Economic depression

[terbang]

So is it for real, are the yanks gonna sink us all or is it just a wee blip? If so, How well do you reckon we would fare as a nation, or even as individuals? Also worth considering, what ended the last great depression?

[idb]

... what ended the last great depression?

World War 2...yikes!!

[KiwiKat]

So is it for real, are the yanks gonna sink us all or is it just a wee blip? If so, How well do you reckon we would fare as a nation, or even as individuals? Also worth considering, what ended the last great depression?

USA is noted as running a deficit economy for years. Overvalued assets and underproduction. For decades they have borrowed heavily from other european and western countries. A high proportion of their major corporations are partly owned or financed by Asian and Middle Eastern investors. These smart cookies are slowly and effectively taking control in US financial circles.

USA is known to play the "let's get involved" hand in other countries conflicts where there is a future economic advantage to them.

The EU is now considered to be more stable financially and more powerful than USA. World focus on stock markets is more than likely to shift towards EU and Asian markets.

There are going to be some crap years financially but NZ is quite well insulated. we are capable of producing nearly all our needs but currently choose to exploit international markets for quick gain. Maybe cheaper meat, dairy products etc for NZ'rs. We are a switched on country but we are lazy and choose to 'cruise' by international standards.

Your house has only ever been worth the value of the used materials in it.

Note: My opinions. :whocares:

[jrandom]

<img src="http://www.sinfest.net/comikaze/comics/2008-09-22.gif"/>

[tri boy]

Just a long overdue shift of economic power.
Q is, will the new power brokers be better or worse.
Hopefully the EU can get their collective acts together, or power will delivered to Asia/Middle East comfortably. MHO

[alanzs]

This too shall pass... As long as people don't panic and take all their money out of the banks, we'll be fine. Gotta go, the line at the bank is starting to move... :calm:

[rainman]

So is it for real, are the yanks gonna sink us all or is it just a wee blip? If so, How well do you reckon we would fare as a nation, or even as individuals? Also worth considering, what ended the last great depression?

It's for real alright - the American empire is a dead duck. Couldn't happen to a nicer bunch, of course, although I do pity the poor US taxpayer (and their descendants) who'll be bent over and rogered comprehensively over this. I see some of them are getting off their arses (sorry, asses) and protesting - as the attached pic shows.

This (http://www.telegraph.co.uk/opinion/main.jhtml?xml=/opinion/2008/09/26/do2606.xml) is a good read from the Telegraph. Highlights:
"Mr Paulson admits: "Raw capitalism is a dead end. I've seen it.""
"the principle of spending money to be paid by posterity … is but swindling futurity on a large scale." - Jefferson
"Having collected sacks of gold at Goldman Sachs, this former champion of free markets (Paulson) wants to nationalise assets at a pace not seen since Che Guevara was lighting cigars with Batista's legacy."
"There is no policy yet invented that can make fifty cents worth two bucks forever."

Don't think the yanks are going to sink us though, we're doing a good enough job on that score ourselves. What'll happen here in little ole NZ? We'll take the eye off the ball again (do we even know what game we're playing?) and get all gloomy over world events and lose all sense of confidence, business and retail will slow, property will slide another 25%+, companies will close and jobs will be lost. Our service economy will encounter difficulties, leading to a further downturn. It will be uncomfortable. Far fewer new TVs will be bought. There may even be a need to cut down on cappuccino consumption! The morons we elect (whichever ones) will doubtless try to jump start things by flinging buckets of our money around.

Fortunately John and Helen have all the answers! Tui...

It's time for all of us to grow up and take some responsibility for what's happening around us. It's going to be a bumpy ride for the next 10 years or so.

[Swoop]

The credit crisis is hitting the UK very hard...

[alanzs]

It's for real alright - the American empire is a dead duck. Couldn't happen to a nicer bunch, of course, although I do pity the poor US taxpayer (and their descendants) who'll be bent over and rogered comprehensively over this. I see some of them are getting off their arses (sorry, asses) and protesting - as the attached pic shows.

