I read stuff like this all the time but this time I have to post it because it is such a good read, and it does ring true based on myriad volumes of related stuff I've read over the last 4 years or so since the wheels came off the wagon.
A couple of excerpts to whet your whistle......
The fact is that economies are slowly melting down. The problem is excessive debt in almost every corner of the world. The only way to deal with the debt is through aggressive growth, but fabricating growth through more debt won’t work. The idea that you can get the economy to move forward by creating even more debt just doesn’t wash.
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I think it’s cognitive dissonance. When confronted with something that’s really unpleasant, and to which there’s no easy solution, the average person will basically block it out and look for somebody to tell them that everything is fine. The mainstream news media and the government are doing that as we speak. Consequently, the average person doesn’t have a chance of understanding what’s going on. The man in the street doesn’t have a clue what’s coming.
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The title of the article doesn't do it justice. To me, it's not about Gold, it's more about describing that we are in a global financial situation where no one has any ability to re-route this quadrillion ton freight train. It's a big machine in a state of crashing in super slow motion and Bernanke, nor the Socialists in Europe have a chance in hell of making the crash go away. The best they can do is throw money around and make it appear as if everything is gonna be Ok. I don't believe it is. I'm not an alarmist and do not by nature believe in alarmist anything but I think the train is too big this time.
It never hurts to keep your eyes and ears open with a bent toward capital preservation and self-protection eh Monsieur and Mademoiselle?
Ever hear of the saying "don't put all yor eggs in one basket"? The global economy is just that and is one hell of a big basket. I believe we will see countries pulling back within their borders and a surge of "nationalism" will return as countries try to protect their own interests in the coming storm. There will be much violence, much bigger than what we are seeing in Greece. Once the world markets "reset" to actual realism then we move forward again ever so cautiously with a hope that those stung by the gordian knot of the intricate interlacing economies learn from this failed model. I believe America will rise from this as we are the best equipped to deal with true capitalism.
ReplyDeleteRosey, that sounds quite plausible. Protectionism seems unavoidable. And the USA still has the best foundation to recover with though I do feel a deeper slide is in the wings.
DeleteThanks for the optimism.
The free market economy will carry us through. Eventually.
ReplyDeleteOpus, I hope you're right. I do believe the majority are productive and have some idea what it takes to pull out of this, I just wonder if it's possible. As in a lifeguard can only save so many before succumbing themself.
DeleteBut as Rosey said, If anyone is going to do it, it will be us.
40% drop is HUGE and I see it everywhere.........very scary times. I wish I hadn't listened to my rich cousin after my husband died and I had a little extra money... I felt like I should buy precious metals and he had really good reasons not to....none of which I remember right now. :0(
ReplyDeleteWell Z, No one knows where the market is going. If anyone claims to they are a fool or a liar. But still you look at the metrics and place your bets. Capital preservation is the most important thing so you can live to fight another day worst case.
DeleteThink that Obama is not a Marxist?
ReplyDeleteHow about the facts ? Nothing but the facts!
Obama's father was a Harvard graduate, a self professed Communist who was perfectly fine with the government confiscating 100% of your income as long as it went to the better good of the people.
Obama admitted to seeking out communist professors while he was at Harvard. Obama started this whole "Communist sloganed" re-election campaign on May 5th, the birthday of Karl Marx ....
And, you guys want to believe this was unintentional or coincidental?
Was "Fast & Furious" unintentional or coincidental? Is that why Eric Holder refuses to testify about it and is now facing contempt charges?
Everything Obama does it very well thought out and calculated with a motive ..
Voted for TARP
*$787 billion stimulus redistribution bill
*Healthcare bill admittedly about ‘redistributing the wealth’
*Single Payer Healthcare proponent.
*President Obama now also President of GM & Chrysler
*President Obama seizes control of insurance giant AIG
*President Obama is leading America to single payer healthcare
*President Obama seized control of Student Loan industry in order to ‘cut out middle man’
*President Obama seizes control in massive land grabs
*Repeatedly vilifies ‘the rich’
*Obama believes race problems can be solved through redistribution of wealth… he said "race is still an enormous factor in our society. But economics can overcome a lot of racial division."
