Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: Moominoid who wrote (50103)	5/18/2004 5:38:34 AM
From: Maurice Winn	Read Replies (2) of 74559

Moom, it's easier to defend against a 50 year increase by a metre or two than an instantaneous tsunami 400 metres high. Over 50 years, people can move uphill with barely noticeable economic dislocation. Economic returns happen largely over periods of 10 years, and after 20 years, net present values become almost indifferent to what happens then. That's not so much the case for now, with interest rates at very low levels and P:E ratios at high levels, but certainly 30 years is of little concern. After 50 years, there's not much economic value left to worry about. Cities are almost unrecognisable after 50 years as a result of normal economic decisions involving destruction of old buildings and construction of new. People aren't much good at positioning for infrequent events of great destructive power. They get bored waiting. Then they act all surprised when things go terribly wrong. Then they set up government committees to find out what happened, who was responsible, and to make sure such a terrible thing never happens again [yawn - it's surprising that they can repeat the cliche with a straight face]. Mqurice

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