Global Depression 2022 - Time to do the Breadline Boogaloo!

[Ishtar]

Some very smart people seem to think it can. They call it modern money theory and it essentially boils down to how Orc Technology works in 40k, or how tinkerbell can come back to life. If you believe REALLY HARD shit just works.

I think they are full of shit. Our economy certainly seems to be running on Looney Tunes rules, but eventually gravity asserts itself and the Coyote stops floating on air. The issue is just how much debt is out there and just how much of it is denominated in USD. If the Fed keeps that money printer going, eventually inflation is going to start taking lenders to the cleaners. The interest rate on my Mortgage is around 2.5%, but with core inflation at 8%, the banks money is literally sitting on my front lawn burning merrily.

Eventually the Fed is going to have to do things. Stop the money printer, which would cause an immediate credit freeze and the banks to go under....or raise the benchmark interest rate, which will immediately bankrupt a huge chunk of the individual debtors and the more over leveraged corporations.

It's a damned if you do, fucked if you don't situation for the central banks right now.

But when is that point reached though? It seems to me that unless some massive external crisis hits, they can just continue pressing buttons on a computer and generating money out of nothing(or at least seemingly so). When and what causes gravity to re assert itself?

 

[mindlessobserver]

But when is that point reached though? It seems to me that unless some massive external crisis hits, they can just continue pressing buttons on a computer and generating money out of nothing(or at least seemingly so). When and what causes gravity to re assert itself?

If you can answer that question you will be absurdly rich. Pull your money to sticky assets, short the market and buy the wreckage. Good luck!

 

[z0mb0]

Some very smart people seem to think it can. They call it modern money theory and it essentially boils down to how Orc Technology works in 40k, or how tinkerbell can come back to life. If you believe REALLY HARD shit just works.

I think they are full of shit. Our economy certainly seems to be running on Looney Tunes rules, but eventually gravity asserts itself and the Coyote stops floating on air. The issue is just how much debt is out there and just how much of it is denominated in USD. If the Fed keeps that money printer going, eventually inflation is going to start taking lenders to the cleaners. The interest rate on my Mortgage is around 2.5%, but with core inflation at 8%, the banks money is literally sitting on my front lawn burning merrily.

Eventually the Fed is going to have to do things. Stop the money printer, which would cause an immediate credit freeze and the banks to go under....or raise the benchmark interest rate, which will immediately bankrupt a huge chunk of the individual debtors and the more over leveraged corporations.

It's a damned if you do, fucked if you don't situation for the central banks right now.

Yes, but to further the comparison sometimes the ork tech explodes killing anything near it for any or no real reason. At some point some guy in data entry hits the wrong key and the dominos start and morons panic and you get cascading failures.

 

[Hippopatumus]

If gold was worthless the Federal Reserve wouldn't have any.

 

[Oxous]

Here's one country that is looking at economic collapse as we speak: Turkey. Today the lira managed to inflate 15% IN ONE DAY. The reasons why are a little complex, but can summarized in one word: incompetence. Erdogan has a view of economics that is detached from reality, he believes that lower interest rates lowers inflation (everyone else knows it does the exact opposite). and he personally controls the Central Bank. Everyone who works there is a puppet who does only what Erdogan wants. In fact yesterday he was talking about formally absorbing Turkey's Central Bank into the government.

 

[Sage In All Fields]

then at least the immigrants will go home.

nah bitch, they ain't got the cash to go back no more

Erdogan has a view of economics that is detached from reality, he believes that lower interest rates lowers inflation

It's not detached from reality, it's more a sort of accelerationism, if you keep 0% interest rates for long enough to the point where banks just stop lending you just end up with practically speaking ~infinite% interest rates which will lower inflation, this strategy does of course however require that you radically reshape/collapse your economy. If that's what you're trying to achieve and that's your game plan, absorbing the bank into the government makes complete sense, because such a bank that has no incentive to loan can't otherwise operate really.

 

[Lord of the Large Pants]

I'm looking at buying a house next year and I have a down payment saved.

How do these economic shenanigans affect me, personally?

ETA: Just to be clear this isn't intended as sarcastic or rhetorical, I'm actually asking.

 

[mold]

I'm looking at buying a house next year and I have a down payment saved.

How do these economic shenanigans affect me, personally?

