I think everybody including the FED realizes the housing bubble cannot be allowed to collapse because of the obvious swift adverse reaction in financial markets including the dollar. So, the game must go on. But what this does is create a kind of moral dilemma, as the participants keep pumping, assured that the FED will not pull the plug, and the FED itself powerless to stop it, and afraid to even admit there is a problem.
It reminds me of the NASDAQ internet bubble. People invested in it heard all the warnings for months and even years. Some probably thought they could get out in time before the inevitable collapse, others who were early in its recognition never partook, never profited, and may even have lost. I see the same kind of thing going on again in various markets. But this time the consequences of a collapse are more severe than ever, and few will escape.
In my opinion we are seeing the stalling of the inevitable, whilst all along hoping for a miracle which would save the world from economic collapse. And a problem downplayed, ignored, and unreported simply doesn't exist. This has been going on for a long time, and will probably go on much much longer.
There is a big ship out in the ocean, and some of the passengers on this ship can glimpse big rocks through the fog. But the Captain and crew refuse to sound the alarm, and continue to steer the boat straight ahead. Some are shivering on deck, looking for lifeboats, while most are partying downstairs. It's no fun on deck. |
