Credit deflation and the reflation cycle to come (part 2)

[Bricormortis]

BofA ....more money has poured into stocks in past 5 months than over the last 12 years.

 

[geordie_lurch]

Cross posting this from @Long time lurking as like I have said multiple times in this thread I think it's vital to be aware of the Central Bank Digital Currencies (CBDCs) and how they could change our best laid plans...

 

[Harley]

6 minutes ago, sancho panza said:

Worlds average person is getting poorer

As the East-West rebalances and the elites take more of the pie.  Let them eat cake instead!  Fools, again!

[Harley]

2 minutes ago, Bricormortis said:

BofA ....more money has poured into stocks in past 5 months than over the last 12 years.

 

Steady, aim,........!

[Harley]

20 minutes ago, sancho panza said:

.....whether they have at least an inkling of what’s really happening and are simply nursing Micawber-like hopes that ‘something will turn up’. Based on the 2008-09 precedent, we can be pretty sure that the “soft default’ of inflation will play a starring role in the coming drama.  

They cannot know how much inflation they need AND our capacity to tolerate it.  This is the same elite technocratic cohort who have demonstrated total inability with covid (an alleged pandemic also run by models and their modellers).  Highly likely "something will turn up" instead, god help us!

[DurhamBorn]

1 hour ago, geordie_lurch said:

The following image from this Zerohedge article about a $1 display chip is causing supply chain chaos is a good overview of what the world is apparently short of even if it is USA focussed as it's from Goldman Sachs...

 

When i went back to work for 4 months until Feb we were having to shut lines down for running out of gaskets etc.Gaskets.30 years ago i could of phoned up dozens of companies in the North east and got them made.Not now.

Supply lines were based on price during dis-inflation,thats in reverse now.

China hoodwinked western governments.They funded loss making companies until they put all the western ones out of business.

West will re-tool and East will look to their own consumers.Energy the big winner.

[King Penda]

25 minutes ago, Bricormortis said:

BofA ....more money has poured into stocks in past 5 months than over the last 12 years.

 

Are you being serious 

[Harley]

30 minutes ago, sancho panza said:

Put another way, this means that each dollar of reported “growth” was accompanied by $3 of net new borrowing.   

Some were quoting this metric over ten years ago.  So even by the usual glacial standards, been going for a long time.  So pop soon or change the goalposts?

[Hancock]

23 minutes ago, DurhamBorn said:

China hoodwinked western governments.They funded loss making companies until they put all the western ones out of business.

Western politicians sold western people/companies down the river for a short term personal gain for themselves. In Africa its knows as corruption.

Our own leaders have done this, you only have to look at the number of ex MP's and the "Well to do" in the House of Frauds who are openly on the payroll of China.

You can include Boris in that, see his time as London Mayor where he was gifting easy money to Chinese property developers for a donation to the communist Tory party. 

https://www.channel4.com/news/boris-johnson-london-propery-deal-china-albert-dock

Just a Covid is not China's fault, along  with the fact our own govts have went full on "commie", neither is it China's fault that the UK/USA etc have sold its own people down the river for what are relatively small bribes.

 

[feed]

Well as we're on the future of money. 

Taken from an interview with Napier and i can’t get it out of my head.  Particularly with the authoritarian road our state is heading down.    

The problem with inflation and Friedman said this, is the taxation without legislation.
Be in no doubt what it’s supposed to do, it’s supposed to move money from one section of society to the other.
I don’t have a problem with that if you were to pass it through Congress, if you’re going to Congress and you get elected, lower house, upper house and President, and what you want to do is move money from one section of society to another, then, well, you may not like it if you’ve got the money but it’s all done legitimately through the political process.
This has to be done illegitimately.
That’s my main beef with MMT.
They want to do it secretly.
The problem is, as you say, Grant, that savers in modern times haven’t had to cope with this new form of taxation and they’re ill-equipped for it.
But be in no doubt that it actually benefits many people.
That’s why it’s a preferred policy.
That’s why softer monetary regimes are a product of democracy.
We shouldn’t forget that… I mean the Gold Standard ends roughly when we get democracy.
Until we don’t get the vote, we have the Gold Standard.
As soon as we can get the vote, we get rid of the Gold Standard.
I know a lot of people support the Gold Standard.
I don’t.
I prefer democracy, but I would think hard currency and democracy are probably ultimately incompatible.
That’s the reason we have moved to soft currencies to allow this form of wealth redistribution.
Savers do have to understand it more than anybody else.

