QE4 begun 2 weeks ago as FED buys bonds

To anyone paying attention to the data, the end of this debt cycle is obvious, just as it was in 2000, and 2008. ISM, Trucking, BDI, and many others all indicate that the economy is rolling over. Add that to consumer debt being higher than 2008 and it does not take Sherlock Holmes to deduce what is happening.

 

It doesn't take Sherlock Holmes to deduce non-existant patterns, either. None of the macro-economic data suggest that the economy is "rolling over."

 

Ok, since you are so confident, please by all means stay fully invested in asset classes, and we can continue this discussion next spring.

 

What asset classes are you referring to? Asset classes that I personally own (not managed by me) are primarily equities. Asset classes that I manage for my firm are mostly related to fixed income.

Regardless of which ever, if you're better on a recession "next spring," you're going to be disappointed.

 

I will not be disappointed because I am not wrong. I really do not care about convincing others, in fact the more people who believe the economy is good and markets will continue to run, the better it is for me. I remember having similar debates with real estate agents and stock brokers in 2006/2007 on forums like this and they were even more certain than you are that "this time is different" and that I did not know what I was talking about.
Most bragged about how much money they were making and laughed about how I was missing out. By 2009 they had all disappeared, and I was busy buying up bargain basement equities, foreclosures, and short sales.
There is really nothing better than sitting on a mountain of cash when the bottom drops out. The more people overpay for assets and go into debt, the better I like it, and the more money I make on the backside.

 

This time literally is different. Housing prices are cheap (nationally, anyway); equity valuations are no where near the levels they were during the Credit Crisis, or even the NASDAQ bubble; prepayment rates on mortgages are near all-time lows; interest rates are still near historic lows.

It's interesting how you're so convinced that this is similar to 2006/2007 when it appears you haven't learned much from 2006/2007.

Just because you were correct at some remote time in the pass doesn't mean that you will continue to correct in the future. I'm not sure why you think it works that way...

 

Because this is not the first time I have been to the rodeo. Yes, it is different this time. It is always different, but it always ends the same way.
If you study the history of economic cycles you begin to understand how they work. You see I did the same thing in 2001, but like I said, I am not looking for converts, please by all means stay fully invested and continue to convince others to do the same. I have done my good deed, and warned whomever is smart enough to listen, and now my conscience is clear, and I can continue to do what I do.

 

Acknowledging that bust occur is different from predicting when they will occur. Predicting recessions is very difficult and it's easy to have the benefit of hindsight when pointing out the obvious. However, if you were so convinced by your convictions in a market crash this spring, needless to say, you would be richer than Warren Buffet.

Of course, there is no such thing as a market nostradamus, because you can't predict asset prices. There are already mountains of research that demonstrates this...

 

Consumer debt was 98.44% of GDP in the 4th quarter of 2008

It's 76.26% today.

A 14 year low:

 

Debt to GDP is a worthless statistic. Household income is not linked to GDP in any meaningful way.

 

Household debt service payments as a percentage of disposable income were a third higher at their peak shortly before the last recession.


In fact, it's near 40 year lows



In fact, looking at the last 5 recessions, it's never been this low and then had a recession onset.

 

Worthless Information as usual... The debt, there should be NONE.. .People should have maybe home debt, and nothing more. There in lies the problem, CC commercials, and Banksters, propaganda telling them to borrow more. The personal debt isnt as high as it was so we should go higher ?

Is that your point ?

GDP #s are worthless anyway, you cant use the Faux GDP we are shown today. It does not include the borrowing and spending by the TRUMP REGIME TYRANNICAL output into the wall and other borrowed money Shown as GDP in today's BS-Documents... How Govt spending ever became part of GDP is beyond comprehension. Yet, Trump borrows, spends as much as need to PROP up GDP to 2.1% and then states LOOK.. .GDP GREAT AGAIN !!!!

And of course cherry picking data... "Debt service payments" laughable to even put that into the thread... But I understand, we all have a job to do, some is to lie and mislead the public...

 

You know he is right, and that is their plan here... You are right too in economic cycles. Then again, the rules, goal posts, degreg. Even how GDP is calculated has all been changed again so they can fully manipulate it all. Exactly what will happen for at least the next year. 16% increase in Govt spending last quarter and GDP up to 2.1%. That directly from them borrowing fake printed money, spending on wall, call it GDP !!!!
Amazing how corrupt this regime is and no one at or near the top doing a thing. PPT buying stock, pumping in money every day to get a GREEN close each day. Market starts to fall, they "STOP IT" literally... Slow down the collapse until algos catch up to propaganda news... New deal here, here, here... via trump tweet and market turns on garbage news.

