conclude anything about a few days of volatility in the treasury market. This could simply be levered basis traders / other FI players unwinding and a "capital markets" event. maybe we'll get an LTCM or something and a fund or three or in a very bad scenario a bank will blow up.  that certainly won't be good but is a problem the fed knows how to deal with and has dealt with in the past. if a fixed income rel val fund loses all its LP's money, it doesn't really matter from an economic standpoint. 

 

 

 

[Gregmal]

Yup. That too. It’s another hallmark of hysteria. People knowingly or unknowingly posting conveniently abridged charts. Been seeing it a lot with treasuries this week.

[gfp]

BONDS CRATER!

 

 

[Sinbius]

European Union approves first set of retaliatory tariffs on U.S. imports

Edited April 9, 2025 by Sinbius

[dwy000]

9 minutes ago, Gregmal said:

Yup. If I take a product and raise prices and it sits on the shelf, people are free to call it inflation but the more realistic and actionable perspective is that I just cratered demand.

In a normal process the cratered demand would result in a lowering of prices.  Since the price increase is due to taxes, that's not possible.  

[rogermunibond]

4 minutes ago, dwy000 said:

In a normal process the cratered demand would result in a lowering of prices.  Since the price increase is due to taxes, that's not possible.  

 

Goods inflation is poised to increase, but you also have demand falling for sure. And as others have pointed out, energy cost is falling, OER/Rent is declining as well.

 

Services inflation likely falls from lower GDP, layoffs, UE rises, all help mitigate the labor cost of services.

 

So the net effect on inflation could be mixed.

 

[Luke]

28 minutes ago, Gregmal said:

Yea I don’t get it. It’s incredible the amount of people whom think this is going to lead to inflation. Staggering even. 

Sorry Greg but i really dont understand how you can stay in persistent denial.

17 minutes ago, Gregmal said:

Yup. If I take a product and raise prices and it sits on the shelf, people are free to call it inflation but the more realistic and actionable perspective is that I just cratered demand.

As @dwy000 said: In a normal process the cratered demand would result in a lowering of prices.  Since the price increase is due to taxes, that's not possible. Most businesses can and will not lower their margins by the amount of tariffs paid. 

9 minutes ago, Gregmal said:

Yup. That too. It’s another hallmark of hysteria. People knowingly or unknowingly posting conveniently abridged charts. Been seeing it a lot with treasuries this week.

Hysteria at the wrong place if China trade more than 2x expensive for import AND export from one day to the other and every other country between 10-60% more expensive to import AND now export...got it.

[Sinbius]

3 minutes ago, rogermunibond said:

 

Goods inflation is poised to increase, but you also have demand falling for sure. And as others have pointed out, energy cost is falling, OER/Rent is declining as well.

 

Services inflation likely falls from lower GDP, layoffs, UE rises, all help mitigate the labor cost of services.

 

So the net effect on inflation could be mixed.

 

 

stagflation

[Luke]

2 minutes ago, rogermunibond said:

Goods inflation is poised to increase, but you also have demand falling for sure. And as others have pointed out, energy cost is falling, OER/Rent is declining as well.

 

Services inflation likely falls from lower GDP, layoffs, UE rises, all help mitigate the labor cost of services.

 

So the net effect on inflation could be mixed.

 

Yeah, you will have inflation numbers and falling demand and falling exports. This will lead to a recession if it holds up for the next year. Fairfax looking good for corporate bond buying here frankly...

 

China should be alright, they were priced so low and will use a stimulus, i am continue to sit on china and fairfax.

[mcliu]

8 minutes ago, dwy000 said:

In a normal process the cratered demand would result in a lowering of prices.  Since the price increase is due to taxes, that's not possible.  

Why not?

Say you run a shop. You buy something for $2 and you sell it for $10 but because of tariffs it now costs $3 and you try to sell it for $11.

But you see that sales has slowed at $11. So what do you do? Keep it at $11 or cut it to $10.50 or back to $10?

[Luke]

Considering trump is a "debt is dangerous" guy, i bet he will be hesitant on stimulus too. This COULD turn out into a massive crash frankly which is why i am not buying now.

[Luke]

1 minute ago, mcliu said:

Why not?

Say you run a shop. You buy something for $2 and you sell it for $10 but because of tariffs it now costs $3 and you try to sell it for $11.

But you see that sales has slowed at $11. So what do you do? Keep it at $11 or cut it to $10.50 or back to $10?

Yeah and how does he make a living when margins implode?

Edited April 9, 2025 by Luke