On Thu, Nov 20, 2025 at 11:36 AM, Les Schaffer wrote: > > what's your take?
David Dayen is someone whose credentials I can vouch for. I also think Michael Burry knows what he is talking about. When Dayen says "We have a 2000s housing bubble level of financial engineering on top of a 1920s level of private unregulated lending on top of something bigger than a 1990s internet (or 1870s railroad) level of technology and infrastructure build-out. It’s one bubble to rule them all." He means that the deal makers are depending on arcane financial wizardry to conceal what they are doing, perhaps even from themselves. They are making objectively high risk investments for the high returns but hiding the risk in "complexity." Hiding the risk doesn't reduce it. It probably increases it because it fosters "creative accounting," which occupies a spectrum terminating in embezzlement and fraud. In 1990, Hyman Minsky wrote an article titled The Bubble in the Price of Baseball Cards ( https://digitalcommons.bard.edu/hm_archive/94/ ). It started out talking about baseball cards and then segued into sovereign debt crisis of the 1980s and then "one of the puzzles of the 1980s -- the rapid rise in the financial wealth of Donald Trump." The puzzle, Minsky revealed, was that the banks failed to realize Trump was "Brazil in drag." The technical term Minsky offered for the financial dealings of Mexico, Brazil, and Argentina in the 1970s and Trump in the 1980s is Ponzi finance. In Ponzi finance, debt is serviced by more debt, not from net revenues. NVIDIA is sort of a reverse ponzi. It is acting as a quasi-bank, making loans to the entities that have to service their debt with more debt. It's a business model... of sorts. But not a sustainable one. -=-=-=-=-=-=-=-=-=-=-=- Groups.io Links: You receive all messages sent to this group. View/Reply Online (#39379): https://groups.io/g/marxmail/message/39379 Mute This Topic: https://groups.io/mt/116383307/21656 -=-=- POSTING RULES & NOTES #1 YOU MUST clip all extraneous text when replying to a message. #2 This mail-list, like most, is publicly & permanently archived. #3 Subscribe and post under an alias if #2 is a concern. #4 Do not exceed five posts a day. -=-=- Group Owner: [email protected] Unsubscribe: https://groups.io/g/marxmail/leave/13617172/21656/1316126222/xyzzy [[email protected]] -=-=-=-=-=-=-=-=-=-=-=-