This 27K DOW will float for the next year and be CALLED a miracle savoir by TRUMP and MNUCHIN. It does nothing for the worker except cost him fees. Those with 1B to invest can make a fortune up 3% and down 3% every month... Workers lose and nothing will change...

Just dont know why no one is doing anything...

 

Don't know what you're going on about. The Bureau of Economic Analysis has made no material changes in NIPA or GDP methodology calculations... Also, Government consumption expenditures and gross investment (government spending) only contributed 0.30% to FY 2018 GDP. It's really unclear if you even understand the metric that you're criticizing...

The rest of your post is pretty much too nonsensical for anyone to respond seriously too...

 

The stock market is a pack of lemmings, and no one knows what will cause them to jump off the cliff, or when they will, but they do from time to time.
The economy is a different story, in a debt based economy, it is fueled by purchases by debt. How long a debt based economy can contiue to grow, is based on the ability of borrowers to continue to borrow and spend which is determined by their ability to service their debt.

Many factors influence this, including the job market, interest rates, and inflation. It is a balancing act which can be upset by many factors.
At some point in every debt cycle, the consumer reaches the point where they must stop purchasing due to their limited ability to service their debt. This begins a domino effect in that their slowing purchases begin to affect the job market.. A slow down in the jobs market causes more people to curtail purchases which in turn effects more jobs...

To judge where we are currently at in a debt cycle we use leading indicator which are industries which are first to be affected by a slow down in consumer spending. We also use loan delinquency and default rates to judge if people are struggling to make payments.

The earliest signs of distress in credit cycles is in sub-prime credit markets. They are the canary in the coal mine.

 

Compound interest over time..........
We don't have a Jubilee year so they have to do something......

This is an extremely simple explanation for what is happening.....

https://www.michaeljournal.org/articles/social-credit/item/the-public-debt-problem?/plenty34.htm

 

This is good stuff. One cant forget, or I cant. Listening the James Bullard St. Louis FED Pres.)on CNBC back in April. Stating Japan has done it for 25 years, we can too.
He looks right past the 99% and onto his friends and Family. The People here will struggle as they dont in Japan. I have mentioned over and over how they take care of their own and have huge mfg. base. The one we sent to China..

The Irony for myself is that I invented something here, took too market in 2005 but could not make it here cheap enough to profit.
Guess where it is made ? The tooling costs there were 5% of here, literally. Started importing out of China in 2009. Packaged goods ready for retail came in at 40% less. With a 5% increase in price 2012 it has not changed.
I could never make it here, never !

We did this to ourselves with Supply side economics, ART Laffer and the boys duped Reagan, added in their taxes to friends and family and you get what we have here. I see you state it has too end at some point. As have the 4 or 5 other fiats from the past. England, Spain, Dutch, etc... I can see this going on for 20 more years and I will be history by then...
They own the media and have it boxed in to Identity politics, the weather, Shootings, arrests, and hollywood. Never ever the honesty in life, living, the struggles. As ABC ends each week with a PERSON OF THE WEEK and others strive for the feel good.

If Trump wins look for Kashkarry or Bullard to take over the FED and right to 0%. A helicopter drop of cash to the citizens will shut them up. Even as high as 5 - 10k. He will be a GOD to many of them... then we cycle thru as we did under Bush and the ultimate collapse. 2024-25.
We have been moving our money out of this banking system and into PM, land (if cheap enough)...
Very scary... I want out of Florida, she still has family here and if anywhere still has money flowing in it is here.
Not a bad spot to be in, just teaching my kid you dont want to be here later... Find a little mountain....

 

Oh, I an help with costs here.... But something has to be done about the Neocons. posting the same propaganda drivel over and over again. Bad enough we have it on TV.

 

According to Trump, the economy is great, better than ever...yet he demands interest rate reductions?

According to Trump, the economy is perfect, best in history...yet he needs $1.2 TRILLION every year in deficit spending?

According to Trump, lowest unemployment in 50 years, yet 60 million Americans live pay check to pay check, millions more have no pay checks, many with little to no savings?

And now more QE?

Americans need to wake up to Trump's CON GAME...