The second Great Depression

Discussion in 'The big picture' started by Jez, Mar 3, 2007.

  1. Jez

    Jez Junior Member

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    Great article from Mike Whitney at Online Journal...it's US specific, but the global market is heavily tied to the US economy and if they start tanking, we all will to some degree...and it's likely to be sooner rather than later...


    The second Great Depression (Click To View)
     
  2. Honeychrome

    Honeychrome Junior Member

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    Agreed, great article. Wish I'd come across it as soon as it was published- in the week-plus since, the American markets have seriously stumbled, maybe the beginning of the collapse it seems like almost everyone intuitively knows is coming (even if they don't know exactly how or why or what it will really be). I've been hoping that the money I have in the market would go up enough for me to cash-out and pay off my mortgage in the next year but I'm gonna have to seriously think over this weekend about selling out on Monday.
     
  3. frosty

    frosty Junior Member

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    thanks for posting yet another great article jez

    I think even hope that last weeks falls is the beginning of the big crash we all know is coming .........

    nasty as it sounds the world needs the US to crash to stop thier military marauding the world and killing millions and to stop the people consuming and producing greenhouse gases ......... hard as another depression will be it will still be better than what peoples in Iraq and other countries are suffering under the US military and what most of the world will suffer with global warming

    in fact a US economic crash it is the only change the planet has :cry: because it is increasingly obvious that bush and bonsai here will do nothing to help global warming at he expense of the economy

    honeychrome the time has definately come to get out of the market

    frosty
     
  4. Plumtree

    Plumtree Junior Member

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    Not sure that the source is completely unbiased. There is very little doubt that the property market for investment has lost some gloss but it is hard to detect a 'crash'. It certainly is nothing like the 02/03 years! The stock market is also jumpy clearly because recent negatives relate to China who are now trying to slow their economy. The Australian economy is strong and will likely stay profitable for a few years yet.

    The drought, even if the current rain continues, will bite for a few more years but will likely be offset by the sale of coal and other energy forms.

    I guess a depression is possible but what I think to be more likely is a 'decline' of sorts affecting countries like Australia and the United States as a depolarisation effect takes place. That is, The western influence on the world economy lessens as other players assume dominance.
     
  5. Jez

    Jez Junior Member

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    Certainly better than getting caught Tom...there may be a plateau or slight rebound in the very short term, but IMO it's far less likely than the downwards spiral which is inevitable.



    Indeed Frosty - global financial meltdown is an opportunity IMO, not a disaster half as bad as 'business as usual' will cause.



    That's quite a statement to make without providing any supporting evidence Plumtree. Who should we rely on for 'unbiased' information? Mainstream media outlets owned by corporate moguls?

    If you read it, the article has nothing to with Australia's property market or economy. And it's not claiming there's a property market 'crash' happening now in the US, it's merely detailing the very worrying signs that there will be a 'crash.'

    The phrase...'when US financial markets sneeze the rest of the world gets a cold' is the connection to Australia.


    US debt is held by the hundreds of billions by all countries that could even begin to presume 'assuming dominance.' The ripple effect will leave every country's economy reeling...just like the last 'Great Depression'...except this time around there is no more cheap energy and resources to facilitate anything resembling a rebound.

    As long as we cling to the current financial system which is utterly reliant on growth, which is in turn reliant on consuming cheap energy and resources, the 'recession, depression' (pick a term) will be permanent.
     
  6. Plumtree

    Plumtree Junior Member

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    Jez, I have to use an independant thought process in my personal perception of global economy and the concept of the'second great depression'. In fact, I try to think independantly in everything I do!

    Much of the tone and phrases used in the article caused me to think that it was unbiased. I could be wrong and that is nature of human reasoning.

    Using the property market is a way of finding an indicator from which we may view a similar thing on a scale more easily understood.

    It would be very difficult to view the global economy as an unchanging paradigm and conclude that there is not the possibility of China, India, EU or others becoming dominant elements.

    Please do not think I am presenting a personal attack on you or your ideas, I am merely putting my thoughts on a forum for others to consider.
     
