1Perry
Banned
- Joined
- Jun 26, 2011
- Messages
- 7,624
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- Political Leaning
- Libertarian
The problem is not politics. The problem is not even fiscal or monetary, at least not in the traditional sense. The problem is growth.
Infinite growth on a finite planet is not only impossible, it is a logical absurdity. This is an important point: think about it until you understand that it is incontrovertible.
I'm jumping in here before I read the rest of your post. I agree with this but I'm interested to note this now and then see where you are going.
The problem is resource scarcity, or more to the point peak oil. For the last 250 years, civilization has had ever increasing amounts of energy available to grow, diversify, and increase in complexity. Since debt is predicated on the belief in the ability to be repaid in the future, it is the most forward-leaning aspect of a money economy. Therefore, when reasonable, rational people wonder if they will ever be repaid (with money that has any meaningful value), debt instruments are the first to not perform according to expectations.
Just to note, we can succeed without oil.
Since the economy is based on the lending of money at interest, that means this is it. In the words of Fred Sanford, "I'm coming Elizabeth, this is the big one!"
This is not a correction, recession, or depression which will be muddled through before the "normal" of 3% YoY GDP growth returns.
This is the end of growth. Plan accordingly.
The end? I think after a pretty painful correction we can grow again. I believe some of the expectations of the past should be scaled back. One does not have to grow yearly at 13% to be successful, damned with how you get there.
One other thing I noticed in this thread: I am a fan of conspiracy theories... even more I enjoy actual conspiracies. The fact that commodities, stocks, and treasury bond yields were all down on the same day is not the result of one however.
Not as in some one manipulating things, I agree. I do believe it is in part a hissy fit on the part of the markets because they haven't been fed more of the taxpayers money.
This is what happens during fast falls when traders need to cover margin calls and raise cash by selling assets that have appreciated recently. Not a rat... finance.
Margins need to be far higher than what they currently are.