I know this is more what happens after this cycle.  But it starts now, politically, it takes a decade to move populations.  
 

[Fully Detached]

The Greek has gone for a Burton. What will they try and bury in the coming days? (Apart from him, obviously)

[Harley]

1 hour ago, sancho panza said:

Next crisis will question the validity of money.

This article nails it for me.  Ages ago I was questioning what "value" is and how we should measure it and whether the principles of money (store of value, medium of exchange, etc) still applied.  I had to go back to basics with the Like of Adam Smith and John Locke to start to address that.  Money now values credit, no more.  Not the productive effort of the past or the future.  To value assets in terms of money is to value them in terms of credit, no more.  We individually need to be valuing our assets differently and allocating our capital accordingly.  How?  Each to their own but to me the value of an asset rises in proportion to its role as anti-money - the extend to which it frees me from using what is currently taken as money.  Sure invest a bit in the markets, etc but beware that this is a casino and any winnings are the casino's winnings until the chips are cashed in for something of tangible (forget recognisable for now) value outside in the real world.

[Talking Monkey]

34 minutes ago, Harley said:

This article nails it for me.  Ages ago I was questioning what "value" is and how we should measure it and whether the principles of money (store of value, medium of exchange, etc) still applied.  I had to go back to basics with the Like of Adam Smith and John Locke to start to address that.  Money now values credit, no more.  Not the productive effort of the past or the future.  To value assets in terms of money is to value them in terms of credit, no more.  We individually need to be valuing our assets differently and allocating our capital accordingly.  How?  Each to their own but to me the value of an asset rises in proportion to its role as anti-money - the extend to which it frees me from using what is currently taken as money.  Sure invest a bit in the markets, etc but beware that this is a casino and any winnings are the casino's winnings until the chips are cashed in for something of tangible (forget recognisable for now) value outside in the real world.

Wouldn't a bunch of BP shares be that Harley, I'm trying to get my head round your posts concepts . I can see how say a bunch of Tesla shares are a bit ephemeral but solid stuff like big oil seems good to me.

[DurhamBorn]

@sancho panza its incredible how that article says the same thing as the macro showed.I think the very first post on this thread or the original one i said the economy cant produce enough for the claims on it,and thats exactly what that article is saying.They are seeing the same thing through energy being the primary source of growth.

My roadmap has shown how they would proceed because the only way they will see is to inflate.Each individual country needs to get ahead of the curve now,and the market doesnt understand that yet.

Here in the UK the huge problem they have is that massive parts of spending are inflation linked,and that defeats the purpose,so benefits and state wages and pensions need putting up less than inflation and even better less than inflation that is already understated.

I would say the key thing to think about here is this.

"poor" people in this country get to consume incredible amounts of "stuff" they havent swapped effort for.So do the rich.

You can see how this plays out as certain workers,for instance council managers,the police etc force through higher and higher wages and pensions and take more and more from the private worker,or saver.

Money has pretty much now lost any hope of holding value,and that value is actually someones labour.Its supposed to save the getting up at 5am,the going to work when ill,the putting up with wanker bosses,getting soaked in the car park,missing your sons football game,your daughters nativity play,your partners hospital appointment

Most blame central banks,i blame government,but both are needed to carry on the theft.

My model shows they need around 65% inflation to stop western governments going bust.Most of that theft then comes from bonds then cash as they run rates way behind.Of course that also hits many other areas,pension schemes etc so divis have to be cut.

That is why i measure success or failure on that 65% number.If i increase my assets from last Feb before the crash (first crash maybe) by 65% or more thats success,less is failure against the system and cycle.

 

[dnb24]

53 minutes ago, feed said:

Well as we're on the future of money. 

Taken from an interview with Napier and i can’t get it out of my head.  Particularly with the authoritarian road our state is heading down.    

