Imminent US bubble burst? Your thoughts on this article?

[wayneL]

As a side note: I wouldn't want to be living in some of their cities, full of angry desparate people....Armed to the teeth.


Vicki

Are you married to robots?

:

 

[Vicki]

Are you married to robots?

:

Yes It might appear we agree on something lol.

Might be a distorted view, but I've watched 'Ross Kemp' on gangs, US eppisode, & remember being horriffied at the amount of gun-related crime as well as the shocking amount of fire-arms in the communities...Automatic weapons taboo.

He also spent some time hang'n round emergency rooms in Orange county FL. I think.
Where young offenders are made to look at the consequences of gun violence.
Didn't have to wait long.

I just shudder at the thought, If there was a crisis in the US, & shortage of food or increased desperation etc....And all those guns?

You can get thugs in any country, but not all are pack'n AK47'S & desert eagles.

Vick

 

[wayneL]

Yes It might appear we agree on something lol.

Might be a distorted view, but I've watched 'Ross Kemp' on gangs, US eppisode, & remember being horriffied at the amount of gun-related crime as well as the shocking amount of fire-arms in the communities...Automatic weapons taboo.

He also spent some time hang'n round emergency rooms in Orange county FL. I think.
Where young offenders are made to look at the consequences of gun violence.
Didn't have to wait long.

I just shudder at the thought, If there was a crisis in the US, & shortage of food or increased desperation etc....And all those guns?

You can get thugs in any country, but not all are pack'n AK47'S & desert eagles.

Vick

The problem is that in other countries only the thugs have AK47s etc.

 

[Smurf1976]

One thing I've learnt from the last GFC, is that "they" can (and will) prop things up for a helluva lot longer then "we" think they can.

I'm certain of a "when", but it could be a long time coming.

Agreed.

Something I've learnt with both financial and non-financial systems under stress is this.

The stress will gradually erode the ability of the system to cope with an external shock. For example, a company gradually runs down its cash reserves or an overloaded water supply system gradually drains the dams.

Various predictions of the "deadline" to resolve the situation based on the above will be made. They will usually be wrong.

At some point an external shock, such as an interruption to production in the case of a mining company or a drought in the case of the water supply example, will arrive. With cash / water reserves already depleted due to the underlying problems, this shock becomes the visible trigger event for a crisis that was always going to happen, the only question being when.

Had the underlying situation been healthy then the shock would have been just a page or two in the annual report. If the company had $100 million to spare, if the dams were almost full, then nothing drastic would have happened since there was plenty of "buffer" to cope with the problems. But with very little in reserve before the crisis hit, outright failure is inevitable.

And so it will be with the US situation. Clearly under stress and heading toward an inevitable crisis. At some point there will probably be a "shock" event, the nature and timing of which would be impossible to predict other than to say something will happen sometime. And that shock will be what tips them over the edge...

Possible shocks? Basically anything that seriously rocks the system. Trying to predict the "what" would be futile in my opinion, other than to say one day you'll wake up an it will have happened. That said, as the system is increasingly stressed, the size of the shock required to bring it down decreases with time until the event finally happens.

It's much like how I remember reading about the problems at General Motors back in 2002, likewise some of the US mortgage lending giants. It was inevitable that trouble lay ahead, and 6 years later it finally happened with the GFC. Trouble was inevitable, it just needed a trigger (and sooner or later you can be pretty certain that there will be a trigger for just about anything).

 

[Vicki]

Could one of these triggers perhaps be, a virtual dumping of the US dollar, by concerned foriegn countries?

Vicki

 

[Pager]

So many people and commentators seem to be convinced the US is about to implode and go on about deficits, bubbles, Debt etc etc.

I haven’t a clue personally but what I have noticed over the years is the experts and academics more often go over board with there dire predictions of doom and gloom and things pan out no were near the degree of doom, either that or there completely wrong, i would be more worried if the same people were all milk and honey and saying the US and its economy had never been better

 

[Vicki]

So many people and commentators seem to be convinced the US is about to implode and go on about deficits, bubbles, Debt etc etc.

