It’s Official: The Crash Of The U.S. Economy Has Begun

[Admiral Valdemar]

But, but, ethanol is TEH FUTUAR!!1 It gets LOADS of subsidies and is HIGHLY profitable! Also, Ford and GM are backing it with new fleets of flex-fuel motors, and those companies are pretty solid.

Right?

[The Kernel]

There are places in California where the monthly mortgage cost is over $1500,

That's not very expensive. $1500 a month? I pay more than that. That's relatively cheap for a mortgage. That's a good price to get if you live on LI. But to contrast this there are people in the midwest and rural south that pay like 300-500.

That's half a month's pay for a lot of people. Yes, it is a considerable amount of money. Don't let your own luck blind you to the lives of other people.

He's right, $1500 is ridiculous. I pay almost twice that in RENT a month for a shitty place.

[Admiral Valdemar]

Location, location, location. It ain't the building, it's the area. They're selling garages that can fit a single car in big cities here for the price of a small bungalow.

[SirNitram]

Three bedroom apartment for a third of that. And thank the dark gods for that.

[aerius]

But, but, ethanol is TEH FUTUAR!!1 It gets LOADS of subsidies and is HIGHLY profitable! Also, Ford and GM are backing it with new fleets of flex-fuel motors, and those companies are pretty solid.

Right?

It could help quite a bit, if you use it right. The latest issue of Car and Driver has a column on how the current ethanol policy is quite retarded, and points out a better way of doing things. I did a little search and came up with the engine technology they discussed. Linky to MIT's engine design.

[Admiral Valdemar]

Help, yes. Solve, no. The problem is, the US gov't thinks throwing billions in subsidies and tax breaks will bring about energy independence from Saudi. Ain't happening, and I have an inkling Bush and co. actually know this. Cheney, at least, is not an idiot, far from it.

You know times are changing when BP and Shell sell off North Sea rigs because they're not turning a profit when oil is $71.

[The Kernel]

Location, location, location. It ain't the building, it's the area. They're selling garages that can fit a single car in big cities here for the price of a small bungalow.

You think I live in a major metropolitan area?

I hardly think Redwood City qualifies. This is just the state of affairs in general in California. People are so used to ridiculously overpriced real estate at this point we don't know any better.

[Admiral Valdemar]

My post was an example here. In the US, certain states are becoming verboten for new buyers, simply because they have more business there or are seen as a nicer area, and so migration happens until equilibrium is attained.

California is a real hot potato. I think the foreclosure number there is the highest in the US.

[Broomstick]

I seem to remember the same bullshit "Everything's fine!" coming out as Katrina hit and hours before the stock markets died in '29 and '87. You sure you want to trust these people that much?

Both those events were followed shortly by periods of unprecedented growth and prosperity. If another '87 is the concern, then I'm... not concerned.

Bullshit - particularly on the '29

America - and Europe - had lingering economic depression during the entire 1930's. Remember Germany's run-away inflation, where the money was worthless? Sure, WWII boosted the economy in some areas - although it's questionable just how much "prosperity" there was in a conflict estimated to have killed 50 million people who certainly didn't profit from that economic "boost" - but there was rationing of many basic goods (not luxuries!) right through the end of the war even in the US, and past it in Europe. The "unprecedented growth and prosperity" didn't come to the US until the 1950's - 20 years after the crash of '29 - came even later to Europe. Most of the boom of the 1950's in the US was due in no small part to the devasation and rebuilding required in other parts of the world.

[Broomstick]

All I can say is that I think my long-standing policy of trying to remain debt-free and live well within my means is the best course for the future. I'm extremely unusual in this, and for having actual savings.

[Illuminatus Primus]

Remember Germany's run-away inflation, where the money was worthless?

Weimar Germany's hyperinflation occured in 1922-1923 with the backed Rentenmark replacing the Papiermark in the Autumn of 1923 and resolving the crisis. It is not a result of the 1929 crash.

[Broomstick]

I am skeptical because of the utter lack of warnings about this. Even with the oil crunch there were people in the 70's warning about it as you saw in Crude Awakening.