The problem with inflation and Friedman said this, is the taxation without legislation.
Be in no doubt what it’s supposed to do, it’s supposed to move money from one section of society to the other.
I don’t have a problem with that if you were to pass it through Congress, if you’re going to Congress and you get elected, lower house, upper house and President, and what you want to do is move money from one section of society to another, then, well, you may not like it if you’ve got the money but it’s all done legitimately through the political process.
This has to be done illegitimately.
That’s my main beef with MMT.
They want to do it secretly.
The problem is, as you say, Grant, that savers in modern times haven’t had to cope with this new form of taxation and they’re ill-equipped for it.
But be in no doubt that it actually benefits many people.
That’s why it’s a preferred policy.
That’s why softer monetary regimes are a product of democracy.
We shouldn’t forget that… I mean the Gold Standard ends roughly when we get democracy.
Until we don’t get the vote, we have the Gold Standard.
As soon as we can get the vote, we get rid of the Gold Standard.
I know a lot of people support the Gold Standard.
I don’t.
I prefer democracy, but I would think hard currency and democracy are probably ultimately incompatible.
That’s the reason we have moved to soft currencies to allow this form of wealth redistribution.
Savers do have to understand it more than anybody else.

I know this is more what happens after this cycle.  But it starts now, politically, it takes a decade to move populations.  
 

Hi feed do you have a link to the interview 

[feed]

1 minute ago, dnb24 said:

Hi feed do you have a link to the interview 

https://ttmygh.medium.com/the-end-game-ep-5-russell-napier-19be8148e21b

 

[MrXxxx]

1 hour ago, Hancock said:

Western politicians sold western people/companies down the river for a short term personal gain for themselves. In Africa its knows as corruption.

Our own leaders have done this, you only have to look at the number of ex MP's and the "Well to do" in the House of Frauds who are openly on the payroll of China.

You can include Boris in that, see his time as London Mayor where he was gifting easy money to Chinese property developers for a donation to the communist Tory party. 

https://www.channel4.com/news/boris-johnson-london-propery-deal-china-albert-dock

Just a Covid is not China's fault, along  with the fact our own govts have went full on "commie", neither is it China's fault that the UK/USA etc have sold its own people down the river for what are relatively small bribes.

 

But the question is, when it is so blatant why are they are they still being allowed to get away with it by us?!

[nomadic]

56 minutes ago, MrXxxx said:

But the question is, when it is so blatant why are they are they still being allowed to get away with it by us?!

Because they have total control over us and 95% are asleep. 

Surprised they haven't tried to get away with more e.g. staging a pandemic! 

[nirvana]

4 hours ago, Harley said:

Recently bought a hydraulic work stand for my Harley.  Time to do some serious work.  Gonna be worth something soon when me body finally gives up.  Loads of parts to sell (for the bike and loads of other stuff).  Best place for the best prices?  Or should I wait some more?   

 

I'm gagging to go to India and buy a motorbike.....something up to 300cc will do nicely cos they cost feck all...

Saw this recently https://gaadiwaadi.com/harley-davidson-300-cc-v-twin-bike-re-rival-leaked-online/

I'd go to China to buy something too but I heard you need a chaperone to go anywhere and that's not my style...

Ordered some stuff (7 items) on aliexpress on 29 March cos they were having an anniversary sale and 5 of em have arrived in the last 2 days, that's a week and a half! Forgot to grab that pure sine wave inverter though 

Happy riding!

[Lightscribe]

1 hour ago, MrXxxx said:

But the question is, when it is so blatant why are they are they still being allowed to get away with it by us?!

Boiling the frogs and conditioning. I actually believe they knew how it would all end when they diverted away from the gold standard. Inflation was never really a thing as the amount of labour a worker in the 16th century had to give for a silver crown didn’t really change much in the 17th century. 

The powers that be were never concerned long term when it all began as they’d be long dead so hence the first can was kicked.

Imagine the restrictions of today thrust on a person suddenly overnight even up to a few years ago, there would be anarchy unless change is introduced gradually into acceptance. Powerful thing the government and the media. Provide a narrative and publicly shame anyone who steps outside the lines. That aspect has never changed throughout history.

[Harley]

2 hours ago, Talking Monkey said:

Wouldn't a bunch of BP shares be that Harley, I'm trying to get my head round your posts concepts . I can see how say a bunch of Tesla shares are a bit ephemeral but solid stuff like big oil seems good to me.

Sat indoors 'cause the BBC promised rain, and (naturally) it hasn't, so here goes one of those posts.....

If we must, and to a point we must, then yes, ideally at the right price.  The point is to think/interpret and spread your assets wide to reduce reliance on the current monetary system because it's on alert level red.  Additionally, I use heating oil.  Such shares hedge that cost, hopefully, but if I could build an oil well instead I would!  But I also installed a log burner, bought a high end log splitter, and would like woodland (to use for fuel, not just "invest", whatever that has become).

