The Great Devaluation

[TeacherinExile]

Happy Anniversary, Bull Market!  Tomorrow marks the eighth anniversary of the second-longest bull market in U.S. history, dating from the March 9, 2009 low in the major stock indices.  It's been quite a run for equity investors.  So it seems like as a good time as any to ask if the stock market is approaching the kind of "bubble" territory that might usher in the Great Devaluation, to which Strauss & Howe make frequent reference in The Fourth Turning.

I have provided links to some of the more interesting articles published, some of which provide excellent perspective with various graphics.

Disclaimer: Nothing here should be construed as trading or investment advice.  Consult your financial advisor for guidance:

Stop! This is NOT like the dot-com bubble... it’s much worse, according to this chart

The dangers lurking within the world’s ‘most deceptive’ stock market chart

Wall Street's super-charged bull faces its own March madness

Stock investors can’t bank on another 8-year bull-market bonanza

A Republican and a Democrat agree: Wall Street’s too bullish on Trump

Bull market depends on whether Trump can deliver on key promises

Of course, the above-referenced articles are limited to the stock market, leaving aside for the time being any discussion of "bubbles" in bonds, real estate, or arts & collectibles.  (And, for what it's worth, some investment advisors say that we're already in an "Everything Bubble.")  

I have a couple of questions--hopefully not rhetorical.  Do you consider the trillions in "lost" wealth, resulting from the financial crisis of 2008, to be sufficient--both in terms of magnitude and duration--to qualify as the Great Devaluation?  Or do other factors have to come into play first, such as a fiscal crisis, currency devaluation, what have you?

[TeacherinExile]

(03-08-2017, 03:03 PM)X_4AD_84 Wrote:

(03-08-2017, 02:24 PM)TeacherinExile Wrote: Happy Anniversary, Bull Market!  Tomorrow marks the eighth anniversary of the second-longest bull market in U.S. history, dating from the March 9, 2009 low in the major stock indices.  It's been quite a run for equity investors.  So it seems like as a good time as any to ask if the stock market is approaching the kind of "bubble" territory that might usher in the Great Devaluation, to which Strauss & Howe make frequent reference in The Fourth Turning.

I have provided links to some of the more interesting articles published, some of which provide excellent perspective with various graphics.

Disclaimer: Nothing here should be construed as trading or investment advice.  Consult your financial advisor for guidance:

Stop! This is NOT like the dot-com bubble... it’s much worse, according to this chart

The dangers lurking within the world’s ‘most deceptive’ stock market chart

Wall Street's super-charged bull faces its own March madness

Stock investors can’t bank on another 8-year bull-market bonanza

A Republican and a Democrat agree: Wall Street’s too bullish on Trump

Bull market depends on whether Trump can deliver on key promises

Of course, the above-referenced articles are limited to the stock market, leaving aside for the time being any discussion of "bubbles" in bonds, real estate, or arts & collectibles.  (And, for what it's worth, some investment advisors say that we're already in an "Everything Bubble.")  

I have a couple of questions--hopefully not rhetorical.  Do you consider the trillions in "lost" wealth, resulting from the financial crisis of 2008, to be sufficient--both in terms of magnitude and duration--to qualify as the Great Devaluation?  Or do other factors have to come into play first, such as a fiscal crisis, currency devaluation, what have you?

Many middle income people suffered from a Great Devaluation last decade, from which they have never recovered. At least some of the Trump voters hail from that demographic.

True enough.  Particularly those middle-class homeowners in some scattered regions of the country who are still "underwater" on their mortgages.  Some in the same group may have panicked out of the stock market, too, near the bottom, though only half of Americans have any stake at all in equities.  But you must admit that the top income group--however one defines it--recovered their "lost" wealth rather quickly, and then some.  The values of high-end real estate alone attest to that, foreign buyers notwithstanding.

So perhaps I should have qualified the Great Devaluation not only in terms of magnitude and duration, but in terms of breadth as well.

