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Post by nonentropic on Aug 18, 2023 3:09:26 GMT
Totally Glen.
in the late 70's inflation round we had interest rates above inflation in general, still not that good as we paid tax on the interest. Since then there has been a slow erosion of this norm and now the expectation is that savers should subsidize people who struggle with to much leverage.
We are held hostage to the fools who borrow to much.
My father who survived WW2 as a youth in a Japanese prison camp once said that "a hero was someone who could not visualize themselves being killed" The process of exerting pressure on borrowers when they have overdone leverage is sort of the same, they could not see markets changing.
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Post by missouriboy on Aug 19, 2023 12:33:13 GMT
Totally Glen. in the late 70's inflation round we had interest rates above inflation in general, still not that good as we paid tax on the interest. Since then there has been a slow erosion of this norm and now the expectation is that savers should subsidize people who struggle with to much leverage. We are held hostage to the fools who borrow to much. My father who survived WW2 as a youth in a Japanese prison camp once said that "a hero was someone who could not visualize themselves being killed" The process of exerting pressure on borrowers when they have overdone leverage is sort of the same, they could not see markets changing. And in terms of Western Hemisphere economy changes over the next couple of decades, does Peter Zeihan have it more or less correct? This was recorded a year ago. Was the forecast valid then? Is it valid now?
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Post by glennkoks on Aug 20, 2023 2:15:42 GMT
Already going up. The Fed is scared shitless. A 1% increase in rates translates into a $280,000,000,000 increase in Fed government interest payments. We are currently running about 3% below historical averages. Increasing rates will result in financial collapse. I have been accused of being a permanent-bear. But looking back at Sigurdur's post from 2021 I have to agree with him now more than ever. The cost of interest paid by our government has gone up astronomically. At the same time our government is spending more than ever. Just about everything costs more than it did when we started this tread. In addition to the inflation, borrowing money costs more than ever. New home mortgages have doubled, car loans are way up. If you take a step back and look at it logically the Fed has to fight inflation job one. Our government can't afford to borrow money at these higher rates very long and our current leadership has no intention of reigning in spending. The only real tool the Fed has for fighting inflation is higher rates. Prohibitively higher rates meant to crush the economy and destroy the demand for goods and services that feed inflation. The Dow is almost exactly where it was when we started this tread. Essentially two years of nothing burger. But over that time the cost for everything has gone up. Way up. We all have a lower quality of life than we did when this thread was created and it is poised to get worse. |
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Post by walnut on Aug 20, 2023 2:35:38 GMT
They F'ed up the economy, no argument there. Currently high diesel prices with rapid deflation, following extremely rapid inflation and interest rate increases? A toxic cocktail of bad policy choices. And all for the sake of a fake power grab drug pushing pandemic.
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Post by code on Aug 23, 2023 0:23:20 GMT
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Post by code on Aug 23, 2023 0:27:59 GMT
They F'ed up the economy, no argument there. Currently high diesel prices with rapid deflation, following extremely rapid inflation and interest rate increases? A toxic cocktail of bad policy choices. And all for the sake of a fake power grab drug pushing pandemic. Did you say they fed up the economy?  |
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Post by glennkoks on Aug 23, 2023 1:01:35 GMT
When Paul Volcker started raising rates in October of 1979 it took a full 2 years for the "Reagan Recession" to kick in in 1981. They say history does not repeat itself but it rhymes. The Fed started raising rates on March 17th 2022. May mean something, it may mean nothing but I listened to a guy on Bloomberg who said the average time from the first rate hikes to a recession was two years and two months.
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Post by ratty on Aug 23, 2023 1:44:53 GMT
When Paul Volcker started raising rates in October of 1979 it took a full 2 years for the "Reagan Recession" to kick in in 1981. They say history does not repeat itself but it rhymes. The Fed started raising rates on March 17th 2022. May mean something, it may mean nothing but I listened to a guy on Bloomberg who said the average time from the first rate hikes to a recession was two years and two months. Using that rule of thumb, we're in trouble about this time next year.  |
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Post by justme on Aug 24, 2023 15:52:01 GMT
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Post by phydeaux2363 on Aug 24, 2023 17:09:30 GMT
When Paul Volcker started raising rates in October of 1979 it took a full 2 years for the "Reagan Recession" to kick in in 1981. They say history does not repeat itself but it rhymes. The Fed started raising rates on March 17th 2022. May mean something, it may mean nothing but I listened to a guy on Bloomberg who said the average time from the first rate hikes to a recession was two years and two months. Using that rule of thumb, we're in trouble about this time next year. just in time for the US elections |
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Post by glennkoks on Aug 24, 2023 20:37:20 GMT
There is nothing to fear from the BRICS unless they try to create some sort of currency that would challenge the dollar as the reserve currency. And that is not likely... |
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Post by justme on Aug 24, 2023 21:52:57 GMT
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Post by walnut on Aug 24, 2023 22:32:47 GMT
There is nothing to fear from the BRICS unless they try to create some sort of currency that would challenge the dollar as the reserve currency. And that is not likely... There is actually nothing there, the members don't even plan on doing it. Just Internet mythology |
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Post by walnut on Aug 25, 2023 0:22:07 GMT
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Post by walnut on Aug 31, 2023 12:47:55 GMT
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