Another case in point for me is I have a disused borehole.  Should I invest in recomissioning that or buy some income shares to hedge future water costs?  I could do some maths on the financials but how valid are the units of measure I use (money) given it values credit first and foremost?  We are approaching an economic (and seemingly sadly social) turning where we are now at the risky extremes of a normal distribution.  I think I might value more highly the certainty of the water that borehole gives me over the alternative "constructs".  That uses a different unit of measure.

If I stand in the burning building of today's financial system, I'm more likely to go along with the status quo and value things as normal.  If I leave that building, look back and think about supply shortages, disruption, huge price rises, legislation restricting usage, etc, I'll be valuing that borehole and everything else very differently.  We are now back where the likes of Adam Smith were at the start of the Industrial Revolution, trying to make sense of the new world unfolding before us and to rationalise the revised principles underlying it. 

Same for solar power, etc.  I would still like an electric dune buggy type setup charged by my own solar charge station.  I'm prepared to pay for more certainty, to compensate for the uncertainty excess credit has caused and has "debased" true value by.  Credit has inflated assets above their underlying productive effort but at a higher risk of a correction.  There is a need to factor in (adjust down) this uncertainty in valuations.

We don't all have boreholes, etc.  But maybe we could/should decomplex our lives as much as our portfolios.  Sinking and running a borehole less complex than some shares?  No, not today, but tomorrow is unlikely to be like today.

One interesting thought you raise is if the article had come down from the big macro to talk about the "wedge" say in terms of asset types, like our decomplex play.  That is take the analysis forward to the "so what...." stage.  It's a great problem statement.  Now on to the real work.  Another reason I'm a fan of Napier.

[Lightscribe]

2 hours ago, geordie_lurch said:

Cross posting this from @Long time lurking as like I have said multiple times in this thread I think it's vital to be aware of the Central Bank Digital Currencies (CBDCs) and how they could change our best laid plans...

 

In a UBI and digital currency blockchain future how they would generate commerce? AI and robotics would after all be replacing a lot of human labour. How about a digital ‘Fed coin’ that expired each month unless it was spent? Allocations increased and reduced in line with your social credit score?

[Harley]

54 minutes ago, nirvana said:

 

I'm gagging to go to India and buy a motorbike.....something up to 300cc will do nicely cos they cost feck all...

Saw this recently https://gaadiwaadi.com/harley-davidson-300-cc-v-twin-bike-re-rival-leaked-online/

I'd go to China to buy something too but I heard you need a chaperone to go anywhere and that's not my style...

Ordered some stuff (7 items) on aliexpress on 29 March cos they were having an anniversary sale and 5 of em have arrived in the last 2 days, that's a week and a half! Forgot to grab that pure sine wave inverter though 

Happy riding!

A finance director of all people told me to buy the expensive Harley because I'll know it when I sat on it.  She was spot on!  

[nirvana]

2 minutes ago, Harley said:

A finance director of all people told me to buy the expensive Harley because i'll know it when I sat on it.  She was spot on!

I think lightweight is key for everything now......I want a sub 160kg motorbike.......I want a campervan that weighs less than 1500kg; impossible you may think? Just use a French car as a base....actually how about a 2CV campervan? Sounds like an interesting novelty 

[JMD]

3 hours ago, sancho panza said:

Another epic from Dr Tim.My thanks as ever to @Democorruptcy for bringing him to my attention.

Highlights are mine for skim readers.The fact that so much is in bold says it all.

Includes-

soft default via inflation inbound,

the time for monetary reform was 08-too late now,

Big Kahuna inescapable.

Next crisis will question the validity of money.

Since 2000,each $1 of GDP growth has been funded by $3 of debt

Worlds average person is getting poorer

 

https://surplusenergyeconomics.wordpress.com/2021/03/24/193-nothing-for-money/

#193. Nothing for money

Posted on March 24, 2021

THE LOOMING FINANCIAL CRASH IN FOUR PICTURES

In the light of recent events, it’s hardly surprising that financial collapse has become an increasingly popular subject of debate.

There seems to be a dawning awareness that the economic crisis caused by the coronavirus pandemic has loaded the system for inflation, because the support given to incomes has boosted demand at a time when the supply of goods and services has slumped. Meanwhile, markets in general – and Wall Street in particular – have taken on some truly bizarre characteristics, suggestive, perhaps, of the frenzied dying days of a bull market.