Still, the question remains: Was the loss in wealth caused by the Great Recession sufficiently dire--across the board--to constitute the Great Devaluation to which the book refers?  Or does some greater financial calamity have to befall us? One that results not only in a paradigm shift in politics, which is obviously underway, but a paradigm shift in the political economy as well?

[David Horn]

(03-08-2017, 03:52 PM)TeacherinExile Wrote: ... Still, the question remains: Was the loss in wealth caused by the Great Recession sufficiently dire--across the board--to constitute the Great Devaluation to which the book refers?  Or does some greater financial calamity have to befall us? One that results not only in a paradigm shift in politics, which is obviously underway, but a paradigm shift in the political economy as well?

Yes, that's the real question isn't it?  Trump is a huge unknown, but the business community thinks he's going to do for them first, and the others ... well, not so much.  That may be changing as reality sets in, but that's still where we are.  I'm still looking for a sell-off.  I may be foolish, but I'm not getting further in.  Not now.

[TeacherinExile]

(03-08-2017, 04:07 PM)David Horn Wrote:

(03-08-2017, 03:52 PM)TeacherinExile Wrote: ... Still, the question remains: Was the loss in wealth caused by the Great Recession sufficiently dire--across the board--to constitute the Great Devaluation to which the book refers?  Or does some greater financial calamity have to befall us? One that results not only in a paradigm shift in politics, which is obviously underway, but a paradigm shift in the political economy as well?

Yes, that's the real question isn't it?  Trump is a huge unknown, but the business community thinks he's going to do for them first, and the others ... well, not so much.  That may be changing as reality sets in, but that's still where we are.  I'm still looking for a sell-off.  I may be foolish, but I'm not getting further in.  Not now.

This year, if not this month, is definitely an "inflection point" in the stock market, in my humble opinion.  The reason I pose the question about whether we have actually experienced the Great Devaluation or not: It still feels like we are mired in some kind of Turning Limbo, a gray territory between Unraveling and Crisis.  Or else a "pendular swing" in this Crisis, one that alternately displays characteristics of both turnings, much like the period from 1929 to Pearl Harbor.

[Ragnarök_62]

(03-08-2017, 03:03 PM)X_4AD_84 Wrote: Many middle income people suffered from a Great Devaluation last decade, from which they have never recovered. At least some of the Trump voters hail from that demographic.

You, bet, man.   It is for that reason that Rags is not a happy camper.


So for the empire, for justice for the top 1%, and fucked for all.






Rags, sees it all, for the past, shall be prologue. All empires are blinded by the fact, they all shall die in ashes. Rome, England, and now... The US shall be cast asunder.  Stephen King is the prophet of the modern age.  Heh, I see it.  It never fails. XY_MOX.  That's how it goes.  The internal contradictions of empire pile up, one by one, Russia is not the cause of collapse, but it's the fact that finance can't keep up with multitudes of bases strewn abroad, that happen. US troops open fire on...
civilians... Heh. Heh.  We're there, man.  Oil shortages will do it. Mounting plagues shall do us in.  Get it, man?  I'll see you at the wishing well, my friend. we've been there , but it's up to you, to see what I see. Empire = Death.  The Dark Man Cometh. He comes to reap for us all. Got it? It's even too much for the MIC. Got it?





Stephen King ain't no prophet for nothing.  Zika, Bird flu, etc.   The neo-plague. for all.  Just like Rome, so goes all other empires.

[pbrower2a]

As I see it, the great devaluation is in the sole commodity that most people have: their labor. The Right wants a cheap labor country with monopoly pricing, the purest sort of exploitation short of peonage or slavery.

[Bob Butler 54]

CNN is saying, There is a retail bubble -- and it's bursting

Too many malls.  Too many strip malls.  The Internet is ever improving as an alternative to brick and mortar stores.  I live in Plymouth MA, and have seen it clearly enough.

