
Economic crisis 'is as bad as they come' - gibsonf1
http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2009/02/22/MNNA161178.DTL
======
moe
Useless article. I want to read about ideas how to get out of it, don't bore
me with your doomsday speeches. We already know this is "bad". It's in the
news _every day_.

~~~
Encosia
I wish I could upvote you a dozen times.

Where were these people several years ago, when raising awareness might have
actually been helpful? Now, all they're doing is exacerbating this paralyzing
crisis of confidence. It's a self fulfilling prophesy at this point.

~~~
startingup
To be fair, some of us saw this coming. Did you ever read blogs like Mish,
Daily Reckoning, Prudent Bear etc. I have read them for years (at least 7
years in some cases), and they have been saying these things, based on very
rational considerations such as historical comparisons to debt levels and so
on. Bill Bonner of Daily Reckoning, in particular, unveiled his "trade of the
decade" around 2000: sell the Dow, buy Gold based on VERY FUNDAMENTAL grounds.
At that time Dow was ~12,000, gold was around $250/ounce. Today, Dow is ~7300
and gold is at $1000/ounce. Not bad for a long term prediction.

Following a lot of their advice, at a personal level, for example, I sold my
home a few years ago (for a tidy profit), have zero debt, I am in mostly cash
+ CDs, have some gold etc. I haven't made much money on my investments (except
in gold, and except the tidy profit on my home) but I haven't lost anything at
all over the past 10+ years, simply because I didn't "play" the markets. I
have a lot of gun powder dry ... I hope to pick up some great companies at
10+% dividend yield at some point, for example.

Many people did see it coming. Most of them were the Austrian-school
libertarian types - in politics, check out Ron Paul's speeches going back
several years, as an example.

The unfunny part is that the exact types of mainstream Keynesians who _didn't_
see it coming are claiming they have the fix for all this mess. That is what
should make you really afraid. Most of us who saw all this coming think these
morons will screw it up even more than it is already screwed up. How is that
possible? Think World War III, just as one scenario or Zimbabwe/Weimar
Republic for another scenario (and a nightmare that combines World War III +
Zimbabwe, if you are really into horror stories!) ...

Is it all psychology? Absolutely not. Debt is REAL. There is nothing
psychological about 10x (or 40x) leverage. Psychology simply accentuates the
direction, but real fundamental factors are involved here.

~~~
Encosia
Sure, I saw it coming too. Saved several of my friends/family from buying in
2007 by convincing them that the converting subprimes were going to kill
housing values.

What I'm saying is that the doom 'n gloom echo chamber is not useful at this
point. It would have been useful right after Glass-Steagall was repealed, but
not now.

