Has the next great depression already begun

[fearless9]

We sailed through the recession whilst everyone was arguing as to whether we would enter recession or not.

Painful for some and a blur of woolly thinking for others.

Now we go through the same exercise all over again, but this time we are not talking falling house prices ... NO NO NO

This time we are measuring the depth of the disappearing money hole, not in silly little billions, or even a trillion.
No this hole is in excess of 10T and picking up speed.
Call me an old fashioned fool but I bet you that US banks alone will absorb another T or two in '09 with nothing to show for it.
RE will continue to fall, so don't get all excited by with falling unsold inventory.
And let us not forget that the unwilling Consumer in '09 will drive huge holes through balance sheets.
All these actions add to the black hole of debt.

So that just leaves the markets to save the world.
But wait a minute, increased capital gains taxes will skim the cream off any profits.

I will not even mention two wars.

If the world is going to absorb US20T+ just to staunch the bleeding, tell me where inflation is coming from.

Certainly O's infrastructure scheme has merit in the sense that over weight office workers will dig ditches and therefore become healthier and more humble but aside from spending on the basics do you imagine they are going to purchase a new car or house let alone keep the factories of Asia and the US retailers in business.

All in all '09 is shaping up to be a very interesting year.


regards
f9

 

[dumb_mother]

agree completely- and what is going to happen when the US tries to unload another 2+T in bonds next year- could we see the last, and very clearly biggest bubble go bye bye

 

[fearless9]

Quote from dumb_mother:

agree completely- and what is going to happen when the US tries to unload another 2+T in bonds next year- could we see the last, and very clearly biggest bubble go bye bye

Look at Taiwan's response to their Freddie and Fannie holdings even after US gov initiated the bailout.

I am sure that Taipei and Beijing put their heads together before the Taiwan announcement

regards
f9

 

[luken]

Been through one of these before down south america about 10 major banks got bailed, only to go bust 6 months later leaving the goverment broke and its people in misery, a bank bailout is a very good indicator of things to come.

 

[fearless9]

US consumers are currently buying new cars at the annualised rate of 10.5M and dropping.

Slightly down from the peak of 17M a couple of years ago you might think.

Along comes O and bails out the big 3, but what are they going to do, what are they going to produce and for whom.

Maybe they could lease out their manpower back to the gov to paint bridges and thereby complete the perfect monetary circle.

regards
f9

 

[libertad]

Good posts....

All in all....time to clean house ...so to speak....

And get far more efficient across the board......

It makes no sense to continue the carrying of losses via socialistic means.....This is just like burning stacks of money for no reason....

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Just to carry this a little further....

When one buys a car...what % of the price is actually the car ?
....and keep in mind ...what % of the price of the other inputs....were actually the inputs?

When one goes to a doctor and pays via insurance....what % of the payment actually represents the actual visit ?

Stocks....a market can exist with a few computer banks and the interested parties that trade and invest....transact for 20 cents a name change no matter what the share count.......

Stock information can be provided by Google....

Listings boilerplate simple.....

Positions restricted relative to float.....
.............................................................................

In short....there is a lot of efficiency to be found....

..............................................................................

And the time allotment of the finding of these efficiencies....could be termed a depression.....

 

[fearless9]

Quote from libertad:

Good posts....

All in all....time to clean house ...so to speak....
............................................................................

In short....there is a lot of efficiency to be found..................................................................................

And the time allotment of the finding of these efficiencies....could be termed a depression.....

Yes, very well put.

When we review the economic history of US, it was lead by an unquenchable desire to succeed.
Individual effort was gradually replaced by team effort lead by good solid engineering.

Work became a cornerstone of the US culture and the country grew.

Then greed and woolly thinking slowly replaced engineering and a pride in hard work and effort and look at the mess this line of thinking has created.

But the slide is not all over and will not be over until this current concept of rewarding fools and greed has come to pass.

The collective talent and work ethic in US is simply enormous and this is what should be allowed to lead the country back to safety.
I say "safety" because right now US is on very dangerous ground.

regard
f9