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Advisor

Seems almost certain to get worse

http://www.telegraph.co.uk/business/2016/09/08/ecbs-mario-draghi-has-run-out-of-magic-as-deflation-c...

 

I thought it might hold until the election, and still may, but yesterdays's sudden downdraft in stock markets was overdue- after wafting along quietly for months it is a stability breeds instability Minsky type thing.

 

Crop size and weather aside the global macro picture looks to deteriorate further. EU is slipping back into deflation, Japan already there. China slowing less but at the cost of adding debt at 40% of GDP annually.

 

Arguably a Trump presidency might offer a better short term outlook. Hard telling what any candidate really plans to try but if you take him at his word then the combination of huge tax cuts for the wealthy, a huge increase in defense spending and occasional hints of huge spending on infrastructure would produce enormous deficits that might be fairly stimulative in the short term.

 

A note- of all the ways to run deficits, giving the ultra wealthy tax cuts is probably the worst- they don't create jobs, they just figure out ways to use the money to screw you more. But anyway, if social justice is required, then I guess we must.

 

So I guess that would be as it is, other than to point out some irony in the flexibility of many toward deficits, the debasement of the currency etc.

 

By contrast, regardless of intentions a Clinton admin. is likely to pinned in from day one.

 

I guess that I'll take the short term pain as oposed to the prospect of four to six years out having all the billionaires loading up the loot on their private jets and flying off to Monaco, leaving the smoldering republic behind.

 

At any rate, for those who are sure that "it can't get any worse, so do something", I'm absolutely certain that it can.

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Advisor

Re: Seems almost certain to get worse

FWIW, farming is approximately where I'd predicted it would be following the blowoff in the commodity cycle.

 

I guess the thing that I, and almost nobody foresaw was that we'd still be stuck near 0 fifteen years in.

 

All the more evidence of my view that the Obama years were a marvelous can kicking exercise- really more successful than even I could imagine, but the bill for the 35 year run down the interest rate slope (to 0, or negative, forever) is going to come due someday, probably in the not too distant future.

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Honored Advisor

Re: Seems almost certain to get worse

Tripling the national debt in only 8 years in not status quo/ kicking the can down the road.

 

 

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Honored Advisor

Re: Seems almost certain to get worse

Just a few random thoughts here.  47 million people or so on food stamps in th USA.  (That number is probably way too low)  No wonder USDA wants to keep a lid on prices down on the farm.   Their game........their rules.

It's the democrat way.   The more people you have that are dependent on the government, the easier it is to control their voting.  Take a look at the things Obama has done to weaken this country.  The list is longer than a train my friends.  It's time to stop this train of destruction.

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Senior Contributor

Re: Seems almost certain to get worse

Spoiler
 

Hobby,

 

Actually, it was only a doubling and not a tripling of the national debt under our first constitutional scholar President. And to be perfectly fair here, his predecessor, GW Bush also managed to double the national debt  from 2001 to 2009. More damning still, all of this government deficit spending by both Obama & Bush was first approved by a highly bi-partisan US House of Representatives and a US Senate.

 

All of which does not mean there won't be a very hard day of accounting when our forty five year paper money confidence game comes to an end. Most assuredly my friend, there will be a great deal of wailing and gnashing of teeth when we are all brought to book. Just, do not blame the coming pain on any one party or any one man. It was a joint effort carried out by the elected representatives of the people.  

 

_________

The fault dear Brutus, is not in our stars,

But in ourselves, that we are underlings.

Julius Caesar

Act I, Scene 2

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Honored Advisor

Re: Seems almost certain to get worse

I'm sorry after almost eight years I forgot "it's Bush's fault"

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Advisor

Re: Seems almost certain to get worse

You are, of course, doing the same as you're accusing me of.

 

Trump's proposals would add much more significantly to the deficit but you're looking back.

 

And what I was saying, in some ways it might be the better option.

 

Although military spending and further upward transfer of wealth and income are probably the worst possible way to do it.

 

And yes, as far as it being Bush's fault, it largely is.  The killer is falling into a recession while near the 0 bound and having revenue collapse (do the math on what happened there). And if you want to strip out the automatic stabilizers that increase spending when that happens, good luck with that kiddos.

