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Well, Over-Speculation And Over Leveraging Again


I miss Bluesox, who was a former member here from Boston in the Finance industry. Being an accountant, I am technically his mortal foe on valuation purposes :P ,but I loved arguing with him over the future of Capital markets and Capitalism itself. Beyond politics, my first love is Economics and we are seeing a classic example of Supply surplus with weak demand. Yes, the great recession was started with too much hype over Supply side economics, but the current situation really shows that there is merit in my side of the debate as well. We have been disinflating for too long, relying on a steady demand that was not matching supply surpluses in Chinese labor or Oil, and ultimately there's a large problem in our market that was not resolved with the 2008 Financial bailouts, leverage. We still have to much debt on our balance sheets, inbued with federal stimulus and federal reserve low lending rates.

 

I know I am speaking a little too technical for most readers, but it is really amazing to see something this happen as theoretical ideas would point.

 

The bigger question now is how do you solve this issue?

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JamesSavik

Posted

I'm fairly sure that invading a hostile country with an endemic enmity toward our culture and ethics probably isn't a good idea.

 

Nor is focusing on popular but over-hyped "green" energy models that the ruling elites are heavily invested in. Solar and wind power have an Achilles heel that the smartest engineers on the planet have failed to overcome: darkness and no wind.

 

I'm certain that more promising alternate energy sources- like geothermal, Thorium based  nuclear power and fusion R&D, that have been overlooked and ignored because rich and popular Hollywood stars failed to invest in it, offers smart investors large long-term growth potential.

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MikeL

Posted

Too much debt.  Too much oil.  Too much government spending.  Too many freeloaders.

 

We have become a nation of excess, with the exception of intelligent leadership.

 

(Confidential to W L:  I am both a CPA and an economist.)

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Zombie

Posted

19th century - When France sneezes Europe catches cold

 

20th century - When the U.S. sneezes the World catches cold

 

21st century - When China sneezes the World catches cold

 

 

Metternich's original remark concerned revolution.

 

The 20th century version concerned economics.

 

The 21st century version also concerns economics but with what has been happening in China this past week there is now a real possibility it will also come to mean revolution.

 

Modern Chinese have accepted totalitarian rule by the Capitalist Communist Party for decades because the Capitalist Communists have continued to deliver economic progress for a sizeable chunk of the population.  But when the music stops it's going to get real ugly.

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