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Europe in Depression. Worse than the 1930s.; Another kick in guts for the property bulls.
Topic Started: 17 Aug 2014, 11:03 PM (3,421 Views)
goldbug
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Europe hasn't recovered, because it hasn't let itself. Too much fiscal austerity and too little monetary stimulus have, instead, put it more than halfway to a lost decade that's already worse than the 1930s. It's a greater depression. And as the latest GDP numbers show, it's not getting any less so.

 Indeed, the eurozone as a whole didn't grow at all in the second quarter. Neither did France, whose economy has actually been flat for a year now. Germany's economy fell 0.2 percent from the previous quarter—and that after revisions revealed it had quietly gone through a double-dip recession in early 2013.

Though that's still much better than Italy: Its GDP also fell 0.2 percent, but its triple-dip recession has now wiped out all growth since 2000. The closest thing approximating good news was that Spain's dead-cat bounce recovery continued with 0.6 percent growth. But it still has 24.5 percent unemployment.
Full Story
http://www.washingtonpost.com/blogs/wonkblog/wp/2014/08/14/europes-greater-depression-is-worse-than-the-1930s

In the 1930's depression the thing that destroyed more businesses than anything else was the debt they carried. Debt it the killer in times like the one we are entering. Income goes down but the debt remains the same and it must be serviced.

Those who trimmed down and got oit of debt in the past decade will survive. Those have taken on loads of debt will be screwed. The good debt meme is only valid in times of strong economic growth and those days are long gone.
Shadow was hopelessly wrong about the Gold Bull Market.
What else is he wrong about?
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lulldapull
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GB, once the BRICS agenda starts getting implemented in earnest, I believe the world would be a very different place than as we know it currently. The way things are going, with Bretton Woods/ IMF/ WB on the road to being bypassed, along with the USD's reserve currency status..............shit, it's not gonna be pretty.

The EU along with the U.S. are an economic basket case.
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goldbug
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The brics are clearly preparing for a gold standard lull, they have been stockpiling for a decade now. In the great depression the gold standard was alive and well and facilitated trade in a time of great uuncertainty. Whether they use that gold outside of their block is unknown, probably they will, if they can get the same in return.

The arabs have a lot of gold too, they have golden bath tubs so they will be quite happy to trade oil for something tangible. But neither they nor the west will do well in the years to come I expect but they will certainly do better than the west. Especially considering all the welfare liabilities we have, which will never be paid unfortunately.

Worse still I think is that most of the wealth Australians and other westerner countries have is paper backed wealth, stocks in corporations that are inflated well beyond their actual value. Property is another classic disaster but those owning it can't see this. What use are 6 overvalued homes in a depression? If you can't sell them and no one can afford to rent them.

Lets be honest, the majority of people who rent are on low incomes and are not otherwise financially secure. Sure they can rent now, while employment prospects are okish and the welfare system is still intact. But take those away and look out below as far as rents are concerned. Property is also paper backed, mortgages are paper, debt, so much investment property hangs under the counter party risk Axe as well.
Shadow was hopelessly wrong about the Gold Bull Market.
What else is he wrong about?
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The beginning of the end came in 1971 when Nixon saw the threat against the dollar that was much stronger back then when it still had some backing by comparison to today.

They did not have enough gold to cover the dollars in the system and people were trading in their dollars for gold. He realised that if people did keep cashing in their dollars for gold , their dollar would become weaker , gold would rise, and that if it continued , all the gold would be gone and all they would have is this worthless paper because they had already started overprinting dollars before this when they had particially removed themselves from the gold standard.

So 1971 was the beginning of the end. In the video below of nixon in 1971, nixon promises to keep the dollar safe and valuable, he sees the threats of emergimg markets with cheaper labour as a threat, but nothing at all like the threat china is now.

So like all politicians, he is a liar and completely full of shit.

Lets see how his promise to keep the dollar strong has worked out against REAL money :bye:

In 1971 , gold was $35 dollars an onuce. If I put my thirty thirty five dollars away under my pillow for the last 43 years and that ounce of gold that cost $35 dollars back in 1971, how would they go today, has the dollar kept its strength as Nixon promised us, let's see....Today that gold is worth $1300 dollars, and would buy you a top quality tailored suit, how bout those thirty five dollar coins I put away, what would that get me, a pair of crappy boxer shorts. So how has nixons promise worked out, did the dollar keep its strength and value as he promised it would, or has it become the worthless piece of shit he quaranteed it to become when he removed the dollar from what security it still had.

