Future of the U.S. Economy

Discussion in 'Politics, Religion, Social Issues' started by glocke12, Jun 27, 2008.

  1. glocke12 macrumors 6502a

    glocke12

    Joined:
    Jan 7, 2008
    #1
    Im really looking for input from people who know what they are talking about, in short, responses from people in the financial industry, but others are welcome to reply.

    How much worse will things get ?

    How long will this current economic downturn last ?

    What will it take for things to get stabilize and get better?
     
  2. Desertrat macrumors newbie

    Joined:
    Jul 4, 2003
    Location:
    Terlingua, Texas
    #2
    First off, some background. I've long been a subscriber to Agora Publishing's "Strategic Investor". For $99 a year it's a helluva deal for financial and economic information. Lots of free daily email stuff as well as their monthly newsletter. Then, Everbank.com. Their specialty is currency trading. Doug Casey's "International Speculator" is another source, as are the regular emails from "The Daily Reckoning" and "Whiskey&Gunpowder".

    These folks have been hollering, "This can't go on!" since before the peak of the housing bubble in mid-2005. So far this century, they've all been spot-on in calling the play. Timing? Nobody can always be correct, but they've been right about the trends.

    How much worse? A bunch. Warren Buffet's not stupid: "Stagflation". Like 1981 but probably worse. Inflation follows M3, with a lag. M3 has been rising by some 15% a year for some years. The feds have been lying about the inflation rate since mid-Clinton, to hold down Social Security COLA raises. (Go to the shadowstats.com website.)

    How long? My guess is as bad as anybody's: Two to five years, I dunno.

    Solution: Dunno. The FRB, the Administration, Congress and the two candidates are pretty much doing everything wrong. McCain has finally come around to being partially correct about energy, but that's about it. I'm not sure he has a clue about monetary policy. Obama's 180 degrees off. So, just make sure you're out of debt and have a very frugal life style, unless you're already well off.

    Investing? Avoid financials like the plague. You can profit from currencies, just like Soros "only littler". Commodities will stay high and likely go higher so long as China and India are expanding; those two countries are the ones to watch. Japan and Switzerland have the lowest inflation rates of modern countries, so those currencies are good "parking places" to avoid buying-power loss from the inflation of U.S. dollars.

    The Brazilian real has out-performed all other currencies against the dollar, so far this year. Booming economy. Brazil exports food to China, among other things. (China "outsources" much of its food supply, including soy from the U.S.)

    Oil service companies are safer than the oil companies, I think, because they are less subject to the politics of envy and government meddling.

    So there's my 2¢ worth...

    'Rat
     
  3. glocke12 thread starter macrumors 6502a

    glocke12

    Joined:
    Jan 7, 2008
    #3
    thanks. I remember '81. I was in junior high and I recall my parents having a very tough time of things....

    I dont really have any debt other than a mortgage, auto and student loans. But I do have my elderly mother living with me, and am facing pressure from my brothers to have her go to assisted living...this is something I will need to help her with, possibly as much as $400.00 a month....

    Man, I wish whoever or whatever is messing with peoples livelihood would stop....
     
  4. Desertrat macrumors newbie

    Joined:
    Jul 4, 2003
    Location:
    Terlingua, Texas
    #4
    I have the advantage of age and years of observing. Basically, our monetary policies have followed John Maynard Keynes since the 1930s, and those chickens are now coming home to roost. Add in our tax structure and our regulatory structure plus our efforts at redistribution of wealth via one form or another of welfare.

    We quit saving and went to spending, by both the public at large and by the government. That. Doesn't. Work.

    Lemme put it this way: I'm not happy about being vindicated for my rather unpopular views of these last twenty or so years. But, hey, it's been one helluva party!

    'Rat
     

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