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Sunday, 21 July 2013

The Marc Faber Blog: Down the Line Expect Massive Wealth Destruction

Just a short post noting that Marc's 50% prediction is in line with what we suggest is a possible valuation adjustment in our July 17th comments on Paul Krugman's Blog - Prophecies of Maestrodamus.

Not a hard one to figure out as it is really just "present value mathematics" whereby if long 30 year bond rates double, then their market value dips by 50%. Very straightforward mathematics that no amount of economic theory nor policy measures can override as it is simply a hard conceptual constraint. Mathematics cannot be persuaded, legislated nor negotiated with - and that should come as no surprise to anyone.

Down the line, looks to be a scary turbulent road ahead. 

We will post more comments from this blog later on.

July 21, 2013

What waits down the line?

By every account, all negotiations with mathematics have resulted in a win-lose situation. Some things are just absolute.

Dr Peter G Kinesa
July 21, 2013 

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