Playing the Blame Game in a Fractured World... And a Return of the 'Meme' Stocks

There's always a motive... That's one way of thinking about anything a central banker says... no matter how logical it may seem. Take the recent speech by European Central Bank President Christine Lagarde on the effect of de-globalization, which was the focus of the April 20 Empire Financial Daily... In that essay, I quoted a […] Not rendering correctly? View this e-mail as a web page [here](. [Empire Financial Daily] Playing the Blame Game in a Fractured World... And a Return of the 'Meme' Stocks By Herb Greenberg --------------------------------------------------------------- [Whitney Tilson says buy these five stocks TODAY]( For a limited time, Wall Street legend Whitney Tilson is sharing the details on a situation he's been following for years. It's an opportunity to take advantage of an $87 trillion wave of wealth that has already started affecting the stock market. The good news is Whitney has handpicked his five favorite ways to play this situation. And he urges that you get in today. [Click here to see his analysis on these five stocks](. --------------------------------------------------------------- There's always a motive... That's one way of thinking about anything a central banker says... no matter how logical it may seem. Take the recent speech by European Central Bank President Christine Lagarde on the effect of de-globalization, which was the focus of the [April 20 Empire Financial Daily](... In that essay, I quoted a friend who is no fan of Lagarde but agreed with some of her points – especially how globalization kept down inflation. But after thinking it through, my friend wondered whether by being so candid and logical, Lagarde might have had have an ulterior motive. As he said... I suspect the issue of de-globalization, for lack of a better term, will potentially be used as an excuse by central bankers to increase their inflation targets. Maybe her speech was a crafty precursor to trying this. I am beginning to learn central bankers seem to like any excuse for more inflation. I guess like taking more heroin, it always seems to be the easiest way out, until it isn't, or you are dead, which might be one and the same thing. And as he went on to say... The central bankers, for some reason unknown to me, tried to fight it by trying to create more inflation, for no real reason. Not all lack of inflation is created equal. A lack of inflation created by globalization did not need monetary stimulus. It was a productive lack of inflation, which was not rate sensitive since rate lowering went into asset prices... not the productive economy. Now that globalization is going the other way, causing inflationary pressure, he muses... Instead of fighting it, the central bank now must get out of the way and let it happen? Central bankers seemingly only act in the direction of allowing for more inflation, for the most part – except for extreme circumstances like we have had over the last year, I guess. My friend thinks maybe only about 5% of what was offshored comes back... That's simply because "it's complicated and hard to bring it back, and we never have the wherewithal to take any short-term pain for long-term gain." Then, getting a bit more worked up, he added... To fully make my point, the price lowering impact of the 100 units of production that was offshored had to be fought tooth and nail by the monetary authorities with loose money to bring inflation back up. But now you're telling me the five units of production that will be de-globalized is a major crisis that needs to be addressed with a higher inflation target???? That does not seem very consistent to me. Nor does it seem to be sound logic. --------------------------------------------------------------- Recommended Link: [The Truth About 'Whisper Trades']( Everyone at the Empire Financial Research offices is buzzing about "Whisper Trades"... According to Whitney Tilson, this kind of trading is the fastest, most reliable way for the average investor to make 10x profits in America today. So far, only six people have seen this. You can be lucky No. 7... but only if you [click here now](. --------------------------------------------------------------- Will my friend be right? I have no idea, but there are clearly too many moving parts for comfort. I don't believe there will be full de-globalization. It can't happen. We're simply too interconnected, geopolitical dysfunction notwithstanding. China clearly wants to prove it's better than the U.S. and ultimately control everything. Culturally, the country believes it's superior... and if it isn't, it's certainly more clever. But in the end, China will be screwing itself... just like we screwed ourselves with all the offshoring. Early on, in the name of lowering costs and avoiding the continued pressure on wages by manufacturing unions, offshoring made sense. The unions, in a way, priced themselves out of the market. Technology accelerated their demise. Low-cost labor abroad (notably in China) was the solution, until it started to become pricier and pricier. Now, as the supply chain debacle caused by the pandemic proved so well – and tensions over Taiwan suggest – the U.S. has no choice but to onshore... It's already happening, but there will be limits... plus a bunch of factories will wind up in Mexico. (That's good news for a few U.S. railroads.) In terms of what Lagarde was saying – she's no dummy, and her comments were so pointed and seemingly candid you do have to ask: What was her real motive? The truth is that central banks around the world are tripping over themselves to buy gold, and they're not doing it for their health. Maybe that goes back to something else my friend said... We live in a victim culture now – maybe central bankers are claiming victimhood by secular forces? Who helped enable those secular forces to begin with? Hmmm... Hmmm, indeed... inflation be damned. Finally, just when you thought it was safe to go back in the water, we see a return of the nonsense... By that, I'm referring to a "Meme Stocks 2.0," with last week's out-of-nowhere explosive gains of shares in little-known, Hong Kong-based TOP Financial Group (TOP). The company went public last June at $5 per share. At its crazy unrealistic and unsustainable high last week, it traded as high as $256 intraday... before swiftly deflating by earlier this afternoon. Take a look... Should the U.S. Securities and Exchange Commission be doing more? Maybe... but [as I discussed on CNBC last Friday]( maybe these companies shouldn't have even been allowed to list in the first place. Regards, Herb Greenberg May 1, 2023 [Get a 60-day, 100% money-back trial to Empire Real Wealth by clicking here.]( --------------------------------------------------------------- If someone forwarded you this e-mail and you would like to be added to the Empire Financial Daily e-mail list to receive e-mails like this every weekday, simply [sign up here](. © 2023 Empire Financial Research. All rights reserved. Any reproduction, copying, or redistribution, in whole or in part, is prohibited without written permission from Empire Financial Research, 1125 N. Charles Street, Baltimore, Maryland 21201 [www.empirefinancialresearch.com.]( You received this e-mail because you are subscribed to Empire Financial Daily. [Unsubscribe from all future e-mails](