I've been reading warnings about a collapse of the housing market for 2 years. Not only is the price of gasoline far higher than it was a few years ago, so is the price of food due to the cost of transporting it. There have been concerns about relatively low rate of new job creation. Bankruptcies and foreclosures are in the double-digits. More and more people are losing their health benefits. You have noticed these signs? These are not good signs, not good trends.

I don't own a car so gas prices aren't felt dirtectly by me.

Have you checked the price of food lately?

There was a recent housing foreclosure scandal that rocked the market a few months ago when foreclosures went up something like 300% because of these shitty ass hidden high interest rate high risk loans these mortgage companies were making to people.

The "high interest" and "gotcha" aspects of these loans were not hidden - it's just that too many people don't read the fine print and don't want to believe what they don't care too hear.

The market took a downward trend for a few weeks and some of these mortgage companies went out of business. It triggered a government investigation into those kind of loans IIRC and there were some lingering questions about foreclosures growing in general but I haven't followed up on it.

Foreclosures have been rising for over a year. They are extending out from the high-price cities out to where I live.

I think Valdy, one thing you have to understand is that things don't seem bad over here in terms of jobs and money. So it's hard to imagine a collapse happening like the Great Depression when everyone is generally employed and making good money. Outside looking in we may present a different picture.

Where the FUCK do you live? Are we in the same country?

It's BAD out there! We've got people going bankrupt due to medical bills. Foreclosures are rising in the double-digits. The price of housing has QUINTUPLED in my neighborhood in just five years. I make more than the US median income, yet I can not afford to buy a home where I live. More and more middle class people are being pushed further and further out into rural America, enduring longer and longer commutes, which costs more and more due to rising gas prices. In cities like Chicago 60-80 hour work weeks are routine for many, and no one dares complain because they're scared as fuck they'll lose their job and wind up at Wal-Mart with shit pay and no benefits. Which means not making their mortagage.

I'm so fucking happy life is great for you. I'm happy it's pretty decent for me. But there are a fuck of a lot of people truly suffering out there.

[Broomstick]

That's not very expensive. $1500 a month? I pay more than that. That's relatively cheap for a mortgage. That's a good price to get if you live on LI. But to contrast this there are people in the midwest and rural south that pay like 300-500.

That's half a month's pay for a lot of people. Yes, it is a considerable amount of money. Don't let your own luck blind you to the lives of other people.

He's right, $1500 is ridiculous. I pay almost twice that in RENT a month for a shitty place.

Whereas I pay just over a third of that for a 3 bedroom apartment with utilities included.

Safe to say, housing costs vary considerably.

[Broomstick]

Remember Germany's run-away inflation, where the money was worthless?

Weimar Germany's hyperinflation occured in 1922-1923 with the backed Rentenmark replacing the Papiermark in the Autumn of 1923 and resolving the crisis. It is not a result of the 1929 crash.

In that case I stand corrected - but it still does not erase the very real economic hardships of the 1930's.

[Flameblade]

I myself work in the mortgage industry, I can personally attest to the idiocy of some of these people.
Earlier today:
Me: "Sir, you do realize that your mortgage contract has an adjustable rate with no adjustment limit, right?"

Tard: "Huh?"

Me: "The bank can increase the interest on your mortgage whenever and however much they want."

Tard: "Is that a bad thing?"

Me:

I've risked being fired because I was trying to get these people to get their mortgages paid off as quickly as they could because the people get pissed off at me trying to do this! Not my boss getting pissy about what I was doing, the guy himself. He wants to have a mortgage. It's a sad statement about the average American when 2/3rds of the people I deal with either don't care about or actively want to be in debt. I can't really imagine these idiots doing anything about anything unless it padded their own fat asses and require 0 effort or "hardship".

[Uraniun235]

Suddenly, the amount of telemarketing I've been getting, focused on "debt consolidation" and "mortgage rates" and "lending", makes sense now.

[Knife]

I've been reading warnings about a collapse of the housing market for 2 years. Not only is the price of gasoline far higher than it was a few years ago, so is the price of food due to the cost of transporting it.

Perhaps it's just me, but these increases are insignificant. Broccoli at a dollar isn't that much more, relatively than...say at a buck twenty five. I don't know about you, but I'd hardly flinch at the difference; the 25 cent mark up.