 

That is my deep fear about a Clinton Admin. and a full obstructionist Congress. We're going to be pointing fingers while the ship sinks.

 

But the schtick is well known here in marketing- get frustrated and impatient with a complex topic, move on and then blame somebody else.

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Honored Advisor

Re: Seems almost certain to get worse

Actually it really started with LBJ and his "great society", broke up the family unit for many when the more kids out of wedlock the more gov't payments.

 

Nixon got rid of the  gold standard and the rush to Infinity was on its way...

 

 

 

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Contributor

Re: Seems almost certain to get worse

I dont usually say much on here but I do read on a regular basis.  As I sit here and watch football though, i figured why not chime in. 

 

First off, I will defend Packard a little b/c i dont see him chime in very often.  I dont think he was trying to say that everything is Bushs fault at all.  I think he was simply making the point that the Bush admin did about as well with the national debt as the Obama admin has.  Furthermore, to blame all of the countries issues on the last 8 years and one president seems a little short sided, not to mention almost idiotic. 

 

I'm not saying that it is all Obamas fault, I'm not saying its all Bushs fault, I don't think you can put any of this on one person no matter which president he was or what party he came from.  If I'm not mistaken there are 535 members of Congress, from both parties, that should shoulder the blame just as much, if not more than any one president.  Especially given the fact any number of them may very well have served under both presidents.  Our issue probably has more to do with the career politicians that we constantly elect into Congress that are OK with the same old crap going on year to year.  Most get in with the help of a few people with big piles of money and then they vote to keep those people rich.  That way they can stay in office, make a pile of money themselves, and eat fancy dinners and all of that good stuff. 

 

Now how to fix that, I dont know, I'm just your common idiot.  I do agree with Nox in the point that cutting taxes for the ultra wealthy seems like a useless idea that never seems to work.  Upping the military spending also seems asinine to me.  The US already leads the world in that category to the point that you have to combine the next 20-some countries on the list to equal us.  Seems like we have probably sucked all the economic benefit out of area already. 

 

As for the next president, I'm just as clueless on that answer.  I cant say that I think Clinton is the answer at all.  The sad part is, I have no idea what the Republican party is thinking.  I think me and a lot of people figured, its been 8 years of Democrats, should let the Republicans back in and let them have a swing at it.  I truly believe if the Repubs threw any run of the mill, normal, semi-competant person in as a candidate, they win.  Instead, Trump the president is born, really 325 million people in this country and that is who they came up with.  I guess OJ Simpson, Bernie Madoff, and Lorena Bobbitt were all busy so they went with him.  I guess good luck either way is what I'm saying because I dont see an outcome with either one that is any different than where we are now. 

 

So as Nox said with any complex issue, I'm going to be frustrated and blame someone else.  I figure if I had all the answers to fix this, I wouldnt be farming and I'd probably be making more money than I am.  So thanks for letting me ramble, that was kinda fun.

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Honored Advisor

Re: Seems almost certain to get worse

Wait a minute.............. There is way too much giving credit around here.

There hasn't been anyone in the white house or congress the last ________ (fill in the blank) years who has done any long term thinking.  Hell ya only got 4 years to get your political debts paid, who's got time for plannin or statesmanship.   Who cares about the country when they all want a "Foundation"....... and I ain't talking feet........ or new shoes........ 

 

"What is the republican party thinking"  ........ really ..........  you think the republican party wants Trump???

 

Trump is pure and simple....... a protest vote........ that's  a protest vote....Big and loud...

 

A protest of all you are complaining about 

 

2016 is the election of the protest/backlash/etc.    From Sanders to Trump a lot of voters said "I am sick of these two scamming political parties who point at each other and blame ....... but most of the time they look and act the same....  raising debt,,,, paying off their supporters,,,,, and living like kings on the public dollar."      

A golden retriever would have gotten good votes this year...

 

And what is it with The Don's hair......... speaking of Golden retr........... oh well lets not misspell that one again....

Or I am getting a hoot over the little old lady in the chairman Mao jackets....

 

Who cares about what they will do  and why are you saying "if the ship is sinking, and it sure is........ any effort to stop the process is a breath of fresh air...

 

Trump blew out the republican party and may very well do the same to the Democrats in a few weeks.