Posted on 09/26/2009 7:43:38 PM PDT by bruinbirdman
Private credit is contracting on both sides of the Atlantic. The M3 money data is flashing early warning signals of a deflation crisis next year in nearly half the world economy. Emergency schemes that have propped up spending are being withdrawn, gently or otherwise.
Unemployment benefits have masked social hardship unto now but these are starting to expire with cliff-edge effects.The jobless army in Spain will be reduced to €100 a week; in Estonia to €15.
Whoever wins today's elections in Germany will face the reckoning so deftly dodged before. Kurzarbeit, that subsidises firms not to fire workers, is running out. The cash-for-clunkers scheme ended this month. It certainly "worked".
Car sales were up 28pc in August, but only by stealing from the future. The Center for Automotive Research says sales will fall by a million next year: "It will be the largest downturn ever suffered by the German car industry."
Fiat's Sergio Marchionne warns of "disaster" for Italy unless Rome renews its car scrappage subsidies. Chrysler too will see some "harsh reality" following the expiry of America's scheme this month. Some expect US car sales to slump 40pc in September.
Weaker US data is starting to trickle in. Shipments of capital goods fell by 1.9pc in August. New house sales are stuck near 430,000 – down 70pc from their peak – despite an $8,000 tax credit for first-time buyers. It expires in November.
We are moving into a phase when most OECD states must retrench to head off debt-compound traps.
Britain faces the broad sword; Spain has told ministries to slash 8pc of discretionary spending; the IMF says Japan risks a funding crisis.
If you look at the sheer scale of global stimulus this year, what shocks is how little has been achieved. China's exports were down 23pc in
(Excerpt) Read more at telegraph.co.uk ...
If it is coming - why pay your debts off? I mean you should keep paying your debts and I am all in favor of Dave Ramset etc etc but you want to have a reserve in case it all falls apart.
The good news is that the entitlement class is pretty incompetent. As one guy said, when they hit the suburbs they will be surprised how many hunting rifles there are in the closets out there. And they will be surprised what a man will do when his family is being threatened.
AS for me, I bought the property in rural central Kentucky. It is over an hour from the nearest city by highway. The urban dependents will have to get through a lot of people like me to get to me. And the people here band together. It will be fortress Kentucky, along with all the other rural fortresses (and some suburban) around the country.
Every time a story like this comes out, the DOW is good for a 100 point jump up. The Nasdaq about 40+ on this news.
Couple all of that with those of us who simply are not spending, in protest of the dictator in the White House and the corrupt congress....Still doing my part!!
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Me, too. I “Go Galt” as much as possible.
Have cash on hand but not in too many large bills.
The housing numbers have been a fairy tale all along.
They have been telling us that the housing numbers are improving.
The numbers the government uses don’t mean a thing.
It matters not how many houses you sell. What matters is the total dollar volume, which they do not give us.
If you sell 1,000 houses for $1.00 each, you certainly have not improved things.
If you sell 50 houses at $1,000,000 each and that is their true worth, you have done something.
Every business person wants to know his dollar volume. You never see that in housing numbers, whether discussing sales or starts. Only unit numbers. That is BS.
Same with employment numbers. It matters not how many are laid off. If each of them can walk across the street and be at work the next day, so what?
But they cannot in today’s economy.
What matters is how many were hired last week.
How many are looking vs. how many were hired. Numbers our all knowing leaders never give us. You can root for them and find them, but they are never in the news or in the spin machine’s news releases.
I would say you are way too cynical. But I have been doing what you suggest for the last 2 years and agree with you 100%!!
I would be almost out of debt except for the cash I have spent on a few guns and ammo. And stockpiling food. I fear it will be BAD!!!
Wish I was with you! I have a friend who moved there 12 years ago and built a house, he is in Saudi right now but will be moving back there soon.
I'm not cynical. I'm prepared (I hope :).
“High taxes = no jobs = no consumer = no recovery”
Taxes have not yet gone up under Obama, so maybe your equation should be “Fear of high taxes and fear of continuing Marxist stupidity = no investment and no spending = no recovery (or worse).”
Point taken. ;-)
As I understand it, there would be nothing for your “good friend that does title stuff” to “see” regarding the first time home buyers. The buyers will claim the credit when they file their respective 2009 federal income tax returns. They do not get the amount of the credit upfront when they close on their purchases.
“Couple all of that with those of us who simply are not spending, in protest of the dictator in the White House and the corrupt congress....Still doing my part!!”
Good for you. You obviously aren’t married to a wife like mine!
Half the chicken littles on these FR threads howl that the money supply is exploding and Bernanke will not be able to sop it up in time to prevent massive inflation. The other half screams that the money supply is in free fall and a depression is just around the corner.
“How do we turn it around at this point?”
In no particular order:
Massive simplification of the Tax Code. Super simple Flat Tax or FairTax. I prefer the FairTax to stop taxing business, and tax only consumption.
Massive tort reform - gotta put the bloodsucking Communist attorneys outta business.
Close the borders. Illegal immigration has to stop immediately. Once the fence is built, build another one 30 yards away. Patrol the area between early, often, and aggressively.
School vouchers. Gotta release the stranglehold the NEA has on the minds of our children.
Milton Friedman’s prescription for health care. Government pays for catastrophic, employers (optionally) fund Health Savings Accounts. Users keep what they don’t use. Must re-establish the financial connection between doctor and patient (fee for service).
DRILL BABY DRILL !!! GO NUKES !!! COAL, COAL, COAL !!!
Natural gas cars. We absolutely MUST re-establish energy independence. Once we do, we get the hell out of the Middle East except to protect Israel, which we must do zealously.
NO MORE BAILOUTS FOR ANY REASON !!!!
Defund the UN. Give the occupants a 30-day notice.
Legalize recreational drugs, and tax them for the revenue. Put the gangs out of business and reduce prison overcrowding.
End abortion. Give God every opportunity to bless us. That means more than all of the above.
Oh - and privatize Social Security.
ping
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