  7. frosty

    frosty Junior Member

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    plumtree what source isnt biased ? me thinks none ....... all the article sayin the economy is going well are only talking it up :evil:

    frosty
     
  8. heuristics

    heuristics Junior Member

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    I'll take the opportunity to jump in here and recommend everyone read
    John Kenneth Galbraith's "The Great Crash of 1929", an analysis of the causes of the Great Depression and what people were doing and what the media was reporting in the few years to 1929.
    I got a copy out of the library and mentally prepared myself to read a boring treatise. I thought it'd be "good"for me to read it.
    I hadn't anticipated the gorgeous writing of Galbraith, and I laughed out loud in several passages. It was no chore to read, and offered a great insight.

    While this coming Armageddon is very different in many ways to the Great Depression, there are some scary trends that show history is repeating - and those that fail to learn the lessons of history are doomed to repeat them.

    One example of what was true then and seems to be happening again is the way the media report the economy and the media's need to keep talking the economy up.

    I think Australia is on the precipice of disaster. Yes we are having a minerals boom, but that can end overnight if the markets crash OS.
    Booms can go bust frighteningly fast.

    There's also an excellent Nouriel Roubini analysis of why the US is going to crash to earth with a terrifying thud. He prediction mid 2006- which is of course why predictions are slippery things to make. But regardless, his analysis is I think incredibly valid and when the crash does come it will be brought about for the very reasons he outlines.

    I cant find the link as I write this, but edit this post to add it when I find it. It's a 45-page article and hard reading, but very well worth the effort.
     
  9. greeny

    greeny Junior Member

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    heuristics....do you think its time to remove money from my bank account? :?
     
  10. heuristics

    heuristics Junior Member

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    Greeny - I dunno. I am no financial advisor. I just worry.
    I read the MSM, and then I read stuff that explains what is REALLY going on, kinda like the Matrix, yaknow? After reading The History of Oil and other books, what is happening in the world actually makes sense.
    That's what scares me shitless. What is happening is not just a random complilation of crazy unrelated incidents. No. Things actually all fit together. The picture I make of it is very ugly.

    In recent weeks even the MSM like The Australian and the Financial Review have carried reasonably argued articles on why there are all these private equity buy-outs of companies like Qantas and Coles and others.

    I struggled to understand it all as I am not a finance literate person, but from what I could understand all these deals are built on debt. Leverage.
    Simply, if you owe the bank $1million, you have a problem, but if you owe the bank 100 million or a billion, then the bank has a problem.

    This is not advice (disclaimer) but a lot of the real money behind the house-of-cards private equity buyouts are superannuation funds.

    SO I do worry about my super and where I should stash it so it is safe when the debt on debt on debt on debt deals crash and burn.

    One lesson from Galbraith and 1929 was that it was the mom-and-pop investors that lost their life savings. The real clever bastards had not been playing with their own money. I see parrallels with the private equity buyouts that are going on right now.

    Small punters like me (and you?) have little control over our super. But we are kinds relying on it being there at age 60. But what happens if (when) these real clever smart-bastard lawyer-banker deals crash, and it is our super money that gets swallowed?

    The clever banker-wankers have covered their arses for sure. It's you and me and 3 million or so other Aussie wage slaves who will loose out.
     
  11. Jez

    Jez Junior Member

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    I encourage everyone to think independantly Plumtree...I post these sort of articles so people can gain another perspective which they won't get from our mainstream media who have a vested interest in promoting 'business as usual' type, non-critical, fact devoid thinking.

    I don't pay much attention to 'phrases' or 'tone'...I'm interested in the facts presented, then as much as possible, I go off and attempt to verify them.


    If (when) the US goes down they will drag everyone else with them. It's a long way back from there for any other country to become globally 'dominant', particularly in view of dwindling future energy supply. Personally, I don't think it's possible - although I'm sure there will be plenty looking to try.


    I didn't feel you were attacking in any way Plumtree...you have a perfect right to post whatever you like, I just happened to disagree...hopefully politely? :D
     
  12. Parsley

    Parsley Junior Member

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    the wave theroy tells us that the extension period is up from the last wave and it is an end to proabbly a once in a millenia cycle. the dow jones will keep falling right down to 400 points massive deflation will happen assets will be worth nothing. all collapases seem to happen at a time of the most optimism.
     
  13. digging

    digging Junior Member

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    Thankx for posting the link,

    Harvest lots this year, plant lots think of having some to share with others.

    Food is real money.

    Digging
     
  14. caldera

    caldera Junior Member

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    what are you gonna eat it ?

    :p
     
  15. Jez

    Jez Junior Member

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    Don't we all? :D
     

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