What Tabby has been lecturing about.

[pwd72s]

What? Me worry?

https://www.zerohedge.com/news/2018-05-26/12-indications-next-major-global-economic-crisis-could-be-just-around-corner

[widebody911]

That's why it was so important to get the huge tax cuts passed ASAP - once the next big recession hits, it will be politically impossible.

[tabs]

Originally Posted by widebody911

That's why it was so important to get the huge tax cuts passed ASAP - once the next big recession hits, it will be politically impossible.

What planet are you on? Tax cuts will not matter.

The Central bank's with their interventionist policy have been able to keep the delusion going. The situation has steadily been stealthly deteroiating all along as can be gauged by the growing instability in society and politics.when a crisis hits it will be a snap back into reality as suddenly you will come face to face with just how broke Americans are. Those retirement portfolios and re will be worth zilch. Jobs what jobs without demand of a broad based MC?

Society will become much more basic. Buying food will be a big deal.

[tabs]

Thx Pwd...we may not get out clean?

I have not been following developments closely for some time. I do watch SP 500 religiously. The smart money leaving the market is a reflection that the savvy players think that the steady accretion in value since 2012 is done. The gravy has been had.

The govt in the advent of crisis and massive unemployment will go in the business of providing sustenance to everybody. Everybody will be getting an EBT card for groceries and utilities. The government could very well nationalize the means of production.so that there isn't wholesale starvation. You won't be worrying about retirement anymore you will be worrying about eating.

[tabs]

When BO was in office conservatives always beothched about how lousy the economy was. Now that Trump is in office they say how swell it is, conviently forgetting the fundlemental realities. This indicates that they never got it in the first place.

The Liberals just think that raising taxes with more government control with a socialy redistributionist agenda will do the trick.

Neither view is correct. The global economy has outstripped the ability of the consumer to purchase. Credit was used as the instrument to keep the music playing and now that is running out.

[pwd72s]

Tossed out as food for thought...Market volatility and rising interest rates does tend to make one think of paring down on equities and moving to bonds...I'm not saying long term treasuries, shorter instruments as a way of preserving capital.

Factor your ages in as well..a 30 year old with marketable skills could handle a nasty and lengthy downturn and have time to recover. Ol' PWD at 74 doesn't have that time. So yeah, Cindy & I are very light on equities...extremely light, according to many of the financial talking heads.

[tabs]

I do believe that because of the undermining of the foundations of the economy it is not going to be a recoverable situation in anybody's life time. With the fall of Rome western Europe fell into a protracted dark ages. When the Egyptian Old Kingdom fell the civilization hit a nadir before the New Kingdom rose. So it will be with the Western civilization model.

[tabs]

Most people's perceptions are myopically locus specific to a few decades at the most. People's attention spans have gotten awfully short. The more you understand the vicissitudes of time and history therein the more panoramic your view becomes. The better able to have a more distant event horizon.

[tabs]

The way monetary policy is being applied the only thing cash will be good for is to wipe your azz. Just like the Weimar.

The government might just ignore cash like it ignores CSA currency. It is worthless. So they may issue an EBT card good for so many food credits a month.

[Cloggie]

Whilst I am not as apocalyptic as Mr. Tabs, it is clearly a deteriorating situation in which Nero is fiddling while the spot fires are filling the backstreets and shops.

Root causes are largely to be laid on the ruling types who have via a perverse combination of cheap money (low interest), profligate state spending too often aimed at non-economic value add and buying votes and a propensity to do this all on the same cheap debt regime that makes all of us want to buy more without truly having the means to afford them.

Once one understands TANSTAAFL then the whole deal snaps into focus and your higher probability paths for success become clearer.

I personally oscillate between high debt which I believe has a fair chance of being inflated into nothingness or no/low debt which does not require debt service during the transition.

In terms of investment, no great insight there other than favouring companies with real, tangible assets whose services are essential to societal operation - e.g. those boring utilities, basic services, food production - no so much to make money but to avoid losing it all.

I do not support Mr. Tabs' view that there is no way out, although we are approaching the 11th hour, it will require Trump-like aggressive actions and cleanout of government bureaucracies and refocus on national interests, and the chances of that happening in most countries is the square root of dick-all.

I also have precious little faith in people as they have lost their underpinning moral standard where what were once vices are now glorified and honesty and ethical behaviour is more seen as an anachronism.

It will be an interesting ride...

