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The Inescapable Reason Why Financial System Will Fail: Credit cannot expand faster than fundamentals
Peak Prosperity ^ | 12/30/2017 | by Charles Hugh Smith

Posted on 12/31/2017 7:32:14 AM PST by SeekAndFind

click here to read article


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1 posted on 12/31/2017 7:32:14 AM PST by SeekAndFind
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To: SeekAndFind

(save for later reading)


2 posted on 12/31/2017 7:33:51 AM PST by grania (Deplorable and Proud of It!)
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To: SeekAndFind

The difference this time is that every single central bank in the world is pushing in the same direction.

That has never, ever, happened before in the history of the world.


3 posted on 12/31/2017 7:39:45 AM PST by PGR88
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To: PGR88

You mean we’ll stay down? For how long?


4 posted on 12/31/2017 7:42:13 AM PST by DIRTYSECRET (urope. Why do they put up with this.)
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To: PGR88

Seems like the only difference is the reset will be global?


5 posted on 12/31/2017 7:44:29 AM PST by zek157
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To: SeekAndFind

Finance.101.

The financial markets and the US economy are more complex than just credits and interest rates. He is not even considering what happens when the economy grows more than currently and people having more disposable incomes.


6 posted on 12/31/2017 7:48:32 AM PST by Tamatoa (Fight for our America, Fight for our Country I fought to defend!!!)
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To: SeekAndFind

What’s this person selling?


7 posted on 12/31/2017 7:51:13 AM PST by SaxxonWoods (CNN IS ISIS.)
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To: SeekAndFind

We seem to have experienced an “unprecedented” financial period during the last decade or so. Corporations have been forced into “saving” money overseas. Now that money is going to come back into the United States. If it goes into circulation all at once we will have run-away inflation, but if corporations continue to “save” it by buying back their stock, we may get to experience the mythical “soft landing”.


8 posted on 12/31/2017 7:51:23 AM PST by SubMareener (Save us from Quarterly Freepathons! Become a MONTHLY DONOR)
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To: SeekAndFind

This stuff has been preached forever. Does this guy sell cassettes?


9 posted on 12/31/2017 8:08:20 AM PST by Seruzawa (TANSTAAFL!)
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To: SeekAndFind
Credit is the foundation of the current financial system, for credit enables consumers to bring consumption forward, that is, buy more stuff today than they could buy with the cash they have on hand, in exchange for promising to pay principal and interest with their future income.

Borrowing: Trading current consumption for future labor.
Voluntarily entering into Indentured Servitude

10 posted on 12/31/2017 8:21:24 AM PST by HangnJudge
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To: SeekAndFind
Credit cannot expand faster than fundamentals <[pp. It has already proven several times that it indeed can expand faster than fundamentals. They were followed by correction periods. Some worse than others.
11 posted on 12/31/2017 8:24:37 AM PST by Robert DeLong
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To: Tamatoa

Bingo. The article has very static 1970s mentality.... As if Volker is the solution to everything.

Credit is not the only way for business to grow. We have GO-FUND-ME type sites that are going to grow massively. We have venture capitalists, some of whom want equity. But Mr Wonderful is often happy with offering non-bank credit.

Cryptocurrencies are going through a maturity step right now. But they will soon be as influential in Central Bank decisions as JP Morgan Chase or Goldman-Sachs, which of course, are also in cryptocurrencies.

New financial vehicles are going to emerge that nobody has even yet imagined. As with cryptocurrencies, there will be risks involved. The trick is to realize the risk.


12 posted on 12/31/2017 8:26:20 AM PST by spintreebob
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To: Seruzawa

I don’t know about “forever” but I’ve the “financial system imminent collapse” story has been around since the mid-60’s.

It’s a long-term-any-time-now collapse.


13 posted on 12/31/2017 8:31:34 AM PST by SaxxonWoods (CNN IS ISIS.)
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To: SeekAndFind

Clearly opening the border to hordes of invaders in hopes they will jump on the credit bandwagon is a losing proposition. Without your signature on a loan Wall Street has no real assets.


14 posted on 12/31/2017 8:32:57 AM PST by RideForever
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To: SaxxonWoods; Seruzawa

Selling Books
https://www.peakprosperity.com/our-books


15 posted on 12/31/2017 8:37:48 AM PST by Pollard (TRUMP 2020)
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To: SeekAndFind

save


16 posted on 12/31/2017 8:55:22 AM PST by gattaca ("Government's first duty is to protect the people, not run their lives." Ronald Reagan)
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To: SaxxonWoods
What’s this person selling?

Didn't click on the "Enroll now to continue reading" button, but probably BUY GOLD!"

17 posted on 12/31/2017 8:56:04 AM PST by glorgau
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To: SaxxonWoods

One could assume Bitcoin.


18 posted on 12/31/2017 9:02:20 AM PST by EEGator
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To: SeekAndFind

Actually, Bill Clinton proved the premise of the article to be false. He fabricated more fiat dollars then sold them to banks and forced them to loan it out.


19 posted on 12/31/2017 9:11:37 AM PST by CodeToad (CWII is coming. Arm Up! They Are!)
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To: Seruzawa

Has a lot of these laying around his house...

https://images.search.yahoo.com/search/images;_ylt=A2KLfRylHUlaGjwAvi9x.9w4;_ylu=X3oDMTByMjB0aG5zBGNvbG8DYmYxBHBvcwMxBHZ0aWQDBHNlYwNzYw—?p=beta+tapes


20 posted on 12/31/2017 9:26:26 AM PST by gov_bean_ counter (Free Republic has been reduced to a gathering place for the inane, banal, and obtuse.)
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