Agreed Astro. I'm very stressed about
the future of the economy.
Anyone who knows me knows I've been predicting just this type of economic event for a couple years. To me, the rising wealth inequality, political discord, but more importantly, the financial recklessness and rising leverage and indebetness that the fed is encouraging, spelled trouble. I said, time and time again, I cannot predict what it is that is going to tip this thing, but it HAS to happen. I said corporate executives are doing the same thing that the bankers were doing in 2008 w/ mortgages by buying back shares, and t will end badly. Treasury yields would go to 0, they'd start massive QE and fiscal stimulus once the system blows. Its all happened. I had no idea it would be corona, but the catalyst doesnt matter, it was inevitable.
Now a pandoras box has been
opened. This will end up being very good for the middle class RELATIVE to the wealthy, but bad for everyone. The only positive is that wealth inequalty hit a high in february of 2020 with the stock market. Never again will we see the same combo of low wages, low inflation, high stock market and free markets. The positives are that there will be a focus on allocating capital where it can do the most good, not just towards creating financial leverage. There will be retrenchment of globalization, which means more pricing power for the middle class. The negatives are that capitalism as we knew it is dead. They have
opened the pandoras box of transfer payments. There will be exhorbitant spending, which will have to be paid for by taxes and inflation. The dollar and all fiat currency is over. Gold is going to the moon. Inflation is going to pick up. If you have any wealth, hedge yourself.
I've literally been saying for 2y that the irony is that we're heading into the "roaring 20s", but unlike the 1920s, these will be roaring for another reason.
Post Edited (dcd2103) : 4/6/2020 12:50:58 PM (GMT-6)