This (http://www.telegraph.co.uk/opinion/main.jhtml?xml=/opinion/2008/09/26/do2606.xml) is a good read from the Telegraph. Highlights:
"Mr Paulson admits: "Raw capitalism is a dead end. I've seen it.""
"the principle of spending money to be paid by posterity … is but swindling futurity on a large scale." - Jefferson
"Having collected sacks of gold at Goldman Sachs, this former champion of free markets (Paulson) wants to nationalise assets at a pace not seen since Che Guevara was lighting cigars with Batista's legacy."
"There is no policy yet invented that can make fifty cents worth two bucks forever."

Don't think the yanks are going to sink us though, we're doing a good enough job on that score ourselves. What'll happen here in little ole NZ? We'll take the eye off the ball again (do we even know what game we're playing?) and get all gloomy over world events and lose all sense of confidence, business and retail will slow, property will slide another 25%+, companies will close and jobs will be lost. Our service economy will encounter difficulties, leading to a further downturn. It will be uncomfortable. Far fewer new TVs will be bought. There may even be a need to cut down on cappuccino consumption! The morons we elect (whichever ones) will doubtless try to jump start things by flinging buckets of our money around.

Fortunately John and Helen have all the answers! Tui...

It's time for all of us to grow up and take some responsibility for what's happening around us. It's going to be a bumpy ride for the next 10 years or so.

Time to get that antidepressant prescription refilled! :yes:

[rainman]

Time to get that antidepressant prescription refilled! :yes:

Naah, I would never take crap like that. No sense getting depressed anyway - it is just what it is... Us Zen masters are very accepting of the universe. (Or maybe it's the universe that's very accepting of us Zen masters ;) )

Besides there's a lot to keep me busy in my local community. Why give a toss about the global shituation or the latest foibles of the John and Helen show?

[Big Dave]

For us as motorcyclists there are some immediate implications.

The recent demise of a bike shop in NZ has stung a lot of people further up the chain. This coupled with the daily despair on the financial pages has shaken retailer confidence.

'Summer will be good - next winter might be long' is not uncommon.

Subsequently the shops are looking at their stock levels. They won't hold as much stock.

If you want parts - even routine service parts - and big ticket items like tyres - order them in in advance or be prepared to wait longer than is usual.

[alanzs]

Naah, I would never take crap like that. No sense getting depressed anyway - it is just what it is... Us Zen masters are very accepting of the universe. (Or maybe it's the universe that's very accepting of us Zen masters ;) )

Besides there's a lot to keep me busy in my local community. Why give a toss about the global shituation or the latest foibles of the John and Helen show?

While not professing to be a zen master, I have learnt over the years to not worry too much about the global situation (or anything really), as it doesn't help; it or me.

I have always tried to live below my means and it has worked so far. Putting emotional attachment to "things" is a never ending roller coaster ride. Health is our only real wealth and that too will eventually cease. I am for not against anything... :hug:

[KiwiKat]

For us as motorcyclists there are some immediate implications.

The recent demise of a bike shop in NZ has stung a lot of people further up the chain.

Talking of this interesting event - is the responsible person being drawn and quartered.

[alanzs]

They are being paid. The former CEO of WAMU, the largest US bank to fail in history, just received a $20 million golden parachute. He had been the CEO for three weeks. :Oops:

[Ixion]

What ended the last Great Depression?

Why, Lord Keynes and socialism, to be sure.

Or Roosevelt and Neww Deal Socialism, if you were on that side of the ditch

Or Mr Savage and Socialism, here in Godzone

See a common thread there?

[rainman]

While not professing to be a zen master

Don't tell anyone but I'm not a real Zen master, I just play one on TV.

Your post is spot on, honest-to-dawg truth. :2thumbsup

[rainman]

What ended the last Great Depression?

Why, Lord Keynes and socialism, to be sure.

Or Roosevelt and Neww Deal Socialism, if you were on that side of the ditch

Or Mr Savage and Socialism, here in Godzone

See a common thread there?

So Socialism causes world wars?

p/t

[Ixion]

So Socialism causes world wars?

p/t

That's Communism. Socialism is social justice through ballots. Communism is social justice through bullets.

[slimjim]

Well its gona get worse forsure....yup

[Coyote]

So long as I'm getting sex I'm fine.

[puddytat]

The Bible & other conspiracy theories have been talking about this for ever...its the self fulfilling prophecy thing. Somewhere around 2012 they reckon,that the end will be nigh so ....:wacko:
Im with Coyote on this one.

