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Depression On Track Says Steve Keen

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http://www.debtdeflation.com/blogs/2010/08/29/what-bernanke-doesn%e2%80%99t-understand-about-deflation/

Look at the last two tables. Total % change in demand in the US a year after the SM collapsed (2010) was -17.2%. The % change in demand in the US a year after the SM collapsed in the great depression (1930) was -16.1%.

2011 and 2012 could be interesting years.

Watch for people trying to sell cars at the roadside to get food, and long lines at the soup kitchens.

:(

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2011 and 2012 could be interesting years.

That's when we will find out but it's happening right now and started about 6 months ago.

We are today back to levels reached at the bottom of the 08 contraction and seemingly falling right past them.

What I find amazing is that just about everybody is oblivious to the fact.

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That's when we will find out but it's happening right now and started about 6 months ago.

We are today back to levels reached at the bottom of the 08 contraction and seemingly falling right past them.

What I find amazing is that just about everybody is oblivious to the fact.

Just to support the above (I was going to write a big post with the excellent correlations with slowing industrial prod numbers everywhere etc. but that will have to be for later if ever), here are a couple of charts that show what has been going on. They are based on real time discretionary consumption in the US (the UK is in phase with the US) and so about 3-6 months ahead of better known statistics:

http://pragcap.com/viewing-the-great-recession-in-hi-def

commentary_2010_contraction_watch.png

monthly_weighted_composite.png

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In the comments section someone asked Keen if he regretted becoming an economist - his response:

Hi soho,

I couldn’t tell you how many times I’ve wondered how I might have fared had I chosen a different career (as a physicist, which was my first preference when I was a child) in which I could truly stand on the shoulders of giants, rather than economics, where I’ve had to stand on the toes of pygmies.

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Thanks for those _w_.

Is it due to the vacuum caused by the withdrawal of stimulus?

That's what so fascinating. If you look at the dates, you see that the stimulus didn't make one blind bit of difference either way!

This is the new normal: no new credit, underfunded pensions, excessive debt, etc.

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Yes

Put off buying anything except essentials and food. Everything is starting to get cheaper; the sales are better and better. The bargains I have had recently in clothing and shoes are outrageous. Food and fuel is going up and will continue to do so. The soup market is stable........but bread will soon go up. The number of people requesting allotments has spiked up enormously all around the country. The amount of net mortgage lending has all but ground to a halt. The HPC is here and here to stay for a while.

Edited by plummet expert

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Put off buying anything except essentials and food. Everything is starting to get cheaper; the sales are better and better. The bargains I have had recently in clothing and shoes are outrageous. Food and fuel is going up and will continue to do so. The soup market is stable........but bread will soon go up. The number of people requesting allotments has spiked up enormously all around the country. The amount of net mortgage lending has all but ground to a halt. The HPC is here and here to stay for a while.

Spot on. Every bit of inflation being generated is moving straight to commodities at the moment, bypasses wages, investments, etc.

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Put off buying anything except essentials and food. Everything is starting to get cheaper; the sales are better and better. The bargains I have had recently in clothing and shoes are outrageous. Food and fuel is going up and will continue to do so. The soup market is stable........but bread will soon go up. The number of people requesting allotments has spiked up enormously all around the country. The amount of net mortgage lending has all but ground to a halt. The HPC is here and here to stay for a while.

I know this is only anecdotal, but ALL of the dental section (brushes, paste, mouthwash) are half price in Sainsbury's at the moment. OK, so the entire store isn't halfprice (never mind the wine & spirits :P ), but who is underwriting this price-cut, and why? It's normally the manufacturers, but EVERY manufacturer together?

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I hear that production of Aboo has reached its possible maximum and its down hill all the way from here. Civilisation as we know it is under grave threat. Peak Aboo is a warning to the world.

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My ten year floss hoard is already laid in. :D

Aye, but watch out for that biodegradable stuff. Old biodegradable carrier bags have already been causing Tesco a load of grief.

Have stocked up on favourite toothpaste and mouthwash... Now there's an inflation hedge.

Not sure if the masses will be as concerned for their teeth when gold hits £6000/oz and they can't afford steak tho.

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Aye, but watch out for that biodegradable stuff. Old biodegradable carrier bags have already been causing Tesco a load of grief.

Have stocked up on favourite toothpaste and mouthwash... Now there's an inflation hedge.

Not sure if the masses will be as concerned for their teeth when gold hits £6000/oz and they can't afford steak tho.

They might worry about their teeth if they can't afford dentists, though.

Just in case, I have a collection of old Welsh recipes involving mainly bread, water and skimmed milk (the cream was used to make butter to sell to pay the rent in times past).

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I know this is only anecdotal, but ALL of the dental section (brushes, paste, mouthwash) are half price in Sainsbury's at the moment. OK, so the entire store isn't halfprice (never mind the wine & spirits :P ), but who is underwriting this price-cut, and why? It's normally the manufacturers, but EVERY manufacturer together?

Supermarkets do the dictating nowadays, they set the deals and ask/tell the manufacturer to supply/price accordigly.

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My ten year floss hoard is already laid in. :D

I've been buying bog roll mega packs on a two-for-one basis for a while now. It has the double benefit of being cheap as well as providing excellent loft insulation whilst in storage.

The only downside is that the abundancy of bog roll in my house means I tend to use more sheets, with value being in the marginal unit etc., which slighly erodes the 50% discount. On balance though, you can't go wrong with buying big in the bog roll sector.

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I've been buying bog roll mega packs on a two-for-one basis for a while now. It has the double benefit of being cheap as well as providing excellent loft insulation whilst in storage.

The only downside is that the abundancy of bog roll in my house means I tend to use more sheets, with value being in the marginal unit etc., which slighly erodes the 50% discount. On balance though, you can't go wrong with buying big in the bog roll sector.

You and me too pal. I've also gone long Fairy Liquid and washing powder. Tesco Colour tabs used to be £2.12 pre NorthernRock/Lehmans, and are now £3.50 for the same amount, so glad I stocked up. The recent 50p-for-a-bottle-of-oldstyle-fairy-at-ASDA was amazing. I've invested the savings into upgraded sentry guns for my storage shed. :ph34r:

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Guest spp

You said that about 2009 and 2010.

You ever heard of food stamps? 40 Mil + in America...the modern day soup kitchen!

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I find it all terribly musing how everyone is complaining about how bad things are now. They are like worms, complaining how awful it is that they have just been introduced to the concept of 'hooks' but are, as yet, blissfully unaware of the concept of 'fish'.

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I've been buying bog roll mega packs on a two-for-one basis for a while now. It has the double benefit of being cheap as well as providing excellent loft insulation whilst in storage.

The only downside is that the abundancy of bog roll in my house means I tend to use more sheets, with value being in the marginal unit etc., which slighly erodes the 50% discount. On balance though, you can't go wrong with buying big in the bog roll sector.

Cut out the middle man and put wads of fivers up there.

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You ever heard of food stamps? 40 Mil + in America...the modern day soup kitchen!

It's about 46-48 million IIRC. And another 40 million eligible.

That's 25% of the US population on welfare or at least classified as "in poverty". And 21% long-term unemployed.

Sounds like 1930 to me.

Edited by AvidFan

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  • 245 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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