November Stock Talk II

 In sum, if we are witnessing the collapse of the USD as the reserve curency (I think so) and the beginning of serious, long term stagflation (I think so as well), if memory serves the way out previously was a sharp rise in interest rates by Paul Volcker and its consequence, sharp increases in unemployment. Compound that with unfunded pension liabilities, the demographic nightmare Baby Boomer drains of underfunded SSA programs, and you have a rather gruesome mix.

 As other countries try to quietly do what Jimmy Rogers has already publicly done (dump every last dollar they have and switch to other currencies/assets), I am not very optimistic regarding the FED or any other governmental arm being to prevent what, ironically, they created in the first place.

 It will be a rude awakening to a generation accustomed to thinking that the US dominated the world. It used to,in 1945; now,  it no longer can even guaranatee to its citizens the availability of imported oil upon which it depends.

 The amount of wealth and power the American public has squandered in a mere 50 years is staggering. At least it was a bipartisan effort...

 

What I find as peculiar is these guys claim to be economist, yet they are trying unsuccesfully to change economic cycle..which is the basic thesis of that which they claim to serve?

In the name of stopping a recession they are causing an even more serious situation by selling our assets at discount prices and creating more of an inflationary bubble, rather than let the US and world economies demand slow and let the cycle run its course?

  Becasue the are/have been trying to put off a serious recession, which should have already occurred.By putting it off, they make what come about much worse when it arrives.

  Here is the scenario I see:

  1.Future cuts as the employment figures (totally off ) are realized to be way off. Election year pressures make Bernanke cut further, then, when dislocations and the dollar his absolutely written off as the world's reserve currency, he will have to place raise interest rates sharply to prevent the USD from total freefall .Unfortunately, he will be forced to do so right during a recession, and naturally that will seriously deepen the recession.Much higher unemployment, much higher interest rates, much higher food costs (already occurring)
  2. As that occurs,some relief to the dollar may occur when the Democrats essentially announce departure from Iraq, but it will be later seen for what it is, a total defeat of US, further encouraging Iranian determination.Straits of Hormuz possibly blocked to further squeeze their old arch enemy.
  3.Russia, despite help from commodity prices, will continue to deteriorate. Saudi stability also is seriously in play once the Americans bail in the region.Oil prices go higher and remain there, locking in higher and higher prices.

A wicked cycle. If the central banks cannot prop up the USD, some how some way, it could play out like the above. Sure hope not.

I don't like negativity, but let's face reality.......I mean the bleak future is so obvious......even a moron could predict it.

The only thing that could prevent the coming doom is like a new invention that creates jobs, makes money, and changes the outlook for the future.

The only other thing would be LONG TERM in scope, and that is a world wide population purge.  The interim would be horrible, though, since the only thing that could purge the population would be war, disease, famine.

Let's also face this.....people aren't just going to wake up tomorrow and come to this prudent conclusion:

"You know what, honey, the world is too over-populated as is, so let's just not have any children, OK?"  And the reply......"You know what, honey, I was thinking the exact same thing."

claycourt,

I am rooting against your Isreal prediction because biblically speaking that is the spark of what starts to end the world..

  The odds are good that it happens. Israel is such a tiny country, it could easily be destroyed by a few nuclear strikes.

 I do think the Israelis will make certain they destroy Iranian abilities to do that (and should they wish to, Pakistan's as well) if they really thought it to be close to occurring.

 They gave a small sign of that willingness by previously bombing the Baghdad nuclear plant in 1981, and most recently (and eerily underreported and unprotested by the Syrians themselves) of a site in Syria supposedly containing nuclear materials imported from N.Korea.

 The Israelis are not going to stand for a repeat of Auschwitz:they will take anyone and everyone out with them if it comes to that.

Back to stocks:The most recent( I think) Top Ten market cap stocks.GOOG and Buffett...wow...

1.  EXXON MOBIL (XOM)   $505.38B
2. GENERAL ELECTRIC (GE)  $415.58B
3. MICROSOFT CP (MSFT) $333.99B
4. AT&T (T) $251.26B
5. GOOGLE (GOOG)  $219.48B
6. PROCTER GAMBLE (PG) $216.99B
7. BANK OF AMERICA (BAC) $214.24B
8. CITIGROUP  (C)  $210.37B
9. CISCO SYSTEMS (CSCO) $199.84B
10. BERKSHIRE HATHAWAY (BRK'A; BRK'B) 200.01B

One person's comment regarding this was :

I believe that the last company to ascend so quickly to the top 10 was Enron.

 Is that true? Sounds like it, makes one wonder...