GFC Part Deux

[Sidewinder]

Round #2, ding ding.

Most of the (pathetically weak) regulations and procedures brought in in the wake of the 2008 GFC in the US have been scrapped by Trump. The exact same nonsense is again rampant in the US housing market. The stock market is over-heated. Vast amounts of toxic sludge remains on the books post-2008 because no real effort was ever made to take the pain and clean up the mess.

Extend and pretend is running out of road and the wheels are starting to wobble. And this time most of the world is already at ZIRP so there's no ammo left (not that I think ZIRP is the correct response anyway, in fact I remain firmly convinced that particular piece of economic orthodoxy is insanely illogical voodoo)

The wheels won't fall off just yet, and predicting when these things turn (or what precisely triggers the reversal) is impossible....but there's a fierce whiff of 2006/7 about numerous economies including the US, UK, OZ and NZ. If I had to put $20 on a prediction, I'd say March/April 2019 myself. But almost certainly at some point in the next 18 months.

[pluralist]

Agreed. Ireland also.

[disability student]

Video refers to the American model. Ireland's model quite distinctly differs but Ireland's economy total reliance on America and GB still up to now.

Housing bubble already in Dublin as CB in IFSC hadn't saying it now. High rents coupled with low income earnings from multi nationals- mismatch which forced others to move out of Dublin with possible loss of jobs or continue renting with nothing left in their savings for future home buy etc.

Most of the multinational/foreign companies profits goes out of Ireland. Also the issue of Irish sovereign debt not paid off but extended to longer periods thus it could affect Irish govt state of economy. Most of corporation taxes mostly 80% came from MNC with a scenario of nothing set up of another tax stream to cover possible loss of corporation taxes.

Also FG govt finance bills were amended or altered at last min to suit the vulture funds/REIT's with a huge consequence of evictions thus in turn, rise of homelessness (possible no voting rights cos u need an address). In reality we are starting to realise that FG doesn't give a damn about us even with FF backing. Double doses of treason and betrayal.

Watch out for contagion effects- for example, Iceland and Ireland economies started to go off the rails which affected America later the rest of the world. Italy now on the spotlight cos of their huge debt bigger than Ireland. But it doesn't excuse Ireland cos their debts being extended to longer periods instead of paying it off. Greece debt is irreparable for decades to come- ever increasing cycle of debts in the eurozone. No financial independence for Ireland as they are strangled slowly over time by the euro masters in Frankfurt.

Could see financial crash coming but don't know when. It's just a matter of time.

[Sidewinder]

Even the FT is finally starting to have doubts about the wisdom of the last 10 years of ZIRP lunacy. And we've hit a yield inversion which means we're definitely on the train to Crashville. The trigger will likely be something random and stupid that the orange monkey in the White House says/does, but in all fairness and as much as I loathe that wretched scumbag, the oncoming collapse actually won't be Trump's fault. He'll get the blame though. Which is fine by me

https://www.ft.com/content/97c1e8da-...1-31da4279a601

[Apjp]

Good thread Sidewinder, and not before time, but I do not see the markets crashing before 2020. Many of the corporations and big banks actually want Trump back in purely cos of his tax cuts. An externality can cause it though as you say.

The zero interest rate policy always made zero sense to me. How else is an ordinary worker supposed to get on in life if he can no longer expect interest rates of 3-4% from his bank on his savings? The banks have turned the tables since the 80s and all their customers now are in debt, propping up the bank's balance sheet, with nothing going out by way of interest. People have largely forgotten it but low interest rates on your mortgage isn't saving you money in the long run, in all likelihood you're losing a lot more money by not getting anything back on your deposits.

As regards Dublin, on an income of 1200-1500 quid in Kiev(slowly rising as I get more freelance translating and writing/teaching work on top of my main marketing job), and paying 200 odd quid for rent, you are actually better off materially than someone earning 2500 or 3000 quid in Dublin and that's the truth.

Of course Ireland has no control over interest rates or monetary policy now anyways so we are powerless to do anything whenever a recession breaks out.

Europhiles will then point at all the weak currencies like the UAH or the Russian Ruble or the Turkish Lira out there but I'd still rather take my chances with a devaluation or interest rate hike every few years than face endless austerity and endless humiliation by the ECB.