World Financial Collapse Imminent

[Cowperson]

Originally Posted by Pinner

OK your both crazy

At this point who would buy American bonds ?

I'm amazed interest rates haven't spiked through the roof, 22% interest rate like in 1982 would cripple the economy.

Are you serious?

The one thing I love about money is that it has no friends or loyalties. It's like a river, flowing the easiest course.

In the worst moments of 2008, when the world genuinely stood on the abyss and even the Chairman of the Royal Bank wondered if his institution was going to make it, where did everyone flee too?

Where did all the money go to in the moment when overwhelming fear was upon us?

The USA dollar and USA Treasury Bonds.

At one point in early December, 2008 , short term USA treasuries were trading at negative yields, meaning distrust of the financial system was so acute that investors were willing to pay the USA government to hold their money for them. The USA dollar was soaring in that period as everyone left all the other currencies in the world and fled to the place they felt gave them the greatest security in the face of impending calamity.

There can be no more genuine moment of pure honesty than that one.

Seriously, you need to take off your blinders and take a look at the world around you.

A sell-off in the USA dollar from the extremes of 2008 is more of a vote of confidence in the growing stability of the global economy than any condemnation of America's fiscal position.

The panic money is leaving and heading back out into the world again.

Just remember what everyone did when the fear was overpowering. A very instuctive moment.

Cowperson

[Clarkey]

The National debt of Canada or the USA doesn't look as menacing when broken out by person.

Debt PopulationDebt/Person

Canada
Debt $ 566,700,000,000
Pop. 34,330,000
Debt/Person $ 16,507

USA
Debt $ 14,000,000,000,000
Pop. 308,745,538
Debt/Person $ 45,345

[Pinner]

Originally Posted by Cowperson

Are you serious?

What do I know ?

Despite interest rates edging up, US bond rates have lost, 1.40% down to .60, seems to me there are better places to put money, like silver.

[WilsonFourTwo]

Originally Posted by Pinner

OK your both crazy

At this point who would buy American bonds ?

I'm amazed interest rates haven't spiked through the roof, 22% interest rate like in 1982 would cripple the economy.

Honestly - given the financial situation of the average Westerner, I think anything like 1980's interest (18-22% range) levels will lead to total and absolute rebellion, perhaps even national collapse.

To hell with the nation - citizens simply do not have the financial capacity to carry their debt with interest at that point. The dominoes would (imo) probably start falling pretty quickly. That said, I doubt we see double-digit interest rates for many, many, many, many years.

[yads]

Originally Posted by Pinner

What do I know ?

Despite interest rates edging up, US bond rates have lost, 1.40% down to .60, seems to me there are better places to put money, like silver.

Interest rates edging up where? The Fed Funds rate hasn't moved from 0.25% since december 16, 2008. The US bond yields going down, signifies that prices are going up. This means people are buying US bonds for more money than earlier.

[firebug]

Originally Posted by 1stLand

Even 566.7 Billion is too large (Canada).

The system is definately broken.
If it wasnt for our oil and gas reserves, we would have a pretty bleak future as a country.

That video was spot on. Western Nations have lost their ability to produce and manufacture goods competitively.

Materialism and consumerism is out of control. The amount of entitlement American and Canadian citizen's have is worrisome.

This is incorrect. We are just even better at things that provide a better return than manufacturing. Look up comparative advantage.

Think of it this way... Do you know how to make your own blue jeans or repair your own car? (neither do I)

Do you panic about that fact?

Most of us are better at other things than those two examples so we do and get paid for what we are good at and hire someone who is good at other things to do them for us rather than do it ourselves.

The same principles hold true on a national level.

[macker]

[QUOTE=Mr.Coffee;2985846]Let's not use the word energy prices when we really mean oil prices. Nat gas is part of the answer moving forward and achieves multiple solutions to problems American people have identified. And it benefits Albertans / Canadians, greatly.






More to it than just oil....look at coal, electricity and uranium prices.....(all moving up)..China and India are supposed to increase coal imports by 78% this year to $337 million metric tons further driving up prices and diverting supplies from Europe to Asia.

Reports from China indicate that the country plans to increase its nuclear capacity from its current 11 gigawats to at least 80 gigawats by 2020. 14 Nuclear power units currently under construction, the largest number of power units under construction in the world. There is legitimate global demand competing for energy and it is driving up more than just the price of oil. I agree though that Natural gas will eventually move much higher.

[blankall]

Originally Posted by Clarkey

The National debt of Canada or the USA doesn't look as menacing when broken out by person.

Debt PopulationDebt/Person

Canada
Debt $ 566,700,000,000
Pop. 34,330,000
Debt/Person $ 16,507

USA
Debt $ 14,000,000,000,000
Pop. 308,745,538
Debt/Person $ 45,345

You've taken Canada's federal debt and the USA total debt. Canada's total debt (which includes provincial debt as well) is about twice the federal debt.

[CaptainCrunch]

Originally Posted by 1stLand

That video was spot on. Western Nations have lost their ability to produce and manufacture goods competitively.

Its not that they've lost their ability, its that we as Western Nations can't compete.

We have to pay people a living wage, while other manufacturing nations pay people a tiny sliver of that cost.

We have quality control, developing nations, and especially china don't

We have safety requirements that add costs, workers are disposable.

We have benefits that other nations don't have

We have patent that are protected, while other nations steal the design

We're dealing with foreign currencies that are intentionally depressed so that their pricing is even lower.

There is a measure of environmental protection in North American manufacturing that doesn't exist in developing nations.

American's and Canadians' know how to manufacture products, we're dealing in an unfair market that protects developing nations.

