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End of Golden Era for Investors Spells Troubles

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Re: End of Golden Era for Investors Spells Troubles

#121

Post by Afforess »

noir-york wrote: post #48

We're gonna be overdue for a large war within 20 years so the pension pot of today's millenials, or indeed, anyone's, is going to be the least of their worries. By large I mean either a world war or a big regional one - and large wars have a habit of resetting economies, technology and societies. Most likely flashpoints: Russia and/or South East Asia. Best investment - I am guessing either a New Zealand or a South Am…

I'm not sure why you suspect Russia or SE Asia, when both are paragons of stability compared to the Middle East. I think the unwinding of the value of oil over the coming decades is going to take away the last pillar of stability holding Middle Eastern countries together.

Re: End of Golden Era for Investors Spells Troubles

#122

Post by dursk »

> The McKinsey study focuses on U.S. and Western European stock and bond markets and doesn’t take investments in emerging markets into account, largely because of a lack of reliable long-term data.

Wouldn't that imply that their predicted returns are much lower than they'll most likely be? Assuming that majority of growth over the next X years will come from emerging markets, if they're leaving emerging markets out of the calculation then their estimates are going to be low.

Re: End of Golden Era for Investors Spells Troubles

#123

Post by paavokoya »

Retric wrote: post #84
Amezarak wrote: post #70

Earlier quoted context omitted.

The US federal debt was even higher in the wake of World War II. The US government did not run surpluses and deleverage in the following decades. The economy grew, without hyperinflation, and the debt became irrelevant. The solution to high levels of debt is sustainable economic growth, not deleveraging. Mass deleveraging would be an economic catastrophe.

US still has a significant chunk of WWII debt after one of the greatest sustained economic booms of all time. Growth really is not the answer. Inflation sounds great, just default without technically defaulting, until you actually see what it does to the economy. The real solution is to simply spend vastly less money accepting that pain now is better than letting the US become a failed state.

>accepting that pain now is better than letting the US become a failed state.

If you look throughout history, there has never been any nation or empire that has ever done this. The US will fail just as Rome and others before it.

Re: End of Golden Era for Investors Spells Troubles

#124

Post by noir-york »

Afforess wrote: post #121
noir-york wrote: post #48

We're gonna be overdue for a large war within 20 years so the pension pot of today's millenials, or indeed, anyone's, is going to be the least of their worries. By large I mean either a world war or a big regional one - and large wars have a habit of resetting economies, technology and societies. Most likely flashpoints: Russia and/or South East Asia. Best investment - I am guessing either a New Zealand or a South Am…

I'm not sure why you suspect Russia or SE Asia, when both are paragons of stability compared to the Middle East. I think the unwinding of the value of oil over the coming decades is going to take away the last pillar of stability holding Middle Eastern countries together.

True, the ME is volatile, but its been unstable for decades. The biggest change in the balance of power was when the West removed Iraq as a buffer between Iran and Saudi Arabia. Now that's gone, and with the recent rebalancing of the West towards Iran, SA is getting antsy. The question is whether the US can act as a moderating influence on both.

However, Russia, and even more so, SE Asia are powder kegs. China is on the move, Japan and SK are starting to make counter moves. An arms race is on, and I really really hope it doesn't end badly. Past history however doesnt give much hope...

Re: End of Golden Era for Investors Spells Troubles

#125

Post by Theodores »

cm2187 wrote: post #61
kabouseng wrote: post #29

Earlier quoted context omitted.

Sorry this is taking your comment on a tangent, but it is not exactly peace time for the USA, nor has it been since the 1960's or arguably since WW2 if you take the cold war into account. The USA has been involved in one or another war for literally decades now...or does minor wars not count?

I don't think we can compare the Gulf wars with the all out World Wars. And none of the European countries or Japan were making any war effort, and accumulated as much if not more debt over the same period.

Didn't the US drop more bombs on Laos in a secret war than all the bombs dropped in WW2?

I do not have the figures but in these 'little wars' there has been a lot of silver spent on munitions. The whole process is just a lot more efficient so we are not at total war on the domestic front, just paying our taxes so the military can buy vastly more effective killing machines. Things may have gone away from the unguided bombs of times gone past, war zones may be in different places, but otherwise, there is a lot to compare today's wars with WW1/WW2 when it comes to $$$ spend and devastation caused.

Re: End of Golden Era for Investors Spells Troubles

#126

Post by RyanZAG »

pbhjpbhj wrote: post #30
RyanZAG wrote: post #6

Earlier quoted context omitted.