With manufacturing and paper shuffling jobs being lost to automation and computers, the retail sector has been one area where ordinary folk have been finding employment.  How stressed is that going to be?

[pbrower2a]

(03-09-2017, 08:30 PM)Bob Butler 54 Wrote: CNN is saying, There is a retail bubble -- and it's bursting

Too many malls.  Too many strip malls.  The Internet is ever improving as an alternative to brick and mortar stores.  I live in Plymouth MA, and have seen it clearly enough.

With manufacturing and paper shuffling jobs being lost to automation and computers, the retail sector has been one area where ordinary folk have been finding employment.  How stressed is that going to be?

Moribund malls are a reality of American life.

The shopping mall depended upon bored people going into a store with a hundred bucks or so, finding nothing more interesting to do than to buy some phonograph records, clothes, or housewares and leave the store with ten bucks or so (after perhaps spending a little money in the food court for some over-priced fast food)  but coming out with some phonograph records, clothes, or housewares. It took little intelligence to sell stuff to impulse buyers. Now that so much income has gone to people who have better things to do with their spare time (like order domestic servants about) than to do impulse shopping at the mall, the impulse shoppers are gone. Without the impulse shoppers, most stores would go under.

Places that cater to low-income shoppers, like Dollar General, Family Dollar, Wal*Mart, Big Lots (if you are unfamiliar with that regional chain,

"Go to Big Lots/ leave dejected
See what Wal*Mart has rejected"

close-outs, schlock too ugly for Wal*Mart, wares of companies that fail to advertise, reconditioned stuff)

are doing well.

What used to cater to middle-income people, like Sears, JC Penney, Macy's, Radio Shack, etc., is dying as the middle-income sector disappears in an America increasingly looking like a land of magnates and peons. But if one is destitute one has no choice; one must pinch pennies.

[Odin]

The Fargo metro area has two malls, the older, larger mall, West Acres Mall, is still doing well. The newer, smaller mall, Moorhead Center Mall, is half empty. Unfortunately the Moorhead City Hall is INSIDE the mall so I don't know what will happen if the mall part goes under...

[SomeGuy]

(03-10-2017, 02:28 PM)Odin Wrote: The Fargo metro area has two malls, the older, larger mall, West Acres Mall, is still doing well. The newer, smaller mall, Moorhead Center Mall, is half empty. Unfortunately the Moorhead City Hall is INSIDE the mall so I don't know what will happen if the mall part goes under...

Guh, Lakewood, WA had its city offices in a mall, too, at least they did when I was there in 2006.  That's so weird.

Honestly, the level of decay one sees everywhere in the US outside a handful of areas is simply astonishing.

[Odin]

(03-10-2017, 02:37 PM)SomeGuy Wrote: Guh, Lakewood, WA had its city offices in a mall, too, at least they did when I was there in 2006.  That's so weird.

Here it was part of the same terrible wave of "urban renewal" in the 70s and 80s that lead to nearly all of the early 20th Century brick buildings in downtown Moorhead to get torn down and replaced by a blight of ghastly strip malls and "suburban commercial" type buildings. That same wave didn't happen on the Fargo side of the river so downtown Fargo still has its old brick buildings, the city actually plays up a bit of a 20s Jazz Age theme for downtown to fit with the historic Fargo Theater.

[SomeGuy]

(03-10-2017, 02:56 PM)Odin Wrote:

(03-10-2017, 02:37 PM)SomeGuy Wrote: Guh, Lakewood, WA had its city offices in a mall, too, at least they did when I was there in 2006.  That's so weird.

Here it was part of the same terrible wave of "urban renewal" in the 70s and 80s that lead to nearly all of the early 20th Century brick buildings in downtown Moorhead to get torn down and replaced by a blight of ghastly strip malls and "suburban commercial" type buildings. That same wave didn't happen on the Fargo side of the river so downtown Fargo still has its old brick buildings, the city actually plays up a bit of a 20s Jazz Age theme for downtown to fit with the historic Fargo Theater.

