The Shape of Things to Come, by Robert Gore
Take another look at the natural gas chart. It’s been over seven years since the price topped out, and it is still only about 20 percent of what it was then. In the bad old days of something closer to dog-eat-dog free market capitalism, downturns were vicious, but they were comparatively short. Gluts in raw materials and crops, intermediate and finished goods, and employment were fixed by falling prices and wages, liquidation and bankruptcy, and newly cheap assets moving from the weak and indebted to the strong and solvent. The depression of 1920-1921 is the most recent example. It was brutal, but it was also over in less than two years (see The Forgotten Depression: 1921: The Crash That Cured Itself, James Grant, Simon and Schuster, 2014) as the government and the Federal Reserve sat on their hands. (The Fed actually raised rates!)
In today’s no-pain-allowed environment, it took seven years before two natural gas producers even went bankrupt. The chart illustrates the harm from the Fed’s ultra-low interest rates, now in their 80th month. They have been perpetual life support for terminally-ill companies for whom the machines should have been turned off long ago.
This is an excerpt. For the full article click the link above.
In today’s no-pain-allowed environment, it took seven years before two natural gas producers even went bankrupt. The chart illustrates the harm from the Fed’s ultra-low interest rates, now in their 80th month. They have been perpetual life support for terminally-ill companies for whom the machines should have been turned off long ago.
This is an excerpt. For the full article click the link above.
The way to survive the coming depression or war will be to move Off-Grid at a distance from heavily populated urban areas and to be self sufficient. See www.texanhomeenergy.com.
If we allow Cap & Trade, governments will control all energy from the grid and we have lost the last vestiges of freedom.
I have designed an Off-Grid Micro-Grid Solar Energy System that will economically provide all of the energy and water needs of Off-Grid Communities
If we're going to let giant companies fail I'd just as soon it be the ones that have taken unfair government favors, such as Trump's casinos or the ten biggest banks.
Along with others like me I'm still asking where's my car?
Things in my corner of the economy are going well. Vendors, customers, and I can raise prices reasonably but it's not an inflationary fire that people in fantasy-land describe. Whatever my wife and I don't invest in our own businesses, you say we should be putting under the metaphoric mattress in short-term Treasuries. A year ago we started looking into commercial RE. Its valuations are on the high side just like equities. You post every week in favor of the metaphoric mattress. It's feels safer putting it in intermediate-term bonds, which have been a volatile version of the "mattress" for the past year, i.e. the point when we started getting nervous about equities.
It's just so counter-intuitive to "invest" in something controlled by the Fed that the Fed has set up to lose 2% (short-term Treasury yields minus inflation). That's speculation. Investment is giving it someone with a good a idea. Holding short-term Treasuries just feels like paralysis.
Thanks again for the free economic advice you provide.
Shat about the things you sell? Have you been able to raise the price of whatever you sell by 10% a year without losing business?
This is an unfortunate situation where everything other people are selling is getting more on expensive but not the thing you're selling. Put another way, what you're selling is getting cheaper. That's a painful situation. You need to figure out how to provide the stuff people are paying more for. That's easy to say and very difficult to do. I admire people just taking that risk and trying and admire it even more when they find a way to be one of those people raising prices, adding more value.
Would this apply even to the price of mfr'ed goods themselves and to services, or is just business valuation?
If it applies to services, would it apply to services that have existed in a similar form since antiquity?
I know I can't discuss monetary policy for long w/o going there, but the question is genuine and thinking of it that way is a crass reminder that the "economy" isn't black magic but rather hordes of human beings of their free will doing the sometimes-unplesant work to give each other what they want so they can get what they want.
I see what you're saying, but I call this gov't dicking with the economy rather than the economy itself.