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Is The Us Going To "politely Default" ?

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There are only a few forms of possible "polite default" :

1. Inflation

2. A substantial devaluation of the Dollar

3. Very high withholding taxes on interest payments made to non-residents.

In order of likelihood and probabality of success, I think that the 3 -> 1 path is much more likely than the 1 -> 3 path.

3. will leave QE as the only remaining funding route which will make 1. inevitable but will delay it for a few years.

I do agree with TMT's implication that the US (collectively and not just at the Federal level) are probably worse off than the EZ. The US are rapidly using up all of their "reserve currency" priviliges and will reach the point of no return quite quickly.

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The only booming US State is Texas and there is an large movement there to rejoin the Commonwealth - I kid you not.

Perhaps we should take advantage!? :blink:

Texas is one of the few states that has explict LTV caps and MEW limits that held firm during the boom and bust which has left housing there affordable regardless of what happened in the rest of the country.

I do not think that their success is a coincidence

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Texas is one of the few states that has explict LTV caps and MEW limits that held firm during the boom and bust which has left housing there affordable regardless of what happened in the rest of the country.

I do not think that their success is a coincidence

Exactly! That is the medicine needed here and as soon as properties return to sensible prices the Coalition should put in theses controls to prevent a repeat in 15 years time.

The answer to the Question is most definitely 'not on the face of it'. There will be QE printing away the debts and this will cause a massive devaluation the USD over time. No need for the USA to ever actually appear to default, but default it is in all but name. The UK will have to do somemore too before the end of 2011. But in the short term the USD will rise whilst the 2nd leg down beds in and any 'crash' happens over the coming months.

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Exactly! That is the medicine needed here and as soon as properties return to sensible prices the Coalition should put in theses controls to prevent a repeat in 15 years time.

The answer to the Question is most definitely 'not on the face of it'. There will be QE printing away the debts and this will cause a massive devaluation the USD over time. No need for the USA to ever actually appear to default, but default it is in all but name. The UK will have to do somemore too before the end of 2011. But in the short term the USD will rise whilst the 2nd leg down beds in and any 'crash' happens over the coming months.

Medicine doesn't work so well if the patient is already in a terminal state. That is the problem with many other states and the industries and activities that those states relied on long term to bring in welath - most driven out by raising costs.

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Medicine doesn't work so well if the patient is already in a terminal state. That is the problem with many other states and the industries and activities that those states relied on long term to bring in welath - most driven out by raising costs.

At the risk of sounding macabre, there are many patients that cannot be saved no matter how much money we throw at them.

The cost of "heroic" medicine which only serves to delay the inevitable but not the outcome is a cost that society cannot afford to bear.

QE / ZIRP / stimulus / zombie banks is the fiscal and monetary equivalent of heroic medicine.

We need to better understand the relationship between spending and outcomes before we spend blindly.

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Texas is one of the few states that has explict LTV caps and MEW limits that held firm during the boom and bust which has left housing there affordable regardless of what happened in the rest of the country.

I do not think that their success is a coincidence

Lucky Texas only half-heartedly entered the Union, so it's much easier from them to escape from Communism/Obama.

I wouldn't recommend their embassy restaurant though except, for the yellow rose.

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There are only a few forms of possible "polite default" :

1. Inflation

2. A substantial devaluation of the Dollar

3. Very high withholding taxes on interest payments made to non-residents.

In order of likelihood and probabality of success, I think that the 3 -> 1 path is much more likely than the 1 -> 3 path.

3. will leave QE as the only remaining funding route which will make 1. inevitable but will delay it for a few years.

I do agree with TMT's implication that the US (collectively and not just at the Federal level) are probably worse off than the EZ. The US are rapidly using up all of their "reserve currency" priviliges and will reach the point of no return quite quickly.

The US will give us a good view of what would have happened to the UK if a left wing gov had remained in power.

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  • 150 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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