[Skybird]

Originally Posted by Catfish

Well we can thank Trump for it, and China. Trade war.

Regarding the german bonds and Money politics.. i do not like Krall, but he has a Point.

"Wenn schwarze Schwäne Junge kriegen":


The monetary crash as a result of the monetary policy of the ECB is such a black swan. The majority of the population and the elites do not see him ,or refuse to acknowledge that a 800-pound gorilla sits at the breakfast table.

The euro crisis is not the only black swan. In my book I have - without claim to completeness - identified four others. They concern our data security, where the arrival of the quantum computer will turn old certainties on the head, the end of the party system that has survived because the parties view the state as the prey to their corruption, the legal form of the corporation because it separates ownership and control and gave a managerial caste power over resources that it does not own but can exploit. The result is bureaucratized large corporations that are no longer entrepreneurial, who punish trial and error with the end of personal career, and who, on a small scale, engage in the same kind of bureaucratic sclerosis as the state on a large scale. But what they master excellently is the corruption-intriguing game of lobbying. In this way they become part of a machine that tries to undermine and suppress market forces because they can not survive otherwise.

Last but not least there lurks at least one big black swan in the form of geopolitics. It consists of the tandem of neo-Ottoman imperialism and an immigration policy that has long since left the border to idiocy behind. Its explosive power will be greater the longer we allow our failed elites to continue their false economic, monetary and security policies.





^ Reply he gave in some interview. Further:





There are no more ways to avoid the crash.

The number of zombie companies is likely to be so great that the volume of lending to them exceeds the equity of the European banking system. The earning power of the banks has been permanently destroyed because they were forced to lend long-term loans at low margins. So it will take a long time to grow out of this revenue anemia. This is the downside of the fact that it took a long time for it to become visible, because you could feed on old, long-term loans with high margins. Other reserves were also consumed and reversed to make institutions' balance sheets and income statements more enjoyable, such as provisions for credit losses. They have been lowered in the course of the decline of bankruptcies, which was only a saving of zombies, and thus profits shown, the substance of which has approximately the character of the profits, which flushed the toxic securitization until 2006 in the income statements of the banks.

However, there are ways to influence the strength of the crash and the speed of recovery. This requires an early strengthening of the equity capital of the banks so that they do not have to be saved from bankruptcy until the crisis. The sums you need after a collapse are three times as high. That's a difference.

Secondly, we need a bank restructuring law that allows for a 50% cost reduction without the double amount of annual savings immediately flowing into severance pay.

Third, we need a market-based 100-day program that would make our real economy more resilient.

But you can bet that nothing will happen. Our political elite prefers to take the oath of blessing after the crash, rather than confessing its failure a few months earlier with the change of course.




And last:



The majority of economists live in a belief system that has won through the symbiosis of politics and chairs in recent decades. This is Keynesianism and its offshoots. Keynesianism provides for the politics of our day what the geocentric view of the world has done for the rulers in the sixteenth century. It provides a narrative that allows politics to raise bread and games, consumerism, to a state ideology. In Keynesianism, this consumerism carries the inconspicuous name "demand".

On the one hand, this theory building provides the foundation for the tax and redistribution state that politics wants because it can thus buy votes, and on the other hand it is fed by a grateful political class. The problem with this theory is that it proves itself again and again in the test of reality as false. This is especially noticeable in monetary policy. For more than 10 years, the ECB has been trying convincingly to generate inflation based on its models by inflating the central bank money stock like a condom in the quality test. With ever-decreasing interest rates, always new bond purchases, more and more panic. The models are provided with regularity with new pipes and valves, which appear to be only partially controllable by the computing power of modern computer. The motto is: "Ours is the firepower, the printing press and the computing power". A few quarters later, you can see that reality has not kept up with the model and is building a new variant.

On the other hand, the representatives of the Austrian School, a minority, are cut off from the fleshpots of the university enterprise of state planning and favoritism. There are the instruments for explaining the disaster for decades before. But because it is always only a minority, to whom the scientific search for truth means more than hanging on the state teat, this group too is small.

But it does not bother me. Because with regard to the reality and the dispute over their explanation applies a word from Ayn Rand: "One is free to ignore the reality. One is free to free one's mind of any focus and to stumble blindly down every path one desires. But one is not free to avoid the abyss that one refuses to see. "