Hi Freeus, <<worst scenario … now-present and worsening financial collapse?
I mean realistically not to the unlikely extreme>>
You asked a serious question requiring an answer without my usual dramatics. I do not know the answer. I think the exchange between you and Joel was a good and responsible one.
Worst? I will take a wild stabbing guess in the dark about what one may want to be mentally prepared for. I guess only, absent of first-hand feel from most industries, and devoid of formal education in economics:
(a) Economic contraction of more than one year for large locomotive economies,
(b) Reduction of global trade (multiple quarters),
(c) Unemployment going above 7% rapidly and staying there (more than one year),
(d) Equity prices in aggregate dropping by another 50% and rest there (multiple quarters),
(e) Investment grade corporate bonds to eventually yield over 15%,
(f) Real estate aggregate prices in current choice locations decline by 30-40%,
(g) Politics turn extreme
In summary, what is coming will be the worst I have ever seen, and worse than what the politicians and financiers know how to navigate. So we go on this journey in a leaky boat, without adequate training, minus a map, and short on rations.
To survive and prosper, use the early New World colony founders’ situation as a thought experiment and ask yourself how you would analogically handle their then equally dangerous journey to an unfamiliar new world.
I am figuring high cash (ration), low debt (responsibility), diversification (hedge the gene pool by spreading the family members out on several boats), keep working (be useful, engaged, challenged, helpful, and paid), be alert (scope for unusual and mis-priced opportunities, and dangers).
If I am wrong with my guess by being too cautious, what is the harm? And if I am right, what is the reward?
I think the Greenspans of this world have been wrong for so long that they forgot how to be right and are a danger to the general welfare of all, and that is why I make a point of thumping them, even though the germs of their ideas are simply too pervasively spread and deeply entrenched that the cure can only be a financial world put to the flame of the Great Purge.
Chugs, Jay
Reference to Equal Time Alternative View:
Message 16313647
Message 16317704
Chugs, Jay |