At some point you're going to see a higher level of market protectionism in North America to bring those cheaper products to an equal bearing.

[Ark2]

Originally Posted by MoneyGuy

If you're crazy then so am I. There will be no world financial collapse. It will take time but the mammoth U.S. economy will emerge from this and the sun will rise again in the morning.

Exactly. I think it will be several years before the economy turns around, but I don't believe that this massive financial collapse is immanent. Most people simply see the escalating US debt and come to these wild conclusions without really have any knowledge of global economics. As long as people continue to have faith in the American dollar, the US will be fine. The reason that people won't lose faith in the dollar is because they really have no where else to turn.

[CaptainCrunch]

The last thing that anyone wants is a collapse of the U.S. economy.

For as much as a mess as it is, it still drives the rest of the world economies especially in terms of trade. I believe that the U.S. runs a trade deficit with most of its trading partners right now.

I think that is one area that has to be addressed for the U.S. to recover.

[mikey_the_redneck]

Originally Posted by firebug

This is incorrect. We are just even better at things that provide a better return than manufacturing. Look up comparative advantage.

Think of it this way... Do you know how to make your own blue jeans or repair your own car? (neither do I)

Do you panic about that fact?

Most of us are better at other things than those two examples so we do and get paid for what we are good at and hire someone who is good at other things to do them for us rather than do it ourselves.

The same principles hold true on a national level.

America was a manufacturing juggernaut. Once upon a time they made the best of everything.....

Now, with "free trade", you have American middle-class labor directly competing with 3rd world slave labor. The result of this, is that middle-class jobs are being sent offshore to save costs for the big corporations, and these jobs are being replaced with service industry jobs, that generally pay much lower on average.

http://www.huffingtonpost.com/2011/0..._n_827360.html

By merging the western middle-class labor pool with the rest of the world, the standard of living will be merged as well, and Americans will be living like Mexcans/Chinese in no time.

[Ark2]

Originally Posted by macker

More to it than just oil....look at coal, electricity and uranium prices.....(all moving up)..China and India are supposed to increase coal imports by 78% this year to $337 million metric tons further driving up prices and diverting supplies from Europe to Asia.

Reports from China indicate that the country plans to increase its nuclear capacity from its current 11 gigawats to at least 80 gigawats by 2020. 14 Nuclear power units currently under construction, the largest number of power units under construction in the world. There is legitimate global demand competing for energy and it is driving up more than just the price of oil. I agree though that Natural gas will eventually move much higher.

So what do you think, start investing in uranium?

[mikey_the_redneck]

Originally Posted by CaptainCrunch

The last thing that anyone wants is a collapse of the U.S. economy.

For as much as a mess as it is, it still drives the rest of the world economies especially in terms of trade. I believe that the U.S. runs a trade deficit with most of its trading partners right now.

I think that is one area that has to be addressed for the U.S. to recover.

The American trade deficit totalled $6.1 trillion from 2000-2010....yikes.

http://www.wnd.com/index.php?fa=PAGE.view&pageId=267889

[Azure]

I actually don't think the problem is that serious.

The US just needs to implement a fair tax, with some additional taxes for the 'rich' people, and cut $500 billion from the budget immediately.

Sure, people are going to suffer, but that is the price you pay for spending money like crazy for so long.

[Mazrim]

Originally Posted by Azure

I actually don't think the problem is that serious.

The US just needs to implement a fair tax, with some additional taxes for the 'rich' people, and cut $500 billion from the budget immediately.

Sure, people are going to suffer, but that is the price you pay for spending money like crazy for so long.

Ah, if only it was this simple. You'd think they would have done this by now.

[CaptainCrunch]

Originally Posted by Azure

I actually don't think the problem is that serious.

The US just needs to implement a fair tax, with some additional taxes for the 'rich' people, and cut $500 billion from the budget immediately.

Sure, people are going to suffer, but that is the price you pay for spending money like crazy for so long.

Its the $500 billion thats tough to handle. If you're going to cut you're going after the major rails of their government policy. Social Programs, or defense.

The U.S. military budget is at $664 billion, which sounds like a lot, but it represents 4.3% of their GNP. Now I get numbers anywhere from 664 to 948 so who knows, it looks like their biggest budget chunk is pensions at 900 billion.

[macker]

Originally Posted by Ark2

So what do you think, start investing in uranium?

Yep.....Saskatchewan is where it is at CCO is core!

[Phanuthier]

Originally Posted by Cowperson

Are you serious?

The one thing I love about money is that it has no friends or loyalties. It's like a river, flowing the easiest course.

In the worst moments of 2008, when the world genuinely stood on the abyss and even the Chairman of the Royal Bank wondered if his institution was going to make it, where did everyone flee too?

Where did all the money go to in the moment when overwhelming fear was upon us?

The USA dollar and USA Treasury Bonds.

At one point in early December, 2008 , short term USA treasuries were trading at negative yields, meaning distrust of the financial system was so acute that investors were willing to pay the USA government to hold their money for them. The USA dollar was soaring in that period as everyone left all the other currencies in the world and fled to the place they felt gave them the greatest security in the face of impending calamity.

As I understand it, its not that there was obscene trust in the USD, money was being piled into US TB's from the 401k's being stashed away as the lesser of 2 evils to the equity MF's - so its not trust in the dollar at all. Especially when the value of the dollar is so heavily dependent on the industries that were drowning, or did I get something wrong?

[troutman]

Which will happen first?

1) World Financial Collapse
2) Eco-system Collapse
3) The Rapture
4) Canucks Win the Stanley Cup