We are heading into a new depression. It is not coming. It is already here but we are only in the beginning so it may not be easy for many people to see just yet. Once it is easy to see it will be too late for any meaningful actions to mitigate the effects. Just as you must prepare for a tornado ahead of time, you must prepare for economic conditions early.
We have 20 trillion in debt, over 200 trillion in unfunded liabilities and over a quadrillion in derivatives held by the banks. Our GDP is only about 17 trillion a year and world GDP is only about 60 trillion. It does not take a math wiz to realize that even if we are not paying any interest at all on this massive debt, there is no way to ever pay it all back short of some type of default.
That is what depressions do. They wipe out all of the misallocation of resources and bad debt and provide a reset for the economy. These resets can be relatively easy or they can be very destructive depending on the amount of misallocation that is present in the system. The amount of debt, brought on by decades of unrestricted credit creation, is the largest in history. That means we are in for a very bad ride in the near future.
Much of the money that people think they have is really only made up of digits in some computer somewhere. The banking industry has already taken this money for its own use. To eliminate the need to ever give it back to the rightful owners they must destroy these digits. That is what the new bail-ins are all about. They can at some point just wipe all of those digits out of existence and say tough luck suckers.
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You will also need to learn the difference between Need and Want. I Need food, though maybe not as much as I am used to. I want new clothes; I have plenty that are serviceable, if out of style.
ReplyDeleteIt would be impossible to be "..heading into a new depression.",as we have not gotten out of the one we've been in for the last 8+ years.
ReplyDelete12:40 thank you.
ReplyDeleteThe economy is terrible the fact we are at the bottom is the difference we have only up to go.
ReplyDelete"...tough luck, losers" would be one of the last things they said before someone puts a bullet through their head.
ReplyDeleteThis ain't going to be like the Great Depression, when everyone was fairly civil as the government stole their money and wiped them out.
Nowadays, too many able men and women are armed and will not stand by as some banker wipes out their savings and says "oh well".
Better say it while trying to make it to their car.
Which won't happen.
we'll all be in the same boat unless you're super rich...
ReplyDeleteor are a governmrnt COLA supported employee!
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