Thought Bubbles from the Deep

[DeepState]

I've been thinking how the themes and concepts in Orwell's '1984' are coming to be.

eg. Orwell's 2+2=5 as 'fake news'. Fake news has been shown to be many times more powerful and influential than the real thing. BS stories have huge click rates among the plebs and Twits.

Doublespeak = political correctness. There's also 'lifestyle correctness'. Are you living the lifestyle that the media says you should live?

Psychological manipulation by huge corporations such as Microsoft, Facebook, Google and Amazon and media outlets.

http://www.sparknotes.com/lit/1984/themes.html

Had a 'conversation' with my father-in-law this afternoon at the airport where he expressed his sense that Trump was a good guy who will learn on the job. He recommended I read "Making America Great Again". Two sons-in-law (me be being one) went bananas and had to be calmed by respective spouses as onlookers turned their heads to stare.

Nonetheless, trying to get an objective viewpoint and consider the other perspective, I duly bought and read the book. I am speechless. The guy is a raving narcissistic lunatic with no concept of truth or decency and an utter opportunist. I suppose that really is presidential material.

Meanwhile, we hear reports that the military are briefing their counterparts in the UK about the Korean situation. They are confident the intel and abilities are such that they can wipe out the missile threats with high confidence because they can account for all the warheads and their locations. I have this feint memory in my my about something 15 years ago, but I just can't place it. Perhaps we can argue that whilst Nth Korea does yet have an ICBM, they had the capability to produce one and that's enough to waltz on in with the 7th fleet.

Abe will get what he wants by acting militaristic which will shore up the votes and possibly help with inflation, maybe. Cleverly, Trump is pushing China to taking real action, with an alternative being their own refugee crisis. If there is hot conflict, who knows what the North actually has to respond with. I don't suppose you go from launching a pile of missiles as a show of force in Syria and move to restraint after ordering an attack fleet in to the region. My concern is that these actions have a strange way of creating complicated outcomes. On the other hand, perhaps we'll see a Berlin Wall moment in Korea and Trump will gain a mantle even more significant than Reagan did.

Mr Kum Jong Un, "Tear down this DMZ". My goodness, maybe my father-in-law might be right. This might just be one of those Catch-22 situations where you have to be nuts to actually succeed.

This really was a very special event. Always gets a chill out of me:

 

[Gringotts Bank]

The guy is a raving narcissistic lunatic with no concept of truth or decency and an utter opportunist. [/MEDIA]

I'd much prefer that lunatic (Trump, the devil you know) than NK's or China's lunatics in top spot. It's absolutely essential for the stability of the World that the US stays in the dominant position.

 

[McLovin]

Nonetheless, trying to get an objective viewpoint and consider the other perspective, I duly bought and read the book. I am speechless. The guy is a raving narcissistic lunatic with no concept of truth or decency and an utter opportunist. I suppose that really is presidential material.

He's been dragged pretty quickly back to the mainstream. Perhaps he's realising he's out of his depth (yes I realise the irony of such a statement). I guess he's realising the world isn't binary, and politics and diplomacy involves a few more working parts than deal or no deal.

IMO, what happens wrt NK in the next few months, it will be something along the lines of the Cuban missile crisis. NK gets assurance the US will not invade and in return China reigns in NK. As an aside, what's the lifespan of a carrier group if things got really hot? I'm guessing ten or so minutes.

 

[qldfrog]

IMO, what happens wrt NK in the next few months, it will be something along the lines of the Cuban missile crisis. NK gets assurance the US will not invade and in return China reigns in NK. As an aside, what's the lifespan of a carrier group if things got really hot? I'm guessing ten or so minutes.

Agree, I believe China will openly take charge there, and they may even be behind the rocket failure;
pity the NK rocket scientists being tortured right now...

 

[McLovin]

pity the NK rocket scientists being tortured right now...

Unlikely. They don't have enough to spare. If the DPRK was a genuine contender they wouldn't have spent 10 years trying to get a fairly simple bit of rocketry going. Those Taepodongs were supposed to be the game changer for them, but they've amounted to nothing and they still have NFI on how to strap something useful on the end of a missile. Self-evidently they are missing a Wernher Von Braun.

 

[Gringotts Bank]

http://www.news.com.au/finance/work...a/news-story/76bc26365c9cb3922d1ac088686a4b53

"If those in charge of our society - politicians, corporate executives, and owners of press and television - can dominate our ideas, they will be secure in their power. They will not need soldiers patrolling the streets. We will control ourselves". -- Howard Zinn, historian and author

 

[qldfrog]

Unlikely. They don't have enough to spare. If the DPRK was a genuine contender they wouldn't have spent 10 years trying to get a fairly simple bit of rocketry going. Those Taepodongs were supposed to be the game changer for them, but they've amounted to nothing and they still have NFI on how to strap something useful on the end of a missile. Self-evidently they are missing a Wernher Von Braun.

so some good news at last for the NK rocket scientists?

