The Global Economy Is a Time Bomb Waiting to Explode

[georgephillip]

Yes, of course the crisis is nearing. Capitalism may be destabilizing, but let us look at the country that is at the top of today's bubble. Well damn, it's the communist China. Our stock market comes only second...

There is no such thing as a perfect system. Minsky having Marxists influence somehow managed to forget that and only criticized capitalism and corporatism. I have to say I am quite amused at how these Marxist use the word capitalism to refer to almost anything and everything. They still got many things right... for example neoclassical economists such as Krugman always being wrong, every time. However, such trivialities are obvious for anyone with a brain.

There is no such thing as a perfect system. Minsky having Marxists influence somehow managed to forget that and only criticized capitalism and corporatism.

Minsky and many others acknowledged the fundamental contradiction of capitalism which pits workers against capitalists in a never-ending struggle over wages. Workers who can't afford to buy products they help produce are left with only one option:

https://seekingalpha.com/article/4196931-state-american-debt-slaves-q2-2018

"Hyman Minsky's theories about debt accumulation received revived attention in the media during the subprime mortgage crisis of the first decade of this century.

"The New Yorker has labelled it 'the Minsky Moment'.[10][11]

"Minsky argued that a key mechanism that pushes an economy towards a crisis is the accumulation of debt by the non-government sector.

"He identified three types of borrowers that contribute to the accumulation of insolvent debt: hedge borrowers, speculative borrowers, and Ponzi borrowers."

Hyman Minsky - Wikipedia

This is dumb, the debt has declined relatively since the heights of 2008.

Get to the socialist Venezuela, wages are booming there.

This is dumb, the debt has declined relatively since the heights of 2008.

Consumer (private) debt has not declined since 2008:

https://seekingalpha.com/article/4196931-state-american-debt-slaves-q2-2018

"Total consumer credit - or less soothingly, consumer debt - rose 4.8% in the second quarter from a year earlier, or by $176 billion, to $3.87 trillion (not seasonally adjusted), the highest ever, according to the Federal Reserve.

"This includes credit card debt, auto loans, and student loans, but not mortgage-related debt.

"Given how passionate Americans normally are in spending money they don't have, that 4.8% increase is moderate: In 2011, increases exceeded 11%."

Private debt relative to GDP has declined.

Go preach your Marxism elsewhere.

Private debt relative to GDP has declined.

Go preach your Marxism elsewhere

How has inflation grown relative to GDP over that time period?

https://seekingalpha.com/article/4196931-state-american-debt-slaves-q2-2018

"To put this 4.8% increase (in consumer debt) in perspective: In Q2, the economy as measured by real GDP grew 2.8% year over year, and inflation as measured by CPI increased 2.7%.

"In other words, American consumers, among the hardiest creatures out there, have pulled through once again, holding up the economy with borrowed money.

"Over the 10 years since Q2 2008, consumer debt has surged 48%.

"Over the same period, the consumer price index has increased 15.1% and the economy has grown 17.8%."

 

[danielpalos]

...Rather than reconstructing a new foundation out of the wreckage, we simply restored the status quo ante, and left the world’s elite financial engineers with a relatively free hand to create a wide range of new destructive financial instruments...
3/11/19
The Global Economy Is a Time Bomb Waiting to Explode

From September, 2018...
BIS warns global economy risks crisis 'relapse'

Economic Crashes are part of the normal cycle of capitalism. Miraculously Japan and a few other countries have found a way to stop economic crashes using a very simple method. Redistribution of wealth. Thom Hartmann Asks Professor Richard Wolff if these methods can be applied to the United States or if the billionaire class will let us stop the crashes before it is too late ?


"The White House has become a country club hangout for Wall Street executives."
Sherrod Brown ( on Seth Myers last night )

solving simple poverty and raising the minimum wage could cure capitalism's boom and bust cycles.

solving simple poverty and raising the minimum wage could cure capitalism's boom and bust cycles.

Wouldn't that eliminate capitalism?

Marx 1844: Wages of Labour

"Wages are determined through the antagonistic struggle between capitalist and worker. Victory goes necessarily to the capitalist.

