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Several people correctly warned of both the dot com bubble and the colapse of the housing bubble, what makes now different?
Neither was a "bubble", and the often padded claims of success by the bulk of these shysters and hucksters can be found in the nature of the broken-clock paradox.
I do not think your definition is what most people associate with financial colapse. Generally it is whenever growth turns negetive and results in spikes in unemployment which devistates the lives of large numbers of individuals.
So that would cover the Great Depression, the Reagan Recession, and the later of the two Bush-43 Recessions.
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Originally Posted by jimhcom
The economy cannot suffer from overconsumption, that is an oxymoron.
It is if you cherry-pick your definitions away from those of any common understanding.
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Originally Posted by jimhcom
The economy is suffering from great losses of good jobs due to outsourcing.
Or due to technology? While outputs have soared, manufacturing jobs for instance have been declining in all of the world's major manufacturing economies since the mid-1990's. China in that time has lost more manufacturing jobs than the US presently has. US losses have been about average for the group.
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Originally Posted by jimhcom
The current low interest rates do little to help common people, because most common people are not doing much borrowing outside of their mortgage which for the most part people established prior to 2008 and credit cards which at current 18-30% rates could hardly be defined as low. Low interest rates are in place to support the financial industry.
The Fed sees low interest rates as a necessity since with the 2010 election of those with irrational notions and fears over "spending and debt", they have had no willing partner in promoting recovery on Capitol Hill.
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Originally Posted by jimhcom
As far as Japan, they are going on 40 years of failed economic policy with little hope of improvement going forward as they are now so desperate they are going to begin money printing to cope with their lack of growth.
LOL! Just 20 years ago the Chicken Littles were warning that Japan was about to swallow the US. Meaningful insight into Japan's economic situation is about as scarce as hen's teeth.
A crisis of production expressed in monetary terms.
Ah, so you DO believe in hyperinflation after all. Since all national debt and cuirrency are backed by the real goods and services output by the issuing economy, an actual or sometimes even a feared drop in GDP can cause people in ever greater numbers to seek conversion out of one currency and into another. When that option is available, hyperinflation typically occurs. When it isn't, it typically doesn't.
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Originally Posted by bale002
Gee, I don't know. Why don't you ask Fidel, he knows.
Fidel? So just more unserious mumbo-jumbo based on "Lost Decade" mythology then.
Neither was a "bubble", and the often padded claims of success by the bulk of these shysters and hucksters can be found in the nature of the broken-clock paradox.
If neither was a bubble, in your opinion, I would be interested in knowing just what does constitute a bubble in your mind. To most people those were two classic bubbles.
In both cases there were plenty of warnings of the impending price collapses for those who were looking at the data logically. It was for the most part the greedy and the ignorant that got crushed by both incidences.
Margin Call is a good movie. At the end, the boss rattles off a number of "crashes" or events. In my lifetime, there was at least one event per decade and sometimes two or three like 2000, 2002, 2008. The "crash" of 2013 was in gold.
If neither was a bubble, in your opinion, I would be interested in knowing just what does constitute a bubble in your mind.
A bubble is a significant market expansion that occurs without a material underlying cause. The Hunt brothers attempt to corner the silver market in 1979-80 for example. Goldman Sachs and others rigging oil futures markets in 2008 for another.
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Originally Posted by jimhcom
To most people those were two classic bubbles.
How so? Can people even spell out what it is they mean by the supposed "dot com" bubble? What you had in the wake of GLB was a gaggle of rigged IPO's (particularly on the NASDAQ) in which the investment side set up favored commercial side customers to reap large guaranteed gains at the expense of everyday investors. There was also a spate of Enron-style accounting scandals at a number of well-known firms, some of which were involved in telecommunications. Also those burgeoning cable business channels were busy feeding a day-trader frenzy by creating the impression that Joe Blow could make money in the markets (typically also on the NASDAQ) simply by following the "inside information" about to be provided by corporate bigwig so-and-so immediately after the break. The suckers who fell for the spiel of these sideshow barkers were eventually bled dry and simply gobbled up by the professional players. And on top of this of course was the natural caution that business exhibits when a change of administration is imminent, this time amplified by a deepening sense of concern over the quite radical economic proposals of one of the two major candidates. That concern would eventually unfold into a crisis of confidence and recession that were not lifted until the events of 9/11 gave us all something more important to think about. These are all things that need to be papered over if one is of a particular point of view. So you invent out of whole cloth an alternative explanation that associates blame with your political opponents and then you and your friends repeat that claptrap over and over and over again. That's where the legend of the dot-com bubble came from. Later the legend of the CRA as a cause of the credit crisis would be produced in a similar manner.
I don't feel like going through all the sordid details of what led up to the credit crisis and resulting Great Recession. Suffice it to say that the proximate causes were the unconscionable greed of a bunch of cowboy capitalists on Wall Street and the incomprehensibly bad fiscal, monetary, and regulatory policies of a do-nothing bunch of laissez-faire free-marketeers within the Bush administration.
Quote:
Originally Posted by jimhcom
In both cases there were plenty of warnings of the impending price collapses for those who were looking at the data logically. It was for the most part the greedy and the ignorant that got crushed by both incidences.
Worthless and unreliable commentators are continuously making all sort of claims. When one of a hundred turns out even partly correct, they go back and claim that they saw it all coming. You shouldn't waste either my time or yours with such rot.
