May 31, 2013
New York City
About once or twice a month for the past few years, it’s been a steady ritual of mine to conduct a Google search for the words “all-time high” and “all-time low”.
The results provide an interesting big picture perspective on what’s happening in the world. A recent search returned the following results:
“Banks Net Income in 1Q Hits All-Time High of $40.3 Billion”
“US equity markets remain near all-time highs”
“NYSE Margin Debt Hit New Record, Surpasses 2007 Peak”
“Foreign holdings of U.S. debt at all-time high”
“Beef prices hit all-time high… and expected to rise.”
“Gasoline prices down slightly after hitting all-time high”
“Premiums for employer-sponsored health insurance reached an all-time high”
“Airline fees hit all-time high”
“Tuition debt reaches all-time high”
“Unpaid student loans reach all-time high in US”
“Junk bond yields near all-time lows”
“Number of self-employed hits all time low: Report”
“US consumer confidence near all-time high”
“French consumer confidence at an all-time low”
“European unemployment hits all-time high”
“European Bank cuts interest rate to all time low”
“China business optimism at all-time low”
“Asian gold demand to hit all-time quarterly high: World Gold Council”
The conclusions we can draw from these headlines seem rather obvious.
1. Inflation is here. It’s understated in official numbers, but from food to fuel to tuition and travel, prices are rising.
2. Such inflation is also fanning the flames of asset prices, both stocks and bonds. And it’s great for bank profits.
3. On the other side of the world, these trends are making Chinese manufacturers quite nervous. And Asia is reacting by stocking up on gold instead of paper currency.
4. Europeans get it too: these are not prosperous times.
5. People in the US don’t seem to get it at all. Despite so many warning signs, the paper currency rise in equities has blinded most folks to the house of cards reality that exists all around them.
Candidly, the data points to a rather dangerous forecast… that people will go to bed one night believing that everything is just fine. And then wake up the next morning like the Japanese– to a stock market crash. Or worse… like the Cypriots– to a full-blown crisis.
At least the headlines do show a bit of good news–
“CNBC viewership at all-time low”
“American Idol Season 12 Finale Hits Record Low”
Have a great weekend.