"The capitalist can live longer without the worker than can the worker without the capitalist.

"Combination among the capitalists is customary and effective; workers’ combination is prohibited and painful in its consequences for them.

"Besides, the landowner and the capitalist can make use of industrial advantages to augment their revenues; the worker has neither rent nor interest on capital to supplement his industrial income.

"Hence the intensity of the competition among the workers.

"Thus only for the workers is the separation of capital, landed property, and labour an inevitable, essential and detrimental separation.

"Capital and landed property need not remain fixed in this abstraction, as must the labour of the workers."

No. Capitalism doesn't work without Government. Solving for Capitalism's natural rate of unemployment is merely solving for that capital inefficiency.

No. Capitalism doesn't work without Government. Solving for Capitalism's natural rate of unemployment is merely solving for that capital inefficiency.

"No Banks without States, and no States without Banks."
https://www.amazon.com/dp/B00GMSUUVS/?tag=ff0d01-20

extreme inequality is worse.

 

[Harpy Eagle]

I have to say I am quite amused at how these Marxist use the word capitalism to refer to almost anything and everything.....

hmmm....when have we seen something like that happen with another word...like the word "socialism"...is is used to refer to almost anything and everything by a select group of people in this country.

it is a damn shame you cannot see the irony of you of all people making that post

Actually it's being used as a code word for anti-American. This was built as the land of the free, if that doesn't satisfy, you can always embrace the Venezuelan paradise.

But the Marxists are correct that the bankers should have been shipped behind bars after their royal fuck up.

this from the Trump worshiper that supports socialist tariffs and the redistribution of more than 20 billion dollars a year to farmers.

you would not know free it if bit you in the ass

 

[Norman]

I have to say I am quite amused at how these Marxist use the word capitalism to refer to almost anything and everything.....

hmmm....when have we seen something like that happen with another word...like the word "socialism"...is is used to refer to almost anything and everything by a select group of people in this country.

it is a damn shame you cannot see the irony of you of all people making that post

Actually it's being used as a code word for anti-American. This was built as the land of the free, if that doesn't satisfy, you can always embrace the Venezuelan paradise.

But the Marxists are correct that the bankers should have been shipped behind bars after their royal fuck up.

this from the Trump worshiper that supports socialist tariffs and the redistribution of more than 20 billion dollars a year to farmers.

you would not know free it if bit you in the ass

Tariffs were how the US government was originally founded, the US way.

For you freedom means free shit.

 

[Harpy Eagle]

Tariffs were how the US government was originally founded, the US way.

For you freedom means free shit.

yeah, it means me paying for your free shit.

 

[Mac1958]

As a Marxist - a real live Marxist, he's a professor in it and does lectures advocating it - he's no doubt hopeful for the worst.

Pretending it isn't going to happen won't help.

Economies fluctuate. Always have, always will. The key is the implementation of effective and efficient controls to smooth out the bumps a bit.

Marxism is not the answer.
.

 

[McRocket]

...Rather than reconstructing a new foundation out of the wreckage, we simply restored the status quo ante, and left the world’s elite financial engineers with a relatively free hand to create a wide range of new destructive financial instruments...
3/11/19
The Global Economy Is a Time Bomb Waiting to Explode

From September, 2018...
BIS warns global economy risks crisis 'relapse'

Economic Crashes are part of the normal cycle of capitalism. Miraculously Japan and a few other countries have found a way to stop economic crashes using a very simple method. Redistribution of wealth. Thom Hartmann Asks Professor Richard Wolff if these methods can be applied to the United States or if the billionaire class will let us stop the crashes before it is too late ?


"The White House has become a country club hangout for Wall Street executives."
Sherrod Brown ( on Seth Myers last night )

Well, these people are almost entirely wrong.

Japan is a complete mess...it's on the slow track to disaster.

