Inflation's Heat & War's Profit Surge

There’s a considerable buzz in the financial community, and we need to sift through the noise. Unexpectedly, the inflation data for today came in hotter than anticipated. But here’s what really grates on me: the perverse reality of our global markets where war suddenly becomes a boon for numbers. In the wake of recent conflicts, a baffling pattern emerges - stocks rise, bonds surge, while oil prices fall. It’s counter-intuitive, right? Yet, this is the paradoxical world we occupy, where market authorities feel the incessant need to manipulate perceptions lest the markets reflect a ‘dissatisfactory’ narrative. It’s been an unsettling trend since Desert Storm. But as we see post-conflict market responses, it feels morally dissonant, as if we’re cheering the very tragedies we should condemn.

The potential repercussions in the global scene, especially in the Middle East, are vast. Rapid escalations could easily plunge us into a worldwide conflict. But how are markets reacting? Seemingly with indifference or, in some cases, euphoria. Perhaps it’s the entrenched belief that the Federal Reserve will always be the white knight, intervening to lower rates and save the day. Especially considering the past years, where the bond market hasn’t exactly been bullish. There’s an implicit hope that military conflicts will prompt a Fed capitulation, causing a significant rate drop and a consequent market surge. This type of expectation has evolved over time. Remember the surprising interventions of 2010 or 2013? Those days seem long gone. Now, it’s almost a given. Yet, when we juxtapose this with the tragedies unfolding globally, the market’s exuberance in the face of such calamities feels like a bitter pill to swallow.

Shifting gears slightly, let’s delve into some intriguing insights shared by Dr. Genevieve Rock. Jerome Powell is sure having an intense day as the CPI for September was reported at 3.7% against an expected 3.6%. Doesn’t sound significant? Well, consider this - it’s the third consecutive month where inflation is on an upward trend. This persistent inflationary pressure contradicts the narrative many hoped for, that inflation would start tapering. These numbers should shake the market, but they seem to overlook them. As we move forward, we need to critically analyze these trends, interpret their implications, and strategize accordingly. Because the signals, if read right, can tell us a lot about our economic trajectory.

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This is a companion discussion topic for the original entry at

Systemic Threat

In a Centrally Planned “System,” the greatest Systemic Threat comes from the Central Planners themselves. In such “System,” the resilient must learn to navigate within it.
There is what we would like it to be, and there is what “is.”

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The Top 5-7 Companies

Known as the magnificent 7 are owned by the global elites so pushing the stock price of those is effectively laundering money from the FED thru to whoever…

Blackrock As The Largest Landlord In America

Why wouldn’t Blackrock come in and buy those homes? I feel like that’s part of their game plan and a tenant of the whole “you’ll own nothing and never be happier” manifesto. I also remember reading about them going into Toronto and buying up single-family homes for ~50% above asking price /
If they did start buying up property in the U.S., my guess would be that it would be on their terms in a rather seift and spectacular yank of the tablecloth.

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Why wouldn’t Blackrock come in and buy those homes?
Because at the moment they can better returns on T bills.

The scenario was with regards to systematic collapse though.

@pnwdefector - Why wouldn’t Blackrock come in and buy those homes? I feel like that’s part of their game plan and a tenant of the whole “you’ll own nothing and never be happier” manifesto.
The process was allegedly laid out by Thomas Jefferson (but the first known appearance of this quote was actually in 1933 in a Texas publication):
"If the American people ever allow the private banks to control the issue of their currency, first by inflation and then by deflation, the banks and the corporations that will grow up around them will deprive the people of all property until their children will wake up homeless on the continent their fathers conquered"
Whether this was an actual T.J. quote or not, it rather pithily describes the oldest banker trick in the book. First banks create ample credit and encourage (if not force) everyone to play along. This was the ZIRP (zero interest rate policy) of the Fed. ZIRP inflated house prices beyond any reasonable definition of a bubble. It also caused "yield chasing" which forced portfolios from the very smallest to the very largest to finance crappy endeavors (e.g. shale plays that only lost money from 2009 through 2020) and to underwrite massive amounts of risk. But what follows ZIRP (which was hugely inflationary for stocks, bonds, and real estate)? That's right! A major interest rate hiking campaign . I've helpfully labeled the ZIRP periods for your ease. ZIRP is the set-up and the rate-hiking campaign is the rug-pulling part of the story. Depiction of the rate-hike part of the process: Massive transfers of real property and productive businesses will now commence. Those with access to the printing press, which includes all of Wall Street and all the major financial entities, will be in a position to purchase these things...and rent them back to you. "First by a process of inflation, and then deflation..." This is simply how the system functions. It's not terribly complicated once you strip away the camouflage. Oh, by the way, the actual target isn't just your home and your car(s)'s the whole country. All of it. Every square inch. These parasites know no bounds to their greed. Here's the process writ-large.


Yes, debanking is very scary. When our guest discussed what the US government should do to those banks that debank US citizens, I had a thought. I would wager the bank is engaging in de-banking as some sort of DEI incentive BY our government. You know, another box to check and somehow there’s a reward.
I wish we would outlaw monopolies again.
I wish we could un-do the Clinton Administration policies. Under Clinton, we lost our stable banking system with the repeal of Glass-Steagal, we lost our independent and diverse media when the FCC “de-regulated.” And I’m pretty sure it was under Clinton that big pharma got the green light to directly advertise to the public.
Another great conversation.

Lots more popping and cracking sounds from the markets on Friday.
US dollar, gold and oil all up.
PPT seemed to be frantically manipulating the markets to stop an all out rout.
Gold hit new highs in Japan, New Zealand, Australia, Israel and Sweden and at previous highs in the UK and China.
Monday could be interesting.


Excellent framing, Chris! The criminality of it all reminds me of the Henry Ford quote:

It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning."
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Derivatives & Markets

I play derivatives. I mainly sell options on 3x leveraged ETFs. I’m up 65% TTM in my retirement, and 38% TTM in my taxable (I’m more conservative there because it’s “savings” I might want to spend tomorrow). It’s not easy to learn, but once you learn it, I would say it’s a pretty good side gig. I used to knock it and complain about it. Then I threw in and decided to learn it.
With that said, I would concur, we no longer have capital markets. Public capital no longer serves the capital needs of the companies themselves. I have a problem with it, but I don’t see the laws changing anytime soon, so I’m letting it benefit me.

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