Wrap

Rotation into value, especially energy characterized today.

• precious metals up, oil up, agricultural commodities mixed,
• dollar weak, but not very, 0.15% decline against Yen,
• bond yields trending, but 10Y still only at 1.62%,
• bitcoin taking a beating, down to $44K,
• NDX weak, MSFT, DIS and CRM all weak amongst the large cap.

Manzara weighs in on inflation expectations

I think half the things I read in the financial press and online these days are about inflation. Half the stuff says “Inflation is here, but it’s transitory.” Half the stuff says “Fed and Treasury policies cannot fail to spark inflation.” Obviously, both cannot be right.

I know that to make money, one has to focus on what will happen, not what should happen. And, one has to focus on what will happen in the short term, because it’s no good being right when we are all dead. It’s clear that there is “a lot of ruin in a nation.” It’s possible to imagine production being restructure, labour being re-trained, population being moved in a way that gets rid of the bottlenecks that give rise to rising labour costs for decades. The problem is political and practical. It’s hard to retrain coal miners to be Python coders. It’s hard to persuade parliaments that badly paid voters in areas of low housing costs to move to fill badly paid jobs in the centre of London.

Anyway, Manzara sees inflation on the horizon and he’s getting increasingly worried. Read more here.

Kevin Muir points out that Wall St. will be united in hating any sign of inflation picking up.

Cheerleading (yes, cheerleading) is operated by a monopolist, owned by Bain Capital

It’s almost impossible to make this shit up. Private equity is entirely about rollups.

Even the FT is taking the piss out of Elon now

Not actually in the paper edition, but it’s coming.

I don’t care about BTC, but I have a sneaky suspicion that if it keeps going down, it will take some more mainstream assets down with it. Sorry, this might be behind a paywall.

Nordea doesn’t believe in Oprahnomics

This note gives a balanced view about whether or not inflation is coming. For sure, it’s not obvious that it’s not slowing, but it’s not obvious that it’s going away either.

Thoughts

This TED talk is about the importance of trying to understand the other guy’s point of view. Julia Galef emphasizes the metaphor of a map, representing how our thoughts about the world map onto the actual world. It is superficially reassuring to close our mind to ideas that may undermine our cherished beliefs, but it is not a route to happiness. It is a pity that most people are more concerned about convincing us that their point of view is correct than detailing the weaknesses in their own arguments. Maybe it’s natural, as we may not have incentives which are perfectly aligned with those of our audience.

Delia Derbyshire

Poor old Delia. It’s quite unusually, still, for someone from a working class household to go up to Cambridge (or Oxford) and it can lead to unhappiness. It’s impossible to know why Delia took to drink, and ended up much less celebrated than she might have been. I think it would be interesting to find out, from a large scale study, how class origins impact the life experiences of Oxbridge graduates. As with any study of class, such an undertaking is likely to be beset with methodological difficulties.