Not everyone missed the signs...

[davereid]

I found it almost spooky how accurate Peter Schiff predicted the collapse, all the time being shouted down.

http://dimpost.wordpress.com/2008/11/19/the-curse-of-cassandra/

[Big Dave]

Fascinating.

'The only thing I know is that I know nothing'. Socrates - and Schultz

[rainman]

I found it almost spooky how accurate Peter Schiff predicted the collapse, all the time being shouted down.

http://dimpost.wordpress.com/2008/11/19/the-curse-of-cassandra/

There's a few people who have seen this shit heading our way but they have generally been laughed at for not following the common wisdom of the time. Even I have predicted the housing collapse for the past few years. And Schiff is probably right, or in the immortal words of Tom Waits:

"If you want money in your pocket,
a top hat on your head,
a hot meal on your table,
and a blanket on your bed,
well today's grey skies and tomorrows tears,
you'll have to wait til yesterday is here."


Personally I think more than a little of this problem is related to the recent spike in oil, which led to a squeeze on the consumer who was paying more for food and fuel, and this may have helped trigger the failure of the dodgy mortgage model that we (well, the US, mainly) was trying to pretend could actually work. Globalisation means we all get affected by the problems of the US, UK and others..

Oil is now down because demand has cratered, but if we can reinflate another bubble by throwing enough "money" around it will bounce right back and even exceed the $147 it hit before.

My conclusions:

Globalisation is a mixed blessing at best, brings "wealth" but at the expense of resilience
"Free Trade" is just more of the same shit as before
The modern banking system is a system of complex frauds
The greenies are right and oil will cause us a world of pain in the near to mid future
We need to localise our economies and build more local resilience


Bet that's not going to win me any fans, though... :)

[98tls]

:buggerd:More wisdom from those in the no.:beer:If per chance you wake up in the morning go outside and listen (for those in Auckland ive no answer).If you have made bad choices get over it and get on with it.

[Big Dave]

:buggerd:More wisdom from those in the no.:beer:If per chance you wake up in the morning go outside and listen (for those in Auckland ive no answer).If you have made bad choices get over it and get on with it.


And If you listen closely you can hear hard working everyday folks life savings evaporating.

[short-circuit]

There's a few people who have seen this **censored** heading our way but they have generally been laughed at for not following the common wisdom of the time. Even I have predicted the housing collapse for the past few years. And Schiff is probably right, or in the immortal words of Tom Waits:


Personally I think more than a little of this problem is related to the recent spike in oil, which led to a squeeze on the consumer who was paying more for food and fuel, and this may have helped trigger the failure of the dodgy mortgage model that we (well, the US, mainly) was trying to pretend could actually work. Globalisation means we all get affected by the problems of the US, UK and others..

Oil is now down because demand has cratered, but if we can reinflate another bubble by throwing enough "money" around it will bounce right back and even exceed the $147 it hit before.

My conclusions:

Globalisation is a mixed blessing at best, brings "wealth" but at the expense of resilience
"Free Trade" is just more of the same **censored** as before
The modern banking system is a system of complex frauds
The greenies are right and oil will cause us a world of pain in the near to mid future
We need to localise our economies and build more local resilience


Bet that's not going to win me any fans, though... :)

Can scarcely believe what I just read - a reasoned and balanced opinion. In here of all places.

[klingon]

And If you listen closely you can hear hard working everyday folks life savings evaporating.

Yeah that's the shame of it. My sister & her husband sold their only asset (a plot of land) because they were trying to have a baby and it turned out they needed IVF (very expensive).

The money that was left over after a single cycle of IVF they put into two different finance companies to diversify their risk. BOTH companies collapsed, taking all their savings with them.

The good news part of this story is that they got pregnant from the one treatment and now I have a lovely little baby nephew! :love: But they cannot afford to have another treatment if they want more kids, and they have completely lost the money they could have used as a deposit on a house. They are really struggling financially.

There are real human beings behind the numbers when companies go under.

[Winston001]

There are real human beings behind the numbers when companies go under.

Amen to that.

[SPman]

A lot of people were predicting the "collapse", but, people only see what they want to see and, if they are in charge, it's just tough shit for the likes of you and me.....

