samedi 16 décembre 2017

La dégringolade des taux réels

Le gonflement de la dette mondiale amène les banques centrales à toujours plus d'expansion et de taux bas. Jusqu'ici, j'ai montré la descente les taux nominaux de placements dits "sans risque". On pourrait dire que ce n'est pas si grave, vu qu'il y avait plus d'inflation "avant" et qu'il y en a moins maintenant.
La question est alors: quels sont les taux si on tient compte de l'inflation ?
Voici donc les taux réels (pour le Franc Suisse (CHF); je laisse en exercice les calculs équivalents pour l'EUR, USD, GBP, ...).
On voit que les taux réels descendent doucement, aussi, depuis trente ans, et qu'ils sont passés, depuis cette année, confortablement en-dessous de zéro.


Avec cela, étonnez-vous des bulles spéculatives et du succès des crypto-monnaies...

vendredi 15 décembre 2017

Largest bubble in history?

According to a study cited by Marketwatch, the current Bitcoin bubble is the largest bubble in history, with a x64 factor in three years ("Bitcoin bubble" meaning: "Bitcoin is in a bubble", not "Bitcoin is a bubble").


Is it the largest one? If you follow Bitcoin for long, there was already a mania in 2013 (red rectangle). Let's zoom on it.


The factor is around x4600 on 3 years.
Oh, but there is more  (another red rectangle zoomed):


Factor is around x2000 on 3 years for the early 2013 bubble. And again:


Factor for the 2011 peak is infinite since the initial value in USD was 0 (and there was no Bitcoin in activity in 2008).
Interactive chart from XE.com is visible here.

To summarize, the hit-parade of bubbles would be rather:
  1. Bitcoin 2011
  2. Bitcoin end 2013
  3. Bitcoin early 2013
  4. Bitcoin 2017 (ongoing...)
  5. Tulip-mania 1637

mardi 12 décembre 2017

Bitcoin (and Swiss Franc) manias

Currently there is a crypto-mania (mostly around Bitcoin), no doubt about it.
But let's put things into perspective.

The following chart compares two monetary bubbles - the central money bubble of the Swiss Franc (CHF) and the Bitcoin, represented by its market capitalization in US Dollars (USD). Since currently 1 CHF is almost 1 USD, we can put both market capitalizations on the same chart:

Click to enlarge

Let's compare some similarities and differences between Bitcoins and Central bank francs.

Similarities:

- Counterparty: none for both - only fame and trust. Both are purely virtual!

- Why hoarding Bitcoins or Swiss francs ? Because other people do! If speculators begin to spend or sell BTC's or CHF's, their value will collapse.

- The trigger to inflate those bubbles is the mistrust about EUR, USD and other currencies following different crises of the last decade, ballooning government debt, currency debasing, negative real interest rates (ironically the buyers of CHF are naive enough to ignore that, for the two last points, the same is happening with the CHF!).

Differences:

- Money creation:
  • BTC: Bitcoins are "mined" on computers, using lots of electricity
  • M0 CHF: Central bank francs need a mouse click and a few keystrokes for ~95% of them; ~5% are printed. So the effort of creating money is minimal compared to Bitcoin (a bit scary if you are living in Switzerland...)
- Storage:
  • BTC: 100% electronic
  • M0 CHF: ~95% electronic, ~5% paper
- Control of money supply:
  • BTC: Limited by design to 21 Million; but forks (Bitcoin Cash, Bitcoin Gold) and creation of other cryptocurrencies (1340 currencies so far) challenge that limit.
  • M0 CHF: Unlimited, but reversible: theoretically the Swiss National Bank (SNB) could repurchase the extra 450 Billion francs by selling its reserves in foreign currency stocks and bonds, and could "destroy" those francs. However, now that the SNB reserve fund has the size of a massive worldwide hedge fund, such a selling would have a significant downward effect on prices, or could even trigger a selloff. That could complicate the reduction of money supply: finally, the SNB could be left with a disturbing gap between reserves and money supply...
- How the bubbles inflate:
  • BTC: due to limited supply, the exchange rates soar explosively
  • CHF: the SNB augment the supply explosively in order to control the exchange rate

dimanche 10 décembre 2017

jeudi 7 décembre 2017

L'effet Philishave

Qu'il est fascinant de contempler des taux négatifs!


