lol. @nemo just and FYI. I've seen a couple of times that you have replied to a comment of mine but your comment is deleted... so I never see what you originally posted. I just wonder, why post it at all?
Maybe that was intended to troll me though. If so bravo. You be you. I respect a good troll.
I've wondered about this a bit lately.
Every time the economy starts to slow down across the West, the magic money tree gets shaken again to inflate everything back up.
So does that mean this could keep happening? And major recession or depression avoided?
I would have said no a few yrs ago but it keeps happening.
So maybe our thinking has to shift slightly...
The can will keep getting kicked down the road, with massive monetary stimulus each time, temporarily averting serious recessions, but with added strings that increase government authoritarianism as the price of the gov "helping" everyone. Because all gov financing has strings attached to promote public policy.
Example; in the UK, the gov has issued mandatory sales targets on heating manufacturers for green tech. Not criticising heat pumps here, as I understand it they're great for the right property. But public policy says we all have to have them regardless. So heating manufacturers have to sell x% of heat pumps. But there is not enough market demand to meet the gov sales targets. So the companies face fines for not meeting targets. To pay the fines, they increase prices (on all types of heating). As prices go up, that feeds inflation, and green tech subsidies have to be increased to compensate... But the gov overspends so it has no money for subsidies, so it has to borrow to fund the subsidies... increasing gov debt, which then increases central bank intervention cos gov debt costs would rocket otherwise, as gov debt keeps increasing, and so on...
It is illogical and is certainly not a sign of free markets or capitalism...
I'm not saying this outcome is preferable but I do wonder if the most likely outcome of our current economic mess, a depression, wont happen because central banks now effectively indirectly fund our governments...
Maybe this just carries on indefinately until we have a 'communist lite' system that arrives by default.
At that point, there is no financial depression, but plenty of shortages and a waiting list for everything!
Just a thought...
It has been strung along longer than any of us would have expected, and they have tricks up their sleeve to keep it going as long as political will doesnt turn. There is a systemic instability though, the numbers get more extreme with every turn, where the turns get more and more frequent. I think its reasonable to extrapolate out and say the next time the money printer starts, maybe its a 50% haircut for savers, maybe the next is 80%. There is no mechanism for reducing items like the national debt, and even under full yield curve control there is only so much they can do to keep rates down (evidence japan), meanwhile politicians follow their incentives to spend more. I see no way out of this cage, its a falling wedge where the top line is the collapse of investor confidence (double/tripple digit inflation and interest rates) and the botttom line is default.
It's been a surprise to me also just how long this has been going. As other posters have pointed out, there is plenty of evidence it's all going badly wrong for those prepared to see it.
Ultimately, maths wins. But I just don't see a default in the true sense for the US, Japan, UK, Euro-zone. Regardless of inflation, they will just hit the button and "print" more money. There are numerous schemes already in place to manipulate liquidity and solvency in the financial system (see Lynn Alden recently on investment banks arbitraging the Fed). So maybe talk of a default is a distraction. We should be more concerned at what policy steps will be taken to avoid default?!
Obvs it's all speculation at this stage. All pov are valid.
Wake up. We've been in a depression since 2008. A depression is an extended (multiyear) period of below trend real economic growth. People are being psyoped by fake inflation numbers to fudge real growth rate numbers - but open your eyes to the number of homeless people on the streets, living in tents, or cars. WE HAVE BEEN IN A DEPRESSION FOR OVER A DECADE. DON'T DRINK THE GOVERNMENT PROPAGANDA.
real GDP has been going up since around 2009 with a dip during COVID. Do you have any data to back up the claim that population adjusted homelessness is getting worse? Why is homelessness the metric to use to establish whether we are in a depression or not? I don't remember the exact numbers, but I know that alcoholism and drug use are significant contributors to homelessness. If population adjusted homelessness is going up, could it be due to other factors?
That's exactly what happened in the 1930's as Hoover then FDR threw the kitchen sink at regulations, mandating everything from above-market wages -- which force companies to lay off workers -- to political kommisars deciding what price you can sell -- indeed deciding if you'll have to sell your product for less than it cost.
This reminded me of a common myth I learned in college and have heard repeated ever since. Hoover was laissez-faire and FDR came in and fixed the economy. In reality Hoover was no where near laissez-faire. Over the years I've read in multiple books about Hoover's massive government projects and regulations on business. There is even a quote by him mentioning that one of his cabinet members was a "crazy laissez-faire" that recommended he remove regulation and reduce spending. He said, of course I didn't listen to him. Apparently some historians take this comment out of context and leave off the part where he said he didn't listen to that crazy idea!
Now, I will say. I wasn't there. I'm no expert but its a word to the wise. Question the "official" narratives. They are OFTEN false. Sometimes completely opposite of reality. At best many are biased or contain half truths.
Joe Biden is still a long ways from Hoover or FDR, who HL Mencken dubbed a "Fuhrer" peddlng envy and hatred. Don't get me wrong, Joe Biden is certainly dumb enough to copy them. But we won't see the truly stupid ideas until we hit the recession.
Love this guy. You can tell when someone is ignorant of history. They will act like Obama, Biden, Trump, or Bush are the worst presidents in US history. When you look at what FDR, Wilson, and Lincoln did and the consequences no modern president can hold a candle to them. From my reading of history the US was far closer to socialism during the FDR period than it is today. Neither Biden nor Obama can hold a candle to FDR.
At that point, there is no financial depression, but plenty of shortages and a waiting list for everything! Just a thought...