 

[qldfrog]

http://www.news.com.au/finance/work...a/news-story/76bc26365c9cb3922d1ac088686a4b53

"If those in charge of our society - politicians, corporate executives, and owners of press and television - can dominate our ideas, they will be secure in their power. They will not need soldiers patrolling the streets. We will control ourselves". -- Howard Zinn, historian and author

funny how I share this quote and scary how facts match theory when seen under that light.1984 should be , can I say should have been? universal mandatory reading.
Instead we got Koran or reality TV shows and our current world is the result.
I obviously bring in quite a few shortcuts there but..
Are we not now getting out of the original target of this thread? DS, up to you to bring us back in line.
Anyone thinking that Theresa May is preparing the way to can Brexit with the coming election?

 

[DeepState]

IMF Key risk scenario from a Trump Expansionary Fiscal Policy:

1. Spends more money to stimulate economy.
2. Mostly goes on consumption stuff, not on supply side enhancements.
3. Inflation gets lifted more than expected.
4. Interest rates rise faster than anticipated.
5. US Fiscal position deteriorates because of higher interest burden.
6. Long bonds rise as term premium normalises due to fiscal risks, USD climbs as a result
7. Finances of EM countries are stressed....

EM Growth suffers
EM loans get stressed....yadda yadda

 

[DeepState]

EDGE: Can you point out what yours is?

1. If I were to ask what your reason is to believe that you can take money out of the market, what would it be?

2. If I then asked, are you in a position to show proof of this, could you?

3. Whatever your response to 2. above, are you able to say who you are taking these returns from? [Not the name of the person, but a general set of market participants of some kind...like other tech traders or large retail investors and the like]

 

[qldfrog]

EDGE: Can you point out what yours is?

1. If I were to ask what your reason is to believe that you can take money out of the market, what would it be?

2. If I then asked, are you in a position to show proof of this, could you?

3. Whatever your response to 2. above, are you able to say who you are taking these returns from? [Not the name of the person, but a general set of market participants of some kind...like other tech traders or large retail investors and the like]

Thanks DS, highly personal answer here:
1. I have no edge, and the market is a wild beast not based on facts; I am an engineer by trade not a psychiatrist and i like numbers and facts; I have learnt my lessons..took a while and lost a lot
I started this year viewing my position on the market as an insurance premium: I am negative so invest some money that way: if a crash occurs, my real estate assets(Home, IP) and income will go down but counter balanced by gold/negative goes up shares
I also get a bit of cashflow in via some hybrids/bond dividends but i do not pretend having any edge there
2 I can show how I go screwed time and time again when i was "right" into macro conditions/events such as Trump victory and lost ultimately.
A recent example:
I put a negative (short $22 option on BHP) a little more than a month ago which expired -> 100% loss, yet I have no doubt that the billions lost here in qld after the cyclone , in Chile with the copper mine strike, and the fall of Iron Ore/Petrol will hit them hard...but people/market is slow
There is still no export of metcoal to talk of as of today, yet hardly anyone care...And BHP shares are still around 24AUD mark
So no edge.....Wish I had, and better timing.A lot of money out of the market now or moved in bonds/other investments

 

[DeepState]

As might have been expected, Trump's election by the disenfrachised white guy who used to have a good job and the 'Nasdaq Mums' (yes, it's a real demographic) has opened the chicken coop to the fox.

The latest tax proposals will just make the rich a whole lot richer. The efforts to hose down ObamaCare was going to leave a lot of vulnerable people without care.

Fortunately, the swamp, which has yet to be drained, is proving more difficult to overcome than he might have imagined. NAFTA is now fine and China is not a currency manipulator. This puts the Border Adjustment Tax in jeopardy. ObamaCare stays in place for now. The Laffer Curve arguments that the Federal Deficit coming from huge tax cuts will be repaid by an improbable boost to activity will be challenged by the various committees which review budget proposals.

Trump, if left to his own devices, would lead to more loss and more pain for many of those non-traditional Republican voters who voted for him. The practices that have lead to much frustration that many Americans feel towards Washington may well be the defence that these people may well be grateful for when looking in the rear view mirror.

It's incredible how these things twist around.