Japan is running negative interest rates, their central bank is buying boatloads of stocks through ETF's to try and artificially prop up the markets there. The government debt-GDP ratio is by MILES the highest in the world at over 253%. More then half of their tax revenues go JUST towards debt servicing. That's like you having to spend half of your take home pay just to pay the interest on your loans.
Japan General Government Gross Debt to GDP | 2019 | Data | Chart | Calendar

Their trade balance - which was a key part of the Japanese economy - has largely collapsed.
Japan Balance of Trade | 2019 | Data | Chart | Calendar | Forecast | News
The present government has deliberately devalued their currency so as to make exports more attractive. But what it has done has made imports much more expensive so that outweighed the benefits of the greater exports. So now, they run huge trade deficits - something that was almost unthinkable there about 20 year ago.

On top of everything else, their population is actually shrinking and getting older fast.

Japan is in MAJOR trouble and if they don't grow up and start living within their means...they will be in massive doo-doo in a decade or two.


Capitalism is not the problem with America. Too much government/Fed interference in the economy is the problem as they have artificially propped up the stock markets - which helps the rich and does nothing for the poor and almost nothing for the middle classes.

Though the video was right that debt levels are skyrocketing...but that is thanks to the Fed's ultra low interest rates (which the video also got right)...not capitalism.

I agree with a better social safety net for America...especially much better government healthcare.

But government-orchestrated, direct, monetary redistribution is not the answer. Stopping the Fed's low interest rate madness which would cause the rich to stop cashing in on the boom and this would re-distribute wealth 'naturally' is the answer.

Please remember people - almost all of the wealthy people/politicians are making TONS off the Fed's policies, so they do not want the party to end. So they will NEVER blame the Fed. So don't look for guidance from them.

Hell, even Trump caved on it.

During the primaries - he got it right:



He said the Fed was the problem, that they were making the economy a 'big. fat, ugly bubble'. He nailed it.

But as soon as he got into office - he dropped ALL of that...and now he is calling for the Fed to do EXACTLY the opposite of what he was calling for them to do before the election. He wants them to keep interest rates down and keep the party going - which is the exact opposite of what he called for during the election.

BTW - this flip-flop by Trump is going to cost him a TON of Tea Party votes in 2020.

He is running massive deficits and supporting massive FED intervention...both things most Tea Partiers are DEAD SET against.
They voted for him last time because he said the right things during the election.
But now that he has gone back on them - most Tea Partier's will not be happy.

It won;t be tens of millions of votes...but it will be a fair number. And judging by the polls - he will need every vote he can get.

 

[the other mike]

Well, these people are almost entirely wrong.

Are you sure ?

BTW - this flip-flop by Trump is going to cost him a TON of Tea Party votes in 2020.

They're still around ?

 

[McRocket]

Well, these people are almost entirely wrong.

Are you sure ?

In terms of Japan has got it right and that government hand outs are the solution - yes, they got it wrong. Some other things - like the debt and it's source (the Fed) they got it right.

 

[georgephillip]

...Rather than reconstructing a new foundation out of the wreckage, we simply restored the status quo ante, and left the world’s elite financial engineers with a relatively free hand to create a wide range of new destructive financial instruments...
3/11/19
The Global Economy Is a Time Bomb Waiting to Explode

From September, 2018...
BIS warns global economy risks crisis 'relapse'

Economic Crashes are part of the normal cycle of capitalism. Miraculously Japan and a few other countries have found a way to stop economic crashes using a very simple method. Redistribution of wealth. Thom Hartmann Asks Professor Richard Wolff if these methods can be applied to the United States or if the billionaire class will let us stop the crashes before it is too late ?


"The White House has become a country club hangout for Wall Street executives."
Sherrod Brown ( on Seth Myers last night )

solving simple poverty and raising the minimum wage could cure capitalism's boom and bust cycles.

solving simple poverty and raising the minimum wage could cure capitalism's boom and bust cycles.

Wouldn't that eliminate capitalism?

Marx 1844: Wages of Labour

"Wages are determined through the antagonistic struggle between capitalist and worker. Victory goes necessarily to the capitalist.

"The capitalist can live longer without the worker than can the worker without the capitalist.

"Combination among the capitalists is customary and effective; workers’ combination is prohibited and painful in its consequences for them.

"Besides, the landowner and the capitalist can make use of industrial advantages to augment their revenues; the worker has neither rent nor interest on capital to supplement his industrial income.

"Hence the intensity of the competition among the workers.

