Everyone Is Still Looking Past The Gorilla In The Room

Business Insider ^ | 11/17/11 | Simon Black

[Kartographer]

I had lunch yesterday with one of the sharpest financial minds I’ve met in a long time at a rather picturesque setting overlooking Evergreen Lake, west of Denver.

The restaurant patrons were all well-to-do residents of this wealthy community… in fact, the whole area is like a bubble, largely shielded from any negative effect of the economic fallout thus far. Most of these folks have gone about their lives over the last few years completely oblivious to the global financial crisis.

My friend agreed; he told me, “Most of the people sitting in this restaurant haven’t felt a thing. Their guard is down, and they have no idea what’s coming. It makes me nervous.”

[Kartographer]

Look up 'Nomalcy Bias'

“There is no greater disaster than to underestimate danger. Underestimation can be fatal.”

[Kartographer]

Prepper’s Ping!

[cuban leaf]

Anybody remember that scene in the movie, The Pianist, where he is asked to stop playing so a couple of guys can bounce some gold coins to see if they are real?

I think that in a way, we are there now.

[Kirkwood]

Baloney. If they had any money in investments for retirement, they have been significantly affected.

[Paladin2]

"Their experience with the poor economy is second-degree… what they read in the papers or see on TV. But overall they live in a bubble."

Perhaps they live a more prepared, conservative life.

[1rudeboy]

Yeah, the whole “they haven’t felt a thing” part struck me as unadulterated BS.

[Winstons Julia]

The gorilla in my room is named “Obadiah” and he keeps pestering me to get a Wii.

[Paladin2]

Change is bad for long term investing.

[Cold Heart]

I see normalcy bias people, and some of them, they don’t know they are normalcy bias.

[PeterPrinciple]

The same thing happens when a nation collapses. Everything is fine until it isn’t. Look at how quickly the situation deteriorated in Greece. Or Argentina.

---

I was in Mongolia after the collapse of the Soviet Union. Visited one of the former state run farms, these were huge operations. I walked through one large livestock building, it was stripped. My eyes started at the top and worked down and you could just imagine what happened when the phone call came that USSR was broke. Upper Management grabbed all the cash and fancy cars. Middle management grabbed the machinery and livestock. The employees were the last to know and grabbed what they could. Then my eyes looked down and saw that the manure chain was still full. NO ONE RAN THE MANURE CHAIN THE LAST TIME - IT HAPPENED THAT FAST.

The upside is that life went on, it wasn't the same but it went on and that will be true for us also.

[MrB]

Isn’t that pretty much the definition of “normalcy bias”... not knowing that you have it?

[bgill]

Their 401-Ks have been hit but some people are still wearing rose colored glasses and refuse to see the reason why and what is coming down the road.

[TSgt]

According to the US government’s own 2010 financial statements, the cost of just three sacrosanct programs– Defense, Social Security, and Medicare– exceeded all of the tax revenue collected that year by $10 billion.

Throw a few trillion in there and then you are talking about real money.

[MrB]

We had a gathering recently at which all who were there “got it”, including the offspring which weren’t there but were the topic of conversation (if you get what I mean) - EXCEPT for my favorite lib-in-law, who is definitely in the intentionally oblivious bubble.

Our guests were talking about their daughter trying out canning and wheat grinding and buying property in the boonies. My libinlaw was expressing her total denial of what’s coming. “Why would anyone in this day and age want to can anything or grind their own flour? It’s cheaper and easier to buy it at the store!”

Of course, back in 2008, she voted for 0bama because “he’s going to make the world a better place for your children” - and she really believes that.

[SoothingDave]

Nobody stole the manure?

[PeterPrinciple]

Baloney. If they had any money in investments for retirement, they have been significantly affected.

---

I know what you are saying but the retirement money is not something that is real and now to them whether liberal or conservative. Most people manage cash flow and as long as they have the cash flow it doesn't not change their behavior.

My economic theory is that nothing changes until the cash flow stops. the only thing that is going to change our federal and state government is when the cash flow stops.

[G Larry]

In fact, these are the people managing the business at hand.

They have the means to expand their business, but will not do so because everyday reveals another unanticipated cost of doing business, due to regulation or threat of new taxation.

Key to a successful business is managing risk, which means bounding the uncertainty to which you expose your enterprise.

[Cold Heart]

I tell jokes to amuse myself. If other people get the joke that’s ok too:)

[blam]

Rush just said that the world is on the verge of a worldwide collapse...AND, Rush is 98.8% correct, right?

Are You Prepared For What’s Coming?