ETA: Just to be clear this isn't intended as sarcastic or rhetorical, I'm actually asking.

like has been repeated here a bunch of times, there is no way to predict the timeline of the collapse with sufficient granularity to make any kind of difference to teeny tiny economic decisions like when you personally buy a house.

just buy a house far away from people who might kill you and steal all your stuff.

 

[Hippopatumus]

I'm looking at buying a house next year and I have a down payment saved.

How do these economic shenanigans affect me, personally?

ETA: Just to be clear this isn't intended as sarcastic or rhetorical, I'm actually asking.

If the current trend continues you have no chance.

What I suspect will happen though, is a massive crash (30-50% or more stock market drop) which will depress housing prices. However, I believe the Fed is intentionally trying to crash the economy and a correction does not align with that goal, so if I am right and there is a huge crash then you should immediately jump on the opportunity before the inflationary spiral picks up pace again as the Fed drops money from a helicopter.

 

[Simple Moving Average]

good thread, but are we gonna require another World War and post-war economy to get out of this?

No. You're gonna get it anyway.

 

[tehpope]

If gold was worthless the Federal Reserve wouldn't have any.

View attachment 2744383

Nobody is saying Gold is worthless. Its just not worthwhile to hoard for indivduals. Silver will be a more easier metal to barter with. Or bullets and food.

 

[Sped Xing]

3 hens, given you picked up the correct breed, will produce enough eggs for a family of 4 to have a breakfast of eggs every day. And if you don't fancy eggs for every breakfast, or even every day, your fridge will rapidly fill up with egg cartons, and you'll get into delicious preservation strategies like pickling eggs.

Plus you can throw the extras at bankers.

 

[Canoodler]

I think we'll be okay.

 

[Hippopatumus]

Plus you can throw the extras at bankers.

 

[z0mb0]

I'm looking at buying a house next year and I have a down payment saved.

How do these economic shenanigans affect me, personally?

ETA: Just to be clear this isn't intended as sarcastic or rhetorical, I'm actually asking.

Really if shit goes belly up your fucked anyway. go for it

 

[Male Idiot]

Non gold backed currency is make belief anyway.

I don't think this will go mad max, but some countries, smaller less important ones, could be seeing the army and its leader take over.

 

[Honka Honka Burning Love]

it seems more prudent than ever to begin stocking up on daily essential's where and when possible. This includes food, dental care products, hygiene products, medications, essential clothing, basically anything that you use on a semiregular basis that isn't perishable in the short term. When you're at your local market buy double(or more) of any canned good's you're purchasing, between the dueling threats of inflation and supply shortages you're almost guaranteed to come out ahead; meaning you'll end up saving money if it inflates, or will actually have some food to eat if it's simply not there. I would recommended starting a pantry if you don't already have one.

Now, one thing to note.

DON'T TELL ANYONE you are doing this, get enough for your family and some spares to give out but do not ever fucking tell anyone that you will be the person to go to if things turn to shit.

 

[mindlessobserver]

I'm looking at buying a house next year and I have a down payment saved.

How do these economic shenanigans affect me, personally?

ETA: Just to be clear this isn't intended as sarcastic or rhetorical, I'm actually asking.

I pulled the gun on buying my house this year because interest rates are so insane. I am not a financial advisor by any stretch, but right now the property market is insane. Houses that sold for 100k 10 years ago are now selling for 300k today. Sometimes even more depending on the area. It's fueled by ultra low interest rates, speculation by big corporations and financial funds, as well as Chinese capital flight.

Smart money would be to wait until prices go down or collapse. But that really depends on how you intend to buy. If you buy cash up front it may be better to wait. If you intend to do financing on the other hand you may want to buy now before the music stops. With interest rates at their lowest level in a century you will never see rates like this in our life times. Even if you are over paying for a house at the front end today, the low interest rates combined with high inflation may mean you end up winning at the back end in 30 years.

 

[beet644]

I see a crash coming because to much debt and keep taking out more debt. The countries have to much debt, the corps have to much debt and every day people have to much debt. Would a word crash be a bad thing tbh I don't think the system now should be saved and a crash just speeds up the process.

 

[Prophetic Spirit]

Chile and Peru get drought.

I know Perú is fucked entirely, but in Chile is yet near all the north regions and some central ones. Bio-Bio and below survived this year drought.
This year was the worst i've seen in all my life about rain; was near non-existent in all Winter. And the gov literally acted too late since all those fucks are more afraid of this year's elections.
For me at least i'm ok, but i know the entire world will gonna fucked up in subsequent years.