*Trying to regulate the Internet via FCC
*Forces mortgage co’s to cover people who aren’t paying mortgage (Link)
*Extends unemployment benefits to 99 weeks (Link)
*Told Joe the plumber ‘it’s better when you spread things around.
And how about his Friends & family..
Ever hear the term Guilty by Association?
Family, Friends, Advisors & Administration
*Wife Michelle Obama said “The truth is, in order to get things like universal health care and a revamped education system, then someone is going to have to give up a piece of their pie so that someone else can have more.”
*Jim Wallis, Obama’s spiritual advisor & forced redistribution of wealth advocate
*Van Jones, disgraced Green Jobs Czar & Communist
*Ron Bloom, Manufacturing Czar & anti-free market
*John Holdren, pro-redistribution of wealth
*Andy Stern, SEIU President & redistribution of wealth fan
*Anita Dunn, fan of Chairman Mao
*Mark Lloyd, FCC ‘Diversity Czar’
*Carol Browner, socialist
*Robert Creamer, socialist
*Admittedly sought out ‘Marxist’ professors!
*Admittedly attended ‘socialist conferences!
*Began attending a Marxist church – led by pastor Jeremiah Wright (attended for 20 years)!!!
Left Hawaii for Indonesia, Pakistan a very unusual thing to do, don’t you think?
*Attended a leftist church nicknamed the ‘little red church’ because of its Communist sympathies
His OWN Mother was a Communist sympathizer!
Now you non-brain-dead will be able to draw your own conclusions from the facts. As for you BRAIN-DEAD Moonies, I’m not even going to try to change your minds, you are too far gone in the Brain-Washed department for that!
TMW. I'm with you. I recently commented on a blog that I absolutely believe the obama administration gets together and literally has side splitting laughing session about how they are tearing down America from every facet of it's foundation. Yea, it's intentional.
DeleteYea, obama himself is a blithering imbecile. Never worked an honest day in his life. Racist. Anti-American, Muslim, In his own words he spent the last 2 yrs of high school in a daze doing alcohol and enthusiastically doing drugs. So he'd he get into hahvard?/He was "placed" there. he did jack shit while he was there outside of protesting Whitey with his black theology friends.
his whole administration is about tearing down America and stealing as much as they can ala Chicago style politics and gettign re-elected do they can continue to steal. him, his democrat buddies and the unions, public and private which these days are nothing more than communist organizations.
Anyway, preaching to the choir I guess.
I think the America public see, hears and know's Obama Marxist leanings. This is the optimism that I have that he is a one-term usurper. In time the true depth of his conspiracies will be divulged and at that moment we will be the better for it. It will be the death knell for the Democrat party as we know it. America has survived many enemies both foreign and now domestic and like mother nature, America will survive this.
ReplyDeleteRosey, Well, a bunch of us do.
Delete"It will be the death knell for the Democrat party as we know it. America has survived many enemies both foreign and now domestic and like mother nature, America will survive this."
That sounds real good Rosey ! Enjoy.
Precious metals are for sucker.
ReplyDeleteTry mortgage REITs but be prepared to move if the interest rate spread shifts.
Duck, Well, I'll take you advice as being honestly given in an attempt to help someone else.
DeleteBut my question is. Why REIT's ? Why Now?
Long term investments are probably the way to go for a lot of people.
Personally, I don't have the patience for long term investment bets. I've redirected all my 401 contribution $ to my trading account a couple years ago as a result. I've been trading the Ultra long and Ultra short ETF's on the senior Gold Miners NUGT and DUST respectively, and have been doing "quite well" which is all I'll say lest I bring the wrath of the trading God's down on me.
I personally think Gold will do quite well over the next couple years, but that doesn't mean I'm going to just go plunk down and buy physical gold or buy a gold ETF and let it sit there. Anything can happen anytime. Especially when the Fed and Policy makers can do anything anytime they want to jack the market in the direction they want. Bernanke has been doing it since early 2008. Anyway, the advantage individual investors/traders have over mutual funds is they can go to 100% cash in a couple seconds.