 

[OmegaTrader]

IMF Key risk scenario from a Trump Expansionary Fiscal Policy:

1. Spends more money to stimulate economy.
2. Mostly goes on consumption stuff, not on supply side enhancements.
3. Inflation gets lifted more than expected.
4. Interest rates rise faster than anticipated.
5. US Fiscal position deteriorates because of higher interest burden.
6. Long bonds rise as term premium normalises due to fiscal risks, USD climbs as a result
7. Finances of EM countries are stressed....

EM Growth suffers
EM loans get stressed....yadda yadda

It is a fait accompli that debt will increase. The real long term question is how the deleveraging goes.

I remember reading a book from the 1980s/1990s stating this.. But the debt is still going and going.

Eventually someone will go in the sovereign debt space.


The options of tax, inflation printing and forgiving debt will all hurt immensely.

Organic growth by technology and reforms is a long term and slow process.

I don't know what the US expenditure is comprised of however

Looking at Australia Ask this simple question.

What is the largest expense to the Australian budget?

http://www.abc.net.au/news/2016-05-...ng/breakdown/2017/social-security-and-welfare

1) Welfare

What is the largest subset of this expenditure??

????????

Uninformed people say aboriginals, dole bludgers.

NO

People don't always like this answer....

Look for yourself to see the truth.

The truth is justified by social conventions and people usually strategic methods to get the middle class welfare and the health benefits associated with that.

Aus has to be careful not to end up like other countries such as the US.

 

[DeepState]

Eventually someone will go in the sovereign debt space.

Of the major nations: Japan is right up there, with France and Italy not too far behind.

What is the largest expense to the Australian budget?

http://www.abc.net.au/news/2016-05-...ng/breakdown/2017/social-security-and-welfare

1) Welfare

What is the largest subset of this expenditure??

????????

Uninformed people say aboriginals, dole bludgers.

NO

People don't always like this answer....

Look for yourself to see the truth.

The truth is justified by social conventions and people usually strategic methods to get the middle class welfare and the health benefits associated with that.

Not quite sure what you are intimating, but here is the info:



With the Welfare part further expressed as:

 

[OmegaTrader]

Of the major nations: Japan is right up there, with France and Italy not too far behind.




Not quite sure what you are intimating, but here is the info:

View attachment 70887

With the Welfare part further expressed as:View attachment 70888

Largest = welfare



Largest= Assistance to the aged


Read between the lines.......

 

[DeepState]

Largest = welfare

View attachment 70892

Largest= Assistance to the aged


Read between the lines.......

Yeah, so...is that some sort of shocking revelation that social welfare in the form of aged pensions and related support, together with healthcare (which is disproportionately utilised by the very young and very much by the old as well), happen to be the biggest budget items and projected to grow for quite some time, and rather rapidly (see below), as the Western populations age and dependency ratios rise?

It's like this everywhere, so I am having a hard time reading between the lines to find something which is shocking.

Is there widespread fraud of 52 year olds falsifying their ID to appear as 60 year olds to get a pension?

Are there many people getting themselves a third parent to boost household income?

Whereas it may appear that government is increasingly captured by big business and the rich, creating a plutarchy, perhaps government is increasingly held hostage by old timers in a form of of a politically organised geriatarchy - The Geezers and Wheezers' Party? Instead of Robin Hood - stealing from the rich to give to the poor, or oligarchy - stealing from the poor and giving it to the rich...we have geriatarchy - stealing from the young to give to the old? These bloody baby boomers... and then defaulting on the next generation after propping up asset prices, leaving a wake of deflation and scorching the environment. That's after they've departed from economy???

Clearly the lines are too narrowly spaced for me to read-between. Would you mind actually stating what you have in mind?

 

[qldfrog]

Instead of Robin Hood - stealing from the rich to give to the poor, or oligarchy - stealing from the poor and giving it to the rich...we have geriatarchy - stealing from the young to give to the old?
View attachment 70898

An interesting fact not mentioned much obviously on our PC medias: in France, the people voting the most for the FN (far right party) are the youths!
While retirees and public servants enjoy indecent income levels and live happily in their villas away from the public estates housing sipping Beaujolais while praising the merits of migrations and blaming the evils of liberalism/FN/Trump/etc:
The below 30's have no jobs with 30% unemployment, no future, a national debt reaching for the roof and actually have to live with the great opportunities migration brings in the housing estates like crime, assaults and racism/sexism/discrimation.
I am afraid here as well we have this focus on the retirees sacrificing our future for short term electoral gain.Sad but common in the west and demography will not help

 

[OmegaTrader]

Yeah, so...is that some sort of shocking revelation that social welfare in the form of aged pensions and related support, together with healthcare (which is disproportionately utilised by the very young and very much by the old as well), happen to be the biggest budget items and projected to grow for quite some time, and rather rapidly (see below), as the Western populations age and dependency ratios rise?