[Hinny]

Time to get that antidepressant prescription refilled! :yes:

Just eat cashews.

[alanzs]

Just eat cashews.

+1 with what coyote said... :calm:

[Shadows]

So long as I'm getting sex I'm fine.


Im with Coyote on this one.

Leave it out guys, I'm trying to eat here!

[Winston001]

What ended the last Great Depression?

Why, Lord Keynes and socialism, to be sure.

Or Roosevelt and Neww Deal Socialism, if you were on that side of the ditch

Or Mr Savage and Socialism, here in Godzone

See a common thread there?

Yes. Keynesian economics, which is exactly what the US government are implementing. I'm not sure they are going about it the right way but its complex.

If governments - as happened in 1929, simply stood back and let peoples savings and business investments go down the toilet - well, harsh at it seems, that is efficent and allows for a redistribution of land/buildings/equipment etc. Unhappily it also means jobless millions while this massive shakedown takes place.

However governments no longer do that. Instead they pump money into the economy to keep it running on the basis that continued economic security will in the long run save peoples lives and repay the government investment.

The debate is how much or how little money should be pumped - and where. In the end, inflation takes care of it. $700 trillion is incomprehensible but in 50 years, who will care.

[karla]

However governments no longer do that. Instead they pump money into the economy to keep it running on the basis that continued economic security will in the long run save peoples lives and repay the government investment.


Must be a bit unsettling knowing that over 50% of the population now own guns ... hungry angry people do not a friendly society make.

[Bullitt]

The bailout in itself I cant see causing too many problems. The concern for me is how the US government is going to finance it...its not like they were swimming with money in the first place so I see this bringing forward the inevitable serious consequences for the US economy and subsequently the rest of the world which would have occured anyway but awhile later down the track.

[Winston001]

The bailout in itself I cant see causing too many problems. The concern for me is how the US government is going to finance it...its not like they were swimming with money in the first place so I see this bringing forward the inevitable serious consequences for the US economy and subsequently the rest of the world which would have occured anyway but awhile later down the track.

1. Taxation

2. Selling assets - not sure what but the US government probably owns a lot of wealth

3. Print money. NB - the Weimar Republic, and more recently Mr Mugabe tried this.....:crazy:

I'd imagine that US businesses and private investors will be selling their holdings around the world to pay down debt at home.

Against that, Japanese, Arab, and Chinese investors who have been awash in cash - which they invested in the US - will be selling out thus putting more down pressure on asset values in the US. Also the $US has been dropping in value for the same reason - foreigners getting out.

Quite why the same foreigners see the EU as the new bastion of capitalism is beyond me. The EU is a vastly complex bureaucratic amalgam of nations with inbuilt inefficencies. Nothing wrong with it except it lacks the vigor of open markets, and in that sense, Asia looks to be the future of economic power.

The one overlooked area is South America which also has vibrant rising economies.

We live in interesting times..... ;)

[Hinny]

The US can print money more easily than almost any other country as the have this magic chequebook.
The fact that all oil trades are in US dollars.
The overcame that little glitch when Iraq decided payment should be in Euros. Fixed that little problem.

[MisterD]

Why the credit crisis is the fault of meddling government regulation, rather than "capitalist greed":

Open letter (http://myslu.stlawu.edu/~shorwitz/open_letter.htm)

[ManDownUnder]

Time to ditch the debt boys and girls. Sell the house - watch the prices drop, buy it back at the lower price - all that kind of clever stuff...

Get lines of credit available and DON'T USE THEM unless you absolutely have to. It's gonna be a bumpy landing...

[imdying]

So long as I'm getting sex I'm fine.A good point :yes:

Just eat cashews.Really? What's the deal with that then?

[puddytat]

I had the disturbing pleasure of watching the movie ZEITGEIST the other day...you can take what they say regarding 911 with a grain of salt,but thier predictions of this financial crisis is spot on & the way they are trying to bail out the system is chillingly like what happened at the beginning of the Great Depression...watch it folks & be very, very worried.:oi-grr::weep::buggerd::gob::yes::finger::soon:

[Naki Rat]

The US can print money more easily than almost any other country as the have this magic chequebook.
The fact that all oil trades are in US dollars.
The overcame that little glitch when Iraq decided payment should be in Euros. Fixed that little problem.

