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World Bear Markets Get Underway

Tuesday Nov 30 2010

The scenario playing out in Europe will likely be in the US next year. Here we will substitute states for European nations. Here the analogy to Ireland and Portugal are cities like Chicago and Miami. The states of CA and IL are analogous to Spain and Italy. Without their own currencies the countries cannot devalue and so they wait for Germany to decide to 'lend' more Euros. I doubt the citizens will want to pay off debt to rescue bond holders that bet on overheated economies. 

Then add the overbuilding in China as well as other emerging economies around the world. It all adds up to another financial meltdown coming our way in 2011. This will definitely impact job prospects for graduates, prepare now!

From Mish Shedlock this morning

Risks to the Downside

  • China is overheating.
  • India is overheating.
  • Philippines, Thailand and Singapore are all in contraction.
  • Growth in South Korea, Taiwan and Indonesia has slowed markedly.
  • Contagion threatens Spain.
  • The property bubble in Australia is busting.
  • Ireland cannot possibly pay back its debts.
  • Greece needs an extension.
  • US corporate bond sales have collapsed.
  • There are significant tax cut and unemployment insurance issues in the US.

 

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3 responses to “World Bear Markets Get Underway”

  1. Phillip Garcia Avatar
    Phillip Garcia

    I believe that all U.S. government agencies, including the States, Counties, and City governments be forced to have a balance budget every year, it should be the law now and for ever. As for civilian companies, they should be free to do whatever they want but within laws. There should be no government bail outs of civilian companies. As for government benefits and services, there should be a limit on the costs; people should remember these benefits are a hand up, not a hand out. And lastly the U.S. government and the States should stop borrowing money, they must live within the taxes they collect. If the economy melts down and if there is another Great Depression, then we all must press the “Reset Button” on the economy, start from zero, and if that happens everybody will lose, but at least everybody will start from zero dollars, then and only then we can build great economy with a balance budget for all governments and this includes the civilian companies.

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  2. Rene Avatar
    Rene

    Greed is greed across the world. Too many greedy rich people try to get more and more money by pushing the envelope of the markets and overvaluing commodities. Then when the shit hits the fan they try to save their ass by getting the little people to bail them out. I say to hell with them they have money because they have exploiting the poor and middle class for years. It is time to let them hit rock bottom and have everyone deal with the consequences like the 98% below them. It’s time to hit the reset button as start over, including the government.

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  3. Dennis Elam Avatar
    Dennis Elam

    Rene
    Is greed solely an attribute of the rich?
    A good deal of the latest round of greed came by simply agreeing with politicians like Barney Frank that everyone needed a home whether they could afford it or not, and by golly lots of poor folks that knew they could not afford the homes bought them, funny the politicians from Bush (go buy something) to Frank to Dodd to Greenspan to Bernanke have yet to apologize

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