Definitely. Just part of globalization. It helps far more people than it hurts, but for those in developed countries, you don't really see the people it is helping because they're across the planet. I'd say it's nice for developed countries to help out like that - but we all know the real winners are the businessmen behind your politicians bankrolling this stuff.

I'd assume you're right. Some evidence would be good to see - strikes me that instead of prosperity shifting to less developed nations it could instead be shifting to the already wealthy capitalists?

It's shifting to wealthy capitalists in developed countries (well not shifting, they were always wealthy), as well as creating new wealthy capitalists in developing countries. There is some extra wealth for the poor, but you're right that it is an unequal distribution in developing countries.

But those aren't "already wealthy capitalists". They're "newly wealthy capitalists". End of the day it's the same thing - a few wealthy capitalists - but it's still more wealth in developing countries than before.

I'd argue that there is zero historical precedent for wealth not to be concentrated though. It's just the nature of wealth - wealth creates wealth, debt creates debt. And that's more of a universal truth than a capitalistic one, and more accurately described as 'value creates value', 'obligation creates obligation'.

Re: End of Golden Era for Investors Spells Troubles

#127

Post by tribune »

paavokoya wrote: post #123
Retric wrote: post #84

Earlier quoted context omitted.

US still has a significant chunk of WWII debt after one of the greatest sustained economic booms of all time. Growth really is not the answer. Inflation sounds great, just default without technically defaulting, until you actually see what it does to the economy. The real solution is to simply spend vastly less money accepting that pain now is better than letting the US become a failed state.

>accepting that pain now is better than letting the US become a failed state. If you look throughout history, there has never been any nation or empire that has ever done this. The US will fail just as Rome and others before it.

Doesn't mean we should embrace to keep the financial party going...

Re: End of Golden Era for Investors Spells Troubles

#128

Post by dragontamer »

paavokoya wrote: post #123
Retric wrote: post #84

Earlier quoted context omitted.

US still has a significant chunk of WWII debt after one of the greatest sustained economic booms of all time. Growth really is not the answer. Inflation sounds great, just default without technically defaulting, until you actually see what it does to the economy. The real solution is to simply spend vastly less money accepting that pain now is better than letting the US become a failed state.

>accepting that pain now is better than letting the US become a failed state. If you look throughout history, there has never been any nation or empire that has ever done this. The US will fail just as Rome and others before it.

Last time I checked, if you're $1 million in debt... its your problem. If you're $18 Trillion in debt, its the bank's problem. Just saying.

True, $5 Trillion of the debt is held by the US Government in some form (around $2 Trillion is held by the Fed, another $3 is held by Social Security). So it'd be bad for them if the US Government defaulted. And that's why we need to pay back the debt, so that Social Security and the Fed can continue to function.

Social Security has lent trillions of dollars to the US Government. They deserve to get their money back.

Re: End of Golden Era for Investors Spells Troubles

#129

Post by maxerickson »

dragontamer wrote: post #128
paavokoya wrote: post #123

Earlier quoted context omitted.

>accepting that pain now is better than letting the US become a failed state. If you look throughout history, there has never been any nation or empire that has ever done this. The US will fail just as Rome and others before it.

Last time I checked, if you're $1 million in debt... its your problem. If you're $18 Trillion in debt, its the bank's problem. Just saying. True, $5 Trillion of the debt is held by the US Government in some form (around $2 Trillion is held by the Fed, another $3 is held by Social Security). So it'd be bad for them if the US Government defaulted. And that's why we need to pay back the debt, so that Social Security and…

The primary banker of the US government is the organized society living in North America.

Re: End of Golden Era for Investors Spells Troubles

#130

Post by st3v3r »

Retric wrote: post #84
Amezarak wrote: post #70

Earlier quoted context omitted.

The US federal debt was even higher in the wake of World War II. The US government did not run surpluses and deleverage in the following decades. The economy grew, without hyperinflation, and the debt became irrelevant. The solution to high levels of debt is sustainable economic growth, not deleveraging. Mass deleveraging would be an economic catastrophe.

US still has a significant chunk of WWII debt after one of the greatest sustained economic booms of all time. Growth really is not the answer. Inflation sounds great, just default without technically defaulting, until you actually see what it does to the economy. The real solution is to simply spend vastly less money accepting that pain now is better than letting the US become a failed state.

"The real solution is to simply spend vastly less money accepting that pain now is better"

Said someone who's probably not going to feel much of that pain. The problem with a lot of these "cut spending" mantras is that they usually want to do it in a way that hurts those on the bottom of society most, which is extremely appalling. And many of those "cut spending" people actually want to increase military spending.

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