SVET Reports
Monday's Markets Update (November 6, 2023)
On Monday, Nasdaq remained stagnant following a strong week and within its key resistance zone of 13K-13.5K. Bulls believe the Fed's rate hikes are over and await corporate results. Tech and healthcare led the gains, while real estate lagged. Apple, Microsoft, Amazon, and Nvidia rose, while Tesla and Berkshire Hathaway fell. Fed officials' speeches this week will be closely watched for clues about future rate moves. BTC holds near 35K, while some coins, including MATIC, AVAX, and DOGE, showed notable increases as some traders' attention switched to large cap alts.
World Markets
Venezuelan stocks (IBC Index) nearly 6x in value (to 61K from 15K) this year due to soaring inflation and a falling bolivar.
Comment
One underappreciated consequence of inflation is the rapid rise of local stock markets. This happens because investors view investing in equities as a safe haven or a way to protect their wealth against the eroding effects of inflation. This is because, historically, stocks have demonstrated the potential to outpace inflation and provide returns that can help investors maintain or increase their purchasing power.
Argentina (inflation to date: 119%; stocks index rise to date: 321%) and Venezuela (303%; 579%) have experienced significant inflation in recent years but their stock markets valuation grew even faster. However, not everyone in these countries has easy access to the stock market. Stock market participation is restricted to a small minority of investors who have the financial means and access to brokerage services.
As a result, the majority of the population have limited options for protecting their wealth against inflation. As a result, many resort to investing in foreign currencies like the US dollar or, increasingly, in cryptocurrencies as alternatives.
Crypto
Investor Charlie Munger voiced his apprehension over Bitcoin's surge in value, citing Adam Smith's economic principles that stress "the importance of individuals taking better care of their own property than that of others. Also, Munger cautioned against disrupting the established financial system with novel currencies like Bitcoin, comparing it to 'throwing a "stinky marble" at a long-standing recipe that works well for many people'.
Comments
The growing gap between generational understanding of finance and economy and their role in improving our civilization is becoming increasingly apparent.
BabyBoomers, in their 60s and 70s, still adhere to the belief in the transformative power of individual 'self-improvement,' which, after numerous Darwinian iterations, would ultimately lead to the emergence of a group of 'super-homo' who would collectively assume the role of Earth's stewards, guiding humanity towards a brighter future defined by their 'ethical' intuitions.
On the other hand, millennials and the affiliated Gen-Z have, through their interactions with boomers, concluded that these notions are utter nonsense, rooted in medieval theories that would regress us to the most catastrophic periods in human history when such 'inspired' shepherds manipulated the destinies of millions like pawns on a chessboard. In response, they propose technology-based solutions driven by algorithmic and mathematical consensus, ensuring timely and effective decision-making for large populations.
Presently, most boomers and their Gen-X allies in power recognize the threat that technology and mathematics-based governance mechanisms pose to their (and their numerous siblings') personal power. Consequently, we are entering an era of 'glove-off' battles where the most intelligent and technologically adept individuals are labeled threats to 'law and order' and dealt with accordingly.
This situation is exacerbated by a deep divide within the Boomer generation, splitting them into two opposing camps. One camp advocates for perpetual economic and social globalization based on the principles of 'universal humanitarian law,' leading to the gradual erosion of national, ethnic, and social distinctions, the dissolution of country borders, and the establishment of a World Government led by the most 'advanced' nations.
This faction is countered by the elites of the least economically developed nations among the Boomers, who vehemently oppose relinquishing any of their authority over their local, suppressed populations to some form of 'human rights' enthusiasts from other continents. They enjoy widespread support from the local, impoverished, and disillusioned segment of the population.
These two factions within the Boomer generation are now entering the concluding phase of their lives and are determined to make a 'last stand' against their opposing and deeply despised counterparts, regardless of the cost to the rest of us, who are expected to 'shut up, serve, and obey'.
In this unprecedented new environment, we - boxed between those two monstrous enraged dinosaurs - must all carefully consider our personal destinies, particularly our current inability to oppose the boomers' indiscriminate and unsubstantiated application of brutal force to intimidate us into submission.
This is a different Earth, and this is a different Game.