The scariest bubble I see right now

Discussion in 'Economy' started by Mac1958, Mar 18, 2018.

  1. Mac1958
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    Mac1958 Diamond Member

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    I won't go so far as to call this a prediction, but there's a massive bubble brewing right now and I haven't seen anyone talking about it.

    Remember those radio and teevee commercials in the 2004-2008 years that advertised low-document and no-document home loans, 125% LTV loans, bad credit mortgages, all the horrific SHIT that would get layered into CDOs and CMOs, avoid regulation, get phony AAA ratings by the paid-off ratings companies, turn to shit and ultimately damn near bring down the entire global economy?

    Well, imagine those same types of loans for small to mid-sized business owners instead of home buyers.

    It's damn near deja vu. Lenders are both proliferating everywhere, and dropping lending standards to a point at which they could barely be considered "standards". Because it's not a front-page thing like mortgages, this massive stew of bad credit is flying totally under the radar - YET, a business is FAR more likely to fail than is a home owner likely to pay their mortgage. They're everywhere now, the loans are going into larger securities, and here we are again.

    Just saying.
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  2. Tijn Von Ingersleben
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    Tijn Von Ingersleben Gold Member

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    With the Dow at 26000...I am pretty sure that everything is a bubble at this point...12392 ten years ago on this day.
     
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  3. Mac1958
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    Mac1958 Diamond Member

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    The market P/E ratio is a little high, but that could come down with earnings growth.

    What's happening in business credit market is its own animal.
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  4. beagle9
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    beagle9 Gold Member

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    . Could Trumps economy stave off the inevitable ?? If the Demon-crats would start helping instead of hurting America, then the bubble's could be avoided. Everyone is ready to break the cycles except for the butt hurt critters. They want to break everything just to show Trump a thing or two, so when will they decide to quit acting like crybabies, and start helping ??
     
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  5. Mac1958
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    Mac1958 Diamond Member

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    Not unless it somehow alters the regular historical business cycle, and that's not gonna happen.

    Small and mid-sized companies are hurt first in regular business cycles. That's where this money is going.

    I don't know.
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  6. william the wie
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    william the wie Gold Member

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    There were three overlapping housing bubbles: S&L; dot.com; and the last 2003-8. This kind of small to medium size business bubble is a direct result of Berkshire-Hathaway and CalPers making oversized returns through direct investment. This bubble will pop in the high SALT/High Cost states and it has already begun to pop in the CA vineyards and the New New York enterprise zones. (And yes that is the real name Cuomo and the NY legislature gave it.) As the state tax breaks are paid for by the employees and the individual owners residence is relocating to other states and countries.
     
  7. Toddsterpatriot
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    Toddsterpatriot Diamond Member

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    How many fewer business loans compared to home mortgages?
     
  8. Mac1958
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    Mac1958 Diamond Member

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    I have no idea. Why?
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  9. beagle9
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    beagle9 Gold Member

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    Need to start teaching this nation how to become sovereign and self sustaining in each and every state again. This is why the nation was so strong back in the day's. Individual strength builds national strength over all. The break down of individualism for globalism in America has set the nation up for dependency.

    It's easy really, just go back to building individual wealth amongst the lower and upper middle classes again, and build up small businesses in this country again. Create products that last, and that empower Americans again instead of creating dependency like it all has been for the last 40 years. Time to MAGA if serious about it.

    Break the monopoly strangle holds on this nation by enforcing anti-monopoly laws or create laws or rules that would address the problems. Trump seems to be trying to address the problems, but those who are raking in the billions aren't up for to much change even if it will preserve the future of America.
     
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  10. Toddsterpatriot
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    Toddsterpatriot Diamond Member

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    24946....Friday.

    Up from 12392 ten years ago is only 7.25% compounded.
    Not an unheard of annual return.
     

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