Nice try. If you are jobless,
Many of my college friends are.
one can file for bankruptcy.
Well then they would have to come up with 500 dollars or so eh? And show up to the lawyers office and fill out paperwork - they always tell me hard work pays off later - but laziness pays off now - too lazy to file bankruptcy.
This is what is going to happen.
Perhaps - I know a lot of 30 somethings that have massive debt problems but are too lazy to do the bankruptcy.
BTW, defaulting is so much less painful than paying "something" even if it is "worthless".
Yes my lazy Lebowski friends are like electricty - always taking the path of least resistance. Filing is too much aggravation.
Also, how do you expect "debasement" to decrease the debt?
Chromatic says Hoover zoomed up the printing presses - but the banks used the money to increase reserves and were not making new loans even though Hoover wanted them too - therefore hoover gave up on that strategy - also that people were throwing any cash they could under the mattress and not borrowing more for wasteful expenditure eh?
If currency debasement happens and people load up more debt how is debt reduced?
From what I understood of Chromatics arguement and his read on Rothbards books - the banks were not making new loans, the citizens were not taking on more debt. I guess mass psychology finally hit enough "loantechs" and "j6p's" that everyone shifted from borrow and spend mode to save save save mode.
Did you ever think of that?
Thinking is hard, I am lazy - I wish Chromatic would come back - he did all the hard work for us!
That is what Chromatic was not willing to understand.
Look if the banks get SCARED and instead of CORS with a 1% reserve wake up tomorrow and say DAMN - we better UP our frigging reserves and decide to take all that new gubbment bernanke helicopter money and build up reserves like the banks did in Hoover's day - why won't the result be the same - they can print and print - but people won't take on new debt and banks won't extend new credit - did you think of that?
Here read this from Herb Greenberg - people are slowing down on their debt buffet - gave me a chuckle:
marketwatch.com
SAN DIEGO (MarketWatch) -- While housing stocks have been humbled, the shares of many lenders and title-insurance companies are exhibiting remarkably strong hubris.
Investor enthusiasm? Short covering? No idea, but the stocks of such companies as Countrywide (CFC : Countrywide Financial Corp.
News , chart, profile, more
Last: 39.51+1.23+3.21%
LEND , First American (FAF : First American Corporation
News , chart, profile, more
Last: 42.21+0.24+0.57%
FAF42.21, +0.24, +0.6%)
LFG67.49, +0.57, +0.9%) are hovering at or near all-time highs.
I know, I know, I've heard the explanations: A fall-off in new housing doesn't matter because people are still getting mortgages, and the companies whose stocks are the most stable or are going higher are those that have staying power or are gaining market share. That may be true, but mortgage originations are no longer booming, at least not at the rate they once were. According to the Mortgage Bankers Association, quarterly growth in mortgage applications is bouncing around like a plane in severe turbulence, with the ground definitely getting closer
What's more, the canary-in-a-coal-mine condo glut only appears to be getting worse in hot markets such as San Diego and Miami. "From our own observations," reads a report from JMP Securities, "as well as conversations with local brokers and sales people, it is apparent that the Florida new condo market, and in particular Miami, is in a lot of trouble."
Panicky flippers?
For evidence, look no further than the Web site Condoflip.com, which matches buyers and sellers in South Florida. It recently added "condo flip panic buttons" that allows sellers to rapidly cut their prices.
Not good, you would think, for Corus (CORS : CORUS Bankshares Inc
News , chart, profile, more
Last: 29.00+0.75+2.65%
CORS29.00, +0.75, +2.7%) , a lender to condominium developers. Last quarter Miami and southeastern Florida accounted for 17% of all loan commitments. Yet its stock hovers near highs.
Memo to Corus investors ... there's more to JMP's report: "Driving through downtown Miami, one can see one empty condo building after another, sitting next to a crane and another crane in every direction. It is clear the vast majority of these units were sold on a 'pre-construction' basis to speculators looking to flip a unit, hoping to take advantage of the rapidly appreciating market. Today, most of these units are sitting empty, and sales are rapidly decelerating." Sooner, rather than later, that should matter.
Lender of last resort: The Web site Prosper.com www.prosper.com, which was founded by the same guys who started eLoan, matches people who want to lend money with those who want to borrow. It's truly a great idea, but it's also a sign of the times.
It is a credit bubble, not "printing press bubble". Also, Chromatic thought, there will be some "initial" deflation and then the printing presses will start. Do you see any sign of this initial activity? There is just going to be sweet credit deflation - but no CPI deflation. There is absolutely no hyperinflation on the hhorizon.
Mauldin did say "Muddle Through" They built a bridge once called the tacoma narrows bridge physics.brown.edu
The engineers of the day FAILED and the bridge collapsed - but I haven't seen too many engineers fugg up that royally since and not take into consideration the harmonics - other science and engineering gets better with time and 20/20 hindsight - why can't financial engineering?
If we prints lots of new dollars - but get lots of new mexicans or others to use those dollars - things dont change much eh? Print lots of dollars and the population using them doesn't grow much maybe inflation will be worse eh? |