It's like this everywhere, so I am having a hard time reading between the lines to find something which is shocking.

Is there widespread fraud of 52 year olds falsifying their ID to appear as 60 year olds to get a pension?

Are there many people getting themselves a third parent to boost household income?

Whereas it may appear that government is increasingly captured by big business and the rich, creating a plutarchy, perhaps government is increasingly held hostage by old timers in a form of of a politically organised geriatarchy - The Geezers and Wheezers' Party? Instead of Robin Hood - stealing from the rich to give to the poor, or oligarchy - stealing from the poor and giving it to the rich...we have geriatarchy - stealing from the young to give to the old? These bloody baby boomers... and then defaulting on the next generation after propping up asset prices, leaving a wake of deflation and scorching the environment. That's after they've departed from economy???

Clearly the lines are too narrowly spaced for me to read-between. Would you mind actually stating what you have in mind?

View attachment 70898

The basis of the argument is the accumulation of sovereign debt in Australia. I don't deny that there is corruption and a sense of the boy's club mentality, this is pervasive throughout all organisations that get in power and dominate society. Especially the burden of tax falling to income because of silly bugger played by companies and the current taxation structure.

I will present facts and let you decide if the current state of affairs is sustainable given taxation expectation in Australia, it is impossible to argue with qualitative points and entrenched social beliefs.

I could give dozens and dozens of colloquial examples of the entrenched social and financial entitlement and how people legally and strategically use the system. But that would not convince. The steps by the government are small and in the right direction but not catching up with the costs.

Below are some of the benefits pensioners get

1) A person can give away assets 5 years before pension age and pay no gift tax
2) A persons main house is exempt from an asset test. e a person can have a $1million, 2 million or even $20 million dollar house and still get a pension
3) A person can have $250,000 - $375,00 (couple) in assets and still get a full pension
4) The assets eventually will be passed tax free to children/ inheritance
5) All capital gains on the main residence house will be tax free
6) Pensioners will get practically free medical which is at exorbitant prices due to the medical cartel monopoly
7) A person can practically spend all of the retirement superannuation upon retirement age and then claim a pension

Please comment if you feel these points are incorrect and if not how/where the money will come from to continue to fund these benefits to people who have such levels of wealth.

We have to accept reality to change it. The current spending is unsustainable.

Back to qldfrog which explains part of the situation.

I am afraid here as well we have this focus on the retirees sacrificing our future for short term electoral gain.Sad but common in the west and demography will not help

 

[DeepState]

OK. Thanks (to both OT and QF). Just needed to know that you had in mind an 'unreasonable' favouring of the older generation as something of an unspoken, secret, injustice. It's not a secret. So why does it happen?

Your facts are not disputed from my perspective. These are indeed the benefits which accrue to the pensioners. Is it unreasonable?

There is no way for governments to fund the cost of healthcare and support for the aged if steps are not taken to correct the trajectory. That's not a secret. Health and welfare for the aged are always the biggest features of western federal budgets and the cause of the projections looking so dire. It is accepted. That is why I am puzzled that this issue, in these recent exchanges, are expressed as some sort of revelation that must not be said.

So, what should happen in your view? Should the elderly be starved? Forced to move in to cramped government hostels? Put in to work-for-the-pension schemes? Made to walk up stairs instead of get pushed on wheel-chairs?

Is it your contention that those who are asset rich but income poor should be means-tested for pension entitlements? I think that is a reasonable perspective. However, Australia has always placed a very high value on the sanctity of the personal home which is why it is exempt from tax and pension assets considerations. It is a shared value of our society. It is widely accepted that we should not have to move out of our homes when aged. The young will eventually become the old. So we all have an eye to our future as well when considering how to share the burden.

The sanctity of the home is not unique to Australia. Take a look at the US. In Australia, our mortgages are not tax deductible, for a start.

If assets are moved to alternative arrangements to reduce income in an illegitimate way, that's an issue. But this sort of thing goes on in all sorts of places. The tax transfers happening within superannuation. Negative gearing. Family trusts. Dividend imputation. Capital gains tax relief.....all involve transfers of some kind, particularly to the asset rich...and those who just retired tend to have the most assets on average.

So...what to do?

+ Encourage own savings. Compulsory Superannuation 1980s via Paul Keating and Hawke. Genius move.
+ Discourage pension reliance. It you are on a full pension, it's not a great life. Escalate below inflation to allow structural adjustment.
+ Delay retirement age
+ Introduce some element of asset testing
+ Limit public health care services to bare essentials and encourage private healthcare and insurance
+...