Or to put it in the almight gas market; as I heard it in the new (tv so no link, I appologise) a little more than $500 bucks in a summer (high point in gas comsumption in USA). Well fuck, I can spent half that at Diseny Land, or take what? Three or four trips to the zoo or mall?

Look, I want to cut back too. Seriously, I wanted a pick up for my next vehicle and instead I'm looking at small sedan's if not alternative fuel vehicles. I want to conserve.

This isn't an issue with me in relation.

There have been concerns about relatively low rate of new job creation. Bankruptcies and foreclosures are in the double-digits. More and more people are losing their health benefits. You have noticed these signs? These are not good signs, not good trends.

This is a concern. Not personally, since I plan to actually live in my house but...

If the housing market bombs, then lots of shit head bail on hte area and local business takes a dive. Those fucking greedy shitheads they voted into local office don't have the $ they used to and need their money fix and raise the taxes on those who have stayed.

Personally, and viewing the McMansions that have sprung up around me, I realize easily that no one can live with that shit. Interest rates and all.

That said, it takes little to plow them under and create more sensible houseing

[von Neufeld]

After running all of the rebuttals to this piece through those four filters, I find ... nothing. So if the piece is so fucking stupid, why don't some of you geniuses explain why? With real reasoning this time?

Because parts of it sounds like it's written by a conspiracy nut.

Among those poised to profit from the crash is the Carlyle Group, the equity fund that includes the Bush family and other high-profile investors with insider government connections. A January 2007 memorandum to company managers from founding partner William E. Conway, Jr., recently appeared which stated that, when the current “liquidity environment”—i.e., cheap credit—ends, “the buying opportunity will be a once in a lifetime chance.”

The fact that the crash is now being announced by the Post shows that it is a done deal. The Bilderbergers, or whomever it is that the Post reports to, have decided. It lets everyone know loud and clear that it’s time to batten down the hatches, run for cover, lay in two years of canned food, shield your assets, whatever.

Translation: The Illuminati has decide to crash the economy.
[/quote]

[Darth Wong]

After running all of the rebuttals to this piece through those four filters, I find ... nothing. So if the piece is so fucking stupid, why don't some of you geniuses explain why? With real reasoning this time?

Because parts of it sounds like it's written by a conspiracy nut.

Among those poised to profit from the crash is the Carlyle Group, the equity fund that includes the Bush family and other high-profile investors with insider government connections. A January 2007 memorandum to company managers from founding partner William E. Conway, Jr., recently appeared which stated that, when the current “liquidity environment”—i.e., cheap credit—ends, “the buying opportunity will be a once in a lifetime chance.”

The fact that the crash is now being announced by the Post shows that it is a done deal. The Bilderbergers, or whomever it is that the Post reports to, have decided. It lets everyone know loud and clear that it’s time to batten down the hatches, run for cover, lay in two years of canned food, shield your assets, whatever.

Translation: The Illuminati has decide to crash the economy.

What are you, fucking retarded? They're not saying the Bushes are deliberately tanking the economy; they're saying the Bushes are making sure they will profit when the economy tanks, because they know it's coming. Where did you learn to read?

[Knife]

What are you, fucking retarded? They're not saying the Bushes are deliberately tanking the economy; they're saying the Bushes are making sure they will profit when the economy tanks, because they know it's coming. Where did you learn to read?

Kind of like the multitudes of CEO's over the last decade have run companies into the ground for personal advancement; why should we be surprised that politicians could do the same?

[Darth Wong]

What are you, fucking retarded? They're not saying the Bushes are deliberately tanking the economy; they're saying the Bushes are making sure they will profit when the economy tanks, because they know it's coming. Where did you learn to read?

Kind of like the multitudes of CEO's over the last decade have run companies into the ground for personal advancement; why should we be surprised that politicians could do the same?

I wonder how many people realize how common the behaviour of Kenneth Lay was. He was only made into a poster boy for corporate corruption when he did it on an unprecedented scale, but that kind of behaviour is routine for big company execs. Around 7 years ago, Proctor & Gamble's stock took a big dive. Does anyone know why? We're talking about a manufacturer of staple goods; the kind of company that investment analysts once called a "widow and orphan" stock because it's so safe and reliable. But it took a big nosedive because its CEO exaggerated its earnings so he could make a fortune on stock options before investors found out the truth and punished the company (and all of its other shareholders).