I'd say be prepared to go to Attack Plan R is interest rates start rising because that will probably mean that we can't even afford to pay the interest on our debt.
So, Why REIT's? Why Now?
PS - Any advice about the markets has to take into consideration the investor's Time Horizon and Risk Profile...
DeleteReal Estate Investment Trusts (REIT's) have performed well in a good to moderate economy, especially Retail Reit's like malls. That industry just went through a massive consolidation through acquisitions forced by non-performing REITs and bankrupcy like General Growth Properties. But as any industry that went on expansion binges through mergers and acquisitions, they were left holding bad investments. The only saving grace is that those properties are still refinancing due to the low interest rates but that bubble is about to burst big time. My advice is run from REIT's as fast as your little feet can carry you....
ReplyDeleteRosey! You're the Real Deal ! Yes, it's my opinion that REIT's are a nightmare. mortgage holders of repo's are still bulldozing thousands of properties because raw development land is worth more than stripped homes.
DeletePlus any student of [even recent] history knows it took a long long Long time for real estate to come back after the 29 crash.
It really doesn't matter so much how many dollars you have -- I'm talking retirement nest egg and investment portfolios here. Purchasing power is the factor that matters.
ReplyDeleteI'll be 72 on my next birthday. That means I have lived long enough to see roughly ONE-THOUSAND PERCENT INFLATION in real estate and most commodities since I was in high school. It would take an income of Two-Hundred-Thousand dollars a year to purchase what you could have bought with an annual income of Twenty-Thousand dollars sixty years ago.
President Reagan called inflation "the cruelest tax of all." He was right.
What this means is that we may have much bigger salaries, and pay much more for our houses today than we did decades ago, but all those dollars are highly inflated, and therefore, worth about once percent of what they were in my childhood.
The Pennsylvania Dutch have an expression that sums it up beautifully:
"The farther ahead I go, the behinder I get."
If you want to save your sanity, you just have to see the humorous aspect of the thing.
~ FreeThinke
http://freethinkesblog.blogspot.com/?zx=da63e836789862c5
FT - 10 times is quite accurate. Gas 35 cents, today 350. Chevy Camaro 2200.00, today actually a little more - 28k for something comparable equipment-wise.
DeleteAmazing how people don't really understand inflation, and APR for that matter. It robs them blind. And Truly Evil is the inheritance tax. Steal the earnings and savings of an entire lifetime, money that has already been taxed. The founders would puke at Today's America.
Z, I'm truly sorry if you're having financial difficulties, but what you said reminds me of a line from Auntie Mame spoken wryly by Vera Charles the day the Depression hit Beekman Place. I'm sure you remember it well.
ReplyDelete"And everybody thought I was crazy to spend all my money at Tiffanys!"
There are times when "crazy" turns out to be incredibly wise.
I guess Patrick Dennis may have "borrowed" that sentiment from Anita Loos' fabled character Lorelei Lee, but who cares? There's a lot of truth in it.
I feel "rich" as long as I can afford to keep a roof over my head, food in the pantry and use the air conditioning in this appalling heat.
I hope I live long enough to see the dust settle after the coming blow up. At the very least it should be most interesting.
Best to you!
FreeThinke
I'm also of the belief of not putting all your eggs in one basket. And it's very true that people put their heads in the sand and don't want to face reality. We need to prepare for the worst and hope for the best.
ReplyDeleteExcellent advice TCL. This is going to be one hell of an interesting decade.
DeleteI'm not very optimistic about things at all. The inflation is a killer, and with stagnate and falling wages, it's bad.
ReplyDeleteIt is obvious that obasturd is destroying America ON PURPOSE! Why other's don't see it besides us bloggers is very maddening.
I pray daily that we'll be rid of him in November.
Bunni, "obasturd" I like It ! There is no doubt in my mind the destruction is intentional.
DeleteRomney is not gonna save the day. Doesn't have enough fingers for the dike. Though he will be a breath of Fresh Air. Can't wait to scrap these racist obama imbeciles off my shoe.
The gears are turning and it's coming apart is what I currently think.