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The FED and government just need to let the economy do its thing and stop extending cheap and easy credit which is inflating asset prices outrageously.
So those people be homeless and there is already tent city problem in San Francisco, Los Angeles, Seattle and San Diego.
I don't agree with much of your post but the portion above is dangerously naive - you'll not find a legit economist who agrees with you. However, I must ask how would you reset prices to 1990s levels?
Legit Economist??? Most so called Economist with those worthless economic degrees are completely clueless. We all see clearly now where those Legit Economist at the FED are leading us.............straight to the SLAUGHTERHOUSE!!!
The FED negated the last DEFLATION CYCLE by diverting future tax receipts back into the present - still we have not resolved all that FED manipulation. If the FED would have allowed the real DEFLATION to run its course from 2001-2019, we would be out of debt now, and sailing into another Business Cycle.
Did those Legit Economists and "experts" at the Fed fix the DEFLATION or just delay it??????????????????????
If the FED FIX was just a delaying tactic, then we still need the Deflation that was scheduled for 2001-2019, which demolishes debt so that we can start again. That did not happen. When the FED attempted to unwind the FED Balance Sheet, the Deflation Demon was unleashed. This is the problem.
And to answer your question on how to reset prices to 1990's levels......... with HIGHER INTEREST RATES and with STRONG US DOLLAR. Imagine what 20% and up interest rates would do to those inflated and fake asset prices. it would deflate it by 80% and back to those 1990's levels.
Every generation has both a Business Cycle AND a DEFLATION CYCLE which unwinds the debt used for expansion during the Business Cycle Growth Season. There is NO perpetual growth. The debt created to fuel the expansion MUST BE destroyed in the subsequent NIGHT or capacity cannot be restored when needed for the following DAY.
Legit Economist??? Most so called Economist with those worthless economic degrees are completely clueless. We all see clearly now where those Legit Economist at the FED are leading us.............straight to the SLAUGHTERHOUSE!!!
The FED negated the last DEFLATION CYCLE by diverting future tax receipts back into the present - still we have not resolved all that FED manipulation. If the FED would have allowed the real DEFLATION to run its course from 2001-2019, we would be out of debt now, and sailing into another Business Cycle.
Did those Legit Economists and "experts" at the Fed fix the DEFLATION or just delay it??????????????????????
If the FED FIX was just a delaying tactic, then we still need the Deflation that was scheduled for 2001-2019, which demolishes debt so that we can start again. That did not happen. When the FED attempted to unwind the FED Balance Sheet, the Deflation Demon was unleashed. This is the problem.
And to answer your question on how to reset prices to 1990's levels......... with HIGHER INTEREST RATES and with STRONG US DOLLAR. Imagine what 20% and up interest rates would do to those inflated and fake asset prices. it would deflate it by 80% and back to those 1990's levels.
Every generation has both a Business Cycle AND a DEFLATION CYCLE which unwinds the debt used for expansion during the Business Cycle Growth Season. There is NO perpetual growth. The debt created to fuel the expansion MUST BE destroyed in the subsequent NIGHT or capacity cannot be restored when needed for the following DAY.
Good Luck!!!
What are your economic credentials? Fairly basic if at all based on your post. You are seriously wrong on most of your post. Deflation is not required - you are confusing deflation with recession. Deflation is reduction in prices, recession is reduction or contraction in economic activity. You keep talking like deflation is recession, they are not the same thing and have very different causes and impacts.
Sorry to burst your bubble but much of your post is really wrong for many reasons. There was some deflationary action during the 2008 recession with the CPI technically being below zero (that is between 2001 and 2019), but the last serious deflation that impacted the US as a whole was in the 1930s great depression. There was no deflation between the 1930s and 2008 but quite a few recessions and depressions.
So those people be homeless and there is already tent city problem in San Francisco, Los Angeles, Seattle and San Diego.
Well certain areas are just beyond outrageously expensive and even were in 2008 to 2012 which are the areas you mentioned. Prices in those areas were far worse even in 2008-2012 than most other major metros today. Those areas are just super super expensive for some reason. The problem is most major metros now have a small bungalow costing $220K or more in a nice neighborhood when back in 2009-2012 you could get that for like $100K to $150K. That is how it is in Metro Detroit and Minneapolis and Atlanta and such.
I am not saying people should be homeless. But extending cheap and easy credit to the is not the answer. There is a such thing called renting until you can save enough for a a house. Or living in a camper and minimalist enough to save enough for a house in a major metro without drowning in debt for more than 20 years.
People are already doing that and then when they get enough for a house it is barely and they have to buy something super expensive of $220K plus for 1000 square foot bungalow when it would be much better for higher interest rates and 20% minimum down where the 1000 square foot bungalow is $100K to $140K instead.
But oh no so many greedy people feel entitled to run away appreciation in homes to price out future generations without them drowning in even more debt because of little money down super low interest rates. Just sickening!! Thats the case pretty much everywhere sadly except rural Ohio, rural Alabama, and rural West Virginia and such.
The price of homes are because of high demand and low supply.It not the price of home but land value cost.
There many places in the US where the price of homes are dirt cheap and other places like New York, Miami, San Francisco and Los Angeles it is really costly.
You really think in 1990 Los Angeles looking at wiki of population of 3,485,398 and looking at it in 2018 of population of 3,990,456 the price is going to stay the same.
Unless American people want to take down the homes and build 12 story apartments I don't see how you can lower the price if the city goes up that much in population. And people are not going to like that.
Looking at the wiki Los Angeles County population of 8,863,164 in 1990 and 10,105,518 in 2018.
