Hello Gumnam, <<1) What will prevent this scenario from happening ?>>
The equity and bond bubbles are still full of piping hot air, getting super heated and ready to blow, to be sparked by any one of many possible flickers or pricked by one of so many pins, from WAT-WOT, energy price, to derivative accidents, or simply the encroaching mob realization that what must be will eventually be.
We are not talking hypothetical disasters. We are only discussing a predictable event awaiting many well-understood and non-random happenings.
The housing bubble, the bubble of most interest, unlike the equity and bond bubbles, are much bigger than either, and it will blow up as sure as night follows day, especially given that the housing bubble is in fact wrapped around the equity/bond bubbles, and in turn wrapped within the USD bubble, much like conventional explosives wrapped around a plutonium core the size of two halves of a grape fruit.
The housing bubble, again unlike the equity and bond bubbles, when exploded, will exact negative consequence not only on the recent buyer, but also on the recent seller who 'traded up', as well as on the financiers that enabled the transaction, and the guarantors of the financiers.
The spectacle will shock and awe like no spectacle ever did, bigger than tulips, more massive than 1929, and ... oh, you know the rest of the script, leading to dissipation, evaporation, and redistribution, ala Argentina, but on a global scale, bringing to us TeoTwawKi of the current monetary system.
<<2) If this is a possibility, what are interesting opportunities to make some money?>>
I must suggest LTBH of gold, gold mines, platinum, platinum mines, energy, energy fields, non-precious but soon to be dearer metals, and those mines, and "Tomorrow's Gold" that is today's Asia.
This way, we win if Asia does well, via Asian equities, gold and commodities, and we win if everything goes to the sh*t, via gold and commodities, and we do not lose if all goes as is, muddling through, via Asian equities, gold, and commodities :0)
If there was a pure play, even such things as phosphate piles, but no so much manure piles ;0)
Chugs, Jay |