October Investigate magazine has a great article by Richard Prosser (p.18-19) on this subject. Well worth the read and very enlightening on the real reasons behind the US's actions against Iraq, Saddam Hussein, 'WMD' - not so much oil as US$ vs. Euros. And now the Iranian oil Bourse is heading the Euro way...... uh-oh!:2guns:

[MadDuck]

Subsequently the shops are looking at their stock levels. They won't hold as much stock.

Oddly our policy is quite the opposite. Our stock levels are higher than they have ever been and increasing.

The theory being that every person that walks in is a potential customer and should not leave "empty handed". This will also (hopefully) mean they will return as we were the only place that had what they wanted.

Empty shelves can give the wrong impression to people. Such as cant afford to hold stock so likely to go out of business ...so no follow up service.

[chrisso]

''There is no Depression In NZ''....wasnt that a song by????? in the 80s??

[Mom]

Just eat cashews.

and grow your own.....




Veges of course :yes:

[riffer]

''There is no Depression In NZ''....wasnt that a song by????? in the 80s??
Yeah, by Blam Blam Blam.

Been reading a bit about this.

I'm of the opinion that the US should learn to take their economic medicine.

Read this article (http://www.cnn.com/2008/POLITICS/09/29/miron.bailout/index.html).

[no-coast-punk]

As someone born, raised and living in the US I'm getting a kick out of these replies.

On behalf of the American people I apologize for our stupidity and the fact that our failure at basic math has caused you guys financial hardship.

What you guys are saying is basically pretty indicative of what the few remaining sane pockets of our society are saying. We've totally screwed the pooch for about two generations and now it's catching up to us. This situation really IS the fault of the average American consumer.

There is nothing inherently wrong with making credit easily accessible to the masses. Before the credit market imploded I could go finance a new R1 for ~$95USD/month at 0% interest. Good for me. I live within my means and keep a tight reign on my finances. I could have paid the balance of my loan at any time I wanted. It's just a better deal for me to finance at 0% and go spend/invest that money elsewhere. Also good for Yamaha because they can sell more bikes this way.

Problem comes when American public schools turn out a few consecutive generations of illiterate lazy fucktards with a sense of entitlement that can't do basic math. Put access to easy credit in their hands and we get where we are now. Believe me when I say that the fault of this really lays squarely in the hands of the average American.

The finance industry is kind of a mindless organism that does one thing and does it extremely well. Make money and increase shareholder value. Firms that were not engaging in these risky pyramid schemes were treated as total fucking outcasts by the average investor. Firms that were making good sound financial decisions either tanked years ago, or were purchased by the rising tide of mismanaged firms. If firms in this country don't go with the flow and do what everyone else is doing... the board of directors gets flooded with angry calls from investors. It sucks but it's the sad reality.

For a better understanding of what really happened you should all listen to this podcast:

http://www.thislife.org/Radio_Episode.aspx?sched=1242

It basically explains in very clear terms how things turned into such a clusterfuck.

A little anecdote from my own life:

I was living in LA at the peak of the housing bubble here. I had moved there for a really cush job at Mercedes Benz of Beverly Hills. Beverly hills is basically ground zero for irresponsible behavior. I lost track of the number of people driving around in $200,000 Benzo's that they had taken out second mortages on their homes to purchase. These people also didn't have the money to keep tires or brakes on the things simply because they hadn't budgeted well.

Housing prices were basically out of control too. Access to easy credit drives up prices. If someone making $20,000/year can afford (on paper) a loan on a $500,000 house. Suddenly all houses will be more than $500,000.

I wanted to keep myself out of that whole fiasco lifestyle so I opted for the cheapest place I could find within ~20 minutes of the dealership. This put me in South Central LA. Yes, that South Central. The one that rappers always rap about.

The house I was renting was a TINY and run down one bedroom affair (but it had a huge garage) built in 1927 with about fuckall maintenance since about 1957. The neighborhood was typical South Central. Two weeks after I had moved into the neighborhood a police helicopter got shot down a few blocks away. Not some action movie fireball affair. But the thing had enough holes punched in it from incoming ground fire that they had to make an emergency landing in the soccer field at the elementary school a few blocks away. All in all a really nice and quaint neighborhood. The sound of sporadic automatic weapons fire eventually turned into a soothing affair... sort of like living next to a babbling brook.

