crap is on fire

Isn’t it awful when you see a slow-moving trainwreck unfolding before your very eyes?

Like two trains on a collision course, the speed may not be too great but the inevitability and magnitude of the crash can’t be doubted.

If only this could have been predicted or avoided somehow…

I don’t know, maybe with central banks following rules-based interest rates such as the “Taylor rule” (???) instead of breeding an environment the past 10 years of low interest rate loans to anyone with a business plan and a pulse?

Could that have helped?

Interesting times lie ahead, for sure.

Oof. Ouch. Owie. This is bad.

“Those who do not learn from history are doomed to repeat it”

The last 10 years of a roaring economy were pretty sweet weren’t they? Welp, fun’s over.

Japan’s asset bubble pop in 1989/90 showed us even a strong economy can be subject to mismanagement. In their (and now our) case, this takes the form perpetually of low interest rates and too easy loans in a roaring economy.

These low rates leave a mess in the making for when a recession actually *does* hit and rates can’t be lowered any further.

I’m not a smart man, but I would wager that “helicopter drops” and other forms of fiscal stimulus (at this point likely to be based on QE) will be only meekly effectual at best.

This is not a demand crisis a la 08, so throwing money at the issue won’t work the way it did back then. Be smart. Look at the problem from all sides. What we’re encountering is a public health, labor, and supply problem. Throw money at that instead.

Ineffectual and poorly though out stimulus could serve only serve to weaken the dollar.

#depression (with a d?)


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