La fourchette actuelle (extrémités des courbes à droite sur le graphique) est de -1% (journalier) à 0.42% (obligations à 30 ans) en passant par 0% (10 ans).
Osons le rappeler, ces taux négatifs sont gênants, mais représentent peu de chose par rapport à l'inflation de la monnaie centrale.
Les taux négatifs constituent la partie "soulever le poil" de l'effet Philishave - l'excès d'offre s'occupera de la partie "couper"...



mardi 28 novembre 2017

1 Bitcoin = 10,000 US Dollars ?

...seems to be imminent.


Impressive how well the price is correlated with the rumor (here, measured with Google Trends).
NB: curves' data were retrieved using our free Recurve tool (http://gen-img-dec.sourceforge.net/).

The current bitcoin bubble amounts to $166 Billion, according to this site, which sums the crypto bubbles to $309 Billion.
Scary ? These are still baby bubbles.
What about the "Swiss franc coin" bubble (the central bank money created since 2008) ?
Around $500 Billion.

Amazon ? Well above $500 Billion.
And let's not forget the other, bigger, Trillion-size bubbles (real estate, student loans, auto loans, ...).

Enjoy the day!

samedi 28 octobre 2017

Silly Abbreviation Generator (SAG)

An overdue feature (better said: a low-hanging fruit) of the Corporate Bullshit Generator is the Silly Abbreviation Generator (SAG). Now, finally, it is in, and online!

Granular Leadership Development Systems (LDS) lead to opportunity pipelines.
The Chief Client Relationship Officer (CCRO) transgenerates our movable business models by thinking and acting beyond boundaries.
As a result, investor confidence, evolution and responsive design invigorate the Chief Branding Technologist (CBT).
The Chief Internal Audit Officer (CIAO) strategizes incentives, while intellect, delivery framework and discipline influence our review cycles.
Pursuing this route will enable us to manage our key differentiator, while the Chief Digital Marketing Technologist (CDMT) takes control of an efficient, high-priority, values congruence. 
The Chief Value Added Services Officer (CVASO) reinvests in our innovations. 



Under the hood: as for the rest of the Bullshit Generator, the SAG is done in a functional and recursive way:

function Silly_Abbreviation_Generator_SAG (X : String) return String is space : Natural; begin if X'Length = 0 then return ""; end if; space := Index (X, " "); if space > X'First then return X (X'First) & Silly_Abbreviation_Generator_SAG (X (space + 1 .. X'Last)); end if; return (1 => X (X'First)); end Silly_Abbreviation_Generator_SAG;

dimanche 24 septembre 2017

Zip-Ada presentations about Deflate & LZMA

Here are two presentations about recent developments in Zip-Ada (newly programmed Deflate and LZMA encoders):

Click to watch the presentation

Click to watch the presentation

lundi 17 juillet 2017

The trend is your friend...

Bitcoin price, and trend as a Google search

NB: curves' data were retrieved using our free Recurve tool (http://gen-img-dec.sourceforge.net/).

Temple of the Beastmen

Exhumé d'une armoire, un jeu garanti "vintage": Temple of the Beastmen, mélange improbable de science-fiction façon Jules Verne / steampunk et de Fantasy médiévale-fantastique, pour les "beastmen". Il s'agit d'explorer le Kraag (une caverne martienne), de s'emparer de trésors, de libérer l'ambassadeur et de se mesurer aux créatures terrifiantes, la plus dangereuse étant l'Indicible Horreur. En passant, on rencontrera le roi Gnaashriik et sa garde, dans la salle du trône.