Douwe

[tabs]

Originally Posted by Cloggie

Whilst I am not as apocalyptic as Mr. Tabs, it is clearly a deteriorating situation in which Nero is fiddling while the spot fires are filling the backstreets and shops.

Root causes are largely to be laid on the ruling types who have via a perverse combination of cheap money (low interest), profligate state spending too often aimed at non-economic value add and buying votes and a propensity to do this all on the same cheap debt regime that makes all of us want to buy more without truly having the means to afford them.

Once one understands TANSTAAFL then the whole deal snaps into focus and your higher probability paths for success become clearer.

I personally oscillate between high debt which I believe has a fair chance of being inflated into nothingness or no/low debt which does not require debt service during the transition.

In terms of investment, no great insight there other than favouring companies with real, tangible assets whose services are essential to societal operation - e.g. those boring utilities, basic services, food production - no so much to make money but to avoid losing it all.

I do not support Mr. Tabs' view that there is no way out, although we are approaching the 11th hour, it will require Trump-like aggressive actions and cleanout of government bureaucracies and refocus on national interests, and the chances of that happening in most countries is the square root of dick-all.

I also have precious little faith in people as they have lost their underpinning moral standard where what were once vices are now glorified and honesty and ethical behaviour is more seen as an anachronism.

It will be an interesting ride...

Douwe

You say you do not support my view but then you cite the very basis of my rational that caused me to arrive at my view. Until the system hits bottom it can not have its moment of clarity. To be dissuaded from its fked up notions.

[tabs]

A couple of years back I found a Woman's League spiral bound cookbook (1985) on cooking during the Depression in a Thrift. It was full of personal stories about how people made do with what they had or could scrounge. The stories are sobering about those tough times

It was only ww2 that changed the dynamic. At that time the US had an extensive industrial plant that was just laying dormant. Today? It ain't the same.

[svandamme]

Originally Posted by pwd72s

What? Me worry?

https://www.zerohedge.com/news/2018-05-26/12-indications-next-major-global-economic-crisis-could-be-just-around-corner

the last crisis started with people protesting in Tunesia and what not, because food prices got to high because of high fuel prices.

First signs "It's kicking off" are happening in Brazil right now..

https://www.washingtonpost.com/gdpr-consent/?destination=%2fworld%2fthe_americas%2fin-brazil-a-truckers-strike-brings-latin-americas-largest-economy-to-a-halt%2f2018%2f05%2f25%2ffe3f06e6-6026-11e8-b656-236c6214ef01_story.html%3f&utm_term=.2a3f5e4b99e2

Truckers upset because their diesel costs more then they can afford to haul food around.
Gubmint thinks about subsidizing diesel now. That's not going to last.

Othere will be more things like this..
Look for 2nd world economies where they have imperfect gubmint, dictators, corruption prone, stuff like that.
They have ok economies when the going is good, but have no safety margin for high fuel prices and will be the first to choke...
mass strikes, protests, unrest, stuff like that.. that's how it started in Tunesia and surrounding areas in 08

People don't rebel against leadership if they are fat and happy, not even if their leadership is a dictator, like Khadaffi.
But but a reduction in standard of life is a feeding ground for dissent and then any other reason will be good, but the classic one is religion or left vs right.

[tabs]

Originally Posted by svandamme

the last crisis started with people protesting in Tunesia and what not, because food prices got to high because of high fuel prices.

First signs "It's kicking off" are happening in Brazil right now..

https://www.washingtonpost.com/gdpr-consent/?destination=%2fworld%2fthe_americas%2fin-brazil-a-truckers-strike-brings-latin-americas-largest-economy-to-a-halt%2f2018%2f05%2f25%2ffe3f06e6-6026-11e8-b656-236c6214ef01_story.html%3f&utm_term=.2a3f5e4b99e2

Truckers upset because their diesel costs more then they can afford to haul food around.
Gubmint thinks about subsidizing diesel now. That's not going to last.

Othere will be more things like this..
Look for 2nd world economies where they have imperfect gubmint, dictators, corruption prone, stuff like that.
They have ok economies when the going is good, but have no safety margin for high fuel prices and will be the first to choke...
mass strikes, protests, unrest, stuff like that.. that's how it started in Tunesia and surrounding areas in 08

People don't rebel against leadership if they are fat and happy, not even if their leadership is a dictator, like Khadaffi.
But but a reduction in standard of life is a feeding ground for dissent and then any other reason will be good, but the classic one is religion or left vs right.

