It’s About You

McAlvany Recap • Apr 24 2023
It’s About You
MPM Posted on April 24, 2023

In one of his famous pearls of wisdom, King Solomon advised, “by wise guidance you can wage war, and in abundance of counselors there is victory.” Though not a warrior himself, he likely learned this truth from his martially brilliant father. It was a lesson Solomon’s son learned only in part (you don’t need merely an abundance of counselors, you need wise ones)—to the great chagrin of his subjects.

The point is important because perhaps the wisest man who ever lived sought counsel from other people in order to lead well. We mention it here because that’s the dynamic in play at MFG. Each week you can click on any of the links below and see evaluation by serious, studious, learned, and experienced analysts. Their observations are often among the deepest and most germane you’ll find anywhere. Yet the deep wells of knowledge and understanding they draw from are not just their own.

The McAlvany Weekly Commentary actively seeks out varied opinions from experts whose insights bolster, challenge, or expand upon each other’s views, the hosts’ views, and even listeners’ views. When an interview is not on offer, the hosts compare their own observations on matters of current importance, and draw extensively from other people’s books, articles, statements—and even moving and insightful poems.

In presenting his broad survey of daily and weekly happenings, Doug Noland draws from so many sources he should really look into a Dewey Decimal System for his citations and footnotes. His ability to comprehensively chronicle the world each day is characteristic of only a few people in each generation whose diligence and productivity dwarf those of even their successful peers. If you miss the CBB, you miss one of the most accessible broad-scale summaries of daily and weekly events on the planet.

Morgan Lewis weaves his narrative from the work of brilliant theorists, accomplished practitioners, high-level officials, and many others to achieve an incisive, coherent, and understandable narrative on what’s happening in the economic and financial spheres. It’s clear, it’s unique, it’s deep, it’s insightful, and it’s useful. Don’t miss it.

Miles Green shares hosting duties with a different analyst almost every week. Together, they draw from the work of theorists, chartists, and notable experts in governance, economics, and other fields. The work is highly technical, but the narrative is accessible and understandable.

If you follow MFG publications very often, you’ll repeatedly hear the word “team.” It’s the integral way the company works. It’s not a committee or a group, it’s several accomplished individuals with complementary gifts working in dedicated and highly motivated concert to move the ball forward. It’s far more effective than are individual efforts. Take advantage of it. After all, “the ball” in this case is your financial well-being.

Key Takeaways:

  • Going is not the same thing as gone
  • Debt is more popular than ever
  • Does the market have a crystal ball or a glass eye?
  • Gold is acting like it’s 2007 again

The McAlvany Weekly Commentary: True, Rome was not built in a day. It didn’t end in a day, either. What we see as the sudden end of an epoch, dynasty, or empire is often the dramatic culmination of a long decline. David and Kevin take some time to sort out what many see as the end of the dollar as the world’s reserve currency. While not denying the premise, the hosts do point out that such immense and powerful things as the dollar and its worldwide role and reputation do not usually end abruptly. They typically roll down a long, initially gentle then steepening grade before falling off a cliff. Where is the dollar in that lengthy process? Only events yet to come will give us a definitive answer to that question, but the hosts present compelling evidence to support their conclusion. The dollar’s role has an immense impact on the lives of Americans and people whose countries use the dollar for trade settlement. Don’t miss this unique and penetrating analysis.

Credit Bubble Bulletin: It was all quiet on the Western (financial) Front this past week, with relatively few major offensives from the trenches to try to gain ground or defend against the market’s attempts to do the same. “The VIX (equities volatility) Index traded intraweek to the low (16.17) since January 4, 2022.” It seemed that banks were in the process of resupplying for a new campaign—seeking funding to replenish deposits withdrawn by nervous customers. Quoting the WSJ, Doug noted that, “The Federal Home Loan Bank system…issued a record $495 billion of debt in March to fund loans… Banks ramped up borrowing…as customers pulled out deposits…” But if the Western Front was resupplying, the Eastern Front made the effort look puny. “Aggregate Financing, China’s metric for system Credit growth, expanded $782 billion during March…, [which] put Q1 Aggregate Financing growth at an incredible $2.111 TN. This is the largest three-month growth in China’s history.” The title for this bulletin has never been more appropriate.

Hard Asset Insights: Despite the difficulties inherent in the process, markets are inveterate, irrepressible prognosticators. They always have opinions about the future, and they price those opinions into their current actions. They are often right, often wrong, and often hard to read, but they always express in their nature their best guess about what the future holds. Morgan provides great value by parsing the markets’ prognostications and comparing them with reality. “Markets have priced in expectations for a soft landing with a very bullish 19x multiple on still overinflated forward earnings estimates. And while consensus earnings estimates have come down from highs, they forecast only a minuscule 4% peak-to-trough earnings drawdown in 2023. They expect this 2023 blip on the earnings drawdown radar to then be followed by a powerful reacceleration higher in 2024 and beyond. Such expectations are distinctly ‘soft landing’ territory. If taken at face value, they imply that the stock market made its bear-market lows last October.” That’s a fairly detailed and extremely valuable read. To see Morgan’s analysis of it in light of current events, be sure to click on the link at the beginning of this synopsis.

Golden Rule Radio: With Tory back for this episode of GRR, Miles applies Elliott Wave principles to gold’s current movement. Such analysis could allow for significant further upward movement in gold, but Tory adds that underlying fundamentals are crucial in this analysis. One of those fundamentals is certainly sentiment, and Miles notes that, while news can affect the gold price, it doesn’t affect its long-term trend. It just affects how quickly or slowly it gets where it’s going. Both hosts agree that the situation now in gold feels like the one in 2009, when gold was in the process of quadrupling in price—with pullbacks—on the way to a record level in 2011. However, the current action in gold more closely resembles what was happening in 2007, though we have yet to experience many of the financial crises that were then ongoing. What will happen, they ask rhetorically, if the stock market loses another 20%? Tune in for their take on this and other subjects and developments.

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