The Core
Why We Are Here => Economics & Investing => Topic started by: Mackin USA on January 21, 2016, 05:59:48 PM
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And the GOOD NEWS is?
http://www.telegraph.co.uk/finance/financetopics/davos/12108569/World-faces-wave-of-epic-debt-defaults-fears-central-bank-veteran.html :o
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>GOOD news
It's the lesser of our worries. Robots living on the floating cities won't care.
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It will become obvious in the next recession that many of these debts will never be serviced or repaid
So ... who is going to eat the losses, and how?
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It will become obvious in the next recession that many of these debts will never be serviced or repaid
So ... who is going to eat the losses, and how?
The next task awaiting the global authorities is how to manage debt write-offs - and therefore a massive reordering of winners and losers in society - without setting off a political storm.
Mr White said Europe's creditors are likely to face some of the biggest haircuts. European banks have already admitted to $1 trillion of non-performing loans: they are heavily exposed to emerging markets and are almost certainly rolling over further bad debts that have never been disclosed.
The European banking system may have to be recapitalized on a scale yet unimagined, and new "bail-in" rules mean that any deposit holder above the guarantee of €100,000 will have to help pay for it.
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And:
"It will become obvious in the next recession that many of these debts will never be serviced or repaid, and this will be uncomfortable for a lot of people who think they own assets that are worth something,"
so what assets will be worth something?
I would hazard;
Something that does not cost anything to keep. So not buildings, or ships, or factories unless you have something that you can keep earning from. The the bottom line is less money about being spent, so rents go down in real terms etc etc.
I kinda thinking gold. there must be more ( Ok Dogboy.. silver too :) )
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>>gold
The problem with gold. https://en.wikipedia.org/wiki/Executive_Order_6102
This lasted till 1974!
Gold jewelry was still allowed. My grandfather had two gold frames put around two gold coins that converted them into tie tacks without destroying the coins. By converting them into "jewelry" he hoped to get around the ban and confiscation. He kept the coins/"tie tacks" as a last ditch nest egg for the family just in case the Great Depression got worse.
Gold is probably still a good choice, just don't put all your eggs in one basket. And never, ever, underestimate the coercive power of the government.
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CASH IS KING
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not if hyper inflation takes hold.....
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not if hyper inflation takes hold.....
Right, but that will come AFTER deflation.
That will be the time to return to hard assets
imo :)
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Right, but that will come AFTER deflation.
Ok I get that now...
And here is another sign:
http://www.businessinsider.com/people-afraid-zombie-ships-first-sign-of-global-economic-collapse-2016-1?IR=T
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Ok I get that now...
Not sure I do... deflation leads the central banks to "print" money (QA, whatever you want to call it) which leads to decreasing confidence in the currency which leads to people dumping it which leads to the currency being worth less and less in a hyperinflationary death spiral?
Is that what you're saying?
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Is that what you're saying? YES THAT DOES HAPPEN
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COMMENT IS THIS
"No matter what happens this year, you can bet that a large number of people will buy whatever is sold in MS/NBC, CNBC, FoxNews, or QVC commercials to "protect you from the coming disaster".
So, go long on silver coins, Elvis plates, and things that sort of look like diamonds. No doubt they will sell like hotcakes. Everyone still has a basement full of gold, guns, and Whiskey they bought near the end of the 2007-8 'disaster', so you need to get creative if you want to sell things.
I COULD just wait until every tabloid newspaper has pictures of people jumping out of Wall St windows, then buy closed-end stock funds at historical discounts, but that would be too easy."
http://www.wsj.com/articles/the-chances-of-a-global-meltdown-1453767149?utm_content=buffer89b6f&utm_medium=social&utm_source=facebook.com&utm_campaign=buffer
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>go long on Elvis plates
hhh