What's The Next Bubble?

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Kriegsspiel
Posts: 928
Joined: Fri Aug 03, 2012 9:05 pm

Re: What's The Next Bubble?

Post by Kriegsspiel »

In the interview with Charlie Munger I posted, he talks about China copying Singapore:
Munger: Who would have guessed the Chinese Communists would have improved their big country as much as they have in the last 30 years?

Interviewer: Did that surprise you?

Munger: Well, they didn't the first 20 years. They had the Cultural Revolution. It was crazy. And now they have one of the greatest success records in the history of mankind. I don't know about you, but I did not predict it.

Interviewer: So what is the secret to China's success?

Munger: They copied Singapore. Remember, the Chinese leader said I don't care whether the cat is black or white, I just care that it catches mice. And they copied a very wonderful, famous Chinese man in Singapore, and lo and behold, they found the right Chinese leadership outside China, which amuses me. But he was Chinese. Look at the way it worked, in the whole history of the world, no nation that big has advanced that fast. And they did it by having a bunch of poor people save half their income. They didn't use the wealth of the rich world to get ahead, they used the savings of poor people. I am a huge admirer of what the Chinese have accomplished. And if you ask me who is the one man who did the most for China, it was Lee Kuan Yew of Singapore. They copied him.

Jason

Re: What's The Next Bubble?

Post by Jason »

I have to agree with Munger. Once you get past the human rights violations, the vomit inducing fish, the hacking of US tech companies, the one child policy and the death clouds making their way across the Pacific, they have done a remarkable job.

chenda
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Joined: Wed Jun 29, 2011 1:17 pm
Location: Nether Wallop

Re: What's The Next Bubble?

Post by chenda »

Right, along with India's intense religiosity and devisiness, and huge linguistic and cultural diversity.

Singapore's semi-free dictatorship may ultimately be copied by Chinese reformers. Free of corruption and crime. They don't shoot dissidents in Singapore, they bankrupt them with libel suits. This is much more civilised.

Capitalism
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Joined: Wed May 15, 2019 12:07 pm

Re: What's The Next Bubble?

Post by Capitalism »

I think that we are going to see some sort of deflation/hyperinflation at some point. The interest rates can't be lowered much further without consequences. It can cause deflation, which again can lead to hyperinflation. This will end up crashing currencies.

Also, if rates are getting higher than they are now (which is a public goal for FED + ECB), asset prices should drop as investors will see bonds as more attractive than already inflated stocks (the thesis is here that investors money will flow towards the place of the best risk/reward based return). The nearly only option would then be to print money to try and save the economy once again by high inflation, which will crash existing currencies.

Buying bitcoin is might not such a bad idea after all...

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Jean
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Location: Switzterland

Re: What's The Next Bubble?

Post by Jean »

As anyone bought monero yet?

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Dream of Freedom
Posts: 612
Joined: Wed Aug 29, 2012 5:58 pm
Location: Nebraska, US

Re: What's The Next Bubble?

Post by Dream of Freedom »

Just thought I'd share a recent, decent article on the subject:
https://seekingalpha.com/article/439673 ... bag-holder
A bubble is not caused by the market being a bit optimistic on its assumptions. Bubbles are caused by a fundamentally different thesis in which the view is that X stock will take over the world.

Digital currency will replace the U.S. dollar as the dominant currency
Electric vehicles will eliminate ICE
Marijuana will displace a large portion of modern medicine
Marijuana will replace alcohol and tobacco as the recreational drug of choice
Space travel will become the new logistics platform
Space tourism will displace beach vacations
Home sharing will replace the hotel industry
Ride sharing will eliminate the need for personal vehicles
Autonomous driving will replace human drivers
Plant-based meat will replace animal meat
Food delivery will fundamentally alter consumption patterns
Gyms, calisthenics, and merely going for a jog will be replaced by digital workout platforms
Video conferencing will replace in-person meetings

Bubble stocks require changes at a level that's the economic equivalent of the laws of physics. The extremity of these stock prices requires a sea change in consumer behavior and, in some cases, even changes to international laws.
Thus, the five most dangerous bubble stocks are those that are likely to fail even if the anticipated sea change happens.

#1 Doordash (DASH)

#2 Zoom Technologies (ZM)

#3 Aphria/Tilray (APHA) (TLRY)

#4 Airbnb (ABNB)

#5 Uber Technologies (UBER)

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