Very long weekend if you took leave on Monday.

Happy Deepavali to those celebrating it.

books on bookshelves

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Junk Bond Bubble in Six Images (Mish Talk)

You know what they say: always follow the money.

If you want to look for where the seeds of the next crash are, you don’t have to look any further than where debt has been building up and therefore, is more likely to implode.

With interest rates going up at a quicker pace as compared to past years, debt serviceability will become an issue for more risky borrowers. If the proceeds from borrowing went into (a) saving a sinking ship, or (b) unproductive assets, that will also be a problem for those who borrowed thinking that rates are low.

Mish’s charts also show what all this could mean for the equity markets.

 

What Today’s Trend Following Sell Signal Implies For The Months Ahead (The Fat Pitch)

I’ve heard of Meb Faber’s signal before but it totally fell off the radar for some reason. I think it’s because I looked at how the signal would have applied to the STI and realised that the whipsaw from buying and selling wasn’t my cup of tea. The findings from the paper are impressive though.

Anyway, if this is triggered on the S&P…

As the post says, there’s a fair chance (about 50-50) that we’re about to see more pain in the markets.

 

The Road To Burnout Helped Me Find My Purpose (The Physician Philosopher)

I read this via Minimalist in the City and the post resonated with me because for those of us who have been working for a while, it’s no surprise that there are shitty aspects to our jobs. Some people may love what they do but even then, they cannot deny that some parts of the job suck. For example, I may love to teach because I get to share and discuss stories and ideas but I hate to deal with all the administrative tasks that come with the job.

I don’t think I have, or even will, hit the burnout stage in my current job but there’s no doubt that I wouldn’t want to be there all the way till I retire/die like some of the older colleagues.

Fortunately for me, and unlike the doctor in the post, I didn’t have to wait until I started working to figure out that I had to build some sort of money machine in addition to the income that I’m getting from my job. It’s still a work-in-progress but I can definitely see it coming together.

If you love your job but haven’t thought about not relying on it for income, I suggest you start today.

Creative Destruction (Humble Dollar)

With the recent emphasis in Singapore on lifelong learning, I thought that this post is quite timely. It goes to show that being adaptable is a necessary skill in life because it seems that a core feature of life is the constant change.

With all the advancements in A.I and robotics, I suspect that both white and blue-collar jobs that are fairly routine will be the first to go. The good news is that the change will happen quicker in countries where the infrastructure was never laid and therefore more open to new forms of organisation. For example, think about how China was so much quicker to adopt mobile payments than more developed countries like Singapore or Japan. In fact, a lot of transactions in Japan still rely on cash. At least in Singapore, we have that dastardly system called “NETS”.

 

Public Pensions for Sale (part 1 of 3) (The Intercept)

Amazing account of how the people running some of the public pension funds sold out to Wall Street. Very long read but this is what journalism is about. Classic examples of information asymmetry and agency problems at work.

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