"Thus only for the workers is the separation of capital, landed property, and labour an inevitable, essential and detrimental separation.

"Capital and landed property need not remain fixed in this abstraction, as must the labour of the workers."

No. Capitalism doesn't work without Government. Solving for Capitalism's natural rate of unemployment is merely solving for that capital inefficiency.

No. Capitalism doesn't work without Government. Solving for Capitalism's natural rate of unemployment is merely solving for that capital inefficiency.

"No Banks without States, and no States without Banks."
https://www.amazon.com/dp/B00GMSUUVS/?tag=ff0d01-20

extreme inequality is worse.

extreme inequality is worse.

As are rising levels of public and private debt:

Trump’s $34 Trillion Deficit and Debt Bomb

"During Trump’s first two years in office, US federal government deficits have driven the national debt up already by $3 trillion: At the end of 2016, when Trump entered office, the US national debt was $19.5 trillion.

"Today it is $22.5 trillion.

"He’s thus already added $3 trillion, a faster rate per year of debt accumulation than under even his predecessors, George Bush and Barack Obama."

 

[the other mike]

Well, these people are almost entirely wrong.

Are you sure ?

In terms of Japan has got it right and that government hand outs are the solution - yes, they got it wrong. Some other things - like the debt and it's source (the Fed) they got it right.

Being an optimist, I don't believe there will be the big crash some have been predicting since 2012- 2013. Preventing it will likely require a major shakedown inside the beltway- how it may unfold is anyone's guess, but I don't see it being a 'shit-hits-the-fan' ,run to the hills scenario. There may be an initial shock where panic could set in & ( as corny as it sounds ) the most important thing will be us coming together as Americans to work it all out rather than let our differences escalate into something we don't want--the globalists want to keep us divided over everything but we can't let them. And our democracy and the Constitution is on very thin ice right now, but there are good people working on it as we speak. Rand Paul is one....Lindsey Graham ( believe it or not ) , Tulsi Gabbard and many others you never heard of.

Civil War? Elites Are the Ones Who Are Dividing America: Salena Zito| Investor's Business Daily

Elites Are the Ones Who Are Dividing America | RealClearPolitics

 

[McRocket]

Well, these people are almost entirely wrong.

Are you sure ?

In terms of Japan has got it right and that government hand outs are the solution - yes, they got it wrong. Some other things - like the debt and it's source (the Fed) they got it right.

Being an optimist, I don't believe there will be the big crash some have been predicting since 2012- 2013.
It will likely require a major shakedown inside the beltway- how it may unfold is anyone's guess, but I don't see it being a 'shit-hits-the-fan' ,run to the hills scenario. There may be an initial shock where panic could set in & the most important thing will be us
coming together as Americans to work it all out. The globalists want to keep us divided over everything but we can't let them.

You maybe right.

But history seems to suggest that when large amounts of debt has to be worked out of the economy...a LOT of defaults have to take place. And that usually leads to a LOT of bad news.

And the amount of debt that has been pushed into the major economies of the world is staggering.

U.S. - public debt and forecast as a percentage of the GDP 2000-2028 | Timeline
Bloomberg - Are you a robot?
The Makings of a Global Debt Crisis Are in Place - Daily Reckoning

BTW, when people say - 'if all this debt is so bad, where is the promised inflation?' Simple (at least to me). Since ALL the major countries/currencies are doing it at the same time, all of their currencies are being inflated at the same time. Currency inflation often occurs when compared to other, stable currencies. If they are all in flux, they all appear to be more stable then they would be otherwise.

 

[georgephillip]

I have to say I am quite amused at how these Marxist use the word capitalism to refer to almost anything and everything.....

hmmm....when have we seen something like that happen with another word...like the word "socialism"...is is used to refer to almost anything and everything by a select group of people in this country.

it is a damn shame you cannot see the irony of you of all people making that post

Actually it's being used as a code word for anti-American. This was built as the land of the free, if that doesn't satisfy, you can always embrace the Venezuelan paradise.

