Deflation contra hot-and-cold-economy

verfasst von netrader, 15.06.2003, 16:22

-->Anbei zunächst eine m.E. wichtige Passage aus Doug Nolands letztem creditbubblebulletin.

Man versucht offenbar, mit exzessivem Kreditwachstum die letzten hot spots der Ã-konomie zu pushen. Wohl denjenigen Staaten wie etwa den USA, denen hierfür noch der Immobilienmarkt zur Verfügung steht. Wo dies gelingt, kann die Deflation natürlich nicht um sich greifen.

Ob in Europa noch eine Immobilienblase mit Hilfe vergleichbarer Agenturen (GSEs = FNM, FRE) induziert werden kann, bleibt anzuwarten.

In Japan kann dies nicht mehr funktionieren. Welchen hot spot die Japaner pflegen können, wäre die interessante Frage. Eventuell die Bereiche Energie/Rüstung?

Persönlich interessiert mich mehr, wie man auf klar erkannten"hot spots" der immer fleckiger werdenden Weltwirtschaft mit Optionsaktien arbeiten kann. Optionsaktien sind bekanntlich vollwertige Aktien, die aber nicht irgendwelchen Derivativrisiken (Verfall, Aufgelder) unterliegen. IdR sind es kleinere Werte, die aber aufgrund ihrer Zugehörigkeit zu einem hot-spot-Markt exorbitante Wertsteigerungen vor sich haben. Es sind normalerweise auch Werte, in die man keine großen Beträge investiert. Als Beispiel, das sich inzwischen ausgezahlt hat, habe ich vor einigen Monaten die NGAS-Aktie (USA) hier gepostet.

Über Hinweise auf andere entsprechende Werte in möglicherweise noch im Keim befindlichen hot spots würde ich mich freuen. Goldminenwerte sind natürlich bekannt.

Viele Gruesse
netrader


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http://www.prudentbear.com/creditbubblebulletin.asp

Regarding GSE risk intermediation: The thinly-capitalized GSEs balloon exposure and use resulting boom-time experience to claim they will never suffer severe Credit losses. The GSEs have basically become the market, and the day they turn more cautious is the day the Bubble is in serious jeopardy. Unprecedented mortgage Credit growth has national prices levitated and many major localities in dangerous Bubbles. Any reduction in liquidity risks setting in motion a telecom- style bust.

Closely related is the issue of the Credit insurers. These thinly capitalized financial guarantors have written well over $1 trillion of insurance. But what would be the consequence - what impact on Credit Availability - if the insurers were to back away from writing new policies? I argue this is yet another Bubble; it only functions well during expansion.

We have nowadays a Hot and Cold Problem. There is no functioning thermostat to even the temperature throughout the economy. Speculative finance will feed over-heating in one area, while out of favor areas freeze.

We face extreme divergences in relative prices. ECB chief economist Otmar Issing made some pertinent comments recently when he stated that the issue today was not deflation but the divergence of relative prices inherent to Capitalistic systems. I would argue that our deranged Credit system is fostering extreme and destabilizing price divergences. A few examples include: Healthcare versus manufactured goods prices; Silicon Valley home prices compared to Dallas; natural gas versus computers. And there is the divergence between stagnant wage growth of goods-producing workers versus surging income for real estate agents and mortgage brokers.

We face Unrelenting Credit booms and Busts: The U.S. and global financial systems are anchorless and rudderless. I would argue that uncontrolled Credit systems cultivate price distortions that are malignant to Capitalistic economies. Free markets and the effective allocation of resources require a stable monetary regime. Here at home, the unstable U.S. financial system and economy are trapped in historic Mortgage Finance excess. To maintain this Bubble and the attendant Bubble economy will require enormous unrelenting Credit expansion. This inflation of financial claims portends a serious dollar problem.

I would argue that the Demise of King dollar changes “everything.” We will now face rising prices for our massive imports. There will be an ongoing inflationary bias in commodity prices, especially for energy and precious metals. The specter of endless U.S. Credit inflation - dollar debasement - has also set in motion significant speculative flows to non-dollar assets and markets. This dynamic has already played a crucial role in the collapse of global yields and risk premiums, evidenced by heightened Credit Availability for many economies including China, India, Brazil, and Russia.

I am not sure what it all means, but this is not “deflation.” In aggregate, we remain in a protracted period of enormous Credit and speculative excess, with ultra-easy Credit Availability for most individuals, companies, governments, economies, and certainly the global speculators. Moreover, this inflation is accelerating. We today face a Bubble crisis not a deflation problem. Could the bursting of these Bubbles end in a deflationary Credit collapse? Absolutely. But I want to make what I believe is an important point: While it may be possible to mitigate deflation risk with further monetary accommodation, there is absolutely no curing runaway Bubbles with only greater Credit and financial excess. It’s impossible, impossible, impossible. The Fed and The Inflationists are fighting a losing battle. They have not only misidentified the adversary, they are aggressively Arming the true Enemy.

This is truly a case of The Implausibility of Federal Reserve and Inflationists’ Ambitions. Additional money and Credit will not right previous wrongs. With current institutional and market structures, it is absolutely impossible to evenly disburse inflation throughout the economy. Today is not “The Way We Were,” with a stable monetary transmission mechanism and a functioning aggregate price level. “The Way It Is” operates with Dysfunctional Monetary Processes, severe structural economic imbalances, and Atypical Inflationary Manifestations. Additional stimulus is only further destabilizing.

First of all, more stimuli feed unsustainable asset inflation. It augments non- productive Credit creation, the inflation of dollar claims with little corresponding increase in true economic wealth. Additional inflation also creates erratic and unsustainable income growth throughout the economy. It fosters an unsustainable divergence between Credit expansion and the wealth-creating capacity of the real economy, intensifying already acute financial fragility. The point being, reflationist policies only exacerbate Bubbles and distortions, while further inflating the unserviceable debt held by our foreign creditors. As an economy, we are not adequately investing - and our domestic price structure makes it very difficult to compete globally. But we at some point will no longer enjoy the wonderful privilege of trading dollar financial claims for imported goods. We will need to trade goods for goods.

I believe we risk an Unfolding Dollar Debacle. The key analytical issue is the unrelenting and uncontrollable inflation of non-productive Credit - dubious dollar claims on the U.S. economy. This is the dollar debasement that will continue to weigh on our currency. And with the passing of King Dollar we face endless oversupply of new dollar claims in the face of waning global demand. The recent dollar speculative Bubble - with resulting artificial demand supporting the dollar in the face of ballooning supply - has now burst. But rather than adjusting to the new supply/demand dynamic, the Fed and U.S. financial sector are inflating the supply of dollar claims only more recklessly. These dynamics ensure a most serious dollar crisis.

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• Deflation contra hot-and-cold-economy - netrader, 15.06.2003, 16:22