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| I agree - long term this cannot "work out." But, as we have seen, it can go on for a long time. We haven't even come close yet to what France did in the early 60s.
I believe it was Herb Stein who said it - if something cannot go on forever, it won't.
As far as OM's "the market never used to be like this" - that is right. The 30s were the classic major cycle low that set the stage for decades of improving times. A cycle low like that sows the seeds for the good times. Everyone became hard-working and conservative. Debt was feared. As I said, we should have had the cycle low following 1987, but Greenspan "rescued" us from it. Absolutely the worst thing he could have done, IMHO, as the low then, while it might have seemed bad, would have been nothing compared to what we probably need to go through now. And - we won't set the stage for another period like the period following the 30s unless we do go through the cycle low, IMHO. I am certain that there is no alternative. Currently, it feels unstable, and the plight of the pension funds tells me how dangerous the Central bankers think this thing is. We certainly could end up with high inflation, but we also could end up praying for some inflation.
As always - just the guesses of a poor dirt farmer. | |
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The 4.5 trillion dollar balance sheet. Continued QE
