He had killed six men during the past month—or was it a year?—he had forgotten. Time had become curiously telescoped lately. What did it matter, anyway? He knew he had to die some time and had long ago ceased to worry about it. His careless attitude suggested complete indifference, but the irritating little falsetto laugh which continually punctuated his tale betrayed the frayed condition of his nerves…
– The Camels are Coming by W.E. Johns, the first in a series over a hundred books long featuring James “Biggles” Bigglesworth.
The market today has a lot in common with the character of Biggles, the adventuring flying ace, when he was first introduced to boys in the Commonwealth back in 1932.
Just like the adventuring flying ace, the market is pretty indifferent, about some pretty major things… but with a skittish, fraying nervousness rattling through it.
Fittingly, the market’s latest foe has also taken to the skies – just on Tuesday in fact. But this tale comes with a modern twist: it’s not a German in a white Fokker biplane that’s coming…
It’s a Hong Konger in a helicopter – armed with bags full of cash.
Visit Hong Kong: tomorrow’s crises today!
… every few seconds their eyes would study the western horizon long and anxiously. A visiting pilot would have known at once that the evening patrol was overdue. As a matter of fact, it should have been in ten minutes before.
‘Here they come!’ The words were sufficient to cause all further pretence to be abandoned; officers and men together were on their feet peering with hand-shaded eyes towards the setting sun whence came the rhythmic purr of rotary engines, still far away…
– The Camels are Coming
We wrote a lot last year on the strange and disturbing events that have been occurring, with accelerating pace, in Hong Kong.
The island is a writhing bag of so many issues and themes we can expect – or at least imagine occurring – across the developed world in the near future.
Wealth disparity soaring to staggering heights as property prices triple while wages stagnate…
Riots breaking out as the social tension finally comes to a head, millennials forming a significant bulk of the agitators…
The rise and brutal exercise of digital totalitarianism, as the internet and all the devices meant to make lives easier are twisted into a grotesque tool of state power…
And the awful face of the Chinese Communist Party (CCP) revealed in ever greater definition.
In Golden toilets, bespoke truffle transport, and 15 bucks for sex (20 November) I argued that while the criminal CCP deserves the negative headlines (and thousands more for its indescribably outrageous crimes against humanity), the wealth inequality side of the Hong Kong scenario receives less focus for its role in fomenting social unrest in the region.
This has been driven (amongst other things) by global central bank policies inflating asset prices, put on steroids by fiscal stimulus from the mainland.
The combination of both put the social unrest further ahead and brought the social unrest even closer in HK relative to the rest of the world. That’s my view, at least – and it’s why I look to the events transpiring over there as a guide for what we might see over here in the future.
And on Tuesday in “future town”, a wild reality begins, which you’ll see heading closer to our shores in the future. one way or the other. A political solution you should bear close attention to particularly.
The Camels..
The crisis..
The easy-credit…
The negative interest rates
The CASH is coming!
Forget lowering interest rates and quantitative easing. Hell, forget printing money to buy shares like those weirdos in Switzerland.
Forget tax cuts and subsidies.
Forget help-to buy schemes.
Screw the lot of them. Throw that impotent garbage in the trash.
You want to know how a REAL baller stimulates the economy?
You inject that stimulus INTO THE VEIN. None of this “risk of inflation” poppycock – what is this, the 1970s? You’re afraid of FOOD PRICES going up? Buy it off the Brexit preppers kiddo, this is the big boys’ table; we’re chasing some serious GDP figures here, and that takes serious action. What was Bernanke always on about? The courage to act goddammit. Any chickens in this administration can go serve themselves to the rioters out there. You want to earn a place here, you get with the programme and start serving them money…
… or at least, that’s how I imagine the mid-crisis presentation within the Hong Kong Executive Council went. However it happened, helicopter money is now here: 10,000 Hong Kong dollars (roughly a thousand quid) for every adult permanent resident on the island. Fresh cash, delivered straight into the hands of the people, for free. You don’t need to be seeking a job, or unable to work.
The only reason they’re not chucking it out the doors of a helicopter is because its easier to just summon digits on a banks database. Andrew Yang may have bailed from the US presidential race, but his “Freedom Dividend” lives on abroad.
The grand issuance of “free money” in HK is currently being described as a one-off, but as Milton Friedman once said, there’s nothing so permanent as a temporary government programme. The people will call for more “stimulus” the same way markets do. The effect on markets from this form of stimulus will be highly different from what they’ve been used to however…
I’d like to continue this in more depth, but it’s almost midnight I’m afraid and it’s time for me to grab some shut-eye. But in the meantime, take heed – the helicopters are coming and you should be equipped for their arrival.
Much storied and debated in the years around the financial crisis, it has finally arrived in HK, but its use won’t be limited to that small island. After all, what better bribe vote-winner can one realistically imagine?
I’ll explore more of this topic in a later note, but if you want to prepare for the mighty helicopter drop here in the UK, I’d look in the direction of the great inflation hedge of energy companies, and a certain yellow metal that you’d be stupid to buy because after all it’s only a pet rock, pays no dividends, and is only coveted by a fringe group of paranoid idiots who think people in charge of paper money systems might actually not know what they’re doing.
All the best,
Boaz Shoshan
Editor, Capital & Conflict
Category: Market updates