One of the best articles I have read on what is to come ...

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
8,211
7,825
1
This a a Barron's article, so if you are a subscriber or have not exhausted free trial access, give it a read. @NJPSU, this is especially for you. Fortunately, this board will probably be long gone before the day of reckoning.

Euphoria before the inevitable pain.

To summarize briefly, the article gives specific time lags on the effect of fiscal and monetary stimulus, the feel-rich effect this has on asset wealth (stocks and real estate), the ensuing inflation, and then the cost/effect of that inflation.

If you're a central banker, politician, or other insider, you can get the timing of stuff like this perfect and become extremely wealthy, taking advantage of the misery of others during a collapse. This has been the game for a long time.

There is another article this morning that claims the stock market is going way beyond fundamentals this time due to "retail investors." These are buy-the-dip people who invest based solely on a trend line.

At the end of the day, after the euphoria, inflation, and pain, we can expect that true capitalism will take another blow to the head. Not because it is wrong, but because it has been corrupted by central banks and governments.

So, this time we will transition to a truly socialist nation, with lower living standards for all. (I think due to our debt situation, and inability to face reality.)

Just "lower your expectations." That's the new message from our leader. He gets it. Must have read the article.
 
  • Like
Reactions: Cosmos and SR108

NJPSU

Well-Known Member
May 29, 2001
42,594
14,601
1
I will read this but my initial thoughts based on just your post is that people have been predicting this since 2008.

People underestimate just how long the can could get kicked down the road before some kind of major reckoning. We could all be dead by then. My thoughts are if you are out of debt, own a home outright, and have a decent amount of diversified assets, what's the worst that can happen? I don't require luxuries to be happy so I'm not that worried about it.
 

franklinman

Well-Known Member
Apr 5, 2011
25,995
5,870
1
79
Pa and Fl
I will read this but my initial thoughts based on just your post is that people have been predicting this since 2008.

People underestimate just how long the can could get kicked down the road before some kind of major reckoning. We could all be dead by then. My thoughts are if you are out of debt, own a home outright, and have a decent amount of diversified assets, what's the worst that can happen? I don't require luxuries to be happy so I'm not that worried about it.
Correct, live within your means, control your debt, don't go chasing pipe dream investments and you can survive this.
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
8,211
7,825
1
I will read this but my initial thoughts based on just your post is that people have been predicting this since 2008.

People underestimate just how long the can could get kicked down the road before some kind of major reckoning. We could all be dead by then. My thoughts are if you are out of debt, own a home outright, and have a decent amount of diversified assets, what's the worst that can happen? I don't require luxuries to be happy so I'm not that worried about it.

For one, there are many people without "diversified assets."

Second, it is very difficult to stay ahead of real inflation with paper assets during a 1970s style inflationary super cycle. You'd have to have all of your "diversified" assets sitting in high-demand commodities, or you'd have to pick the perfect stocks/real estate.

Third, the 2008 stimulus was measured. It was not as large, and so it did not produce euphoria. Therefore it did not produce inflation and the hangover like the article describes.

This is entirely different. Governments and central banks looked at the 2008 recovery and thought they could eliminate the pain it caused. What the article says is that there is no way around the pain. And this time it will be worse, and possibly abrupt, because government spending is way out of balance, and debt/GDP is soaring. The only way to stop it from soaring is to begin the process of feeling pain.

People have NO IDEA what is to come.
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
8,211
7,825
1
And I'll ask you guys (@NJPSU and @franklinman) again: What do you say to people on fixed incomes, such as pensions?

Screw them?

(It's OK. You can say they are just casualties of reckless spending and stimulus.)
 

franklinman

Well-Known Member
Apr 5, 2011
25,995
5,870
1
79
Pa and Fl
And I'll ask you guys (@NJPSU and @franklinman) again: What do you say to people on fixed incomes, such as pensions?

Screw them?

(It's OK. You can say they are just casualties of reckless spending and stimulus.)
At my age 78, i have many friends living on pensions and SS.and savings. We are all cutting back on our spending and will ride this out, as it won't be the 1st time.
 
