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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Hawkmoon who wrote (98896)	6/24/2009 2:18:00 PM
From: Skeeter Bug	1 Recommendation Read Replies (1) \| Respond to of 116555

HM, but you would agree there is a difference between owing oneself with money left over (japan) and relying on the goodwill of others to finance one's debt (usa). this makes the last 20 years of japanese history very different from what the usa is facing now - especially since the last 20 years didn't have a world wide collapse. japan going forward may well be very different than japan in the past - precisely because folks aren't buying as much of their stuff. while i see some mutual benefit between lender/supplier and borrower/buyer, i don't think it is as strong as some would believe. how long do you throw good money after bad? i'll bet you don't see the good ole usa ever balancing its budget, let alone paying down the debt. nobody i know believes we will ever balance the budget. ever. assuming this is true, and i believe it is 100% true, it is insane to lend us money knowing we will never pay it back without turning up the speed on the printing presses in a massive way. like you, i see a shorter term economic collapse view that drives the markets and commodities lower, but that even will likely end up being the trigger for several trillion in newly printed money lining the pockets of friends of obama. every year, year after year. i find it hard to believe that 10x (20x? 50x? 100x?) the money will somehow ending up being worth more - even if the average person is poor. i speak medium to longer term. short term, i think everything heads down. i've read that if you take the cost of the government obligations and promises and divide it by the number of current workers, the average is over $500k each. that just isn't recoverable. with the boomers voting in people who promise to spend more money on them, fiscal soberness isn't around the corner. in fact, i expect the fiscal drunkenness to get worse. the government works for the bankers and they get rich off the debt and hand outs that bankrupt the rest of us. have you seen what happened to credit card holders? 12% rates jumped to over 25% rates. wait until our creditors decide to do what our banks are doing to our own people.