Attention aux "beastmen" tout juste sortis de la grotte de musculation!



samedi 17 juin 2017

Pasta!

My first online game (I mean, as an author)...

Pasta! is a match-3 puzzle game.
Free of charge, no in-app payment.
Link on the image or here.
Work in permanent progress.
20 levels available so far.
Under the hood: Gnoga.

Enjoy! Caution: high-carb, addictive contents!

jeudi 8 juin 2017

Up, up, up!

Here is a firework of charts that should speak for themselves...

We begin with the Bitcoin:


Then, ladies and gentlemen: the FANGA team (Facebook, Amazon, Netflix, Google, Apple):

Click to enlarge

Note that AMZN and GOOGL have reached the 1000$ level almost together. Wow! Congratulations (to the sellers)!

Now, the Dow Jones index, monitored by a very famous Twitter user:

We are a bit plateau-ing here, but still 18% above the "big, fat, ugly bubble" level.
A plateau is bad. People could become hesitant. "We have to go up, up, up"!
Here a zoom out:


The hundreds of billions created and injected every month in the markets by central banks are helpful, of course, for maintaining the uptrend.



Here, a small contributor - but direct buyer of US and European shares - the Swiss National Bank.


Here in logarithmic scale (doubling at each row up):


Two remarks about this:
  • Since last August, the SNB owns more publicly-traded shares in Facebook than Mark Zuckerberg! Source here.
  • The production of central-bank Swiss francs (the credit-based ones from commercial banks is yet another source of fresh money...) is more than 4 billion monthly on average since 2008. Each monthly injection could be enough to finance a bunch of fighter jets, a major tunnel, a social security gap... This for 113 months now!
Not only central banks contribute to the stock market records. There are share buybacks (companies buying their own shares, often with borrowed money) and margin debt (debt directly used for speculation):



Now, you may have some vertigo with all these steep curves.

So, here a flat one - Japan's inflation, as measured by the Consumer Price Index:


Better ? I have even decreasing curves: central-bank and government yields over time for different durations, from overnight to 30 years (back to Switzerland):


and mortgage rates (fixed-rate 5-year & 10-year mortgage rates of a certain bank, but the other ones follow the same trend):



Happy, now ?

mardi 9 mai 2017

Avindex 1.0, the Big Mac(ron) edition

Stock markets celebrated the election of Emmanuel Macron with VIX (implied volatility index) close to record lows, below 10.


On the big picture of financial markets, this was the main contributor to the latest overshoot in greed:


mardi 28 février 2017

Dow Jones and the twelve records

Twelve records in a row - and not only records, but "numbers that's never been hit before", so these must be very special records 😉 !...

Trump Tweet Twists

Here is a bigger picture:

NB: data was grabbed from a chart using our Recurve tool (GID project).

And now a really big picture, including debt...


vendredi 10 février 2017

Data and indices, 2017-02-10

A bunch of updated economic data, in charts.

- our home-made greed index (Avindex): we are clearly in the danger zone for stocks and high-yield bonds.

- long term precious metals prices in USD (current or corrected by CPI or M2 values).





- Baltic Dry index, measuring maritime trade. At 707 points it is below the initial value of 1000, more than 30 years ago!



- Japan Consumer Price Index (CPI) - a chart that is not shown very often. The obvious reason is that it invalidates the legend of the "Japanese Deflation" specter heard from many mainstream economists and other spin doctors.



- USD Libor interest rates: they are still very low, but back to end-2009 levels. How high can they
go before it hurts ?



- US trade balance: trade deficit is still pretty large - will president Trump be able to reverse this situation ?



- Western Texas Intermediate (WTI) oil barrel price: until mid-2014 it was stabilizing at ~100, then crashed, and now beginning to stabilize at ~50. What's next ?


Big mistake!

Tweet of the day: "Big mistake!" 👌😰 Click to make it bigger Click to make it bigger