The David McWilliams thread


#2182

I don’t think the USD will collapse completely as there is nothing to replace it. I just think the Fed will be forced to continually monetise endless quantities of treasury debt until we cross the rubicon in their balance sheet. The fact that they are adding junk bonds to their portfolio now is hastening this day of reckoning. Every municipal bond and corporate bond that they buy is degrading their balance sheet.

Now, the central planners will say they don’t need to mark to market and they don’t need capital. They object the thesis that high debt causes low growth which leads to a feedback loop that destroys the credit system. But to me, socialism is always wrong and Von Mises and Hayek showed this convincingly. Unfortunately socialism is the cancer that never dies until it destroys everything and you are queuing up for rotten fruit and mouldy bread. But I digress…to me the Fed is just a giant hedge fund with 100-1 leverage. Once this loss of confidence in the happens, there is no way to restore it without letting interest rates go up which will initiate a gigantic credit default.

Eventually the market will stage a run on the Federal Reserve but I don’t know exactly when this will happen. My guess is it will happen in the next few years though.


#2183

How does one position oneself? What are the real options? Precious metals and so on?


#2184

I don’t give investment advice but if you are lucky enough to have significant investable assets, then I would maintain a diversified portfolio to include cash, property, precious metals and equities with exposure to same.


#2185

What about guns ‘n’ beans?
As for property, would you prefer a discrete cave in the hills, or a defensible compound on a plain with a good view of anybody approaching?

Asking for a friend.


#2186

Gallows humour :slight_smile:


#2187

I’d like a castle keep with high speed internet, a courtyard full of well-trained soldiers, a surrounding moat, and a village of expendable serfs.


#2188

Limerick?
Apologies to the good people of Limerick - I couldn’t resist.


#2189

On the original topic I wonder if it would be safe to put your moolah in the An Post Saving certificates - surely the obvious hypocrisy and the enormous political outcry that would follow would make it difficult for even this crowd of chancers to put their mitts on them?


#2190

McWilliams has the same understanding of the ECB as your average Taxi driver

I didn’t see the original article but that’s some boo boo


Sir,– David McWilliams argued that existing loans in the Irish banking system, particularly mortgage loans, can be refinanced at lower rates using cheaper funding from the European Central Bank (ECB) (“Why an Irish mortgage costs ¤80,000 more than a German one”, Analysis, October 10th).

This is not correct.

It is true that the ECB offers banks long-term funding at low interest rates through refinancing operations as part of their monetary policy tool. But this does not apply to mortgages. This long-term refinancing by the ECB is “targeted” towards lending to non-financial corporations and to households excluding loans for house purchase.

In other words, as stated by the Central Bank of Ireland before, the stock of mortgages held by Irish banks is not “eligible” toward the borrowing allowance in the ECB’s longer-term refinancing operations.

It is without argument that interest rates for mortgages and SMEs are higher in Ireland compared with other jurisdictions in the EU.

However, it is also true that Ireland has one of the highest capital requirements for banks in the euro zone which increases the cost of capital.

For example, banks in Ireland hold on average twice the level of capital for performing mortgages and SME loans compared with banks in Germany.

In addition, it is more difficult to enforce security in Ireland for what is supposed to be secured lending, which makes it more costly to lend. – Yours, etc,

ALI UGUR,

Chief Economist,

Banking and Payments

Federation Ireland,

Dublin 2.


#2191

In addition, it is more difficult to enforce security in Ireland for what is supposed to be secured lending, which makes it more costly to lend. – Yours, etc,

And insurance rackets vs the sympathetic courts.


#2192

McWilliams again adopting a very upbeat stance, is there no down side to anything?


#2193

It’s absolutely fascinating that the Daily Express decided to quote a counterargument from a Twitter account with 16 followers ! Run by a Munster Orangeman seemingly !

https://twitter.com/CSRI_ie/status/1342231926900477952?s=20


#2194

McWilliams can make all sorts of fantastic predictions and claim he wasn’t wrong. If there is no Brexit dividend like he claimed, he’ll just claim that Ireland botched the opportunity.

That aside, the comments on the Express are priceless. Absolute gammon central. Paddy this, Paddy that. The funniest exchange was this:


#2195

Absolute gammon central.

Stand back, we got a woke one here!

I agree, some of the comments under that article were unintentionally very funny.


#2196

Gas.

But ‘Gammon’ is a nasty term employed by woke comedians when they are ‘punching down’ on the English working class - bit like the British financial press labelling us the ‘PIIGS’ during the GFC.

You will find that sentiment is fairly close to the surface of lumpen british culture if you have lived there for any length of time.


#2197

Everyone who uses the term Gammon is a midwit AFAICS. And a nasty midwit at that.


#2198

Punching down on the working class?
We’ve caught a live snowflake here!

The typical middle aged Freds and Rogers fuming on the Express aren’t working class.
There is a veneer of semi informedness for example. The view that Britain were responsible for bailing out Eire 10 years. Completely skewed in one sense but I’d say 95% of the UK aren’t even aware there was an arrangement of any sort.

What has gotten on their wick here is someone from a lower caste speaking upwards. A Paddy trying to be an economist instead of shoving cement into a mixer.

These are the crew who in theory have just had a big win over the EU, yet they are still red faced and angry.

The irony is that the reflex of the MAGA types on this site would jump in to defend their honour yet any admiration will never be reciprocated.


#2199

Come on - my post largely agreed with yours!

The latent anti-Irish racism of the British is not just the Express or Mail readers or their working class - arch-liberal university dons, investment bankers and Guardian readers are also prone. It is in Ireland as well (cf Irish Times, Belfast Newsletter).

Many here remember the 80s and 90s.

My objection is to the term ‘Gammon’

As Michelle Obama would say, ‘be better’!


#2200

The irony. You’re touchy yourself (about Britain’s bailout & cement mixers) while mocking their touchiness.

McWilliams himself is very interesting himself about the ins and outs of “Paddy trying to be an economist” - Irish central bankers said nothing in the minutes of European meetings when he was a junior economist, when later he was briefing traders in UBS in the early 90s they nicknamed him ‘Semtex’ (you may shudder with rage at that but I think that’s funny and so does he)

The fact is the term ‘Gammon’ is invariably used by creeps with really nasty race and class hatred in their veins. It’s dehumanizing Soviet stuff. So you’d be best avoiding it.


#2201

Should point out that the term can get you places: Frankie Boyle got a weekly primetime BBC show punching down on white english voters.