USA economic collapse in 2005?

[stockGURU]

Found this interesting article that predicts an economic collapse for the USA sometime early next year:

"What is clear now is that this unsustainable effort is likely to come to an end sometime in 2005, just after the elections, regardless of who is President. Given the scale of the money-printing by the Fed and the US Treasury since 2001, it is pre-programmed that the "correction" of the latest Greenspan credit binge will impact the entire global financial and economic system. Some economists fear a new Great Depression like the 1930's. The world today depends on cheap US dollar credit. When US interest rates are finally forced higher, dramatic shocks will hit Europe, Asia and the entire global economy, unlike any seen since the 1930's. Debts that now appear manageable will suddenly become un-payable. Defaults and bankruptcies will spread as they did in the wake of the 1931 Creditanstalt collapse"

http://www.globalresearch.ca/articles/ENG407A.html

Would be interested in the opinions of others regarding the credibility of such a claim and the implications for the global economy if it is true.

 

[phoenixrising]

I find the housing "bubble" bit interesting

So 50% rise in 5 yrs is out of cotrol?
Prices doubling in 7 yrs a worry?

The Oz maxim of real estate doubles every 7 to 10 yrs seems normal to me
97 to 03 has done more I know but other than concerns for people entering the workforce now and trying to get into the market, I don't hear that the universe as we know it is about to collapse.

And 20% over valued, why loose sleep

Yes the US debt is a concern, whats going to happen I don't know
This same argument was around in the early 90's.
There was a book called "Surviving the 90's coming depression"
It didn't happen obviously.

If we all collectively beleive it's coming it will and the reverse is true also

Cheers

PR

 

[Bonk]

Be happy~! atleast in australia we will be able to pay the rent and eat as there is so much going for it.... atleast i wont go hungry .

Go for that world trip now and enjoy what you got ......the future will take care of itself .

Maybe we can get ready for the "great collapse", and make a killing ~! on the other side .........?

 

[Cosmos]

God dam, dickheads have been predicting economic collapses in the US for the last 10 years.

The economies/markets have 58 year cycles, the next been 2045 and it fits well.

2039 is the year social security starts to lose money.
2044 its out of money
2045 it has to cash in gov bonds its had for the last 50 years

Now maybe then when the US gov is forced to payout in a couple of trillion in cash we may have a problem.

As for now there is no problem and there never will be a major one.


Cheers

 

[wayneL]

These things tend to happen when no one is expecting them.

Smartest attitude IMO is to have a contingency plan in place for if/when the world economy does melt down.

This is something permabulls have great difficulty with, and it is these people who will unfotunately be hurt the most if/when the occasion arises.

Economies are tremendously complicated and no-one can pick a small set of factors and make a prediction based upon them. It is a left field event which will trigger something off.

Til then be like the boy scouts...be prepared.

Cheers

 

[tech/a]

Wayne

Im interested in how you/me/or anyone would prepare yourself for such an event.

Could I have your views?

 

[wayneL]

Just a short note:

Not ignoring you all, missus has me doing some work for her business.....so will be coming back to this later.

Cheers

 

[tech/a]

Thought you were preparing for the Armagedon.

 

[wayneL]

Thought you were preparing for the Armagedon.

Nah, but the scene may have resembled it here if I didn't help missus

 

[positivecashflow]

Wayne

Im interested in how you/me/or anyone would prepare yourself for such an event.

Could I have your views?

Adjust your positions so that in the event of a market move in the opposite direction, you will not get hurt. Maybe you can lock in your profits and exit the trade or place a low cost trade that will be there should the market go against you. E.g EBAY - if you had EBAY to the upside, a call ratio backspread (for a credit) would have protected you during its severe drops (you would still have your credit) after EBAY missed its earnings target by a "single penny". A cheap OTM Put could also be employed if you had bullish positions on a trade and vice versa(that would change a few risk graphs).

 

[DTM]

Hi Wayne, Posi

Can you see a pullback in GOOG coming up? It looks like the price has peaked and a round of profit taking will occur.

Any thoughts?

