What's in Your Wallet?

tw · 11-11-2005, 05:47 PM

So is that wallet one of a creditor or a debtor? Many only have instruments of debtors - credit cards. And yet current economic conditions say you better not be a debtor with storm cloud brewing on the horizon. Symptoms are similar to the early 1970s.

Paying big bucks for a war that, somehow, does not show up on federal spread sheets.

Massive government spending that, last time, was so dependent on European and Japanese bond buyers. Today that same debt problem is very dependent on Chinese buyers.

Serious trade imbalances that don't have any sign of being corrected as even jobs move overseas while a wave of new innovative products diminishes.

Unprecedented debts among consumers - we have never had so many consumers this deep in debt.

Unrealistic prices for things such as housing. A market driven mostly by rediculously low interest rates that will only keep increasing to address serious and impending inflation.

Sharp increases in energy prices created by extreme and unproductive consumption levels - ie car MPG back then dropped from 17 MPG to 8 and 12 MPG. Today the 25 MPG number continues to be driven lower by vehicles that only get 8 and 12 MPG.

Domestic automakers in serious financial trouble. Combined with some whose entire product line is incompatible with the future, whose costs due to inferior design are excessive, and whose corporate leaders are again trying to blame the unions.

One new factors is the impending Pension Fund disaster that looms like the S&L crisis of the mid 1980s. A problem created by bean counter mentalities whose function was to make a profit - the purpose of those financial instruments irrelevant.

Let's look at the stock market when these same factors previously existed as cited by Lookout123. Notice the pathetic growth rates from 1970 until the early 1980s - when gasoline went from the highest price in mankind to the lowest.

The first chart uses a linear scale that really distorts the numbers. The second chart uses a logrithmic scale that puts the stock market Dow Jones Industrial Average into useful perspsetive:

11-11-2005, 05:47 PM	#15
tw Read? I only know how to write. Join Date: Jan 2001 Posts: 11,933	So is that wallet one of a creditor or a debtor? Many only have instruments of debtors - credit cards. And yet current economic conditions say you better not be a debtor with storm cloud brewing on the horizon. Symptoms are similar to the early 1970s. Paying big bucks for a war that, somehow, does not show up on federal spread sheets. Massive government spending that, last time, was so dependent on European and Japanese bond buyers. Today that same debt problem is very dependent on Chinese buyers. Serious trade imbalances that don't have any sign of being corrected as even jobs move overseas while a wave of new innovative products diminishes. Unprecedented debts among consumers - we have never had so many consumers this deep in debt. Unrealistic prices for things such as housing. A market driven mostly by rediculously low interest rates that will only keep increasing to address serious and impending inflation. Sharp increases in energy prices created by extreme and unproductive consumption levels - ie car MPG back then dropped from 17 MPG to 8 and 12 MPG. Today the 25 MPG number continues to be driven lower by vehicles that only get 8 and 12 MPG. Domestic automakers in serious financial trouble. Combined with some whose entire product line is incompatible with the future, whose costs due to inferior design are excessive, and whose corporate leaders are again trying to blame the unions. One new factors is the impending Pension Fund disaster that looms like the S&L crisis of the mid 1980s. A problem created by bean counter mentalities whose function was to make a profit - the purpose of those financial instruments irrelevant. Let's look at the stock market when these same factors previously existed as cited by Lookout123. Notice the pathetic growth rates from 1970 until the early 1980s - when gasoline went from the highest price in mankind to the lowest. The first chart uses a linear scale that really distorts the numbers. The second chart uses a logrithmic scale that puts the stock market Dow Jones Industrial Average into useful perspsetive: Attached Images

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)