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

To: SouthFloridaGuy who wrote (104467)	11/18/2009 6:38:34 AM
From: axial	1 Recommendation Respond to of 116555

I tend to agree with your views... "Commentary on SI threads seems more like post-traumatic stress disorder, complete with apocalyptic visions." Message 25923322 Message 25923717 --- However, for a number of reasons (derivatives, growing and intractable debt, transformational change, inflationary potential, rising energy costs, etc.) I also think another unpredictable event will destabilize things badly, perhaps catastrophically. Schumpeter has been denied again. A crash was averted by unprecedented intervention. Fiat money and interventionist economics seem intuitively wrong, in that they postpone true reconciliation of realities. Who knows when reconciliation will come? Until it does, where can we see the extent of the damage? In currency: "The final guarantor in financial crises is the economy itself; specifically, dilution of the currency. The public bears the burden, distributed over time: "all at once" provokes collapse. Talk about "moral hazard", while justified, ignores the fact that there are only two choices when these crises occur - collapse (which serves no useful purpose) - or spreading the pain. So in fact, there's only one choice. The likelihood that the currency (as opposed to guilty players) will pay the price increases with the size of the transgression. When other parties become too numerous or too big to fail - the currency itself will pay, and the outcome will be distributed fractionally on every man, woman and child: even the poorest." Message 24665654 Jim