 

[money tree]

never short a stock that has surprise upside earnings

BHP is an example

 

[DTM]

GOOG down $6.50

 

[wayneL]

Yeah DT,

Intersting that it was hitting range highs (the code I placed on the other thread) in several different time frames. It's not a signal I would have taken though.

Did you trade it?

 

[DTM]

Yeah DT,

Intersting that it was hitting range highs (the code I placed on the other thread) in several different time frames. It's not a signal I would have taken though.

Did you trade it?

No. I'm still trying to find my bearings with the US markets. I was looking at it because all the signs were saying that the only way from there is down. I doubt if they can match this year's performance and the way I read the charts, people were expecting a good year and were ready to sell out once announcement came through. Anyway, that's how I interpreted it.

Interesting that the strike prices were $5 apart. If I had made my usual buy at 10 contracts, that would have been $5,000 USD. Now that's expensive but because it moves with such speed, I probably would have made a lot of money and could have taken my risk out of the trade by selling half the contracts. I'm always very wise with hindsight.

 

[stockGURU]

"March 02, 2005

Is America going broke?

Record deficits, colossal debt and no clear plan for digging itself out. If the U.S. sinks, it will take Canada down with it.

STEVE MAICH

David Walker can see the future, and it scares the hell out of him.

That wouldn't be terribly unusual if he were one of the thousands of lobbyists, legislators and activists crawling all over Washington on any given day, pontificating about the urgency of their pet issues. There is a thriving industry here built on pushing policy prescriptions for every ailment, real or imagined. But Walker isn't a lobbyist or an activist, he's an accountant. His title is comptroller general of the United States, which makes him the head auditor for the most important and powerful government in the world. And he's desperately trying to get a message out to anyone who'll listen: the United States of America's public finances are a shambles. They're getting rapidly worse. And if something major isn't done soon to solve the country's intractable budget problems, the world will face an economic shakeup unlike anything ever seen before."

(more)

http://www.macleans.ca/topstories/world/article.jsp?content=20050307_101541_101541

This issue of America's collossal debt doesn't seem to be going away. Will the bubble burst eventually or will the USA be able to weather the storm with high levels of economic growth?

What would happen if one day the world financial markets lost confidence in the ability of the USA to service it's debt?

 

[tech/a]

I see this as the way terrorism will eventually have its day.
Wars here outbreaks there with America spending Billions
running around policing everything with no way of paying this huge cost.
Minimum cost to terrorists huge costs to policing.

Like the old story of the midget causing a cut in the giant.
Giant dismisses it as a nick.
Nick becomes a sore sore festers and needs amputation,
rots set in though and amputation doesnt stop the poison
which eventually kills the giant.

Simplistic?

 

[RichKid]

I see this as the way terrorism will eventually have its day.
Wars here outbreaks there with America spending Billions
running around policing everything with no way of paying this huge cost.
Minimum cost to terrorists huge costs to policing.

Like the old story of the midget causing a cut in the giant.
Giant dismisses it as a nick.
Nick becomes a sore sore festers and needs amputation,
rots set in though and amputation doesnt stop the poison
which eventually kills the giant.

Simplistic?

Apt anaolgy Tech/A, sometimes simplicity is ignored. Reminds me of the cold war, Russia just couldn't keep up the military spending they needed to stay ahead in the arms race, the Americans did a good job of scaring the hell out of them too to encourage high spending. The worst thing for America is the current administration, they have overstreched their military and dispersed them around the world. It costs biliions (literally) just to keep them well supplied. The industrialists behind the current administration don't care since they make loads of money over supply contracts and the like.

The terrorists certainly have achieved some of their aims, democratic govts are often pressured into taking expensive defensive measures, otherwise they get voted out of office at the next disaster. It doesn't help when people like Bush jnr go on crusades actually looking for more people to fight. These Americans aren't completely stupid though, they may find a way to wriggle out of it, at somebody elses expense- might spend more money on another 'hostile takeover' of an oil supplier (read 'like Iraq'- but look where that got them).

 

[wayneL]

Jim Puplava interviews Robert Prechter.

Very interesting......

windows format http://www.netcastdaily.com/broadcast/fsn2005-0618-2.asx

realplayer format http://www.netcastdaily.com/broadcast/fsn2005-0618-2.ram