Politics The Next Global Financial Crisis?

[Chief]

Worth a chat.

Should we worry when everyone will be rich on cypto-currency anyway?


http://www.smh.com.au/business/the-...ys-senior-oecd-economist-20180122-p4yyr2.html

The great disinflation of the last three decades was essentially a global "supply shock". The opening-up of China and the fall of the Berlin Wall added 800m workers to the traded economy, depressing wages and unleashing a tsunami of cheap goods. The "Amazon effect" of digital technology capped price rises. The demographics of the baby boom era played its part by boosting the global savings glut.

But there was another feature that is often neglected. Central banks intervened "asymmetrically" with each cycle, letting booms run but stepping in with stimulus to cushion busts. The BIS says one result was to keep insolvent "zombie" companies alive and block the creative destruction that leads to rising productivity.

"Everything could now go into reverse: the baby boomers are gone; China's working age population is falling; and zombie companies are going to be forced out of business at last as borrowing costs rise," said Prof White.

 

[Darkyprotector]

Worth a chat.

Should we worry when everyone will be rich on cypto-currency anyway?


http://www.smh.com.au/business/the-...ys-senior-oecd-economist-20180122-p4yyr2.html

The great disinflation of the last three decades was essentially a global "supply shock". The opening-up of China and the fall of the Berlin Wall added 800m workers to the traded economy, depressing wages and unleashing a tsunami of cheap goods. The "Amazon effect" of digital technology capped price rises. The demographics of the baby boom era played its part by boosting the global savings glut.

But there was another feature that is often neglected. Central banks intervened "asymmetrically" with each cycle, letting booms run but stepping in with stimulus to cushion busts. The BIS says one result was to keep insolvent "zombie" companies alive and block the creative destruction that leads to rising productivity.

"Everything could now go into reverse: the baby boomers are gone; China's working age population is falling; and zombie companies are going to be forced out of business at last as borrowing costs rise," said Prof White.

Thanks for the link, informative
I often Wondered why the Chinese now own the countries LMI portfolio or at least 80% of it
Makes sense to me , they get it on the cheap
Wonder if they will stimulate the housing crash by raising their o/s loan rates causing a run
MAKE NO MISTAKE IT'S COMMING and its been planned

 

[SSwans2011]

I'm personally more worried about when the Australian housing market inevitably crashes. It's essentially the only thing that maintains our GDP growth each quarter (despite the delusional bravado from ScoMo), and it just not sustainable in the slightest.

"In 1880, Melbourne was the richest city in the world, until it had a property crash in 1891 where house prices halved causing Australia’s real GDP to crash by 10 per cent in 1892 and 7 per cent the year after. The depression of the 1890s caused by this crash was substantially deeper and more prolonged than the great depression of the 1930s."



Fantastic article, by the way.

 

[Mofra]

I'm prepared. I put all my money into BeanCoins

 

[Chief]

I'm prepared. I put all my money into BeanCoins

The sky’s the limit!


On iPhone using BigFooty.com mobile app

 

[Bradesmaen]

Well if we believe our resident kook, the Jews are doing this. As such on his advice I have taken all my money out of the bank and blown it on hookers and cocaine.

On a serious side. Things like this are why I moved to the UK to have fun with my savings rather than buy a house yet.

 

[Moshie The Mook]

If China takes a big hit, do we think they will start dumping their Kew mansions? I would imagine real estate isn't the most fluid of assets.

 

[King Brown]

If China takes a big hit, do we think they will start dumping their Kew mansions? I would imagine real estate isn't the most fluid of assets.

More likely they flee China to live in them.

 

[Total Power]

Well if we believe our resident kook, the Jews are doing this. As such on his advice I have taken all my money out of the bank and blown it on hookers and cocaine.

I am waiting for him to enter the thread over a grand conspiracy to bring Australia down

But on a serious note, like you, i sold my house 4 years ago and made more than 10x times the purchase price in a little more than 15 years. Anyone can see that this is unsustainable, its not a question of what or why, its a question of when and what will be the trigger.