Those of us who understand the economy as an energy system have long known that an event far larger than the global financial crisis (GFC) is inescapable. Indeed, ‘GFC II’ was hard-wired into the system from the moment when the authorities decided to prevent market forces working through to their logical conclusions.  

If markets had been left to their own devices back in 2008-09, what would – and arguably should – have happened was that those who had taken on excessive risk would have paid the price in widespread defaults, whilst asset prices would have corrected back to levels preceding the debt binge which had started a decade before the GFC.

It’s ironic that we hear so much talk of “re-set” nowadays, even though the only real opportunity for resetting the financial system came – and went – more than ten years ago. Promises of a post-pandemic reset are proof – if proof were needed – that ‘hype springs eternal’.  

Properly understood, all that covid-19 has really done is to accelerate our advance along a pre-determined road to crisis.

There are two big differences between the coming crisis and its predecessor.  First, whilst 2008-09 was caused by reckless credit expansion, the coming crash will be a product of far more dangerous monetary adventurism. Second, a crisis previously confined largely to the banking sector will this time extend to the validity of money itself.

The best way to understand the looming crisis is to recognise that the financial system, and the economy itself, are distinct (though related) entities. The ‘real’ or material economy of goods and services is a product of the use of energy. The financial system acts as a proxy for the energy economy, and consists of monetary ‘claims’ on the economic output of today and tomorrow.

If finance and the economy diverge, so that a gap is created between the two, the restoration of equilibrium must involve the destruction of the ‘value’ represented by ‘excess claims’.

Our current predicament is that there now exists, not so much a gap, as a chasm between the material economy and the financial system. The emergence and scale of this chasm can best be depicted as a series of “wedges” that have been inserted between financial claims and underlying economic prosperity.

The debt wedge

The best place to start is with debt, which customarily – though mistakenly – is measured by reference to GDP.

Between 1999 and 2019, world GDP increased by 95%. Expressed in constant international dollars (converted from other currencies on the PPP – purchasing power parity – convention), this means that GDP grew by $66 trillion.

Over the same period, though, debt expanded by 177%, or $197tn. Put another way, this means that each dollar of reported “growth” was accompanied by $3 of net new borrowing.   

As the first set of charts illustrates, what happened was that a “wedge” was inserted between debt and GDP.

 

This was a product of deliberate policy. The predominant belief, back in the 1990s, was that economic growth could be furthered by “de-regulation”, which included relaxing rules that, hitherto, had limited the rate at which debt could expand.

At the same time, the process of globalisation created its own pressures for credit expansion. Essentially, the aim was to out-source production to lower-cost EM (emerging market) economies whilst maintaining (and preferably increasing) Western consumption.

This divergence between production and consumption created a gap that could only be bridged by making credit ever easier to obtain.  

An even more important factor then in play was an economic deceleration known as “secular stagnation”. The real reason for this deceleration was a relentless rise in the Energy Cost of Energy (ECoE). But this causation wasn’t understood. Instead, policymakers thought that the hard-to-explain deterioration in economic growth could be ‘fixed’ by making credit easier to obtain.

This in turn meant that monetary stimulus, hitherto used for the perfectly reasonable purpose of smoothing out economic cycles, would now become a permanent feature of economic policy.

It seems to have been assumed that excessive debt was something that the economy could somehow “grow out of”, much as youngsters grow out of childhood ailments.     

Financialization – the second wedge

Debt is only one component of financial commitments. There are many other forms of monetary obligation, even without moving into the realms of assumed (rather than formal) commitments such as pensions expectations.

A broader measure, that of financial assets, gives us a better grasp of the extent to which the economy has been financialized. For the most part, these “assets” are the counterparts of liabilities elsewhere in the system, much as banking sector “assets” correspond to the liabilities of borrowers.

Financial assets data isn’t available for all economies, but the right-hand chart below shows the aggregates for twenty-three countries which, between them, account for three-quarters of the world economy. 

What this illustrates is that the “wedge” inserted between debt and GDP is part of a much bigger wedge that has been driven between the financial system itself and the economy.

 

Comparing 2019 with 2002 (the earliest year for which the data is available), the financial assets of these 23 countries increased by 158%, or $275tn, whilst their aggregated GDPs grew by only $44tn, or 77%.

On this basis, financial assets increased by $6.20 for each dollar of reported “growth”.

