Comments on: Peak collateral – a strange attraction

By: Roger G Lewis

Roger G Lewis — Thu, 10 Oct 2019 12:59:41 +0000

https://longhairedmusings.wordpress.com/2019/10/10/gfc2-peakcollateral-the-next-crisis-pausereplay-dejavu-golemxiv-grubstreetjornal-conquestofdough/

https://longhairedmusings.wordpress.com/2019/10/10/the-disloyal-rebranding-dissent-listening-to-brexit-and-the-mythology-of-money-the-melt-fund-mythology-melting-pot-carboncurrencyendgame-agenda21-agenda2030-nwo-newworldorder-scads/

How about dusting off that crystal Ball again David, I fancy a bit of a peak of what to short?

By: venbar

venbar — Tue, 28 May 2013 16:01:24 +0000

Very good commentary..but the question is on just one statement you made in the above blog.
“And this – the need for collateral – is the reason for the endless QE”.
Didn’t understand how QE – where central banks are buying assets – will help need for collateral ?

By: Golem XIV

Golem XIV — Tue, 28 May 2013 15:07:41 +0000

In reply to Ral.

Hello Raj,

Sorry not to reply sooner. I have been away and will be away again at the end of this week.

I think Steven Keen is one of the best minds looking at this whole problem. That is a really interesting article and puts the mis-match between economic theory and the non-linear world clearly.

Thanks for pointing it out. I hadn’t read it till you did.

I have given further thought to aspects of theory but since I am neither a good mathematician nor as good as Keen is on the economy I feel I should tread carefully.

By: Blackhawk

Blackhawk — Tue, 28 May 2013 13:51:16 +0000

Brilliant ramblings and the analogy makes perfect sense.
In my opinion, collateral is in asset that a majority of participants in the market assigns a certain value. This value could go up or down according to the level of participants’ trust in the respective asset. Now all the assets that entered the markets over long periods of time have built their trust and therefore their value on the oldest and most trusted asset on this planet, namely GOLD. This asset has been for more than 3000 years the point of reference in all market based systems and it proved to be the most enduring element, regarding material exchanges, in the collective unconscious.
The current crisis is about the melting of this trust at global level, trickling in an inverted pyramid fashion, trough all the asset classes, all the way down to gold.
What I see happening now, in my opinion, it is a war to remove from the collective mind the belief that gold represents the ultimate value and it is the instrument which measures people’s mistrust in all the other asset classes. For the elites any outcome of this war is favourable because the removal of gold would open the doors to a valuation based on thin air, and on the other hand, a failure would see a huge scramble from all other classes of assets to their base, namely gold, which is by the way held mainly by the same elites through their proxies governments and central banks.
It was just a thought that I considered worth sharing. If anyone has some feedback, I would warmly encourage sharing it here.

By: Ral

Ral — Tue, 28 May 2013 10:18:26 +0000

Peak collateral and strange attractors, an interesting combination

I am curious to find out if you have followed Prof Keen’s work eg here :
http://www.businessspectator.com.au/article/2013/1/14/resources-and-energy/blame-it-bad-weathermen

and whether you have given an further thought to analysis?

By: Golem XIV

Golem XIV — Mon, 20 May 2013 11:21:15 +0000

In reply to Eric. Thank you Eric. You are kind.

By: Eric

Eric — Mon, 20 May 2013 10:17:17 +0000

Hi,
It is only the second time i have read this blog. But what you have written so far is more intelligent that what i have ever read in the mainstream press here in switzerland or other places. Thank you very much. And i can handle your ramble, so don’t worry about it as long as you provide intelligent analysis.

By: GB

GB — Fri, 17 May 2013 15:53:37 +0000

In reply to 46Martman.

Re “rambling” reminded me of another rambler, David:

— “The commercial world is very frequently put into confusion by the bankruptcy of merchants who assumed the splendour of wealth only to obtain the privilege of trading with the stock of other men, and of contracting debts which nothing but lucky casualties could enable them to pay; until after having supported their appearance a while by tumultuary magnificence of boundless traffic, they sink at once, and drag down into poverty those whom their equipages had induced to trust them.” —Samuel Johnson: ‘The Rambler’ (a series of essays); January 7, 1752

Thank you for sharing your thoughts, David. They have been of value as I try to make sense about what has occurred and appears to be ongoing.

By: 46Martman

46Martman — Fri, 17 May 2013 08:04:23 +0000

I don’t think it a ramble David. I think it makes perfect sense.
This article in the Guardian http://www.guardian.co.uk/business/2013/mar/14/private-equity-financial-crisis-bank-of-england
Seems to highlight exactly the problems lack of collateral could have.
We are nowhere near the out of the woods position, the politicians would have us believe.
So as always I’ll keep coming back to read your rambles.
Because the offer me lucid explanations of the problems we face and our politicians refuse to address.

By: Golem XIV

Golem XIV — Wed, 15 May 2013 15:35:37 +0000

In reply to Chris. They did indeed send me a copy. I owe them a review. I am reading it. Though I got side-tracked by Hilary Mantel. What a writer!