Global Economy

quantic

Been trying to get my head around the current economic times we are in, from what I have gathered so far this is likely to be a long run deal and we are going to be in a bit of a pickle for the next decade or there abouts.

I understand what has caused all of this, but - its not like this crisis is actually physical, money is not like oil, it is made up, numbers on a spreadsheet, its not linked to resources in the same way that it used to be. So, all of these countries that have deficits, which is most of them. What would happen if we all just wrote them off.

Surely, thats got to be better than the next 10 years of chaos? I could understand if it was one or two countries that are in this mess but its the majority of the EU, us and the US... surely our current economic philosophy is not working out if these boom busts keep happening?

Thoughts?

Flight2quality

quantic wrote: »

Been trying to get my head around the current economic times we are in, from what I have gathered so far this is likely to be a long run deal and we are going to be in a bit of a pickle for the next decade or there abouts.

I understand what has caused all of this, but - its not like this crisis is actually physical, money is not like oil, it is made up, numbers on a spreadsheet, its not linked to resources in the same way that it used to be. So, all of these countries that have deficits, which is most of them. What would happen if we all just wrote them off.

Surely, thats got to be better than the next 10 years of chaos? I could understand if it was one or two countries that are in this mess but its the majority of the EU, us and the US... surely our current economic philosophy is not working out if these boom busts keep happening?

Thoughts?

What you are suggesting is kind of happening but look at the problems it is causing.

They wrote off half the Greek debt, and there is a very real danger of big deflation now.

The more outstanding revolving credit collapses the more deflation there will be.

Deflation means all debts go up in value. I would not like to be a BTLer with large mortgages for instance in the deflationary environment we are in.

Mallotum_X

Basically (well according to people on here) we are all screwed but house prices will rocket or maybe crash, but everything will be ok if you buy silver and go on strike. Or something like that.

Flight2quality

Mallotum_X wrote: »

Basically (well according to people on here) we are all screwed but house prices will rocket or maybe crash, but everything will be ok if you buy silver and go on strike. Or something like that.

Is there really anyone who think house prices could rocket from here?

I would say there is zero chance of that, best the bulls could hope for is no further falls, but then that is not bullish that in itself is bearish.

So are there any house bulls left? Really are there?

There is a very real chance of further falls and there is a chance they could be large.

I stick to what I have always said and I am sure I will be proved right in a few yrs. This housing crash will be around 50% down from the top to the bottom in real terms.

Only the uneducated do not care about real terms, they think price is all that matter do not understand value.

Generali

quantic wrote: »

Been trying to get my head around the current economic times we are in, from what I have gathered so far this is likely to be a long run deal and we are going to be in a bit of a pickle for the next decade or there abouts.

I understand what has caused all of this, but - its not like this crisis is actually physical, money is not like oil, it is made up, numbers on a spreadsheet, its not linked to resources in the same way that it used to be. So, all of these countries that have deficits, which is most of them. What would happen if we all just wrote them off.

Surely, thats got to be better than the next 10 years of chaos? I could understand if it was one or two countries that are in this mess but its the majority of the EU, us and the US... surely our current economic philosophy is not working out if these boom busts keep happening?

Thoughts?

If you do that then you wipe out the banks which wipes out a chunk of people's savings.

IMO that isn't necessarily a bad thing but pretty much nobody agrees with me.

nearlynew

Generali wrote: »

If you do that then you wipe out the banks which wipes out a chunk of people's savings.

IMO that isn't necessarily a bad thing but pretty much nobody agrees with me.

I do Gen

Who was it that said "capitalism without bankrupcy is like christanity without hell"

Pimperne1

Flight2quality wrote: »

Is there really anyone who think house prices could rocket from here?

I would say there is zero chance of that, best the bulls could hope for is no further falls, but then that is not bullish that in itself is bearish.

So are there any house bulls left? Really are there?

There is a very real chance of further falls and there is a chance they could be large.

I stick to what I have always said and I am sure I will be proved right in a few yrs. This housing crash will be around 50% down from the top to the bottom in real terms.

Only the uneducated do not care about real terms, they think price is all that matter do not understand value.

Where have you always been saying it then if you have only been on here since Sep 11?

hillcats

Flight2quality wrote: »

I stick to what I have always said and I am sure I will be proved right in a few yrs....

Pimperne1 wrote: »

Where have you always been saying it then if you have only been on here since Sep 11?

:doh::doh::doh: Time to reveal original ID....

worldwheeler

nearlynew wrote: »

Who was it that said "capitalism without bankrupcy is like christanity without hell"

Max said that.