Quick, buy now, or be priced out forever :bye:


http://www.youtube.com/watch?v=iRzr1QU6K1o&feature=youtube_gdata_player
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Perthite
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Not to mention Japan, the third largest economy is well any truely headed back into recession.

This is some global recovery.
Edited by Perthite, 18 Aug 2014, 12:10 PM.
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Count du Monet
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Periods of strong market growth seem connected with the exploitation of new technologies and resources. Post WW2 we saw world oil production increase 10 fold in a generation. There was a lull in the 1970's but computer technology as a new marketable item suddenly appeared around 1980 (it saved the FED's bacon) and remained strong for almost a generation with mobile phones and similar as the last hoorah. These things drove vast investment potential.

I'd say we are in another lull. It remains to be seen if new materials and processing technology will make a difference in the next decade.
The next trick of our glorious banks will be to charge us a fee for using net bank!!!
You are no longer customer, you are property!!!

Don't be SAUCY with me Bernaisse
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Foxy
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Zero is coming...

Time for global warming to make a come back.
Dumb and dumber is need.
Peter
Read "Tax"
http://www.afr.com/content/dam/images/g/n/2/1/u/8/image.imgtype.afrArticleInline.620x0.png/1456285515560.png
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Jimbo
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18 Aug 2014, 10:25 AM
The beginning of the end came in 1971 when Nixon saw the threat against the dollar that was much stronger back then when it still had some backing by comparison to today.

In 1971 ,gold was $35 dollars an onuce.

Quick, buy now, or be priced out forever :bye:


What you say is true and comes straight from the lips of Peter Schiff, Mike Maloney and James Rickards.

Good advice.

But meanwhile, there are just as many "respected economists" telling us to buy the Dow or Sydney property.

The first rule of investing is not to buy what others are desperate to sell when they claim that prices can only go up (because derr, they wouldn't be selling would they?)




Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be :?: rising.
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goldbug
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If you go back and look at the timeframe of depressions beginning at the 1929 one you will see that they were regular every 20 or 30 years but they were short in extent. What was basically happening was a short rapid credit expansion, leading to mal investment and the like and then a collapse with the loss of capital in bankruptcies and bank failures.

Gold acted as a regulator in this, in a sense preventing the money printing and debt issuance by the various banking cartels from distorting the economy to any great extent. With the legalization of a central banking cartel, this rapid boom bust cycle still continued. But when gold was removed as currency and people had no option but to store wealth in paper the cycle broke down and we have seen a massive debt buildup the likes of which the world has never seen that began around the late 1930's when that depression ended. It started with borrowing to fund WWII and hasn't let up since.

The 1971 event was really about forestalling a depression. By 1971 the debt in circulation, including the US paper currency which is debt backed, was big enough to trigger a collapse and depression. Gold was signaling that by going up in price outside of the $US $35 an ounce system. Elsewhere in the world is was trading up to $100 an ounce.

When the US defaulted on gold as an international terms of trade settlement it opened the door to a credit expansion beyond comprehension. What this had led to is just insane. Average working people owning 8 and 10 times their annual income just to buy a house. Average young adults with tens of thousands of dollars in credit card debt. Nations owing 100, 150 and 180% of their GDP, and the GDP has been manipulated so much that it now includes the very debt they owe!

The entire system is one big shell game, one big fantasy where people believe they are wealthy and their retirment savings are huge, yet they don't own anything in most cases because it is all basically debt with the belief that future growth and inflation will allow them or others to pay for it. Well that worked up until 2008 but it's becoming clearer by the month that the game is over.
Shadow was hopelessly wrong about the Gold Bull Market.
What else is he wrong about?
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cokatoo56
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what could the US do to re boost their economy for real ? (as past stimulus, like their $700 billion injected by the gov, didn't prove to be working)
(hint : it worked tremendously well in the 20th century)
Edited by cokatoo56, 19 Aug 2014, 08:24 PM.
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