What next ? The cycles are getting higher in amplitude like the system is unstable. The smart money gets bigger as its rolling through making the bulge bigger as it progresses through time. Also evident is that the smart money coherent so they are talking to one another. By working in unison the price of said commodity is driven up. It may be casual talk but the message is getting through one way or another. The supply of internet connectivity and housing went up. However boom and bust is inefficient. Rather than overshoot its best when systems are near critically damped. This is the type of bad system behavior that get greedy liberals talking about taxing the crap out of us. You can just hear them think. Look at all that money. I need to get a piece of that. We MUST tax that. Of course we must its to help "the little guy". Here little guy suck on this. The real solution is to keep interest rates higher. Reduce their liquidity. Unfortunately in the rush to save us from the "housing crisis" they are flushing a bunch of liquidity like adrenaline to an anaphalactic shock victim. Notice only AFTER the housing slow down occurred did oil REALLY start shooting up. By all rights the economy slowing down should have decreased oil demand. But it did not. You really can not hide oil for very long. Seems like the cost of money and storage will kill you. Thus my hypothesis will be tested shortly. Oil is a currency issue. Not a supply issue. However since oil is so necessary I’m not sad to see it. The supply needs to go up. Congress needed to be told as they were by the head of Shell oil that they are a part of the problem. The good side effect is that the smart money is attacking a weak point in the system. Another good side effect is that electric car development has quite noticeable gone into high gear. As previously written I think the main good side effect of electric cars is not the hoax that is global warming but rather people in the big cities will be able to sleep better. Allergies contribute heavily to sleep apnea disorders. Its kind of funny that in governments rush to maintain political power they created a liquidity snowball effect that has outstripped their ability to control it. This is important. Before we were living in a mode that progressed in a retarded rate due to excess government regulation. With 300 million people its just not practical that a congress of 435 pinheads can keep up with the activities of that many people.
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What really caused the housing debacle and lead to the government bailouts » A MarketPlace of Ideas · September 21, 2008 at 10:08 am
[…] What happened to Fannie Mae / Freddie Mac / AIG was more a direct result of easy money low interest FED policy than anything else. Factoring in inflation our interest rates have been either %0 or even negative. See my article about the Rolling Liquidity Bubble. […]