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Surely the crash of the US economy has to be soon

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Re: Surely the crash of the US economy has to be soon

#641

Post by Tiktaalik »

torginus wrote: post #97
singularity2001 wrote: post #63

Maybe 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…

> 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.

One absolutely would have been able to say the same thing about Japan in the 1990s when they were top of the world.

So I dunno! Anything's possible!

Re: Surely the crash of the US economy has to be soon

#642

Post by teiferer »

estimator7292 wrote: post #211
teiferer wrote: post #37

Earlier quoted context omitted.

Skill. Knowledge. At your age, your biggest assert is your future earnings potential. The more employable you are, the better you will make iduring and after a downturn. In fact, the highest skill folks tend to even profit from hiccups in the economy.

None of that is true. Not one word of this applies anymore. Being highly skilled means you're highly paid, which puts you first in line for cuts. Talent doesn't get you hired, networks do. "Future earning potential" is just nonsense words, you can't eat "future earning potential". This advice is from half a century ago. The times have moved on.

What's your advice then, if it's not investing in your hireability?

Re: Surely the crash of the US economy has to be soon

#643

Post by xanthor »

dash2 wrote: post #589
xanthor wrote: post #471

Earlier quoted context omitted.

The US has pointed and fired guns at other countries for moving away from US treasuries, but alternative justifications are produced to reassure our domestic population that it’s really because the foreign leader is a very bad guy.

Which countries?

Libya for one.

https://theecologist.org/2016/mar/14/why-qaddafi-had-go-afri...

All the wars which are said to be for resources like oil are actually over the US financial system’s monopoly over access to such commodities as it tends not to be practical to execute complex resource extraction in countries devastated by war.

Re: Surely the crash of the US economy has to be soon

#644

Post by HeyBigE »

AdamN wrote: post #537
DangitBobby wrote: post #514

Earlier quoted context omitted.

> Presumably i now either repeat the cycle or use my winnings to spend on us output. What you are missing is that these dollars can be circulated indefinitely in the global economy without ever repatriating, because they are valuable and useful as actual currency. They may never come back to the US.

They also don't have to circulate - they can be used as collateral for debts.

Indeed, everyone should be familiar with the "eurodollar" system - it's critical to how the world economy works.

Re: Surely the crash of the US economy has to be soon

#647

Post by trgn »

dgellow wrote: post #639
trgn wrote: post #600

Earlier quoted context omitted.

do you have link to article or vids where trump or admin talks about this?

It’s such a well documented and covered topic I cannot imagine that you’re asking that in good faith. But sure, I will send you that in a bit

Ha, no I'm serious, thx!

Re: Surely the crash of the US economy has to be soon

#648

Post by solatic »

state_less wrote: post #617
solatic wrote: post #602

Earlier quoted context omitted.

US stock market index funds will crash when the US stock market crashes. That will require very large sums of capital to decide to move away from US capital markets. To give an idea of how much money would need to move - VTSAX alone is about $2.1 trillion, with hundreds of billions of dollars of shares of each Mag7 stock. You basically need the world to decide that EMEA/JAP markets are collectively stronger than the…

> US stock market index funds will crash when the US stock market crashes. That will require very large sums of capital to decide to move away from US capital markets. To give an idea of how much money would need to move - VTSAX alone is about $2.1 trillion, with hundreds of billions of dollars of shares of each Mag7 stock. I'd like to make a technical note about markets because I see this mistake repeated in the com…

You are correct, but only insofar as destroying paper value. If investors have a firesale because the market would prefer to realize whatever value might be rescued, even at a loss, but the proceeds of the sale stay inside the US, then that capital is more likely to be reinvested in the US once investor confidence returns. This is the underlying reason why most long-investors should continue to hold their positions despite short-term losses. The fact that NVDA has a $4.6T market cap, as a product of about 24 billion shares multiplied by about a $190/share price, does not mean that the market believes that all 24 billion shares could be sold for that $190/share price. That is a convenient fiction that falls apart when investor confidence bursts, but that does not in and of itself truly represent value destruction (Nvidia employees will still wake up the next day and go to work), at least not until second-order-effects kick in (e.g. Nvidia employees leave because their RSU packages are no longer competitive compensation). People who stay long in the stock market can wait for investor confidence to return, in which cash is reinjected into the stock market, and the losses in diversified portfolios are not realized. If the S&P 500 investor takes a 50% hit in a crash, decides to hold, then the S&P 500 rises by 140% in the next two years, then the investor who held will still realize a nice return.

The way in which that narrative does not happen is if the capital leaves entirely to be locked up in other investments; in the context of index funds which would anyway rebalance to rise with those other investments, if the capital leaves for other countries, to investments that are not covered by the index funds.

Re: Surely the crash of the US economy has to be soon

#649

Post by dgellow »

dgellow wrote: post #639
trgn wrote: post #600

Earlier quoted context omitted.

do you have link to article or vids where trump or admin talks about this?

It’s such a well documented and covered topic I cannot imagine that you’re asking that in good faith. But sure, I will send you that in a bit

- video clip from the 80s in this video https://www.pbs.org/wgbh/frontline/article/trumps-tariff-str...

- 1987 newspaper ad in major newspapers where he complains about the strong dollar https://www.snopes.com/fact-check/trump-foreign-policy-ad/ (and see the weak yen as something good)

- 2017 "the dollar is too strong and is killing us" https://finance.yahoo.com/news/dollar-tumbling-trump-said-to...

- 2019 deleted president remark from whitehouse.gov https://trumpwhitehouse.archives.gov/briefings-statements/re...

- 2020, mentions of trump "long desired weaker dollar" https://www.forbes.com/sites/williampesek/2019/11/18/dollar-...

- 2024 arguing the dollar being strong is a tremendous burden https://finance.yahoo.com/news/trump-says-dollar-too-strong-...

- 2025 "you make a hell of a lot more with a [weak dollar]" https://finance.yahoo.com/news/trump-strong-dollar-sounds-go...

- 2026 "I think it's great [that the dollar is weakening]" https://www.politico.com/news/2026/01/27/the-dollar-is-sinki... (this one is literally from this week)

If you want to understand the goal of the administration, read Stephan Miran's 2024 paper titled "A user's guide to restructuring the global trading system" (the author is the current chairs of "Council Economic Advisers", the paper is casually called Mar-a-lago accord...):

https://www.hudsonbaycapital.com/documents/FG/hudsonbay/rese...

The TL;DR is something like: use overvalued due to reserve status => devalue 40% via tariffs + threatening to withdraw military protection from allies who don't comply

You can find more sources and videos with fairly basic googling, such as multiple interviews from the 90s (or 80s?) with Larry king, Oprah, and way more, none of that is hidden

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