The Scroll

8/8/24

Morning, full edition today for the people who haven’t upgraded to paid yet.

Remember the dip in the markets I spoke about earlier in the week? Well it turns out we actually have someone in the community who can explain it to us like you all have my IQ. Big thanks to ‘Keeping It Casual’ for taking the time to do it. So we’ll start with that today.

“Should have written this earlier in the week but been on leave. I am a private banker spend most of my time advising high net worth clients where to put their money.

There's a phrase in economics, "When America sneezes, the world catches a cold." But when both America and Japan have economic troubles, the world starts to shake. This is what happened recently in financial markets. However, this doesn't mean people should panic. We've seen this before, and the U.S. economy has shown long-term resilience.

What happened first in the US?

Recent U.S. data has been disappointing. Fewer jobs were created than expected, and unemployment claims are high. Wage growth is slowing, and manufacturing is weakening faster than anticipated.

U.S. bond yields have dropped, and markets expect interest rate cuts by the end of the year. Basically a collection of bad US data suddenly panicked global investors

How does Japan fit in?

Japan has historically had low interest rates. So large investors borrow money in Japan to use to invest in the rest of the world. Eg you borrow money in Japan at 2% to invest in the US stock market and make 7% - sounds easy right?

Suddenly the Bank of Japan suprised the world by raising interest rates, which affected investors who borrow in yen to buy riskier assets. This added to the global sell-off caused by U.S. news.

What did these two events lead to?

Both of the above events happening at the same time scared investors, who were used to the U.S. economy doing well. Many investors rebalanced their portfolios and sold a load of assets to bring cash back to the US. To do this they had to sell the Yen they were using to get US dollars and doing it on this scale impacted Japanese markets.

However, the unemployment rate is still low, and some job report data was positive. The services sector is also showing signs of improvement.

Should people worry?

Yes and no. Markets weren't ready for this "growth scare," so some adjustment is expected.

However, while the U.S. economy may slow down, it's unlikely to collapse. The general advice I give to clients is that diversified portfolios should help in this risky environment.

What's Next?

The future is uncertain, but a slowdown in the U.S. economy isn't surprising in anticipation of new laws and environment that will come in post the US election.

What will the smart money and big investors do?

As I am writing this a day after Tuesday (when Japanese markets bounced back by 10%) I have a bit of hindsight benefit.

The sell off was not because of issues in any particular sector but more general economic data trends so all sectors sold off equally. This presents big bargains for people with cash on the side and thats why you saw a big swing back in markets on Tuesday. This is called a 'Dead Cat Bounce' - as even a dead cat bounces if you drop it from high enough. Shocks like this from time to time are useful to remind people that not 'everything goes up' and you should understand what you are investing in.

All the best,

Keeping It Casual”

Right, well last night was completely ridiculous.

Here’s a really simple timeline:

• Word goes out from government that there’s 100 odd far right riots planned.

• Media spread this message, normie populace are scared.

• CPS put out a message that sharing any video of those riots online could be a criminal offence - in order to minimise independant evidence of what actually happens.

• Media interviews CPS guy who lays it all out, media distribute it.

• The far right don’t turn up to the riot locations - because they don’t exist in numbers to facilitate 100 riots.

• Thousands of ‘counter protesters’ do turn up.

• There’s fuck all to do so some get a bit lairy and smash shit up, hassle the police.

• Government puts the word out to media that the line is UK is now united, we faced down the far right.

• Copy paste front pages high fiving for something completely fake.

I was messaging Hugh about how I though this was going to happen last night in bed, none of it passed the smell test. I thought it was possible though that there’d be at least one genuine location that did have proper disorder where something bad happened, giving the government the excuse it needs to ramp up restriction of freedom etc. What I actually think happened was that the PM was told by senior police ‘you’re fucking this, we’re not going to be able to cope’. So we got this arrangement instead as a desperate off ramp from Starmer’s miss-handled antagonistic response to the concerns of the public - likely without the full knowledge of the forces who had to scramble for manpower to facilitate it - in order to provide enough front pages to gaslight the normie UK populace into thinking there’d been some huge Battle Of Britain style victory over Nazis and that now the UK is united - so please just forget all of your valid concerns please, WE ARE UNITED! Mental. The only very large crowds I saw were in Bristol and Brighton, as you’d expect if there’s an opportunity to ‘bash the fash’, but all the other locations seemed pretty dead.

I could spend all day posting stuff from X about this. It’s the right seeing through it completely and the left lapping it up. I’m sure some of them really do think that the mythical army the far right were just too scared to come out and face them, but it doesn’t matter. The government now has its win. They have their new manufactured bogeyman who:

• It’s very difficult for the person on the street to disprove.

• Is very scary and could be anywhere, it could attack you.

• You’re not allowed to share posts about online or you’ll get a knock from the police.

• We probably need legislation to ensure we keep at bay.

What does that sound like? All too predictable.

What you just saw was mass diss-information spread deliberately by the same people who want to now put you in prison for sharing miss-information, or anything countering the party line. But that’s fine I suppose.

We’ll see how it actually plays out over the coming days and whether the public takes their new narrative update. I actually think there’s a good chance it doesn’t stick, provided that those who see through it keep asking questions. It’s all been far too obvious. As I point out often, I’m a complete retard and I can see this stuff as clearly as you can spot where a shit film’s storyline is heading. (obviously if you’re not sold on this idea, I’ll give you what your internal dialogue just said “Gaz you see this stuff because, yes, you’re retarded” it’s cool I don’t mind you thinking that 😂, maybe you’re right).

Tragically this is completely correct and you have complete control over your place as one of these statistics. I know we have a load of people who value their physical fitness within this community, but everyone has ebbs and flows, which can be demoralising. I haven’t done what I consider a proper run since January, which is probably the longest I’ve gone without that since I was 15 - all the worse because I now live between two national parks, the boundary of the house we’re in is the park edge. Strength training wise, it’s been super rollercoaster all year. 3-4 weeks of consistent training, getting a nice routine, seeing changes, then disruption. 2 weeks of virtually nothing, repeated all year. None of that is ideal, but life isn’t ideal. The difference with people like us is I know that there won’t be a day where I just stop bothering and turn into a bag of milk. On the days I struggle to do at least something, I have that nagging feeling that something vital hasn’t happened. If I go more than a few days without anything at all I stop feeling like me. So I’d encourage you to realise that not everyone is like us, the vast majority do not get, or choose to ignore that nagging feeling, they choose comfort, ease, mediocrity and decline. You can allow yourself a sense of pride that though you may have short periods in the wilderness, you’re always moving back to what you know the standard is, you don’t give in.

It’s undeniable we’re in wild times, so we really do need to be ready for anything, ensuring we’re as physically capable of using the experience many of us have, when other can’t or won’t.

Suppose I better do some phys now.

See you tomorrow.