So when will the sharemarket crash in 2014?

[buggerit]

Yeahbut, I worry.

I mean there was a time when fuckwits mostly didn't breed, y'know?

And now that Darwin's been suspended they all think their opinion is as good as the next man's.
:

How is the family?

[Woodman]

Economists predict ten out of every one recessions.

[Winston001]

Makes you wonder.........The derivatives exposures of four American banks exceed by several times the world GDP. There is no way these exposures are covered by the banks’ capital or by their depositors deposits.

Yes it seems weird. If all the copper derivatives were actually perfomed, there isn't enough copper on the planet to deliver. But what actually happens is each buy contact is covered by a sell contract and the tiny margin in between is where the banks make their money. Incidentally the derivative contracts are created by banks - the buying and selling is done by traders in other organisations.

Where it goes wrong is when there is an unexpected event and the bank hasn't covered itself.

The other relevant problem is that merchant banks in the US (and maybe Europe, UK these days) can lend money and act as if they were accredited banks. Ronald Regan allowed this change in 1982 and the GFC is the result.

US business investment consists of corporations repurchasing their own stocks. Stock prices are soaring on the back of it, so, make the most of it, because sure as eggs, it's going to come tumbling, sooner rather than later. Just depends how long everyone can keep their balls in the air........

Mmm...don't think so. Companies only purchase their own shares when they do not have a better way to invest their earnings. Usually retained profis go to repay debt or to build new plant or as a bonus return to shareholders. Buying their own shares is a way of saying "our business is performing well and we expect it to get even better". Shareholders have to approve this and only do so if they can see future solidity.

[Ocean1]

How is the family?

Solvent, thanks.

[Winston001]

At least we know where all of the QE goes. Wonder what'll happen when they drop QE.

Funnily enough Mashie you are correct. Classical economics predicts inflation when the money supply expands.

That has not happened. Why not?

The reason is that printing new money over the past six years by the major economies, has been soaked up by the void left by the worthless valuations of 2007. People have hunkered down and refused to sell or buy until there was enough money floating in the general economy to make them feel safe. Think of the new money as filling up a hole - it takes a long time.

From the 1929 Depression it took until 1960 for stock markets to recover and in fact they didn't boom until about 1970. Then there was the 1973 Oil Shock.

So 30 years of economic flatlining is not unusual and we might be in such a period right now.

[Brian d marge]

Funnily enough Mashie you are correct. Classical economics predicts inflation when the money supply expands.

That has not happened. Why not?

The reason is that printing new money over the past five years by the major economies, has been soaked up by the void left by the worthless valuations of 2007. People have hunkered down and refused to sell or buy until there was enough money floating in the general economy to make them feel safe. Think of the new money as filling up a hole - it takes a long time.

From the 1929 Depression it took until 1960 for stock markets to recover and in fact they didn't boom until about 1970. Then there was the 1973 Oil Shock.

So 30 years of economic flatlining is not unusual and we might be in such a period right now.

been saying that for a while now .


the qe money is not being lent to the high st banks are just sitting on it , expanding the base money at the expense of the high st

when or if that money hits the high st . . then we should see inflation trend skywards

btw i thought it was clinton who removed theglass stegal act

sorry on phone so difficult

[R650R]

From the 1929 Depression it took until 1960 for stock markets to recover and in fact they didn't boom until about 1970

Thanks to Vietnam and also the Cold War, nothing like a bit of conflict to generate spending, pity about the people though....
Looks like we're headed the same way now...

[scumdog]

Thanks to Vietnam and also the Cold War, nothing like a bit of conflict to generate spending, pity about the people though....
Looks like we're headed the same way now...

Others have said the same.

For quite a long time...

[mashman]

Funnily enough Mashie you are correct. Classical economics predicts inflation when the money supply expands.

That has not happened. Why not?

The reason is that printing new money over the past six years by the major economies, has been soaked up by the void left by the worthless valuations of 2007. People have hunkered down and refused to sell or buy until there was enough money floating in the general economy to make them feel safe. Think of the new money as filling up a hole - it takes a long time.

From the 1929 Depression it took until 1960 for stock markets to recover and in fact they didn't boom until about 1970. Then there was the 1973 Oil Shock.

So 30 years of economic flatlining is not unusual and we might be in such a period right now.

People aren't going to spend what they perceive that they don't have. Not saying that you don't have a point in regards to why QE isn't being seen, but I believe that we've created too much of an income disparity gap and that QE is propping up the part of the economy that the less affluent don't take a part in i.e. stocks/shares. The primary reason to do this, other than for "confidence" reasons, if that people aren't spending, so the "value" isn't trickling up as it used to do. Apparently that plays merry hell with value of a company. If they keep that economy going, which they can by simply pumping in more money, then the system will float. When that stops, well, if those who aren't spending still aren't spending, then there's going to be a bit of a mess. They need people to start spending again, even if they don't want stuff.

I believe that this is what the buffets, keisers, hedgefund managers, economists etc... are highlighting without trying to take the wind out of the markets sales (pun intended). Yup you're probably right, we're likely to be in the mire for some time.

[Brian d marge]

japan
the qe byatch
japan central will buy anything . .have a horse named shergar with only 3 legs ,dumb san is yer man

quite simply put money is leaving as the people hit their seventies

there needs to be a correctionas simple as that and it will be a doozie .

ok now will add to this later

[scrivy]

This'll be fun............

http://www.infowars.com/new-law-woul...atives-losses/

[mashman]

This'll be fun............

http://www.infowars.com/new-law-woul...atives-losses/

It doesn't matter... we can always print more money.

[scrivy]

It doesn't matter... we can always print more money.

I guess that's the Feds answer to the whole thing....

[mashman]

I guess that's the Feds answer to the whole thing....

... why break a winning formula that's stood the test of time over the ages. If only it were just the Fed.

[Winston001]

It doesn't matter... we can always print more money.

People may not realise that the idea of the government making new money is a revolutionary idea. The classical Adam Smith model of economics held that there was no artificial expansion in the money supply and that hard times for ordinary people was normal. The Gold Standard made that certain. And cruel.

John Maynard Keynes proposed a brand new theory when he said that governments should spend, borrow, amd print money to ease people through times when they would otherwise lose their homes and starve. A very left wing socialist idea but it has been proven to work. Devalue the currency and never mind the gold reserves.

Franklin D Roosevelt's New Deal in the USA after the 1929 Great Depression is the poster child for Keynsian economics.

Those who argue against borrowing and printing money don't realise they are reverting to 19 century lassier faire economics which is brutal. Eat or die.