My tiny piece of shit run down rental house in a neighborhood that could have passed for downtown Mogadishu was worth $1.1 million US dollars (before our currency tanked). There was something seriously wrong with that picture but so few people seemed to realize that.

The reason I've got my eye on heading to NZ is that it's one of the few remaining western style countries that seems to have an economy and society grounded in reality.

Lots of people like me have seen this coming. Even though I could have afforded to buy a nice house for several years now I've continued to rent because prices were just totally unsustainable. I've also been keeping money in the bank instead of new investing or buying stupid shit. All of the stocks I owned have lost about 75% of their value this year. Good times.

[alanzs]

The reason I've got my eye on heading to NZ is that it's one of the few remaining western style countries that seems to have an economy and society grounded in reality.



If you really decide to come on down, feel free to pm me if you have any questions. I'm from LA originally. Been here since just before GW got in the 2nd time. Voted with my feet. NZ is a great place. Things be way different here bro, just a heads up. We ain't in Kansas anymore... :2thumbsup

[Hinny]

A good point :yes:
Really? What's the deal with that then?

Cashews are an alternative to anti-depressant and maybe anti- psychotic.prescription meds. Contain the same chemicals.

Try them and see if you notice any difference to how you feel.

[MadDuck]

The reason I've got my eye on heading to NZ is that it's one of the few remaining western style countries that seems to have an economy and society grounded in reality.

Yep the same reason Tony Alexander from the BNZ is predicting a housing shortage here in 2009/10. New housing consents have had a huge decrease in August and September.

Will be interesting to see how it all pans out.

PS: Not sure about "grounded in reality" though.

[Naki Rat]

Lots of people like me have seen this coming. ............. Good times.

Your post sounds similar to a mate who lived in Southern California for 14 years up until moving back to NZ about 5 years back. Surrounded by people funding their lifestyle by using their homes as ATMs, and since being back here has maintained his disbelief that the whole US/Californian economy hasn't long since crashed and burned.

[alanzs]

Cashews are an alternative to anti-depressant and maybe anti- psychotic.prescription meds. Contain the same chemicals.

Try them and see if you notice any difference to how you feel.

So that I get it right, if I eat a lot of cashews the voices telling me to not bring my gun to work will go away? :shit:

[alanzs]

Your post sounds similar to a mate who lived in Southern California for 14 years up until moving back to NZ about 5 years back. Surrounded by people funding their lifestyle by using their homes as ATMs, and since being back here has maintained his disbelief that the whole US/Californian economy hasn't long since crashed and burned.

Had a house in L.A. The value rose 100% in three years. Refinanced once a year and took out a shit load of money each time, and always had a lower fixed interest rate and payments than before. It was like a cash machine. I had a fixed rate loan for 25 years at 5.1%. I didn't even go for the ARM loans, which were as low as 2.5% for 5 years. Heady days they were, heady days. Anyone with any sense saw that unsustainable bubble bursting. Like now!

[Hinny]

Must be a bit unsettling knowing that over 50% of the population now own guns ... hungry angry people do not a friendly society make.

Their society is so violent there has only been one President in their history to have not sent troops into armed conflict in some foreign land. Pretty sad indictment.

Paul Wolfowitz reckoned on the David Letterman show that they had fifty countries lined up that needed dealing to. This was just after the start of the last Iraq invasion.He is commonly credited as being the architect of that invasion. He estimated that incursion would take three weeks to complete.

There are plenty of US states where the major industry is what they euphemistically call defence. They need to wage war to support their society. As George Bush Snr. said when justifying his invasion of Iraq "...it's about jobs, American jobs"

It also deflects attention from domestic strife and woes.
Forget about poverty, poor education, abysmal health system etc etc. lets just pray for our good men and women serving overseas blah blah blah

[Hinny]

So that I get it right, if I eat a lot of cashews the voices telling me to not bring my gun to work will go away? :shit:

Maybe the ones telling you to bring your gun to work.
But they may be rational voices and you may be able to smile as you use it.

