05-20-2017, 07:46 PM
(05-19-2017, 01:05 PM)X_4AD_84 Wrote: [quote pid='25762' dateline='1495216579']
That’s my point. There are other things that can happen. Suppose a recession begins at the end of this year, 10 years after the last one started. Assume the stock market is as overvalued as I think it is and the Dow falls to 8000 or lower. Finally assume just a large decline in asset values produces another financial crisis ten years after the last one. Will Democrats provide the majority of the votes for another Wall street bailout to help Donald Trump politically? Suppose they don’t?
None of the things I propose here are implausible. We are overdue for a recession and many observers think the market if very overvalued. We had financial crises in 1857, 1866, 1873, 1884, 1893 and 1907 with an average spacing of a decade, so such a spacing today is not totally crazy. And I find it hard to believe that Democrats will do the heavy lifting on a bill to help Trump. I’m not saying this likely, but it’s not unlikely either. If it does then you are going to get a 4T type outcome.
Now I cannot think of any way one can get a 4T outcome to an era beginning in 2008 without something like this happening. So does this mean that the theory predicts this? I don’t think I would be on firm ground on that point.
And in the "Lessons Never Learned Department" - household debt now exceeds what it was in 2006 - 07.
[/quote]
When you start seeing the same shit but in a slightly different way then it is likely the boom phase of the business cycle is done.
Democracy is the theory that the common people know what they want, and deserve to get it good and hard. -- H.L. Mencken
If one rejects laissez faire on account of man's fallibility and moral weakness, one must for the same reason also reject every kind of government action. -- Ludwig von Mises
If one rejects laissez faire on account of man's fallibility and moral weakness, one must for the same reason also reject every kind of government action. -- Ludwig von Mises
