02-27-2020, 10:25 PM
Comments on the last two items:
1. Forbes is far more reliable as a source of economic news than is FoX News. The coronavirus is the pretext; the inverted yield curve signals big trouble, as it has signaled for almost a year. In essence, "short" loans pay better than "long" ones -- and I am guessing that such is so because savings are inadequate to back the debt -- public and private.
2. The sole rationale for some to support Trump has been the economy. Such is his entire claim to desirability as a leader. Trump may have been taking credit for the longest bull market in history, but the politicians have ensured that the people get paid so little that they are deeply in debt and cannot save. Savings do not match debt, and when a sell-off begins, there will be few buyers flush with cash. Booms end when they run out of buyers of the securities and other investments -- as in 2007 -- and 1929, most blatantly.
3. The shakiest entities collapse first, and there will be no cause to back those. Student loans for medical school or law school might still be reasonably low-risk investments, but student loans being paid off perhaps never will crash. Highly-leveraged entities will die as their revenues cannot meet debt service.
4. So far the great devaluation has been of the value of labor. Just look at what has happened in communities that have depended upon manufacturing and mining, mostly in "flyover" country.
5 I may be biased, but Donald Trump is suited even worse than Herbert Hoover or George W. Bush for dealing with an economic meltdown. When it happens, and it has been only a matter of time, he will offer the wrong solutions. Does he seem like the sort of leader to instill courage in people enduring harsh consequences of an economic meltdown?
6. In the wake of an economic meltdown, the most radical reforms serve best. The market indices are coincident indicators, and... if I suddenly got a big inheritance I certainly wouldn't put it into stocks until the market has worked itself out. I have no crystal ball... but I see underlying cause for even more 'retreats;' in the stock market. I'd let the suckers get burned and learn a lesson -- that if you are the last investors in the boom, then the next appropriate investment for you is a long-term, low-yield (but highly-safe) form of saving.
Face it -- we are not going to have a real recovery until people start saving again. Saving became unfashionable in the run-ups to economic meltdowns. Such will take a revaluation of work; workers save.
1. Forbes is far more reliable as a source of economic news than is FoX News. The coronavirus is the pretext; the inverted yield curve signals big trouble, as it has signaled for almost a year. In essence, "short" loans pay better than "long" ones -- and I am guessing that such is so because savings are inadequate to back the debt -- public and private.
2. The sole rationale for some to support Trump has been the economy. Such is his entire claim to desirability as a leader. Trump may have been taking credit for the longest bull market in history, but the politicians have ensured that the people get paid so little that they are deeply in debt and cannot save. Savings do not match debt, and when a sell-off begins, there will be few buyers flush with cash. Booms end when they run out of buyers of the securities and other investments -- as in 2007 -- and 1929, most blatantly.
3. The shakiest entities collapse first, and there will be no cause to back those. Student loans for medical school or law school might still be reasonably low-risk investments, but student loans being paid off perhaps never will crash. Highly-leveraged entities will die as their revenues cannot meet debt service.
4. So far the great devaluation has been of the value of labor. Just look at what has happened in communities that have depended upon manufacturing and mining, mostly in "flyover" country.
5 I may be biased, but Donald Trump is suited even worse than Herbert Hoover or George W. Bush for dealing with an economic meltdown. When it happens, and it has been only a matter of time, he will offer the wrong solutions. Does he seem like the sort of leader to instill courage in people enduring harsh consequences of an economic meltdown?
6. In the wake of an economic meltdown, the most radical reforms serve best. The market indices are coincident indicators, and... if I suddenly got a big inheritance I certainly wouldn't put it into stocks until the market has worked itself out. I have no crystal ball... but I see underlying cause for even more 'retreats;' in the stock market. I'd let the suckers get burned and learn a lesson -- that if you are the last investors in the boom, then the next appropriate investment for you is a long-term, low-yield (but highly-safe) form of saving.
Face it -- we are not going to have a real recovery until people start saving again. Saving became unfashionable in the run-ups to economic meltdowns. Such will take a revaluation of work; workers save.
The ideal subject of totalitarian rule is not the convinced Nazi or the dedicated Communist but instead the people for whom the distinction between fact and fiction, true and false, no longer exists -- Hannah Arendt.