If you predict a crash every month and it happens after 2 years... can we call you a visionary?
Yes and thank you in advance
Surely the crash of the US economy has to be soon
191–200 of 697 posts
Re: Surely the crash of the US economy has to be soon
#192Earlier quoted context omitted.
Prepayment penalties are illegal for the vast majority of loans that consumers can get in the US, which makes it a no-brainer to refinance any time the payment saving exceeds the cost of writing a new loan. The Trump admin has floated the idea of allowing prepayment penalties in home mortgages, BTW.
Would you mind posting a link where Trump wanted to allow prepayment penalties? This sounds unbelievable. Every home owner in the US would be against it (especially the ones who got their mortgages in the past two years at relatively high interest rates).
Crap, I was wrong. Bill Ackman is trying to convince Bessent to do it. So while it may happen, it isn’t coming from inside the admin.
One argument is that it could allow for lower rates, BTW. (This is true, it very well could).
And also, if it happened it would be for newly issued mortgages. Existing mortgages have language in the contract that you couldn’t just unilaterally change
Re: Surely the crash of the US economy has to be soon
#193Earlier quoted context omitted.
What is a mess about the Eurozone and reckless about the ECB?
https://robinjbrooks.substack.com/p/the-principal-agent-prob...
save people a click:
> The incentive structure at the ECB has become distorted and favors high-debt countries [that underperform or are risky]
Re: Surely the crash of the US economy has to be soon
#194What is different this time? Maybe: 1 Online shopping market in the range of 5 trillions 2 Electricity and energy price raise 3 Impossibility to lower interest rates 4 Tech market also in the range of multi Trillions 5 Global education and power expansion ... Meaning that a % of all this money flow goes private pockets destroying medium class, which gets poorer. It is like a memory leak that keeps sucking resources w…
you can couch it in tech metaphors but there is a clear path forward and it involves eating a certain class of people
Re: Surely the crash of the US economy has to be soon
#195I feel like there's some credibility to 'this time it's different' The US economy depends on the country's position of world hegemon - the US dollar is the world's main reserve currency, the US enforces international order and trade rules via its military strength, it dominates technology and culture through 'US defaultism'. I dont think AI even factors in to this. The US economy is priced for global reach - if it ma…
> 'this time it's different' I remember reading this a lot in 2000-2001 and 2007-2008 That said, overall I sort of agree with your assessment except for having any optimism that the US changes course. The current looming problems with the US economy are almost entirely unforced errors of the Trump administration (they could have done basically nothing and taken credit for the Biden soft landing and economic growth) b…
Still, he'll be gone one day and I am going to be all in on that day. It'll all be hockey-sticks from that moment on.
Re: Surely the crash of the US economy has to be soon
#196Earlier quoted context omitted.
I don't understand why people expect the Chinese economy to crash - they can basically make everything, a lot of which is internationally competitive, they can trade for the resources they don't have with the goods that they do - with basically the whole world dependent on them. They have a huge internal base of poor people, and lifting them to a middle class level will alone fuel domestic demand for years to come. T…
> Their biggest problem[…] is demographic in nature. https://www.populationpyramid.net/china/2024/
Great website, not going to downplay the problem, but you can check out other countries, and see that a lot of places - particularly in the West - are f*cked. That China is too, is not much of an upside, Honestly its kinda shocking how bad things are going to get, and Im not sure what can be done if anything at this point.
Re: Surely the crash of the US economy has to be soon
#197Maybe simultaneous with the crash of the Chinese economy, which was predicted for 40 years now
I don't understand why people expect the Chinese economy to crash - they can basically make everything, a lot of which is internationally competitive, they can trade for the resources they don't have with the goods that they do - with basically the whole world dependent on them. They have a huge internal base of poor people, and lifting them to a middle class level will alone fuel domestic demand for years to come. T…
The Chinese economy is indisputably strong and real, but rumor has it that its reported growth numbers have been inflated in the last couple of years. And why wouldn't they be - there is an autocratic government whose justification is that what they are doing is increasing economic success. No success is not an option.
Re: Surely the crash of the US economy has to be soon
#198Earlier quoted context omitted.
Well it's an all time high in EUR as well for instance. I haven't checked for CHF or other currency one may cherry-pick, but in any case it wouldn't change my point: even if it was slightly below an all time high, it's not currently crashing.
I'm not the one who made the "it's crashing now" claim and I do agree that from a certain point of view , it might be seen as a stretch. However, what I'm claiming is that "all time high" is also quite a stretch. Pretty much all nations have been printing money pretty intensely, so fiat is not a solid anchor to derive "actual value", but CHF might be among those that are less printed, so I chose it. Even if we chose…
My counter point is "stocks are not crashing".
It being an all time high was just to highlight how much "not-crashing" they are, but that doesn't really matter. Even if stocks were merely flat over the past year (or even somewhat down), the general point would still be the lack of a stock market crash.
Re: Surely the crash of the US economy has to be soon
#199I think the government is laser focused on reducing regulations, reducing energy costs, reducing interest rates, a weaker dollar that makes exports better, minimizing taxes. Technological innovation is increasing overall productivity. There are definite headwinds like upward pressure on labor by reducing the worker population, stagnating population growth, undertainty, tarriffs, a weaker dollar increasing inflation.…
Hold on there, they have been very explicitly doing the opposite of reducing energy costs. The administration has been aggressively trying to cancel all sorts of energy projects, even projects that have almost been completed. At the same time they've been encouraging as much data center build out as possible. Lowering supply and increasing demand is hardly going to reduce energy costs. They have managed to significan…
I think it's a little bit more nuanced than what you say and that they generally are trying to increase energy supply while withdrawing from using heavy government subsidies or extensive regulations to pick the winners and losers.
From a demand side, they aren't looking to restrict demand, but want to have ample supply to meet the demand.
Re: Surely the crash of the US economy has to be soon
#200Earlier quoted context omitted.
Would you mind posting a link where Trump wanted to allow prepayment penalties? This sounds unbelievable. Every home owner in the US would be against it (especially the ones who got their mortgages in the past two years at relatively high interest rates).
Crap, I was wrong. Bill Ackman is trying to convince Bessent to do it. So while it may happen, it isn’t coming from inside the admin. One argument is that it could allow for lower rates, BTW. (This is true, it very well could). And also, if it happened it would be for newly issued mortgages. Existing mortgages have language in the contract that you couldn’t just unilaterally change
How would prepayment penalties lower interest rates ? I really do not see how.