It's hitting a lot of people badly, here in Aus, where they were smugly thinking they'd be OK, the shit is starting to hit the fan, and it's only going to get worse - next year is not going to be pleasant!

An American workers perspective...http://www.truthout.org/112108L


We need to localise our economies and build more local resilienceEek - sounding like a Greenie - anathema to the "free traders" and global market purveyors, but too true. A stable, reasonably self sufficient economy, is not one that is as easily manipulated by large vested interests.

[LilSel]

There are real human beings behind the numbers when companies go under.

Yep!!... I almost got made redundant recently due to the state of things at the moment!
Today I find out one of my big industrial customers is closing down before xmas :( thats two big accounts gone this month so far, I wont be able to meet my budgets without them. Certainly tough times out there!! Affects everyone in some way or another, really feel for those getting laid off at this time of the year, esp those with families to support.

[Winston001]

There's a few people who have seen this shit heading our way but they have generally been laughed at for not following the common wisdom of the time. Even I have predicted the housing collapse for the past few years.

Gareth Morgan has been preaching this for 15 years but no-one took any notice. Right through the Asian Crisis 1998, then the dot.com collapse of 2001, I expected Gareth's predictions to come true - as did he - but nadda. The financial system righted itself and carried on.

So while I think we are entering a 1929 type depression, we won't really know for a couple of years - by which time it's entirely possible world economies will be booming again.


Personally I think more than a little of this problem is related to the recent spike in oil, which led to a squeeze on the consumer who was paying more for food and fuel, and this may have helped trigger the failure of the dodgy mortgage model....Agreed.


Oil is now down because demand has cratered, but if we can reinflate another bubble by throwing enough "money" around it will bounce right back and even exceed the $147 it hit before.Not exactly. The longterm oil price was predicted (4 months ago) to be around $US70. The reason for the spike was a heavy world demand and restricted supply. That has now eased in both directions. As for OPEC restricting supply, those countries are as attached to oil dollars as a heroin addict and they simply cannot afford to reduce their income.

[Winston001]

My conclusions:

Globalisation is a mixed blessing at best, brings "wealth" but at the expense of resilience
"Free Trade" is just more of the same shit as before
The modern banking system is a system of complex frauds
The greenies are right and oil will cause us a world of pain in the near to mid future
We need to localise our economies and build more local resilience


Bet that's not going to win me any fans, though... :)

Globalisation - when it eventually happens - is the best chance for evening out the prospects for all people. At the moment 80% of the worlds wealth is held by 20% of the global population. A Kenyan farmer cannot sell his cotton in Europe or the USA at his price. He has to pay an import tax to protect American and European farmers. That is a really fair system. :mad:

Yes there are banking frauds. Always have been. Look at Barings Bank. Consider the South Seas Bubble, the Tulip Bubble. But for the most part, it still works.

Oil - don't think this is a Green issue, just common-sense. As it gets harder to find, the price goes up, alternative energy becomes viable, substitution occurs. Margarine only exists because of the high price of French butter in the late 19th century.

Local resilience is good - but we have to sell the citizenry on it. Bill Birch and Think Big projects are the last iteration of this type of policy and rightly or wrongly, they failed. The Motonui Liquid Fuels plant is now moth-balled and it was built to give NZ more fuel independence.

[Finn]

What recession? Have you guys seen the mortgage rates drop this week? Shit, I better go buy some more houses. Hell, at this rate I might put that new car and bike on the mortgage as well.

Yippee!!!

[short-circuit]

What recession? Have you guys seen the mortgage rates drop this week? **censored**, I better go buy some more houses. Hell, at this rate I might put that new car and bike on the mortgage as well.

Yippee!!!

What a lemon you are.

[Finn]

What a lemon you are.

Better a lemon than a sour grape.

How's Helen?

[boomer]

:buggerd:More wisdom from those in the no.:beer:If per chance you wake up in the morning go outside and listen (for those in Auckland ive no answer).If you have made bad choices get over it and get on with it.


The distant sound of the neighbours' banjo's playing does it for you then Kleetus?

[slofox]

Times are hard and wages are small......
so drink more piss and fuck 'em all....