[Pedrostt500]

This is just my view of things, once the dust settles, it will be the nations that are rich in natural resorces, and that can sustainably exploit these resourses that will become the power houses of the world, so the likes of Austrailia & Brazil, are the first 2 to come to mind, the Southern African nations could be very big players on the world stage if they could get their acts together and sort out their tribal issues.
New Zealands place in all of this, is we will never be a major player as an Industrial Nation, our place as it always has been will be as a food supplier, because we will always be able to grow food easily and cheaply, compared to many other Nations.
the likes of China, India and Japan, will if not already have to import all they need as theses countries will quickly use up their natural resources, and will be unable to support their own people with the little they can produce from their natural resources.
But at the end of the day we will look back on this period in time wonder what we learned and realise we learned nothing as we the people of the world are, Stupid, Glutonus, Hairless Monkeys that live in fear of all that is around us, and will continue making the same mistakes time and time again.

[alanzs]

Maybe the ones telling you to bring your gun to work.
But they may be rational voices and you may be able to smile as you use it.

I never liked Mondays either... :niceone:

[alanzs]

But at the end of the day we will look back on this period in time wonder what we learned and realise we learned nothing as we the people of the world are, Stupid, Glutonus, Hairless Monkeys that live in fear of all that is around us, and will continue making the same mistakes time and time again.

I think someone forgot to take their happy pills! :laugh:

[puddytat]

But at the end of the day we will look back on this period in time wonder what we learned and realise we learned nothing as we the people of the world are, Stupid, Glutonus, Hairless Monkeys that live in fear of all that is around us, and will continue making the same mistakes time and time again.

I agree with Pedrost on this & I just took my happy:doobey:

[Manxman]

It's for real alright - the American empire is a dead duck. Couldn't happen to a nicer bunch, of course, although I do pity the poor US taxpayer (and their descendants) who'll be bent over and rogered comprehensively over this. I see some of them are getting off their arses (sorry, asses) and protesting - as the attached pic shows.

This (http://www.telegraph.co.uk/opinion/main.jhtml?xml=/opinion/2008/09/26/do2606.xml) is a good read from the Telegraph. Highlights:
"Mr Paulson admits: "Raw capitalism is a dead end. I've seen it.""
"the principle of spending money to be paid by posterity … is but swindling futurity on a large scale." - Jefferson
"Having collected sacks of gold at Goldman Sachs, this former champion of free markets (Paulson) wants to nationalise assets at a pace not seen since Che Guevara was lighting cigars with Batista's legacy."
"There is no policy yet invented that can make fifty cents worth two bucks forever."

Don't think the yanks are going to sink us though, we're doing a good enough job on that score ourselves. What'll happen here in little ole NZ? We'll take the eye off the ball again (do we even know what game we're playing?) and get all gloomy over world events and lose all sense of confidence, business and retail will slow, property will slide another 25%+, companies will close and jobs will be lost. Our service economy will encounter difficulties, leading to a further downturn. It will be uncomfortable. Far fewer new TVs will be bought. There may even be a need to cut down on cappuccino consumption! The morons we elect (whichever ones) will doubtless try to jump start things by flinging buckets of our money around.

Fortunately John and Helen have all the answers! Tui...

It's time for all of us to grow up and take some responsibility for what's happening around us. It's going to be a bumpy ride for the next 10 years or so.

....lurv the photo.:laugh::laugh::laugh:

[terbang]

Well the house of cards continues to fall. They have all been borrowing too much money and I reckon they programmed themselves that way.
Turn on the TV and watch any yank show or movie. You see teenagers driving to school in $50,000 dollar cars or you see an all American hero saving the world from Ze Germans, Russins, Vietnameise and even aliens. Many variants of a common theme, we´re rich and influential.
So here they are now, their kids are driving expensive cars all on tick, they're saving the Iraqis from themselves and its all getting a bit expensive! Perhaps getting kicked out of ANZUS and moving closer to Asia wasn´t such a bad move after all.

[Ocean1]

Well the house of cards continues to fall.


Yup. They also found a couple of decades ago that actually producing anything is just too much hard work. Much easier to sub all that out to south America and Asia.