  • Like
Reactions: NJPSU

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
8,211
7,825
1
At my age 78, i have many friends living on pensions and SS.and savings. We are all cutting back on our spending and will ride this out, as it won't be the 1st time.

Really? What does "as it won't be the 1st time" mean?

If you're talking about "future," the last inflationary super-cycle lasted more than a decade, and took decades to tame. This will be worse, because the government has no tools other than to dramatically cut fiscal spending, which the Dems are actually intent on INCREASING.

If you're talking "past," when was the last time your retired friends road out high inflation? When they were young workers getting raises each year?

If you think taxes will be the tool to reduce inflation, keep in mind that you will be taxing back money that is invested. Which means your "other savings" will also be worth less.

And by the way, the COLA doesn't cover seniors very well. Even the Democratic Party makes this claim.
 

NJPSU

Well-Known Member
May 29, 2001
42,594
14,601
1
Really? What does "as it won't be the 1st time" mean?

If you're talking about "future," the last inflationary super-cycle lasted more than a decade, and took decades to tame. This will be worse, because the government has no tools other than to dramatically cut fiscal spending, which the Dems are actually intent on INCREASING.

If you're talking "past," when was the last time your retired friends road out high inflation? When they were young workers getting raises each year?

If you think taxes will be the tool to reduce inflation, keep in mind that you will be taxing back money that is invested. Which means your "other savings" will also be worth less.

And by the way, the COLA doesn't cover seniors very well. Even the Democratic Party makes this claim.
If your doomsday scenario comes true, people will simply be forced to drastically cut their lifestyle. The only thing you can do is get your own house in order before it occurs .
 

HartfordLlion

Well-Known Member
Sep 28, 2001
21,858
14,739
1
At my age 78, i have many friends living on pensions and SS.and savings. We are all cutting back on our spending and will ride this out, as it won't be the 1st time.

When the government is forced to lower you SS payouts I think this will be the first time.
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
8,211
7,825
1
If your doomsday scenario comes true, people will simply be forced to drastically cut their lifestyle. The only thing you can do is get your own house in order before it occurs .

Tell that to certain family and friends. Even if I am fine they will likely not be fine.

They would not be at risk if the government kept its house in order, and that includes the Fed. So even if I am responsible, it's not enough when the government is irresponsible.
 

NJPSU

Well-Known Member
May 29, 2001
42,594
14,601
1
Tell that to certain family and friends. Even if I am fine they will likely not be fine.

They would not be at risk if the government kept its house in order, and that includes the Fed. So even if I am responsible, it's not enough when the government is irresponsible.
If you are responsible you will be fine. Yes I agree, some people you know likely won't be fine but they won't die. They will just be poor.
 

Petch

Well-Known Member
Mar 28, 2012
3,306
5,163
1
They won't lower the payouts in dollars. It's just that the dollars may buy less.
You sound like that old Bernie Sanders clip when asked about lines for bread and toilet paper, he said “That’s a GOOD thing!”

Why do you feel that this road we are traveling down is acceptable? Pre-Covid, we had a booming economy, shortages of NOTHING, plenty of jobs AND plenty of workers. Now we have a growing number of Americans AND additional countless numbers coming in to live off of the federal government handouts…all caused by irresponsible Democrats (and some RINO Republicans) that just want a huge government and ruling class.

Why is this good?
 
  • Like
Reactions: Ski

NJPSU

Well-Known Member
May 29, 2001
42,594
14,601
1
You sound like that old Bernie Sanders clip when asked about lines for bread and toilet paper, he said “That’s a GOOD thing!”

Why do you feel that this road we are traveling down is acceptable? Pre-Covid, we had a booming economy, shortages of NOTHING, plenty of jobs AND plenty of workers. Now we have a growing number of Americans AND additional countless numbers coming in to live off of the federal government handouts…all caused by irresponsible Democrats (and some RINO Republicans) that just want a huge government and ruling class.

Why is this good?
Actually shorting Granny with her COLA adjustment is right from the ole Paul Ryan Republican playbook. They've been trying to do that for years.

The inflation and and the shortages are a global event that is the result of reopening from a global pandemic.