[alanzs]

An American workers perspective...http://www.truthout.org/112108L


Excellent article.

[Big Dave]

Better a lemon

I think you are a lemon - always good for a drink.

[The Stranger]

There's a few people who have seen this shit heading our way but they have generally been laughed at for not following the common wisdom of the time. Even I have predicted the housing collapse for the past few years.

Oil is now down because demand has cratered, but if we can reinflate another bubble by throwing enough "money" around it will bounce right back and even exceed the $147 it hit before.



I recall Muldoon predicting the sharemarket crash for about 5yrs prior. When it came, he was soo quick to point out that he predicted it. There is nothing smart in predicting the enivitable - timing is everything.

Did speculators entering the market have any effect in driving the oil prices up, or was it all genuine demand fueled? Do you suppose that they are sill taking long positions?

[Bullitt]

Lots of comments in here I dont agree with.

Sorry to say it to those affected but investing in two finance companies who invest in property development or even worse second hand cars is not diversification.

Oil prices were not fueled by excess demand or limited supply although both were a factor. The major reason was speculation by people (particularly hedge funds) who thought prices would go up forever.

Free Trade is great, the problem is the only people who benefit from it are the people who need it the least...namely USA and Europe. The main gain from free trade comes from less developed economies (including to a lesser extent NZ) being able to provide more efficent agriculture to developed nations who are relatively less efficient at doing it. Despite all their claims Europe and US both have massive protectionism on agriculture whereas all the less developed countries have dropped their tariffs and subsidies making them less competitive against other countries. Its a prisoners dilema (game theory) and everyone only wins if everyone plays.

Oil will not be an issue. Im confident the world wont run out of oil in my lifetime (should be another 50-60 years Id hope). Both through scarcity causing the price to rise resulting in substitution and through peak oil being a scam. Do some research into why Russia can get Oil out of Vietnam when America said there was none there.

Theres alot worse to come yet. House prices have dropped about 7% in New Zealand and a lot of people think they may fall another 10%. I would be very surprised if they dont drop another 20%. Given the amount they went up theyre still so far above their long term averages and itll only take a few more people to lose their jobs (which noone is denying anymore) and be unable to meet their mortgages in a market where theres no buyers. There has been such an unprecedented rise in house prices for such a long time too many people who either have never experienced or dont remember that houses are not an instant quick trip to riches. When houses go up 100% then down 10% that does not make them cheap. Just look at the fundamentals of New Zealand houses compared to US, aside from not having non-recourse loans NZ is in a substantially worse position than the US was we're just a year behind them.

[The Stranger]

Just look at the fundamentals of New Zealand houses compared to US, aside from not having non-recourse loans NZ is in a substantially worse position than the US was we're just a year behind them.

I would have thought that alone would put us in a significantly better position. However, would you care to elaborate on the fundamentals you refer to above?
Not questioning your assertion here of course, just interested to know your thoughts is all.

[SPman]

Theres alot worse to come yet. House prices have dropped about 7% in New Zealand and a lot of people think they may fall another 10%. I would be very surprised if they dont drop another 20%. Given the amount they went up theyre still so far above their long term averages and itll only take a few more people to lose their jobs (which noone is denying anymore) and be unable to meet their mortgages in a market where theres no buyers. There has been such an unprecedented rise in house prices for such a long time too many people who either have never experienced or dont remember that houses are not an instant quick trip to riches. When houses go up 100% then down 10% that does not make them cheap. Just look at the fundamentals of New Zealand houses compared to US, aside from not having non-recourse loans NZ is in a substantially worse position than the US was we're just a year behind them.Ah - just like the early 90's - driving down street after street with For Sale signs on 90% of the houses.......

[Bullitt]

I would have thought that alone would put us in a significantly better position. However, would you care to elaborate on the fundamentals you refer to above?
Not questioning your assertion here of course, just interested to know your thoughts is all.

NZ as a whole has an advantage that our Government is not heavily indebted like the US government is but the two biggest issues for NZ that I see are 1)our totally unsustainable current account deficit and 2)the amount of household indebtedness.

Id suggest you read this by Bernard Hickey
http://www.stuff.co.nz//blogs/showmethemoney/2008/09/01/iounz-more-than-they-iousa/