And what happened to him? Nothing. That kind of shit happens all the time in Corporate America, and Enron only made headlines because it happened on such a grand scale. Most CEOs are smart enough to keep the scale of their larceny limited so that it will stay off the headlines, but it's pretty much Business As Usual for them. Dick Cheney is pulling an Enron with the entire country and people are just as clueless as they were about Enron. Or Proctor & Gamble, which nobody even knows happened because it didn't kill the company and make headlines.

[Darth Wong]

The history of modern economics has been one of constant and excellent growth, and I see no reason to stop trusting these gentlemen simply because they remind you of republicans or something. The decisions I've made up to now have been very lucrative, and every indication points to that trend continuing.

You honestly don't see how we're talking about major sea changes in the global balance of trade, power, and resources, do you? You think the gravy train will go on forever, and the most we'll ever see is "cyclical variations": an assumption which treats the global economy as if it's a stable control system. But if you take the long view of history, you quickly realize that there is always massive upheaval whenever there is a major shift of economic power from one place to another in the world.

Like it or not, that kind of shift is happening right now, to a place called China. Perhaps you've heard of it. America can't keep the entire world under its thumb forever, and when the world starts to squirm out from under that thumb, there will be major economic instability. The fact that we've gone a few decades without this kind of major instability means precisely nothing; the global balance of power has been fairly stable over that entire time. When (not if, but when) the global balance of power shifts, those comfortable assumptions and trend extrapolations won't count for much.

[The Duchess of Zeon]

The history of modern economics has been one of constant and excellent growth, and I see no reason to stop trusting these gentlemen simply because they remind you of republicans or something. The decisions I've made up to now have been very lucrative, and every indication points to that trend continuing.

You honestly don't see how we're talking about major sea changes in the global balance of trade, power, and resources, do you? You think the gravy train will go on forever, and the most we'll ever see is "cyclical variations": an assumption which treats the global economy as if it's a stable control system. But if you take the long view of history, you quickly realize that there is always massive upheaval whenever there is a major shift of economic power from one place to another in the world.

Like it or not, that kind of shift is happening right now, to a place called China. Perhaps you've heard of it. America can't keep the entire world under its thumb forever, and when the world starts to squirm out from under that thumb, there will be major economic instability. The fact that we've gone a few decades without this kind of major instability means precisely nothing; the global balance of power has been fairly stable over that entire time. When (not if, but when) the global balance of power shifts, those comfortable assumptions and trend extrapolations won't count for much.

More to the point, Mike, this retard is ignoring that infinite growth is impossible. How the fucking hell can the economy keep getting bigger when there's no additional energy resources to fuel increased manufacturing and consumption? The Free Market is a goddamned free energy machine, it seems. Or, a load of fucking bullshit to anyone with half a brain.

The most worrying thing about this is how supposedly smart people even on this board are unable to grasp the fact that manufacturing, transporting, selling, and picking up things all requires energy, and there's only so much of that on this planet.

[Darth Wong]

I also like the way people are dismissing the idea of the wealthy vacuuming up more of the economy in the event of a major downturn as if it's some kind of shadowy conspiracy theory, even though that is what always happens during such upheavals. It's a two thousand year old pattern for fuck's sake. I'm sure you remember who ended up owning all the farmland after the upheavals of the Punic Wars, and it certainly wasn't the middle class.

[The Duchess of Zeon]

I also like the way people are dismissing the idea of the wealthy vacuuming up more of the economy in the event of a major downturn as if it's some kind of shadowy conspiracy theory, even though that is what always happens during such upheavals. It's a two thousand year old pattern for fuck's sake. I'm sure you remember who ended up owning all the farmland after the upheavals of the Punic Wars, and it certainly wasn't the middle class.

Ah yes, the latifunda. Well, hopefully things won't get bad enough, but on the other hand, there is some poetic justice in forcing enslaved old fat rednecks to harvest your wheat for you....