NEWS: The Sky Is Falling. And It Looks Like A House.

Whoops! You're right, I completely forgot about the $100k limit. Good call.

word.

Weee let the feeding begin! Guess who's going step up to the economic table when the US economy collapses once and for all? You guessed it folks, our good pals China, who have quietly been building the strongest economy in the world for the past decade or so. All you people pulling your savings out would be wise to convert your dollars to yen. I've been telling everybody this for years... and since I own no credit cards, have no debt, other than a student loan which accumulates no interest and I might never have to pay back, and very little savings, I'm golden! This is going to be great...

*edit* Oh and, nooooooo! Take Terminator 4 but please, save The Hobbit!

Except their econ will also tank if we can't buy their products. Worst case scenario world wide depression part 2.

At the expense of further devaluing the dollar. I say fuck em, Its not my fault people are idiots when it comes to credit. Why should I have to pay for America's ignorance and bloated credit?

Are you talking about China or Japan now?

I've been worried about this for years. I'm a former credit junkie, paid part of my way through school using credit cards because I was stupid.

I spent the better part of 10 years digging myself out of that hole, but I am out.

When my wife and I bought our first home last summer, we went straight to the fixed-rate mortgage with a payment we could afford, even on one income. Some people call that living below their means, and it's what people with common sense do.



The biggest question I've always kept asking myself - where the hell was all of the money coming from to finance all of these half-million dollar (and up) houses? The answer? It was all bullshit!

The Chinese is yuan, and it's very undervalued.

Im actually in Beijing now. Good times. Though China is having hard times with inflation right now due to food costs (up nearly 50%) fucking up the CPI basket. Theyll probably do a lot better when they get some more of these coal powerplants fired up, and some more cheap gasoline. Of course, theyll try to keep Beijing clean for the Olympics though

Their currencies look the same to me.

You really think economically fucking a large portion of the population is going to some how not devalue the dollar worse?
Thank you for demonstrating that your understanding of economics is less than my own.

I dunno. I'm pretty sure this is cause for celebration on both accounts.

Also, isn't this vaguely similar to what caused the Great Depression? If my recollection of high school history is correct, credit became popular back in the early 20th century, and people went fucking crazy with it, charging everything and never paying on their loans, things like cars and businesses and furniture and other big stuff like that. Then when the economic situation started to resemble a recession there was a rush of lenders calling in their loans, a lot of which didn't get paid, which caused more lenders to call in their loans, etc. and this chain reaction caused a lot of problems. If that's the case (I'm over-generalizing to a large degree, I'm sure), that resembles the situation a lot of Americans are in right now.

I dunno. Sounds to me like we're all headed for Grapes of Wrath style living for a while.

Short-term financial meltdowns have probably successfully preceded/predicted four of ... err, one of the last serious economic depressions.

The US economy is not, I don't think, particularly structurally weak, but its government is heavily exposed to foreign debt, much of which is held by the Chinese. There's a big risk that people like Larry Kotlikoff have been drawing attention to for some time now (not that's connected to poorly judged behaviour in the financial sector).

Kotlikoff: book, lecture, Is the US bankrupt?.

Well, I'm fucked.

<--Massive credit card debt

So any thoughts on what living in a world wide economic depression will be like?

I think a worldwide depression is pretty much impossible at this point without some massive externality taking effect worldwide.

There could be a slowdown, but it looks like the affected areas are very small, and overall, the economy is doing better than it ever has.

I'm not too worried myself people have way too much of a stake in keeping the status quo, people can bluster on about china but they have an export based economy if we can't buy they go under fast and I am guessing those workers don't want to end up back on the farms.

Still it's possible I give people too much credit.

Is there a theory lurking somewhere in here? Cos durned if I can find it.

Nope it's called realy tired should have been asleep rambling hours ago.

What I love about everything that's going down now and predictions for where it's going to take us, is that people are actually SURPRISED. The American market has been ignoring natural pattern theories and any semblance of order and balance for a good fifteen years. It's not sustainable... And unfortunately when it eventually does crash, it's going to crash HARD, and potentially take most of the world's developed economies down along side it. But it's this "we're the world's economic superpower, we don't need to cycle, we can just keep growing perpetually until someting fucks up and we run out of steam and the damn universe explodes and in the wake of our financial destruction the new economic superpower becomes China which will be excellent for everything the developed world holds dear"... cool, thanks guys

No economy in history has ever survived long running large trade and fiscal deficits. The entire economy needs to be restructured.

Rate cuts will further weaken dollar and create even higher inflation, which is a problem.

I think we are looking at a 4th quarter recession.

I have to admit, being in the financial services industry, I'm not sorry to be on maternity leave right now.

Having said that, I'm pissed about the Hobbit. I want to see that! (My normal big picture outlook may have been shrunk by sitting at home with the kiddies, though)