One of things that gives me hope is just how much of that pre-WWII urban infrastructure still survives, despite all of the late 20th century trends you mention, and how enthusiastically some of those areas are being revived even in not terribly progressive places.

[Kinser79]

Not really. This is how empires collapse. Their own people stop believing in them. If we're lucky, we'll be more like Rome and less like the USSR and have a saeculum of crisis and decay before total collapse.

https://en.wikipedia.org/wiki/Crisis_of_...rd_Century

It just so happens that such a devlopment would play right into my Mega-Saeculum theory which has been much poo-pooed by the Boomers here.

[Odin]

(03-10-2017, 03:01 PM)SomeGuy Wrote:

(03-10-2017, 02:56 PM)Odin Wrote:

(03-10-2017, 02:37 PM)SomeGuy Wrote: Guh, Lakewood, WA had its city offices in a mall, too, at least they did when I was there in 2006.  That's so weird.

Here it was part of the same terrible wave of "urban renewal" in the 70s and 80s that lead to nearly all of the early 20th Century brick buildings in downtown Moorhead to get torn down and replaced by a blight of ghastly strip malls and "suburban commercial" type buildings. That same wave didn't happen on the Fargo side of the river so downtown Fargo still has its old brick buildings, the city actually plays up a bit of a 20s Jazz Age theme for downtown to fit with the historic Fargo Theater.

One of things that gives me hope is just how much of that pre-WWII urban infrastructure still survives, despite all of the late 20th century trends you mention, and how enthusiastically some of those areas are being revived even in not terribly progressive places.

The Fargo-Moorhead metro is a university city, which helps make it more progressive than it would otherwise be.

[SomeGuy]

(03-10-2017, 03:13 PM)Odin Wrote:

(03-10-2017, 03:01 PM)SomeGuy Wrote:

(03-10-2017, 02:56 PM)Odin Wrote:

(03-10-2017, 02:37 PM)SomeGuy Wrote: Guh, Lakewood, WA had its city offices in a mall, too, at least they did when I was there in 2006.  That's so weird.

Here it was part of the same terrible wave of "urban renewal" in the 70s and 80s that lead to nearly all of the early 20th Century brick buildings in downtown Moorhead to get torn down and replaced by a blight of ghastly strip malls and "suburban commercial" type buildings. That same wave didn't happen on the Fargo side of the river so downtown Fargo still has its old brick buildings, the city actually plays up a bit of a 20s Jazz Age theme for downtown to fit with the historic Fargo Theater.

One of things that gives me hope is just how much of that pre-WWII urban infrastructure still survives, despite all of the late 20th century trends you mention, and how enthusiastically some of those areas are being revived even in not terribly progressive places.

The Fargo-Moorhead metro is a university city, which helps make it more progressive than it would otherwise be.

Yes, I'm sure, but my point was that the trend towards rehabilitating those areas is occurring even in non-progressive places, like for instance Fayetteville, NC.  Or Galax, VA.

[pbrower2a]

(03-10-2017, 02:56 PM)Odin Wrote:

(03-10-2017, 02:37 PM)SomeGuy Wrote: Guh, Lakewood, WA had its city offices in a mall, too, at least they did when I was there in 2006.  That's so weird.

Here it was part of the same terrible wave of "urban renewal" in the 70s and 80s that lead to nearly all of the early 20th Century brick buildings in downtown Moorhead to get torn down and replaced by a blight of ghastly strip malls and "suburban commercial" type buildings. That same wave didn't happen on the Fargo side of the river so downtown Fargo still has its old brick buildings, the city actually plays up a bit of a 20s Jazz Age theme for downtown to fit with the historic Fargo Theater.

I'm guessing that the strip malls and 'suburban commercial' schlock will themselves be torn down in a forthcoming wave of urban renewal.