The price is not going to stay same with population going up like that. It not some place in the Midwest or south like Alabama or Mississippi.
Outrageously high housing prices are very locale dependent, not because of general inflation, which has been tamed for a long time now. And that is a very issue for those not having the wealth to cope, yet still having to live and work there. The solution is for those people to move elsewhere. That is a major lifestyle choice, and one that every middle class worker under that sort of stress needs to consider.
Then there is lifestyle and standard of living. Certainly better in general for our poor. And of course we rich have done famously with all this monetary policy.
The crux is that middle class wages have not kept up the last few decades. And letting the economy go to total hell without governmental and Fed assistance post 2008 crash is just nonsense. Many more of the middle class would have been beaten down.
IMO the cure is money policy directed toward the working middle class. IMO we will see some of this coming soon for Coronavirus relief. Which will lead to...
IMO the best, simplest, quickest and easiest way to augment our broad middle class is through HC reforms, and whatever means it takes to reduce their OOP financial stress.
Outrageously high housing prices are very locale dependent, not because of general inflation, which has been tamed for a long time now. And that is a very issue for those not having the wealth to cope, yet still having to live and work there. The solution is for those people to move elsewhere. That is a major lifestyle choice, and one that every middle class worker under that sort of stress needs to consider.
Then there is lifestyle and standard of living. Certainly better in general for our poor. And of course we rich have done famously with all this monetary policy.
The crux is that middle class wages have not kept up the last few decades. And letting the economy go to total hell without governmental and Fed assistance post 2008 crash is just nonsense. Many more of the middle class would have been beaten down.
IMO the cure is money policy directed toward the working middle class. IMO we will see some of this coming soon for Coronavirus relief. Which will lead to...
IMO the best, simplest, quickest and easiest way to augment our broad middle class is through HC reforms, and whatever means it takes to reduce their OOP financial stress.
Let's hope this criminal activity since 2001 of simulating or faking economic growth with money stolen from our kids and grandkids is over. The cries and howls you hear this past few weeks are from debtors. Savers smiled. It’s time for savers to stand up for themselves. It’s time for a little pain to be felt by those who have inflicted it without end for so long. Deflation is hard but at this point its much needed for SAVERS.
Deflation is the transfer of wealth back from debtors to savers through the increase in purchasing power of your money and the liquidation of over-priced assets by desperate debtors trying to remain solvent.
Look at the gas prices now???? Lower gas prices are making it far easier for real people to get to work, buy food, pay off debt and build a life for themselves. Same is true for lower housing cost, lower healthcare cost and lower education cost. Its time to end this inflation madness created by those "Legit Economists or LUNATICS at the FED. It's time to end SOCIALISM FOR THE RICH ONLY and perversion of Capitalism.
What are your economic credentials? Fairly basic if at all based on your post. You are seriously wrong on most of your post. Deflation is not required - you are confusing deflation with recession. Deflation is reduction in prices, recession is reduction or contraction in economic activity. You keep talking like deflation is recession, they are not the same thing and have very different causes and impacts.
Sorry to burst your bubble but much of your post is really wrong for many reasons. There was some deflationary action during the 2008 recession with the CPI technically being below zero (that is between 2001 and 2019), but the last serious deflation that impacted the US as a whole was in the 1930s great depression. There was no deflation between the 1930s and 2008 but quite a few recessions and depressions.
I graduated from the University of Mother Nature and I only follow the LAW OF NATURE. Mother Nature teach us that Inflation (Growth) lasts for certain number of years. It is succeeded by certain number of years (a generation) of DEFLATION. This is a necessary sequence, like Day and Night. We can't FIX IT. We have to endure it.
I suppose they don't teach you this at those worthless business schools? Most so called Legit Economists believe in "the Business Cycle" but most have no idea what the Business Cycle is and how long it lasts. They think it is variable, depending upon the details of economic expansion. What if the Business Cycle is fixed?????? This idea that it is fixed eludes them since we have all come to think that fixed cycles....suggests God, which it does - at least suggests an intelligence much larger than the current human intelligence.
We had a multiple asset bubble going on. It is popping now. Recession is coming. La port traffic is way down. Job losses will follow along with cheaper prices as folks will be holding on to cash. Those over extended will lose more. Government jobs will be kept. Ford and General electric will go belly up. Ge has over 30 billion in pension debt to be serviced. Those on the cusp of retirement will have to work longer.
Cash is king in a recession. Goods and services will be cheaper, There will be a reset in stocks, housing and labor. It was bound to happen. The bull market has been going for over 10 years. The Bear is here. Another wave of homeless will happen. So what. Those who saved and have zero debt will survive. The debt laden folks will crumble and famalies will have to live together again. Say hello mom and dad here comes Johhny with his wife and kids.
Congrats to those that lived in there means. Folks have been taking money out of there houses again and spending foolishly. These folks will be homeless. Then again as long as you have the earth you are never homeless. Houseless yes, homeless no.
Spy defensive sectors like utilities,healthcare, consumer staples is where money is going. Think defense..
Sorry, but we are still not in a BEAR MARKET. It has been so long since we've had a real bear market, we don't even know what a Bear Market is. A BEAR MARKET has duration. Lasting a full generation. Which this may become, but is NOT after 2 weeks. A BEAR MARKET is defined by time, not by % lost.
That's what I mean by investors today being inexperienced to how painful a real BEAR MARKET is. It wipes out opportunity for a full generation. It is much more painful than a CRASH, which can be a sudden loss of 20-38%, with a recovery and new highs in 6 months.
Good Luck!!!
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