It’s a simplification, but a reasonable one, to say that, for these economies, each dollar of growth between 2002 and 2019 was accompanied, not just by net new debt of $2.70, but by a further $3.50 of additional financial commitments. 

What this really means, in layman’s terms, is that debt escalation has been accompanied by a broader – and faster – financialization of the economy. Essentially, ever more of the activity recorded as economic ‘output’ is really nothing more than moving money around.

This is represented in the aggregates by relentless increases in the scale of interconnected assets and liabilities.

The risk, of course, is that failure in one part of the financialised system triggers a cascade of failures throughout the structure.    

The third wedge – the ‘let’s pretend’ economy

By convention, both debt and broader financial commitments are measured against GDP. This would be reasonable if GDP was an accurate representation of the ability of the economy to carry these burdens.

Unfortunately, it is not.

Over the period between 1999 and 2019, trend GDP “growth” of 3.2% was a function of annual borrowing which averaged 9.6% of GDP. The mechanism is that we pour credit into the economy, count the spending of this money as economic “activity”, and tell ourselves that we can ‘grow out of’ our escalating debt burden.

As well as funding purchases of goods and services which could not have been afforded without it, relentless credit expansion also inflates the prices of assets, and this in turn inflates the apparent ‘value’ of all asset-related activities.

The SEEDS economic model strips out this credit effect, a process which reveals that underlying growth in the world economy averaged just 1.4% – rather than 3.2% – between 1999 and 2019. Accordingly, underlying or ‘clean’ output – which SEEDS calls ‘C-GDP’- is now very far below reported GDP. If net credit expansion were to cease, rates of “growth” would fall to barely 1%, and even that baseline rate is eroding. If we were, for any reason, to try to reduce aggregate debt, GDP would fall back towards the much lower level of C-GDP.

Neither is credit-injection the only major distortion in the story that we tell ourselves about economic output. More important still, ECoE – in its role as a prior call on output – is continuing to rise. Incorporating ECoE into the equation reveals that prosperity has stopped growing, whilst the number of people between whom aggregate prosperity is shared is continuing to increase.

In essence, this means that the world’s average person is getting poorer. This happened in most Western countries well before the GFC, and the EM economies have now reached their equivalent point of deterioration.

What began as “secular stagnation” has now become involuntary de-growth.  

We can’t make this hard reality go away by pouring ever more and ever cheaper liquidity into the system. All that monetary loosening really does is to create financial ‘claims’ that the economy cannot meet.

The combined effects of credit manipulation and rising ECoEs form the third wedge – the one that divides economic reality from comforting self-delusion.    

 

 

The fourth wedge – the quantum of instability

With the reality of flat-lining output and deteriorating prosperity understood, all that remains is to use this knowledge to recalibrate the relationship between a faltering economy and an escalating burden of financial obligations.

Even the ‘fourth wedge’, pictured below, excludes assumed (though not guaranteed) commitments, of which by far the largest is the provision of pensions.

The final set of charts compares debt and broader financial commitments with underlying prosperity. These charts reveal the drastic widening of the chasm between prosperity and the forward promises that the prosperity of the future is supposed to be able to meet. In SEEDS parlance, we are confronted by a massive crisis of ‘excess claims’ on the economy.

With these equations laid bare, we are entitled to wonder whether decision-makers are in blissful ignorance of this reality, or whether they have at least an inkling of what’s really happening and are simply nursing Micawber-like hopes that ‘something will turn up’. Based on the 2008-09 precedent, we can be pretty sure that the “soft default’ of inflation will play a starring role in the coming drama.  

The question of ‘how much do they know?’ must be left to readers to decide. The same applies to quite how soon you think this situation is going to unravel, and whether you want to label what’s coming as a ‘crisis’ or a ‘collapse’.  

 

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Thanks for the summary CP. What stuck out for me was the financialisation of the economy, and that over last 20 years world GDP grew by 66bn dollars but only alongside nearly 200bn increase in debt, and that the banks, etc should have taken the bullit back in 2008. But in terms of contrarian investment I think this is why Horizon Kinetics like the international finance exchanges, they must have a dozen of these in their inflation portfolio. Because although these are financial, they are not the hated banks, and will be supported by their national governments, because they are in effect national financial clearing/trading monopoly assets. I predict the banking 'franchise' model will wither away, helped along by agressive central bank policy, and ultimately eaten up by the new DeFi.