My question to you was why were you silent when your Cult Leader was doing the exact thing you are now crying about? Trump passed multiple stimmies during his Presidency. Trump begged the Fed to create negative interest rates and run the printing presses. The man was thrown out of office while begging for Mitch to give everyone another $2000.
 
  • Wow
Reactions: franklinman

Cosmos

Well-Known Member
May 29, 2001
25,446
17,956
1
So, this time we will transition to a truly socialist nation, with lower living standards for all. (I think due to our debt situation, and inability to face reality.)

You had me there until you said this^^

No way we can transition to socialism when we are already broke! You can thank the coastal elitists for offshoring manufacturing jobs. But to the point Americans are in for a long overdue adjustment to their standard of living. As a WaPo editorial alluded to today. Can't find a Thanksgiving turkey? Substitute potted meat. 99 cents a can at Dollar General. It is what it is. And American-Africans are going to have a nut when they can no longer afford to lease BMW and Mercedes. LMFAO!
 

NJPSU

Well-Known Member
May 29, 2001
42,594
14,601
1
You had me there until you said this^^

It is what it is. And American-Africans are going to have a nut when they can no longer afford to lease BMW and Mercedes. LMFAO!
Sometimes your racism cracks me up. Yeah i know you married a big booty latina. You are still a racist though.
 

Petch

Well-Known Member
Mar 28, 2012
3,306
5,163
1
Actually shorting Granny with her COLA adjustment is right from the ole Paul Ryan Republican playbook. They've been trying to do that for years.

The inflation and and the shortages are a global event that is the result of reopening from a global pandemic.

My question to you was why were you silent when your Cult Leader was doing the exact thing you are now crying about? Trump passed multiple stimmies during his Presidency. Trump begged the Fed to create negative interest rates and run the printing presses. The man was thrown out of office while begging for Mitch to give everyone another $2000.
Nope…I disagreed with a few of Trump’s policies. Wasn’t a big fan of tariffs and I don’t like recklessly printing money…but giving people a Covid check because the country is locked down is much different from incentivizing people not to work when the country is NOT locked down. Also, there were no strings with the Trump money…everyone (or most) got it and it was like getting a tax break. Biden is incentivizing people to NOT work AND have babies in order to get even more government goodies. His insipid plan is to grow the hell out of the federal government with huge growth in countless agencies (including the IRS). This country will be devastated with another $3.5 Trillion…especially since inflation is already spiraling out of control.

So, will I be alright? Probably…unless Joe decides to go after my retirement cash. But the people that will suffer the consequences of these socialist policies will be our kids and grandkids.

I, at least got to grow up in an America that was prosperous and free. The young kids today may never experience that in their lives. That is very sad to me, especially since it is totally self-inflicted.
 

NJPSU

Well-Known Member
May 29, 2001
42,594
14,601
1
Nope…I disagreed with a few of Trump’s policies. Wasn’t a big fan of tariffs and I don’t like recklessly printing money…but giving people a Covid check because the country is locked down is much different from incentivizing people not to work when the country is NOT locked down. Also, there were no strings with the Trump money…everyone (or most) got it and it was like getting a tax break. Biden is incentivizing people to NOT work AND have babies in order to get even more government goodies. His insipid plan is to grow the hell out of the federal government with huge growth in countless agencies (including the IRS). This country will be devastated with another $3.5 Trillion…especially since inflation is already spiraling out of control.

So, will I be alright? Probably…unless Joe decides to go after my retirement cash. But the people that will suffer the consequences of these socialist policies will be our kids and grandkids.

I, at least got to grow up in an America that was prosperous and free. The young kids today may never experience that in their lives. That is very sad to me, especially since it is totally self-inflicted.
You aren't free? LOL...you guys and your "Patriot" fantasies crack me up.
 

KnightWhoSaysNit

Well-Known Member
Jul 19, 2010
8,211
7,825
1
If you are responsible you will be fine. Yes I agree, some people you know likely won't be fine but they won't die. They will just be poor.

The difference between Trump's cuts and the current spending (including proposed) on top of the Fed's overprinting is that we now have unnecessarily high inflation. Other central banks did the same thing, following our lead. No big currency changes relative to each other.

And they are still buying bonds / printing. It is madness.