I haven’t a clue personally but what I have noticed over the years is the experts and academics more often go over board with there dire predictions of doom and gloom and things pan out no were near the degree of doom, either that or there completely wrong, i would be more worried if the same people were all milk and honey and saying the US and its economy had never been better

Like some of the US politicians & their paid fo, media cronies?

Vick

 

[Vicki]

So many people and commentators seem to be convinced the US is about to implode and go on about deficits, bubbles, Debt etc etc.

I haven’t a clue personally but what I have noticed over the years is the experts and academics more often go over board with there dire predictions of doom and gloom and things pan out no were near the degree of doom, either that or there completely wrong, i would be more worried if the same people were all milk and honey and saying the US and its economy had never been better

Like some of the US politicians & their paid for, media cronies?

Vick

 

[Julia]

So many people and commentators seem to be convinced the US is about to implode and go on about deficits, bubbles, Debt etc etc.

I haven’t a clue personally but what I have noticed over the years is the experts and academics more often go over board with there dire predictions of doom and gloom and things pan out no were near the degree of doom,

Well, if that's the case, where were their gloomy predictions pre the GFC? Didn't they all repeatedly tell the gullible public that all would be well?
I remember clearly the pundits who said the subprime crisis in the US would be contained there. That the notion it could lead to a global crisis was preposterous.

 

[satanoperca]

I remember clearly the pundits who said the subprime crisis in the US would be contained there. That the notion it could lead to a global crisis was preposterous.

Brilliant :bananasmi

 

[Smurf1976]

Well, if that's the case, where were their gloomy predictions pre the GFC? Didn't they all repeatedly tell the gullible public that all would be well?
I remember clearly the pundits who said the subprime crisis in the US would be contained there. That the notion it could lead to a global crisis was preposterous.

I'm still paying attention to the same commentators I've been paying attention to for years.

Back in 2002 I didn't know whether to believe them or not when I heard about GM being likely to end up broke and likewise major mortgage lenders, rising gold price etc. I thought the Fannie Mae / Freddie Mac stuff was literally a joke for a while (what a truly ridiculous name for a financial institution!) but sure enough, they ended up in trouble as predicted.

Track record is pretty good so far. Needless to say, I don't bother listening to the mainstream "nothing to worry about" crowd...

 

[Pager]

Well, if that's the case, where were their gloomy predictions pre the GFC? Didn't they all repeatedly tell the gullible public that all would be well?
I remember clearly the pundits who said the subprime crisis in the US would be contained there. That the notion it could lead to a global crisis was preposterous.

Erm thats my point, the experts dont really know what will happen

 

[satanoperca]

Erm thats my point, the experts dont really know what will happen

I think it is a case of them knowing what will happen but they cannot accurately predict when it will happen, the emphasis is time.

Cheers

 

[Pager]

I think it is a case of them knowing what will happen but they cannot accurately predict when it will happen, the emphasis is time.

Cheers

Which though

When they tell the gullible public that all would be well or when they predict an imminent bubble burst.............................

 

[satanoperca]

Which though

When they tell the gullible public that all would be well or when they predict an imminent bubble burst.............................

They will always tell the public everything is going to be A OK, dont need to create hysteria.

The are well aware that GFC bear just went back into the cave after being pushed back with the heavy burden of debt. The question is when will the GFC bear come out of hybernation to play again.

Cheers

 

[derty]

I'm still paying attention to the same commentators I've been paying attention to for years.

Who do you pay attention to Smurf?

 

[qe2infinity]

Gold price is being manipulated. Dec had an increase of over 120% for demand in physical gold yet the market price stayed flat. So much for supply and demand.

China and USA is doing everything it can to prop up the US dollar. They can only manipulate it for so long til it implodes

agree with Dowdy, would also like to add that silver was manipulated too, by who else but JPMOrgan...any surprises?

china will keep their currency low to help exporters and eventually reduce their USD holdings...who would like to hold something that continues to fall in value?