Half the gloom-and-doom people of the mid- to late-1990's were airheads who thought this whole internet thing was just a fad that would eventually die out. There was after all no viable way to make any money with it. The rational people were pointing out that as had been the case with what I gather you would call the automobile bubble, the airplane bubble, the railroad bubble, the telephone bubble, and the electric light bubble, not every player in the park was going to be around to turn a profit, and no one could tell for sure which were going to be which. Care and caution were to be advised.
Meanwhile, by 2004 there were indeed warnings of unaddressed expansions in credit market abuse creating a growing pile of mortgage paper that would not be rigorous enough to withstand what everyone knew would be an eventual increase in interest rates. No one knew or could foresee exactly what form such a crisis would eventually take. All one could say is that a dangerous overhang was being allowed to build up and compound on itself, and that the consequences could ultimately be dire if action were not taken to rein in and control these abuses. It was not housing markets or prices that tumbled us into crisis. It was the stocks of bad paper that had been knowingly sold off into the system by unscrupulous players along with the people and policies that allowed them to do that.
A bubble is a significant market expansion that occurs without a material underlying cause. The Hunt brothers attempt to corner the silver market in 1979-80 for example. Goldman Sachs and others rigging oil futures markets in 2008 for another.
How so? Can people even spell out what it is they mean by the supposed "dot com" bubble? What you had in the wake of GLB was a gaggle of rigged IPO's (particularly on the NASDAQ) in which the investment side set up favored commercial side customers to reap large guaranteed gains at the expense of everyday investors. There was also a spate of Enron-style accounting scandals at a number of well-known firms, some of which were involved in telecommunications. Also those burgeoning cable business channels were busy feeding a day-trader frenzy by creating the impression that Joe Blow could make money in the markets (typically also on the NASDAQ) simply by following the "inside information" about to be provided by corporate bigwig so-and-so immediately after the break. The suckers who fell for the spiel of these sideshow barkers were eventually bled dry and simply gobbled up by the professional players. And on top of this of course was the natural caution that business exhibits when a change of administration is imminent, this time amplified by a deepening sense of concern over the quite radical economic proposals of one of the two major candidates. That concern would eventually unfold into a crisis of confidence and recession that were not lifted until the events of 9/11 gave us all something more important to think about. These are all things that need to be papered over if one is of a particular point of view. So you invent out of whole cloth an alternative explanation that associates blame with your political opponents and then you and your friends repeat that claptrap over and over and over again. That's where the legend of the dot-com bubble came from. Later the legend of the CRA as a cause of the credit crisis would be produced in a similar manner.
I don't feel like going through all the sordid details of what led up to the credit crisis and resulting Great Recession. Suffice it to say that the proximate causes were the unconscionable greed of a bunch of cowboy capitalists on Wall Street and the incomprehensibly bad fiscal, monetary, and regulatory policies of a do-nothing bunch of laissez-faire free-marketeers within the Bush administration.
Worthless and unreliable commentators are continuously making all sort of claims. When one of a hundred turns out even partly correct, they go back and claim that they saw it all coming. You shouldn't waste either my time or yours with such rot.
Half the gloom-and-doom people of the mid- to late-1990's were airheads who thought this whole internet thing was just a fad that would eventually die out. There was after all no viable way to make any money with it. The rational people were pointing out that as had been the case with what I gather you would call the automobile bubble, the airplane bubble, the railroad bubble, the telephone bubble, and the electric light bubble, not every player in the park was going to be around to turn a profit, and no one could tell for sure which were going to be which. Care and caution were to be advised.
Meanwhile, by 2004 there were indeed warnings of unaddressed expansions in credit market abuse creating a growing pile of mortgage paper that would not be rigorous enough to withstand what everyone knew would be an eventual increase in interest rates. No one knew or could foresee exactly what form such a crisis would eventually take. All one could say is that a dangerous overhang was being allowed to build up and compound on itself, and that the consequences could ultimately be dire if action were not taken to rein in and control these abuses. It was not housing markets or prices that tumbled us into crisis. It was the stocks of bad paper that had been knowingly sold off into the system by unscrupulous players along with the people and policies that allowed them to do that.
I personally exited the stock market in 1999, and sold 4 of my income properties in 2006 because of what I saw coming, but then I learned many decades ago that the first rule of making money is not to lose it.
People who are too lazy or ignorant to do the research and analysis of the cause and effect of cycles and monetary flows reap what they sow. People who claim it is impossible to analyze markets and cycles are simply blind people groping in the dark.
I personally exited the stock market in 1999, and sold 4 of my income properties in 2006 because of what I saw coming, but then I learned many decades ago that the first rule of making money is not to lose it. People who are too lazy or ignorant to do the research and analysis of the cause and effect of cycles and monetary flows reap what they sow. People who claim it is impossible to analyze markets and cycles are simply blind people groping in the dark.
Personal anecdotes are worthless. The vast majority of people simply lack one or more of the time, capacity, and interest necessary to become savvy investors or money managers. They don't deserve consignment to the ninth circle of hell for this.
By the way, there is no such thing as business or economic cycles. People have been looking for them for a long time, but they remain entirely elusive. They are off hiding somewhere perhaps in the company of El Dorado and the Fountain of Youth.
Bubbles meanwhile actually do exist, but there was not either a dot-com bubble or a housing bubble. These are CYA mythologies invented by people who would prefer not to talk about what actually happened.
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