That is already happening in the US with minority group unrest...BLM, Ferguson, Baltimore..

Look at the unemployment rates in those communities...welfare is pacification money to keep the dark pigment skinned people from lootin and burnin in your hood.

Why do ya perchance think Trump won?

[Crowbob]

Originally Posted by tabs

I do believe that because of the undermining of the foundations of the economy it is not going to be a recoverable situation in anybody's life time. With the fall of Rome western Europe fell into a protracted dark ages. When the Egyptian Old Kingdom fell the civilization hit a nadir before the New Kingdom rose. So it will be with the Western civilization model.

Maybe.

In an apocalyptic collapse, of course the focus will be on food, fuel and shelter. And, though from an optimistic perspective, the US will close ranks and foreign involvement will evaporate.

If so, since we do have abundant F, F and S, or at least the technology to produce them, the cirisis will be short-lived.

What I find truly interesting is pondering what a global shuffling of the deck will ultimately look like. Transitions are always difficult and we are in for a big one.

[flatbutt]

In other words whatever our investment choices are it is a crap shoot and we're all likely screwed?

[island911]

Our health will screw us before any collapse of modern society.

Then again, places like California pass laws that KILL productive farm land.

[MRM]

Paul, I wish you would stop reading Zerohedge. It is not just an unreliable source, it is a deliberately false source. The authors (there are apparently two or three of them pretending to be a staff of 40) manipulate their readers by making up a bunch of stupid stuff that sounds just plausible enough to convince people that the apocalypse is coming. In other words, they are not just lying to you, they are playing you for the fool. You are too good and too smart to let yourself be misled by them.

The economy will someday stall, the stock market will some day crash. But it's not crashing today and it's not likely to crash tomorrow. It's unlikely to crash any time soon because of all the trillions of dollars being repatriated through the tax change and the drop in overall corporate rates. Frankly, rising interest rates are the sign of a healthy and improving economy. Rates have to get back to realistic and sustainable levels. The Fed is making a good start at weaning us off cheap credit and getting the economy back on sound footing without causing a market shock. When things do go south Zerohedge will be there to tell you they predicted it. If you say the same thing long enough it will eventually come true.

Anyone who tells you they know when it will crash is lying. Even the guys in The Big Short who correctly read the market almost starved waiting for the market to come back to earth. Tabs has a good handle on the fundamentals of the economy but he lost objectivity in predicting doom and gloom and now he only announces news and analysis that supports his prior prediction. Zerohedge makes its money selling scares to people who want to believe the world is on the edge of collapse. Zero hedge is fine to read for fun or to see an (extremely) contrarian view, but it's nothing anyone should rely on. Kind of like the New York Times.

[MRM]

Originally Posted by tabs

At that time the US had an extensive industrial plant that was just laying dormant. Today? It ain't the same.

In constant dollars, US industrial production today is the highest it has ever been. Industrial Production - 100 Year Historical Chart | MacroTrends

[Shaun @ Tru6]

Originally Posted by MRM

Paul, I wish you would stop reading Zerohedge. It is not just an unreliable source, it is a deliberately false source. The authors (there are apparently two or three of them pretending to be a staff of 40) manipulate their readers by making up a bunch of stupid stuff that sounds just plausible enough to convince people that the apocalypse is coming. In other words, they are not just lying to you, they are playing you for the fool. You are too good and too smart to let yourself be misled by them.

The economy will someday stall, the stock market will some day crash. But it's not crashing today and it's not likely to crash tomorrow. It's unlikely to crash any time soon because of all the trillions of dollars being repatriated through the tax change and the drop in overall corporate rates. Frankly, rising interest rates are the sign of a healthy and improving economy. Rates have to get back to realistic and sustainable levels. The Fed is making a good start at weaning us off cheap credit and getting the economy back on sound footing without causing a market shock. When things do go south Zerohedge will be there to tell you they predicted it. If you say the same thing long enough it will eventually come true.

Anyone who tells you they know when it will crash is lying. Even the guys in The Big Short who correctly read the market almost starved waiting for the market to come back to earth. Tabs has a good handle on the fundamentals of the economy but he lost objectivity in predicting doom and gloom and now he only announces news and analysis that supports his prior prediction. Zerohedge makes its money selling scares to people who want to believe the world is on the edge of collapse. Zero hedge is fine to read for fun or to see an (extremely) contrarian view, but it's nothing anyone should rely on. Kind of like the New York Times.

Bless you.