There's an economic maxim that all wealth comes from the production of marketable goods. So if you stop making shit not only does your economy shrink but it leaks offshore, to those economies that actually do produce the shit you still can’t do without.

In the meantime they’ve spent the last couple of decades throwing their economic weight around and manipulating exchange rates, queering trade deals etc, all to keep the US$ value worth enough to pay for all those Toyotas and Samsungs.

They bought their own bullshit, believing they could all live the good life without actually producing enough to support the spending. Even those who made nothing whatsoever.

Sound familiar? The time to pay the piper’s well and truly here, if you’re not actively involved in producing something tangible you might want to consider a career change.

[scumdog]

The sky is falling, the sky is falling...

[terbang]

The sky is falling, the sky is falling...

Nope, but it´ll be raining cheap V8´s shortly. Here in Jeddah, I went down to the car auctions the other day, what a sight. Second hand imported yank tanks galore. You name it, it was there and the bigger the engine the better it seemed. At around 12c per litre, they just snap them up and you see them thundering around the highways a day or so later. Just missed out on an 8 litre Lincoln that went for roughly a grand Kiwi.

[slowpoke]

As someone born, raised and living in the US I'm getting a kick out of these replies.

On behalf of the American people I apologize for our stupidity and the fact that our failure at basic math has caused you guys financial hardship......

(edited for reasons of space)

.....Lots of people like me have seen this coming. Even though I could have afforded to buy a nice house for several years now I've continued to rent because prices were just totally unsustainable. I've also been keeping money in the bank instead of new investing or buying stupid shit. All of the stocks I owned have lost about 75% of their value this year. Good times.

This is the best "real world" post I've seen on this subject.

As the cluey bloke above mentioned, the banks/companies are left with no choice but to push their profit making to the limit otherwise you and I see them as economic lepers. If their profits aren't "up there" then they aren't seen as doing their job.

Most people are going on about "those yanks" "the greed of the rich" "the chickens are home to roost on Wall Street" etc yet the mentality of everyday Mum and Dad small investors is a carbon copy of those wanker bankers.

We don't choose to invest a couple of grand from an inheritance, or our kids Uni fund, or our superannuation etc in low percentile investments. We chase the biggest/fastest return we can get, almost without fail. Even now there are a lot of people rubbing their hands in glee going "Fucking great! I can buy up large now that stocks are down and make a motza!"

We deliberately max out our mortgages to buy in the fastest appreciating suburb in a suitable town/city. We revel in the fact that our property has skyrocketed in value.....based on what exactly? Even if we can comfortably pay it off we are still worshippers of the "growth is good" mantra. The problem is that despite being collective drivers and participants in the system the average Mum/Dad investor has no control whatsover

One of the previous posts attached a letter proclaiming that government regulation is the problem not the cure.....which just smacks of self serving foolishness. If someone has proven themselves incapable of driving responsibly despite limited guidance then I don't see how less guidance is going to improve the situation.

As a result it must be the job of Governements to having the guiding hand. These are the people who are (hopefully) truly aware of the big picture, and able to exert appropriate influence when and where appropriate. Yeah, it's a laughable view sometimes but there is no alternative. Really, there is no alternative. Sure they are self serving but far less so than those with direct monetary return from dealings that don't just put themselves but also others at risk. Now is the time to put a framework in place such that wealth creation is based on concrete capital projects/improvements not just shuffling electronic paper around the globe or "clever" accounting practices.

John Ralston Saul wrote something particularly apt well before all the latest shit went down:

"The conclusion drawn by ... most of our élites ... is that the population constitutes a deep and dangerous well of ignorance and irrationality; if our civilization is in crisis the fault must lie with the populace which is not rising to the inescapable challenges. And yet civilizations do not collapse because the citizenry are corrupt or lazy or anti-intellectual. These people do not have the power and influence to either lead or destroy. Civilizations collapse when those who have power fail to do their jobs."

[Zapf]

Oddly our policy is quite the opposite. Our stock levels are higher than they have ever been and increasing.

guess the question is, how long can you afford to keep the high stock level on for.

