Thread: Inflationary Crack-up Boom has Commenced in the G7 Economies

Inflationary Crack-up Boom has Commenced in the G7 Economies!

Economics / Inflation
Jul 03, 2009 - 03:02 PM

By: Ty_Andros

There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved. --Ludwig von Mises

Make no mistake, we are in the latter category (total catastrophe) throughout the G7, unfolding over the next four years or less, but many opportunities are presented during these periods as these booms create Mal-Investments, MISPRICED ASSETS AND MARKETS OF ALL STRIPES; some will zoom higher and others lower. In the G7, Mal-Investments have been piling up for almost three decades as credit was turned into an entitlement and as easy money (money below the rate of inflation) became a policy of G7 central banks and banking systems. Combine this with tax, spending and entitlement policies created by public servants, mandates, overregulation and misstated inflation numbers – which generated excess demand in many UN-ECONOMIC sectors – and many of these economies have been converted into asset-backed economies. Now as the debt pyramids collapse, so do the industries, businesses, state, local and federal government programs which were supported by them.

The collapse of income and living standards in the G7 (trough misstated inflation) is combining with the “something for nothingâ€

Just for my two cents worth:

1. No American seems to think his income is sufficient. This is true from the panhandling wino to Bill Gates.
2. Thus, many jobs go to the nastiest temperament---instead of always to the capable
3. The displaced people (as I have found out) may resort to buying cheaper imported good to stay afloat--and assuming a risk that the cheaper item will function just as well and for as long as the Western or US made original. (I have bought a LOT of Chinese stuff lately.)
4. US productivity suffers--and US competitiveness diminishes
5. Foreign Manufacturers strive to do better and to fill in a broader nice in the market.
6. The meanest individuals ( regardless of their political affiliation) hold on to their jobs--eventually driving their companies into the ground or resorting to cheaper, imported labor.
7. The people cry out and elect a False Messiah, guaranteed to make things worse,