We are facing some challenging times that will test what we are made of. I've been preparing for this for quite some time. The media saying that this "recession" is going to last at least through the year are dreaming. This one is going to be 45-90 years, probably more.
It is going to be a very tough time for Obama. Bailout plans have a history of not working - the U.S. didn't recover because of FDR's new deal, it recovered because of WWII.
During the last Great Depression, while there are differences to today's situation that makes it impossible to make a side-by-side comparison, the main cause is that the economy went too happy (roaring 20's) based on I.O.U.'s. There was not enough underlying value to justify the consumer spending. Then the party was over, and the world went through a period of "reckoning".
People then were saying this is the end times too, and that Jesus was coming. He didn't come then, he's probably not coming any time soon, or at least I wouldn't "bank" on it.
An entire generation lived through soup lines, and in this case there will be two generations fighting for the soup.
I am very very sorry, I am watching the world economic numbers, and the banking system as it stands, is insolvent. We are all running on IOU's, and the stimulus plans worldwide are printing IOU's like crazy, further propogating the devaluation of currency.
I haven't been saying much about gold lately, but if you look it is nearly $1,000 an ounce. I know it sounds crazy, but I'm pretty sure as I sit here that it will hit $3,000 and once it gives way, could go to $10,000/oz.
6 comments:
I believe you are mostly correct. I don't see it lasting that long, but everything I'm looking at says late 2010 to 2015 or 2016 are going to be pretty financially devastating times.
The "bailout" will have a slight bandaid effect, that will assist a bear rally for 2009 and potentially early 2010. After that, it will be time to pay the piper.
This is very unfortunate for President Obama, as he will bear the brunt of the blame. When in fact this course was laid out long before he entered the picture.
I personally think Dick Cheney should be interrogated in the Guantanamo style that they allowed over the past 8 years, and then be forced to repay the millions he gained through his VP position. GW was merely a nice little puppet for Cheney's agenda. Still, even they are not totally to be blamed for this impending crisis.
Wall street greed, FBI supported bank fraud, and the "federal reserve" are the true criminals. Those who don't know, take some time to read what the federal reserve really is sometime.
I truly fear for our world.
I agree with you 100% that this recession is going last for years. We are only at the beginning of this world wide crisis. The reason why it is going to last is because the current solutions to the problem being proposed are not going to work. The people in charge are the very same people who caused the problem in the first place and their solutions will only make matters worse. Spending trillions of dollars the government doesn't have on pork projects and agenda driven social changes will not boost the economy. Very little money is going towards true job creation. Forced social change is what got us into the crisis in the first place. The government forced banks and lending institutions to give mortgage loans, through Fannie Mae and Freddie Mac, to people who could not afford to pay them back via a government edict called the CRA (Community Reinvestment Act)in order to get more minorities into the housing market. A noble cause no doubt, but not the right way of going about it. Giving out mortgages destined to fail, which were also marketed as derivative mortgage backed securities (CMOS) to brokerages is what caused the financial institutions to collapse. The plan was started by Pres. Carter, increased by Pres. Clinton, and promoted by ACORN. The affect of the collapse and the lame solutions being instituted will inevitably lead to a total U.S. economic collapse and ultimately a depression. This is happening in all of the socialist countries around the world. Capitalism can not live side by side with Socialism. Socialist government programs will bankrupt Capitalism every time. Capitalism left to prosper by itself will eventually trickle down to positively affect the majority of the population (a topic for another blog). With Socialism, every year the government needs more money to feed social programs like a drug addict needing more drugs to feed their habit. More and more money is taken out of the private sector to pay for the programs. The more money (all taxes) government takes out of the peoples pocket (private sector), the less money people have to spend on goods and services. The less private sector money spent on goods and services the more people get laid off. That is a fact. It is like a vicious never ending cycle. The social programs never solve the problems they were supposed to solve and the government keeps telling us that they could solve them if they just had more money. Since the beginning of man, no government has ever taxed itself into prosperity; and no government has ever completely solved the problems of inequity and social injustice no matter how much money they have spent on doing so. All I know is that I could sure solve a hell of a lot of my own problems if I could keep getting more money just by demanding it.
Since we're all just throwing it out there...
I think things will start to turn around this summer and by this time next year we will be talking about the word "recovery" in the present tense.
what will you consider the end of this "depression", so in a year when things are better we can say that you were wrong?
45-90 years is just plain stupid. beyond stupid. You are going to be wrong by decades. The economy while I agree is terrible it is showing positive signs towards improvement.
You haven't said much about gold because the last thing you said was it was "cheap" at 1000/ounce and it tanked after that.
It is up because Gietner opened his mouth bad mouthing the chinese.
Back in the day gold was a safehaven, however this is not back in the day, it is a short term hedge made by the major players. Small retail investors will get killed in the gold market. Gold is where the big boys play.
Here is what I think gold will do in 09, it is going to drop to low 700's an potentially get as high as 1000.
if you look at the charts it is very hard to break through 900, gold is good for two things
1. Inflation - we are facing deflation, simple as that, they can't print money fast enough. It is easy for the government to control inflation.
2. economic unrest - are you not an obama lover, don't you believe that he is going to bring "change"
I think the worst is behind us, yes jobs losses are catching up etc. and times are going to be tough for some time. This would be a terrible time for someone to buy into gold.
Thanks for making me want to kill myself.
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