But the Marxists are correct that the bankers should have been shipped behind bars after their royal fuck up.

this from the Trump worshiper that supports socialist tariffs and the redistribution of more than 20 billion dollars a year to farmers.

you would not know free it if bit you in the ass

this from the Trump worshiper that supports socialist tariffs and the redistribution of more than 20 billion dollars a year to farmers.

you would not know free it if bit you in the ass

Since the end of WWII in general and particularly since leaving the gold standard in '71, the US has imposed "free trade" policies on the rest of the world while enhancing government regulation over its domestic markets:

https://michael-hudson.com/wp-content/uploads/2010/03/superimperialism.pdf (pp. 32-33)

"Even as U.S. diplomats were insisting that other nations open their doors to U.S. exports and investment after World War II, the government was extending its regulation of the nation’s own markets.

"Early in the 1950s it tightened its dairy and farm quotas in contravention of GATT principles, providing the same kind of agricultural subsidies which U.S. negotiators subsequently criticized the Common Market for instituting.

"Today (2002) nearly half of American agricultural income derived from government subsidy.

" World commerce has been directed by an unprecedented intrusion of government planning, coordinated by the World Bank, IMF and what has come to be called the Washington Consensus.

"Its objective is to supply the United States with enough oil, copper and other raw materials to produce a chronic over-supply sufficient to hold down their world price. The exception to this rule is for grain..."

 

[danielpalos]

solving simple poverty and raising the minimum wage could cure capitalism's boom and bust cycles.

solving simple poverty and raising the minimum wage could cure capitalism's boom and bust cycles.

Wouldn't that eliminate capitalism?

Marx 1844: Wages of Labour

"Wages are determined through the antagonistic struggle between capitalist and worker. Victory goes necessarily to the capitalist.

"The capitalist can live longer without the worker than can the worker without the capitalist.

"Combination among the capitalists is customary and effective; workers’ combination is prohibited and painful in its consequences for them.

"Besides, the landowner and the capitalist can make use of industrial advantages to augment their revenues; the worker has neither rent nor interest on capital to supplement his industrial income.

"Hence the intensity of the competition among the workers.

"Thus only for the workers is the separation of capital, landed property, and labour an inevitable, essential and detrimental separation.

"Capital and landed property need not remain fixed in this abstraction, as must the labour of the workers."

No. Capitalism doesn't work without Government. Solving for Capitalism's natural rate of unemployment is merely solving for that capital inefficiency.

No. Capitalism doesn't work without Government. Solving for Capitalism's natural rate of unemployment is merely solving for that capital inefficiency.

"No Banks without States, and no States without Banks."
https://www.amazon.com/dp/B00GMSUUVS/?tag=ff0d01-20

extreme inequality is worse.

extreme inequality is worse.

As are rising levels of public and private debt:

Trump’s $34 Trillion Deficit and Debt Bomb

"During Trump’s first two years in office, US federal government deficits have driven the national debt up already by $3 trillion: At the end of 2016, when Trump entered office, the US national debt was $19.5 trillion.

"Today it is $22.5 trillion.

"He’s thus already added $3 trillion, a faster rate per year of debt accumulation than under even his predecessors, George Bush and Barack Obama."

but, hey; the Richest got richer faster.

 

[the other mike]

...
BTW, when people say - 'if all this debt is so bad, where is the promised inflation?' Simple (at least to me). Since ALL the major countries/currencies are doing it at the same time, all of their currencies are being inflated at the same time. Currency inflation often occurs when compared to other, stable currencies. If they are all in flux, they all appear to be more stable then they would be otherwise.

In the case of the US dollar, the Feds have been pumping cash out, and some entities have collectively bought up $ 2 trillion in treasury bonds ( this is something from a long radio interview I heard a few weeks ago... )- in effect - propping up the house of cards. Keep in mind, some of the 'experts' predicting doomsday could also be the suckers who invested a lot in expensive gold ( over $1500 an ounce ) over the last decade ....they're hoping for hyperinflation to hit so they can sell off their gold at 10 times that while fearing it could drop back to $300 an ounce....but they're not the big players( with vast hidden wealth) who can pull strings and manipulate the speculators information and shift the market either way.

 

[the other mike]

Maybe one of these two that I was referring to about the $2 trillion in bonds mysteriously purchased.