3 ms·

Systems fail in many different ways. Its not that the market can never fail, that would be an absurd claim. They are less likely to fail along the lines that th

by pm90 4y ago

Systems fail in many different ways. Its not that the market can never fail, that would be an absurd claim. They are less likely to fail along the lines that they failed before. What we’re seeing instead is people fearing a repetition of the same mistakes and the same failures.

lamontcg 4y ago
Yeah it won't literally be a repeat of 2001 or 2008. I mentioned CMBS which along with crypto are the fairly safe bets on what will meltdown this time, and they weren't involved (or didn't exist) last time. The script also tends to vary. I was quiet surprised that the markets had a fit over the 1% fed funds rate and was caught a bit off guard. They're announcing very directly though that they're going to invert the yield curve. They are quite concerned about wage inflation. They are more than willing to tank the economy to get it under control and are invoking the name of Paul Volker. There is no way we get out of this with a "soft landing" and things are going to detonate. Then the fun really begins because the political climate is going to be much worse than 2008/2009. The Tea Party Republicans ostensibly claim to be against any kind of bailout and they'll be willing to play chicken with the entire economy in order to harm the Biden administration. It is pretty obvious that it is going to be somewhat different this time. The idea that policymakers will magically navigate us through these waters though harkens back to the Clinton/Greenspan era of policy. But we don't even have anyone like "The Maestro" running the show this time. Wages are out of control and they're going to crash the economy to get them back under control. That's what they do. They haven't figured out anything magical to avoid the pain, and they always underestimate what kind of chaos it will cause.

3 ms·

Systems fail in many different ways. Its not that the market can never fail, that would be an absurd claim. They are less likely to fail along the lines that th

by pm90 4y ago

lamontcg 4y ago
Yeah it won't literally be a repeat of 2001 or 2008. I mentioned CMBS which along with crypto are the fairly safe bets on what will meltdown this time, and they weren't involved (or didn't exist) last time. The script also tends to vary. I was quiet surprised that the markets had a fit over the 1% fed funds rate and was caught a bit off guard. They're announcing very directly though that they're going to invert the yield curve. They are quite concerned about wage inflation. They are more than willing to tank the economy to get it under control and are invoking the name of Paul Volker. There is no way we get out of this with a "soft landing" and things are going to detonate. Then the fun really begins because the political climate is going to be much worse than 2008/2009. The Tea Party Republicans ostensibly claim to be against any kind of bailout and they'll be willing to play chicken with the entire economy in order to harm the Biden administration. It is pretty obvious that it is going to be somewhat different this time. The idea that policymakers will magically navigate us through these waters though harkens back to the Clinton/Greenspan era of policy. But we don't even have anyone like "The Maestro" running the show this time. Wages are out of control and they're going to crash the economy to get them back under control. That's what they do. They haven't figured out anything magical to avoid the pain, and they always underestimate what kind of chaos it will cause.