U.S., Europe Headed Towards Another Depression?
For some, warnings of a U.S. economic slowdown go beyond a recession. From the CNBC website this morning:
The end result of the global economic slowdown may be the U.S. announcing national bankruptcy as the government cannot afford the bailouts that it promised and the market will not bail out the government, Martin Hennecke, senior manager of private clients at Hong Kong-based Tyche, told CNBC on Thursday.
“We expect a depression in the United States. We expect a depression, very possibly, also in Europe,” Hennecke said on “Worldwide Exchange.”
Hennecke, who previously worked as an investment adviser at Hong Kong’s Bridgewater Ltd. and is a frequent guest on CNBC and Bloomberg Television, explained:
The estimated $300 billion cost of the Fannie/Freddie bailout will probably be considered as a loss that the government will have to take, therefore passing it on to taxpayers, he explained.
“We already have $3 trillion of debt, as far as the U.S. government is concerned. These debt figures across the U.S. economy are rising very sharply.”
When the government can no longer pass the United States’ “immense debt” on to taxpayers, it will turn to the holders of U.S. dollars, leading to the eventual downfall of the currency, Hennecke said.
“Definitely, it (the dollar) is not a safe place to be invested in, as real inflation is closer to 10 or 11 percent than the actual inflation numbers given by the U.S. government,” Hennecke said on “Worldwide Exchange”.
“Better than Charmin?”
Source:
“Bailouts Will Push US into Depression: Manager”
CNBC, September 11, 2008
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September 11th, 2008 at 6:07 pm
Gaaah — and you should trust them why? Because they have a spiffy web site?
September 11th, 2008 at 6:34 pm
I just shat myself…
September 12th, 2008 at 8:02 am
Thanks for the comment Scorpio.
“Gaaah — and you should trust them why? Because they have a spiffy web site?
Not sure if I’d trust them, but I thought their forecast was interesting enough to share with everyone.
As to their website, it is kind of spiffy, now that I’ve looked at it a second time.
September 12th, 2008 at 8:10 am
Thanks for the comment George L.
“I just shat myself…”
Someone get than man some Bernanke dollars, pronto!
September 12th, 2008 at 10:00 am
Great minds think alike - the other day I was wondering whose face should appear on the coming $Million Bill - Bernanke, Paulson, or bush?
————————————————-
Regarding Europe’s recession/depression, it now appears that this crisis, which arguably started here in the US, will spread around the world.
That’s right - we are heading into a worldwide depression.
Now - the question is - how do we not only survive, but also make a profit off of this?
-Mammoth
September 12th, 2008 at 3:37 pm
This is news? No we have been envisioning this for about two years at least, you can’t rack up this kind of debt and continue paying the bills. The best chance anyone has to survive this is to own gold and some silver. If you don’t own coins or bars, but digital gold from Bullionvault.com , GoldMoney , Anglo Far East, Pecunix , Webmoney (WMG). Make sure it’s allocated gold where you own the actual metal. America will survive but the dollar index will be dropping to around 52, so say the experts. Do that math equation….52
Mark Herpel
Skype IM ‘digitalcurrency’
September 12th, 2008 at 7:14 pm
It is transparent and funny paper simple. The Fed and Tresury are doing everything possible to push off the admission of their raw economic failure until the election.
The Infamous ” Plunge Protection Team” has been likely interfering with the markets with particular focus, as of late on the cost of petroleum, to push off the inevitable securities market collapse.
Paulson is reported to have set, in July, a target of $100 dollar oil by election time. Today, in the face of IKE, oil fell to that price. I would speculate that the drop in price ( future sales) has been indemnified by the Strategic Petroleum Reserve.
I further suspect that December will see a major sea change as the criminals prepare to get out of town. Secret public policy dictated by politics. Stand back it may be violent.
September 15th, 2008 at 2:05 pm
Thanks for the comments Mammoth, Mark, and bindlepete.
September 15th, 2008 at 3:54 pm
Wait till after the elections, and the real shat hits the fan
September 15th, 2008 at 4:04 pm
How long can some big firms keep loaning billions to other firms to keep them afloat ? at some point there just will be a true collaspe of the house of cards held together by worthless paper assets backing up other other worthless worthless assets
September 15th, 2008 at 11:46 pm
I f the events of today dont scare you shit less than you wernt paying attention in history class, the depression happened as a result of several facotors, agricultural crisis, stock market crashes bank failures that set of a rash of withdrawls, and war, but didnt world war two come after the start of the depression? very good you were paying attention but you forgot about world war one. we boomed for a short decade after that then….the crash today we have agricultural crisis( hurricanes, tornados, floods and an overproduction of corn with out balancing it with other crops) bank failures, loss of thousands no im sorry hundreds of thousands of jobs lost, a war that weakened our economy (remember the world wars we had our women and men who couldnt fight building the weapons we used,…. today we buy them from foriegners) there has been a run on the first bank that failed and with todays wall street crisis we are facing not only a crash equal to the one of 1929 but more private investors than ever before who very likely will begin to sell out of panic, our government is in debt more than any other point in the history of our nation. ever hear the saying ‘he who pays the piper calls the tune’? well after years of tax cuts we couldnt afford and a war economy that benifited some of our enemies rather than us you can be sure we stand a real chance of loosing the right to call our own tune stop wondering if we are heading towards a depression turn the recorder on your vcr( if you still have one) on and know that you are witnessing history because it just started
September 16th, 2008 at 8:29 am
Thanks for the comments Tom 5129 and wildrosegypsum. I believe most Americans still underestimate the severity of our economic situation. Doesn’t surprise me, as Washington, Wall Street, and their cronies won’t level with them. And, it’s not like the American public is financially literate or pays attention to current events anyway. Oops, gotta go, my favorite reality shows are on…
September 18th, 2008 at 12:12 am
sometimes (even though i am a woman) i really dont like it when im right good luck all we are going to need it
September 18th, 2008 at 7:55 am
Thanks for the comment wildrosegypsum.
“sometimes (even though i am a woman) i really dont like it when im right good luck all we are going to need it”
My sentiments exactly…