Summer Crash?

[errolanderson]

Realize I’m stirring the pot here . . . but a lot economically simply does not add up . . . in-the-least.

The Fed is now at-a-crossroads. Their power of massive money printing forcing liquidity into markets and debt-at-no-consequence is forcing temporary inflationary pressures. But now, the Fed realizes the gig-is-up. Their magic power supporting ballooning bad debt is waning economically. Bang-for-the-buck fading . . . .

They have to either now ‘tamper’ stimulus which in-english means; the stock market will have to learn to swim on-its-own as money printing is losing-its-shine. OR ‘unwind’ meaning sluff-off their debt and possibly push rates negative which is not a sign of healthy inflation. OR stay-the-course bloating markets with money that needs a home and let true economics tip the ship over naturally.

Pick your poison . . . .

So what did this money printing rescue mission create? Insane real estate values that are unsustainable. Land values that are unsustainable. Funds parking money in commodities like there is no tomorrow (except cattle). Imaginary products that have no value, just hype that are suddenly worth more than corporate America. Let’s invent, the investor will buy. Banks are sitting on massive amounts of cash. Valuations have NO meaning.

But, the economy is recovering. And there are no consequences, we are told.

[agstar77]

You mean NFT 'a are not real? Bitcoin not real? I suppose you don't believe in Santa Claus or Hesus ? What could go wrong?

[bucket]

Well if you index grains it seems we are still not being paid enough in correlation to what it costs to grow food for a so called hungry world.....


You think manufacturers are going to drop there prices?????

[errolanderson]

Well if you index grains it seems we are still not being paid enough in correlation to what it costs to grow food for a so called hungry world.....


You think manufacturers are going to drop there prices?????

Yup . . . .

[jazz]

So long as the fed is buying 100s of billions per month in treasuries and MBS, the party continues....until it doesnt.

Digital currency ushers in negative rates next as they try to inflate away the debt.

I dont know how this one ends. One day we will wake up and canola will be $2 or something.

[Sodbuster]

It’s time for the feds to start raising interest rates and recognize the inflation we are having. The longer we wait to raise rates the harder it will be on the economy.

[errolanderson]

It’s time for the feds to start raising interest rates and recognize the inflation we are having. The longer we wait to raise rates the harder it will be on the economy.

My opinion, that was be a disaster. Banks could go under with defaults. This hole is far too deep . . . .

[biglentil]

Basel III goes into effect for European banks June 28th rest of the world early 2022. Arguably the biggest monetary policy and banking system shakeup since Bretton Woods and the quasi gold standard was abandoned 1971. 'Inflation temporary' is a total lie we haven't seen nothing yet, and when the everything bubble pops dollars will be confetti.

“By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”

~ John Maynard Keynes

[GDR]

Realize I’m stirring the pot here . . . but a lot economically simply does not add up . . . in-the-least.

The Fed is now at-a-crossroads. Their power of massive money printing forcing liquidity into markets and debt-at-no-consequence is forcing temporary inflationary pressures. But now, the Fed realizes the gig-is-up. Their magic power supporting ballooning bad debt is waning economically. Bang-for-the-buck fading . . . .

They have to either now ‘tamper’ stimulus which in-english means; the stock market will have to learn to swim on-its-own as money printing is losing-its-shine. OR ‘unwind’ meaning sluff-off their debt and possibly push rates negative which is not a sign of healthy inflation. OR stay-the-course bloating markets with money that needs a home and let true economics tip the ship over naturally.

Pick your poison . . . .

So what did this money printing rescue mission create? Insane real estate values that are unsustainable. Land values that are unsustainable. Funds parking money in commodities like there is no tomorrow (except cattle). Imaginary products that have no value, just hype that are suddenly worth more than corporate America. Let’s invent, the investor will buy. Banks are sitting on massive amounts of cash. Valuations have NO meaning.

But, the economy is recovering. And there are no consequences, we are told.

Care to share what you have done personally to prepare for such an event? I don't disagree with your suggestion, I just dont know what we can do about it. I'm doing the same I have always done, live within my means and pay down debt as I am able, lock in a few forward sales and just carry on. Investment wise, doesn't sound like real estate will be any better off, likely not great moving to cash either?

[errolanderson]

Basel III goes into effect for European banks June 28th rest of the world early 2022. Arguably the biggest monetary policy and banking system shakeup since Bretton Woods and the quasi gold standard was abandoned 1971. 'Inflation temporary' is a total lie we haven't seen nothing yet, and when the everything bubble pops dollars will be confetti.

“By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”

~ John Maynard Keynes

Unfortunately for Keynes, he is dead wrong in this economic environment. Great for economic textbooks though!

[ajl]

Right now the central banks have two choices and no one like either: let interest rates rise or eliminate the currency. The former was the choice made in 1980 to deal with runaway inflation and is the smarter of the two choices now. Banks will collapse but that is something that needs to happen in canuckistan anyways as our banking sector is way too big. Start now with consolidating banks so it will not be as messy later.

[foragefarmer]

Hard to believe what poster's put in print on Agriville.

One feels Canadian banks should operate not for profit. Hard to believe someone who supposedly runs a business and is capitalist would even make such as statement. I guess he runs his farm as a not for profit business and that's why he suggests the Cdn banks should run as a cooperative. I guess deep down inside he did support the CWB.

Then the other makes a claim Canadian banks should consolidate, eliminating competition for Canadians needing to borrow money and 10's of thousands of jobs for Canadians. Putting Canadians on the unemployment line collecting EI, less Canadians paying income taxes and the Government deficit increasing. Sounds like someone suffers from a Harpo hangover who made the case for this preposterous idea when he was in opposition. Thank goodness for Paul Martin.


The Cdn big six banks employ 100's of thousands of Canadians and have trillions in assets, who operate throughout many countries. Canadian banks are a business success.

Always negative towards any Canadian from these two.

[biglentil]

Unfortunately for Keynes, he is dead wrong in this economic environment. Great for economic textbooks though!

Really dead wrong? Keynes understood fully that printing money was the surest way to destroy capitalism and enslave a population. The elite are tickled pink with how well its working and how only 1 in a million understands it.

I agree the banking sector is in big trouble all part of the plan.

[jazz]

One feels Canadian banks should operate not for profit. Hard to believe someone who supposedly runs a business and is capitalist would even make such as statement. I guess he runs his farm as a not for profit business and that's why he suggests the Cdn banks should run as a cooperative. I guess deep down inside he did support the CWB.

I agree totally. Canadian banks should be able to operate at a profit, but regulated to prevent gouging and bad loans.

If people want non profit lenders there are local credit unions and FCC.

Personally because the banks operate as businesses, they are a lot more business friendly than CU or FCC. But each to their own.

[WiltonRanch]

Someone smarter than me please explain why banks need to be for profit?

I hate the obscene profits banks and credit card companies enjoy but if you decree banks be credit unions or such, it’s veering down the road of communism. Sometimes we’d be better if we had more than 5 or 6 major banks for competition but 1000 banks like in the USA is unfathomable. The reason Canadian banks have been successful has been successful is the regulation employed by the feds to limit stupid lending practices which like in the states helped create the 2008 lending crisis with NINJA loans and such. I feel there should be more economic tests employed for loan approvals to prevent sinking ones unable to fulfill their obligations. Credit is a privilege not a right but in my 20 years of being a borrower I’ve seen it getting too bloody easy to attain credit. I think it’s a result of the entitled attitude of younger generations who never seen tough times, and a large supply of funds, coupled with government too afraid to let the house of cards fall. It used to be a lender wouldn’t want to give you too much rope but now they’ll give you a whole coil if you want. It’s scary.