[SomeGuy]

(03-10-2017, 03:37 PM)pbrower2a Wrote:

(03-10-2017, 02:56 PM)Odin Wrote:

(03-10-2017, 02:37 PM)SomeGuy Wrote: Guh, Lakewood, WA had its city offices in a mall, too, at least they did when I was there in 2006.  That's so weird.

Here it was part of the same terrible wave of "urban renewal" in the 70s and 80s that lead to nearly all of the early 20th Century brick buildings in downtown Moorhead to get torn down and replaced by a blight of ghastly strip malls and "suburban commercial" type buildings. That same wave didn't happen on the Fargo side of the river so downtown Fargo still has its old brick buildings, the city actually plays up a bit of a 20s Jazz Age theme for downtown to fit with the historic Fargo Theater.

I'm guessing that the strip malls and 'suburban commercial' schlock will themselves be torn down in a forthcoming wave of urban renewal.

Oh my God, you made a post worth responding to.  Well done, guy!

Yeah, considering how few of those buildings were built to last longer than 30 years or so, I think that highly probable.  I fully expect the remnants of suburbia to be the "inner cities" of the next saeculum.  Look at Ferguson, which was a white commuter 'burb within my lifetime.

[Galen]

(03-10-2017, 03:06 PM)Kinser79 Wrote: Not really.  This is how empires collapse.  Their own people stop believing in them.  If we're lucky, we'll be more like Rome and less like the USSR and have a saeculum of crisis and decay before total collapse.

https://en.wikipedia.org/wiki/Crisis_of_...rd_Century

It just so happens that such a devlopment would play right into my Mega-Saeculum theory which has been much poo-pooed by the Boomers here.

In other words, you would prefer to be dead rather then have to deal with the real shit-storm of collapse.  Not a completely unreasonable position even though it means future generations will have a harder time of it.  I would say you were acting like a Boomer but unlike them you did not cause the problem and are not in a position to stop the process.

Lord Rees-Mogg and James Davidson wrote about a similar process in history where the western history undergoes a major crisis and evolution about every five hundred years.

[Kinser79]

Galen in the end we're all dead anyway.

More my point is that unlike the End of o the USSR which left a large number of the old guard intact to rule over a remnant state, the US going the way of Rome would allow in a few saculua (I don't think it would take millennia this time--technological progress and such) for a new state to rise on the burnt out ashes.

One could liken it to the periodic control burns done by Native Americans both on the Plains and in Florida.  They burned the land to make it fertile once more, lest it become over clogged with weeds and trees and so forth.

As for future generations they are going to have a harder time of it at least in the next saeculum anyway.  Further not only am I not responsible for it but no one is, and not only I cannot stop it but no one can.  The wheel within the wheel grinds forward--at least until the material conditions for the formation of saecula stops existing or extinction (whichever happens first)

[Classic-Xer]

(03-10-2017, 04:10 PM)Galen Wrote:

(03-10-2017, 03:06 PM)Kinser79 Wrote: Not really.  This is how empires collapse.  Their own people stop believing in them.  If we're lucky, we'll be more like Rome and less like the USSR and have a saeculum of crisis and decay before total collapse.

https://en.wikipedia.org/wiki/Crisis_of_...rd_Century

It just so happens that such a devlopment would play right into my Mega-Saeculum theory which has been much poo-pooed by the Boomers here.

In other words, you would prefer to be dead rather then have to deal with the real shit-storm of collapse.  Not a completely unreasonable position even though it means future generations will have a harder time of it.  I would say you were acting like a Boomer but unlike them you did not cause the problem and are not in a position to stop the process.

Lord Rees-Mogg and James Davidson wrote about a similar process in history where the western history undergoes a major crisis and evolution about every five hundred years.

The chances are likely that we'll all live to see it. BTW, I'd rather be living here than be living/stuck any where else in the world when it happens.