[scumdog]

Nope, but it´ll be raining cheap V8´s shortly. Here in Jeddah, I went down to the car auctions the other day, what a sight. Second hand imported yank tanks galore. You name it, it was there and the bigger the engine the better it seemed. At around 12c per litre, they just snap them up and you see them thundering around the highways a day or so later. Just missed out on an 8 litre Lincoln that went for roughly a grand Kiwi.


I followed the impact carefully on car prices during the last 'recession' when petrol prices were also high.

The V8s stayed the same price but the 'oh-so-economical' 4 cylinder cars went through the roof in price.:pinch:

[alanzs]

I was back in LA in July. It was MUCH cheaper to rent a big SUV or Van than a small car. The world has turned upside down.

[Winston001]

Yup. They also found a couple of decades ago that actually producing anything is just too much hard work. Much easier to sub all that out to south America and Asia.

There's an economic maxim that all wealth comes from the production of marketable goods. So if you stop making shit not only does your economy shrink but it leaks offshore, to those economies that actually do produce the shit you still can’t do without.

In the meantime they’ve spent the last couple of decades throwing their economic weight around and manipulating exchange rates, queering trade deals etc, all to keep the US$ value worth enough to pay for all those Toyotas and Samsungs.

They bought their own bullshit, believing they could all live the good life without actually producing enough to support the spending. Even those who made nothing whatsoever.

Sound familiar? The time to pay the piper’s well and truly here, if you’re not actively involved in producing something tangible you might want to consider a career change.

I like what you say and for me, a farmers son, (call me Jethro) it rings true. Yet the great wealth accumulated around the globe is accumulated and lies in the hands of those who produce "services", not "goods". Much of global manufacturing occurs in Third World countries but it is the people in First World countries who own huge multi-bathroomed homes.

To me it is weird but people with MBAs command mega salaries just to organise businesses, shuffle contracts, and move money around. Is this really likely to change? They are intelligent, there are lots of them, and they have a vested interest in keeping modern business as complex as possible. Derivatives, swops, forward cover, futures, Contracts For Difference (CFDs are the latest game in town), margin trades etc etc.....

[Ocean1]

I like what you say and for me, a farmers son, (call me Jethro) it rings true. Yet the great wealth accumulated around the globe is accumulated and lies in the hands of those who produce "services", not "goods". Much of global manufacturing occurs in Third World countries but it is the people in First World countries who own huge multi-bathroomed homes.

To me it is weird but people with MBAs command mega salaries just to organise businesses, shuffle contracts, and move money around. Is this really likely to change? They are intelligent, there are lots of them, and they have a vested interest in keeping modern business as complex as possible. Derivatives, swops, forward cover, futures, Contracts For Difference (CFDs are the latest game in town), margin trades etc etc.....

That’ll remain true as long as governments manipulate markets. Implementing complex regulatory controls and disincentives to genuinely productive behavior heavily distorts markets. Clever bastards find loopholes much faster than governments can close them. Leveraging those loopholes is often very profitable, but it’s rarely productive. Remember that needs pyramid? Without artificial constraints the most valuable commodities are what?

There’s a limit to the ability of an economy to absorb non productive behavior, what might the symptoms of an economy reaching those limits be? What abilities would represent a good income if the regulatory control framework fails? Share broker or tailor? Asset management consultant or farmer? Lawyer or engineer? MBAs are a dime a dozen dude, and as useful as a diploma in marine tourism services. Anyone can learn to cheat the system, it takes more than that to create genuine value.

[Winston001]

That’ll remain true as long as governments manipulate markets. Implementing complex regulatory controls and disincentives to genuinely productive behavior heavily distorts markets. Clever bastards find loopholes much faster than governments can close them. Leveraging those loopholes is often very profitable, but it’s rarely productive. Remember that needs pyramid? Without artificial constraints the most valuable commodities are what?

LOVE man, LOVE :love: I can feel it now.....

But didn't know Maslow was an economist, we learnz and learnz stuff alla time my Precioussss........


There’s a limit to the ability of an economy to absorb non productive behavior, what might the symptoms of an economy reaching those limits be? What abilities would represent a good income if the regulatory control framework fails? Share broker or tailor? Asset management consultant or farmer? Lawyer or engineer? MBAs are a dime a dozen dude, and as useful as a diploma in marine tourism services. Anyone can learn to cheat the system, it takes more than that to create genuine value.

?? Whats a tailor?