Paradigm Shift

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    • Tue Mar 11th 18:38 PM | Rating: 0 0
      Commented on:
      Nowhere Near a Real Estate Bottom
      Welcome to the next Depression

      I Like that the D-word is more readily used today than everyone trying to not use the R-word for the short 2001 recession. Currently, the D-word is more accurate.

      The "Long Business Cycle" (also called K-wave) was described by a Russian Economist (Nikolai Dmyitriyevich Kondratieff [1892-1938]) as having four seasons.

      With four distinct phases in the K-wave a number of analysts have compared them to the seasons. Spring (inflationary growth, expansion), summer (stagflation, recession), autumn (deflationary growth, plateau) and winter (depression).

      Below summarizes the generally accepted phases since 1784 in the United States. It notes the significant wars that accompanied the recession (price peak) and depression (trough) phase. It also notes the tag name for the Autumn periods that were characterized by massive debt growth and speculative bubbles.

      1784-1800 -- Spring (inflationary growth, expansion)
      1800-1816 -- Summer (stagflation, recession)
      [War of 1812]
      1816-1835 -- Autumn (deflationary growth, plateau)
      [Era of Good Feelings]
      1835-1844 -- Winter (depression)
      [Mexican American War]

      Note: In the mid 1830's Andrew Jackson killed the private Federal Reserve (then called the Second Bank of the United States) and the bankers retaliated by tightening up the money supply which helped dish out a depression)

      1845-1858 -- Spring (inflationary growth, expansion)
      1859-1864 -- Summer (stagflation, recession)
      [American Civil War]
      1864-1874 -- Autumn (deflationary growth, plateau)
      [Reconstruction]
      1875-1896 -- Winter (depression)
      [Spanish American War]

      1896-1907 -- Spring (inflationary growth, expansion)
      1907-1920 -- Summer (stagflation, recession)
      [World War I]
      1920-1929 -- Autumn (deflationary growth, plateau)
      [Rouring 20's]
      1929-1949 -- Winter (depression)
      [World War II]

      1949-1966 -- Spring (inflationary growth, expansion)
      > Post WWII Expansionism
      > Baby Boomers born
      > Cold War
      1966-1982 -- Summer (stagflation, recession)
      [Vietnam War]
      > American oil production peaks 1970-71
      > Two oil crises (early, late 70's)
      > US now dependant on foreign oil
      1982-2008 -- Autumn (deflationary growth, plateau)
      [New World Order]
      > Deregulation of everything
      > S&L crash
      > Proliferation of derivatives
      > Hence the Pension Raiders
      > Massive corporate accounting scandals (thefts)
      > Subprime CDOs (only 7 Trillion)
      > Value of US Stock market (about 25 Trillion)
      > Proliferation of Credit Default Swaps (40+ Trillion)
      > Disappearing pension, benefits
      > Proliferation of personal and national debt
      > No savings (thrift)
      > Gulf War [Oil War]
      > War on Terror [Iraq, Afghanistan]
      2008-???? -- Winter (depression)
      [War on Terror] evolves into
      [War on Tyranny] for purposes of securing
      World Oil Supply
      > Also Note: Water Wars

      With decreasing production of oil society's prospects are grim. Oil is so very energy dense and portable, and it is a one-time-gift from ancient Jurassic sunlight. It is a bonus that we reaped by putting a tube into the ground and sucking it out. And we squandered it. Oil replaced coal and coal replaced wood. The only thing that can replace oil and give us the energy output that we currently use is controlled fusion (hot or cold). And that is not going to happen any time soon.

      The graph of human population growth shows the steepest geometric expansion of any graph around. Mathematics runs the universe and anything that goes up must come down. Regression to the statistical mean. The population only grew because there was a free source of energy to exploit. When it runs out then everything that depended on it will also run out. For example, agriculture (fertilizer). So look forward to crop failures, famine, and the FINAL bubble popping.

      Just a different point of view (detailed version)


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    • Tue Mar 11th 03:36 AM | Rating: 0 0
      Commented on:
      Nowhere Near a Real Estate Bottom
      Thanks GodSend, everyone is caught up in questioning the main ingredient of the American Dream, that is, buying a house. They are all lost in the fog. When the fog clears everyone will realize that the landsccape has changed quite a lot and they will be in no position to change their lot. So many peaks going on (stocks, accounting scandals, ceo salaries, the rise and fall of the Dollar, and now the Euro, and Gold, and commodities, etc...) But there is a final spectre of a peak, Peak Oil. The proof that most people are oblivious to this is Detroit's success at selling millions of big SUVs for no profit at all. Makes you wonder.

      When declining worldwide production of oil finally hits the fan people will be caught holding their overpriced, low quality homes far off in suburbia and exurbia with no buyers in their right mind in sight. Exurbias followed by commuter suburbias are the future's next slums. Good luck suburban home owners.

      When the fog clears, not only will you wonder if you can ever sell your home to (retire, downsize, cashout, etc...) you will also have to wonder if your grandchildren will ever be able to get on an airplane for a spring break trip to Cancun.

      Just a different point of view.
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