Another bubble thread

[widebody911]

http://www.financialsense.com/stormwatch/oldupdates/2004/0618.html

Interesting, although it's peppered with a couple of digs at Kerry.

[CamB]

Wow:



I note only that recent history (last decade or so) is incredibly different to what came before that!

[turbo6bar]

" With Asian central banks pulling back on their purchases, the Fed may have no choice but to start monetizing our debt. The government deficit will be over $500 billion this year and the trade deficit is tracking at an annual rate of $575 billion. Where will all of this money come from? If the government tries to get it from taxes, there will be a tax revolt in this country the likes we have not seen since the founding of this country. Taxes are going to go up no matter who is elected president. Kerry will raise tax rates the most, which will be the final death knell on the economy. Regardless of what tax rates our leaders impose, they won’t be high enough to cover the government’s voracious appetite for spending. (Each candidate is proposing massive new spending programs.) Taxes will not be able to cover the government’s bill. Government simply spends more than it takes in. So what they don’t take in taxes will be made up by printing more money. This will further accelerate inflation."

Also, the article claims inflation is much worse than currently stated, since the index is based on rent equivalents instead of actual costs. Commercial and residential rent has been stagnate for several years. The real inflation rate may be closer to 8-10%.

Perhaps Kerry shouldn't win this election. If he does, he'll be walking into a big *****storm of economic heck. I only found one 'dig' at Kerry regarding spending polices, quoted above. This is beyond Democrat vs. Republican.

[Moneyguy1]

And at the time of the writing, oil was $31 a barrel.

Man, are those with ARMs gonna take it in the nose!!!!

As a financial planner, I always wondered when I would see the 3,000+ square foot acre plus house with the new Lexus in the driveway, what portion of either was actually owned by the resident. Rarely saw anyone inquire about investment driving a Lexus or other high end trendy car. The folks I had in my office with the real money generally lived modestly and drove Ford LTDs, generally in grey, black or (occasionally) white. They invested in General Electric and the like. Taught me at least as much as I taught them, probably more.

Life is funny. I just hope too many folks aren't hurt when the adjustments are made.

[island911]

That website pegs my BS-meter.

Theses efforts to tell us how bad things are . ..

[CamB]

I gotta say that the length of the article and the wording of the bits I read seemed a little alarmist to me too. However, some of the pretty pictures (which I did read more carefully) still paint a pretty interesting picture.

[widebody911]

Originally posted by island911
Theses efforts to tell us how bad things are . ..

OTOH, I haven't seen anything from the other camp explaining in great detail what is good about these various statistics, or what's good about the economy in general. All I've seen are reports that gush over statistic X and how it's "surged" .0y point, the largest increase in Z weeks.

So, can you debunk the urban myth of the over-leveraged homeowners who've buoyed the economy with their own macro deficit spending? Can you debunk the myth of the XXX trillion national debt with no resource on the horizon to pay for it. It seems to be a foregone conclusion that Kerry would raise taxes, but GWB will cut them. How will GWB's tax cuts decrease the deficit?