Notice how many of these are already in place or in train.

 

[OmegaTrader]

OK. Thanks (to both OT and QF). Just needed to know that you had in mind an 'unreasonable' favouring of the older generation as something of an unspoken, secret, injustice. It's not a secret. So why does it happen?

Your facts are not disputed from my perspective. These are indeed the benefits which accrue to the pensioners. Is it unreasonable?

There is no way for governments to fund the cost of healthcare and support for the aged if steps are not taken to correct the trajectory. That's not a secret. Health and welfare for the aged are always the biggest features of western federal budgets and the cause of the projections looking so dire. It is accepted. That is why I am puzzled that this issue, in these recent exchanges, are expressed as some sort of revelation that must not be said.

So, what should happen in your view? Should the elderly be starved? Forced to move in to cramped government hostels? Put in to work-for-the-pension schemes? Made to walk up stairs instead of get pushed on wheel-chairs?

Is it your contention that those who are asset rich but income poor should be means-tested for pension entitlements? I think that is a reasonable perspective. However, Australia has always placed a very high value on the sanctity of the personal home which is why it is exempt from tax and pension assets considerations. It is a shared value of our society. It is widely accepted that we should not have to move out of our homes when aged. The young will eventually become the old. So we all have an eye to our future as well when considering how to share the burden.

The sanctity of the home is not unique to Australia. Take a look at the US. In Australia, our mortgages are not tax deductible, for a start.

If assets are moved to alternative arrangements to reduce income in an illegitimate way, that's an issue. But this sort of thing goes on in all sorts of places. The tax transfers happening within superannuation. Negative gearing. Family trusts. Dividend imputation. Capital gains tax relief.....all involve transfers of some kind, particularly to the asset rich...and those who just retired tend to have the most assets on average.

So...what to do?

+ Encourage own savings. Compulsory Superannuation 1980s via Paul Keating and Hawke. Genius move.
+ Discourage pension reliance. It you are on a full pension, it's not a great life. Escalate below inflation to allow structural adjustment.
+ Delay retirement age
+ Introduce some element of asset testing
+ Limit public health care services to bare essentials and encourage private healthcare and insurance
+...

Notice how many of these are already in place or in train.

Most people in the street do not understand the issue. The budget issue is not politicians or labor or liberal or this or that. It is middle class welfare and people getting money they do not need. Boom time cannot occur perpetually.

Almost every person I talk to immediately attacks me on a personal level. They almost always use personal attacks. I will recall a conversation I had recently, verbatim of course. The mindset is pervasive amongst almost all generations young and old from my experience in talking about the issue.

Other person: Oh the budget is so bad -it is the government spending

Me: I agree the budget is getting worse. Do you realise what the largest expenditure?

Other person: Welfare and all of these bludgers and politicians.

Me: Yes welfare is the largest expenditure. Do you realise what the largest welfare expenditure is ?

Other person: Young people and the unemployed bludgers

Me: No the largest expense is pensioners

Other person: Waits... thinks about it. But they have worked all their life

Me: Standard point about main residence loop holes,gifting, tax concession and savings

Other person: Your a terrible person etc etc poor old people are struggling. Continued personal attacks.

I am glad you agree with some of the points I am making.

No one wants to tackle the issue that is destroying the budget. Middle class welfare.
The issue with gov spending is hardly ever income, most of the time it is spending.

Unfortunately even you have resorted to these qualitative arguments which I cannot argue against.

So, what should happen in your view? Should the elderly be starved? Forced to move in to cramped government hostels? Put in to work-for-the-pension schemes? Made to walk up stairs instead of get pushed on wheel-chairs?

The issue is about Middle class welfare, not people who have suffered a bad life, that is the outlier in Australia. A person with wealth should not be getting benefits full stop.

Legal tax transfers do not make it sustainable or reasonable. I reject that argument because it is legal and I can do it then therefore I should.

1) main residence not exempt or value limited
2) Stop gifting / tax gifting
3) Main residence not tax exempt
4) Super can't all be spent and then pension claimed
5) Wealth should be investigated to stop money disappearing before pension age
6) Assets limited further
7) Introduction of competition and regulation to help market failure and gouging in the medical sector


Remember the pension is a benefit meant for people who are struggling not people who have strategically placed the money by spending, gifting or in the main residence. People should support themselves not be having decent estates given tax free to their children.

If it is not stopped the buck will keep getting passed. We have to live in reality. Later generations will get hit because of the greed on people who already have money.

I am really disappointed in how selfish people are being by legally gaming the government.