My record with economic predictions is certainly better than it is with political predictions, so I'll make a prediction about which result will happen. Just for fun, since I'm not aware of how to place bets on this question.
I predict that if the crack-up happens while there is still a central bank in the US, and the US dollar is still the world's reserve currency, that the Federal Reserve will do everything it can to try to prevent a collapse, by papering over the crash. After finding an alarming (to them) lack of success, they'll urge whomever is President to declare an emergency, and that everybody's financial assets will be thrown in the pool. This pool will allow the government to collateralize everyone's former assets to cover all the government's debts, including the debts of foreign governments.
The result will be the fantasy of Klaus Schwab, as everybody will own nothing, and they'll all be happy. Or as Thomas Sowell put it, "Socialism is the equal spreading of misery."
Kevin, The Weimar Republic tried this in the 1920's by taking 20% of everyone's savings and giving them government bonds in return. This led to a collapse in confidence in the German Mark and hyperinflation (those images of wheelbarrows of money to buy a loaf of bread.) People were not happy. The streets were full of fighting communists vs. right wing WWI veterans which ended up spawning the National Socialist Party (Nazis) and Adolph Hitler. Let's hope the idiots at the Fed don't follow this example.
I'm somewhat hopeful, too. But hope is never a winning strategy. Based upon their history, I have little faith in the government doing the right thing. I am usually surprised if they do the right thing, when I usually expect them to do the exact opposite of the right thing.
Most governments are composed of sociopaths, who find it more to their liking if they can create rules for others to follow. It doesn't matter to them if those rules are productive (usually they are not); they just get a high from bossing others around. In other words, an administrative state that has no sense of morality.
"..........declare an emergency, and that everybody's financial assets will be thrown in the pool. This pool will allow the government to collateralize everyone's former assets to cover all the government's debts, including the debts of foreign governments."
Well said Kevin Beck. Your hypothesis is not unlike The Great Taking - David Rogers Webb.
We are already experiencing a drop in quality of life and life expectancy in the USA. I expect this trend to continue. The lockdowns did so much damage to children and the economy it will take generations to recover. The Soviet Union never did recover from WWII and is only doing so now due to the rise of Putin and his group. I expect that the USA will take the same course as the Soviet Union.
I watched many different financial gurus state their predictions at so many different predictions of course a few will be right maybe by coincidence so then will be the gurus
I am going with the money printing prediction hopefully won’t get badly burned lol
As per “Rosy projections are not causal; real productivity gains take time, and don't always play out as projected. If AI eventually boosts productivity across the entire economy, is may take a decade to play out. The current credit-asset bubble that's popping will not be "saved by AI."
When the steam engine came to be people designed the mill the same way as when a water wheel was the power source
One big steam engine driving a network of pulleys and belts
Then the electric motor came along and the used one giant electric motor was used to replace the steam engine
Then someone said electricity flows through wires so we can use many smaller motors and get rid of all those belts and pulleys
My record with economic predictions is certainly better than it is with political predictions, so I'll make a prediction about which result will happen. Just for fun, since I'm not aware of how to place bets on this question.
I predict that if the crack-up happens while there is still a central bank in the US, and the US dollar is still the world's reserve currency, that the Federal Reserve will do everything it can to try to prevent a collapse, by papering over the crash. After finding an alarming (to them) lack of success, they'll urge whomever is President to declare an emergency, and that everybody's financial assets will be thrown in the pool. This pool will allow the government to collateralize everyone's former assets to cover all the government's debts, including the debts of foreign governments.
The result will be the fantasy of Klaus Schwab, as everybody will own nothing, and they'll all be happy. Or as Thomas Sowell put it, "Socialism is the equal spreading of misery."
Kevin, The Weimar Republic tried this in the 1920's by taking 20% of everyone's savings and giving them government bonds in return. This led to a collapse in confidence in the German Mark and hyperinflation (those images of wheelbarrows of money to buy a loaf of bread.) People were not happy. The streets were full of fighting communists vs. right wing WWI veterans which ended up spawning the National Socialist Party (Nazis) and Adolph Hitler. Let's hope the idiots at the Fed don't follow this example.
I'm somewhat hopeful, too. But hope is never a winning strategy. Based upon their history, I have little faith in the government doing the right thing. I am usually surprised if they do the right thing, when I usually expect them to do the exact opposite of the right thing.
Most governments are composed of sociopaths, who find it more to their liking if they can create rules for others to follow. It doesn't matter to them if those rules are productive (usually they are not); they just get a high from bossing others around. In other words, an administrative state that has no sense of morality.
"..........declare an emergency, and that everybody's financial assets will be thrown in the pool. This pool will allow the government to collateralize everyone's former assets to cover all the government's debts, including the debts of foreign governments."
Well said Kevin Beck. Your hypothesis is not unlike The Great Taking - David Rogers Webb.
That was exactly what I had in mind when I wrote it; I just couldn't think of the author's name.
https://www.youtube.com/watch?v=QTNZL2XACVQ
We are already experiencing a drop in quality of life and life expectancy in the USA. I expect this trend to continue. The lockdowns did so much damage to children and the economy it will take generations to recover. The Soviet Union never did recover from WWII and is only doing so now due to the rise of Putin and his group. I expect that the USA will take the same course as the Soviet Union.
I watched many different financial gurus state their predictions at so many different predictions of course a few will be right maybe by coincidence so then will be the gurus
I am going with the money printing prediction hopefully won’t get badly burned lol
As per “Rosy projections are not causal; real productivity gains take time, and don't always play out as projected. If AI eventually boosts productivity across the entire economy, is may take a decade to play out. The current credit-asset bubble that's popping will not be "saved by AI."
When the steam engine came to be people designed the mill the same way as when a water wheel was the power source
One big steam engine driving a network of pulleys and belts
Then the electric motor came along and the used one giant electric motor was used to replace the steam engine
Then someone said electricity flows through wires so we can use many smaller motors and get rid of all those belts and pulleys
That took decades
So AI applications face similar issues
David Lentz: See this link!
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