 

[Mofra]

I haven’t a clue personally but what I have noticed over the years is the experts and academics more often go over board with there dire predictions of doom and gloom and things pan out no were near the degree of doom, either that or there completely wrong, i would be more worried if the same people were all milk and honey and saying the US and its economy had never been better

In modern society, there are a million voices making many predictions, and those that tend to get the exposure are those that will catch the most attention - this invariably leads to the most shocking predictions gaining the most traction.

The hard part is shying away from the economic shock jocks and finiding those that can put forward a reasoned opinion without needing to resort to cute catchphrases.

 

[explod]

agree with Dowdy, would also like to add that silver was manipulated too, by who else but JPMOrgan...any surprises?

china will keep their currency low to help exporters and eventually reduce their USD holdings...who would like to hold something that continues to fall in value?

In recent times it has been the US Federal reserve providing the backing for JPMorgan to do the rigging. And you can easily guess, to hold up the dollar.

Trying to find an economist that is truly independent, not selling something or having his/her own axe to grind and who is very well educated in the field (of economics) is very difficult.

I have subscribed to a number but the standout, and I am in no way connected to him is Jack Buckler and his newsletter "The Privateer" all of his statements and conclusions are backed up by actual figures, more often than not from Government or an organisations own figures. Actual quotes are given references that can be easily verified. The bigger picture of world economics is not that difficult if we can get onto the correct guidance.

It is worth looking out for and noting that almost no mainstream financial commentators will qualify anything that they assert.

 

[FxTrader]

In modern society, there are a million voices making many predictions, and those that tend to get the exposure are those that will catch the most attention - this invariably leads to the most shocking predictions gaining the most traction

Here's another shocking prediction for you from Charles Hugh Smith (oftwominds.com)...

Why the World Is Financially Doomed in Four Charts (January 6, 2011)

The global economy is doomed to implosion, and here are four charts which explain why.

Though the complexities may appear endless, the global economy's coming implosion is really fairly easy to understand: here are four charts which do the heavy lifting. It boils down to these basics:

1. When money is dear and difficult to borrow, then productivity and capital accumulation are encouraged, speculation, malinvestment and debt-based consumption are discouraged.

2. When money is "free" (zero-interest rate policy) and liquidity is unlimited, then the opposite conditions hold: speculation in risk assets, malinvestment and debt-based consumption are all encouraged, and productivity and capital accumulation are heavily discouraged.

3. When debts exceed the value of the underlying assets, the only way out of the Tyranny of Debt is to write off the debt on both the borrower and lender's balance sheets, wiping out their capital via liquidation and bankruptcy.

4. The "extend and pretend" policy pursued by all major nations is simply transferring the impaired debt from private hands to the taxpayers (public debt), crippling the economy with higher taxes and higher debt service.

5. The Central State's "extend and pretend" policy requires heavy borrowing every year to prop up the status quo, pushing the Central State (or equivalent, i.e. the Eurozone) into an inescapable double-bind: either continue increasing public debt and cripple the economy with high taxes and high public-debt servicing costs, or let the financial status quo of "profits are private, losses are public" implode.

The first path leads to default, as the Tyranny of Debt cannot be masked for long, while the second path wipes out the Financial Power Elite which feeds the politicians.

Here are the charts. Note how the speculative economy created the illusion of rising wealth for the bottom 90%, an illusion stripped away by the Default Economy.

In essence, the Financial Power Elites profited immensely from creating this illusory wealth which gave the bottom 90% the false sensation that their declining earnings and purchasing power were being offset by the "magic" of asset bubbles.

Then, when the bubble popped, the Financial Power Elites transferred the impaired assets to the taxpayers, a process which is still underway. The politicos of both parties are complicit; behind the simulacra of toothless "reforms," this process proceeds in myriad ways (Bank of America transferring toxic debt to Fannie/Freddie, etc.) Behind the smokescreen of conjuring a "wealth effect" to foster more consumption, the Fed's purchase of Treasuries (QE2) serves this transfer-of-debt-to-the-public process.




This same process is playing out throughout the global economy: Greece, Ireland, the U.S., and eventually, in China when its monumental property bubble pops.