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The European ‘Slow-Motion Train Wreck’

Posted by Larry Doyle on January 2, 2012 9:28 AM |

The lessons which went unheeded from the economic calamities and accompanying market meltdowns of the 1980s and 1990s laid the foundation for the Ponzi-style financings underwritten within our sub-prime mortgage market and the European Union of this past decade.

How have political leaders at home and abroad addressed the enormity of our collective indebtedness? They merely continue to kick the can down the road so that our global economic landscape can only be compared to a ‘slow-motion train wreck’. 

For those who would like a comprehensive understanding of how this train wreck developed and is playing out in Europe, The Wall Street Journal provides a fabulous 20 minute video.

I really cannot say, “Enjoy this clip” but I think you will find it to be truly educational.

Navigate accordingly.

Larry Doyle

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I have no affiliation or business interest with any entity referenced in this commentary. The opinions expressed are my own. I am a proponent of real transparency within our markets, our economy, and our political realm so that meaningful investor confidence and investor protection can be achieved.

 

  • Randy

    L.D.,

    Good clip but have you heard that a senior administration official recently told Kyle Bass that they are going to “kill the dollar”, meaning print much more of it?

    Keep up the good work, I appreciate your efforts.

    • LD

      Randy,

      Thanks for your kind words.

      I had not heard that but am not surprised. Monetize the debt so the costs of repaying these debts incurred in the process of wasteful and wanton government spending are paid off with dollars worth less and less as time goes by.

      I do think that reality may lead to increased civil unrest as people become aware and feel that their/our government has betrayed us.

      I also believe that Obama will not be reelected because people will understand that neither he nor his staff are capable of managing our economy through the challenges that lie ahead.

      • Bruce H.

        Hi Larry and Randy,
        Killing the dollar means QE to infinity, and I’ve read about this for several years after the Fed boosted the money supply through the roof. It’s one thing to give the banks boatloads of fiat money to boost their balance sheets (because they are holding toxic (worthless) assets), and another thing entirely for those banks to lend out that money nine times over, creating massive inflation in the process. It seems like it is not happening. If you look at the velocity of money it is low and declining (not good for growth). So I’m on the fence now as to whether the economy is about to fall off the cliff, whereas a few months ago I said nothing can stop the plunge.

        I do wonder if the boys (CEOs) have been told to start implementing raised capital budgets now (hire more people in the process) which will boost the economy and get Obama back in office. Yes, a good conspiracy. I wouldn’t put it past the WS/Washington incest.

  • coe

    Thought the report was very crisp – built the case with little room for doubt – the truth is that the economic union in the Euro-zone has not started to bring the cultural and social ties of the member states closer together. While the implications for continued deterioration seem to be potentially disastrous and quite contagious in these days of a global economy, I suspect that if/as a Greece finds there is no other solution but to break away from the EU, the sun will likely rise the next day, and people will figure out how to cope. At least Merkel and Sarkozy continue to meet to try to address issues – using their relatively strong positions as the foundation for a fix. Leadership is like pornography – you know it when you see it. Imagine how fractious things would be in the US if Nevada’s unemployment, or California’s housing crisis, or Michigan’s urban blight, or Illinois’ state corruption, or Georgia’s banking crisis – or any of a myriad number of local/state issues – were isolated in a way that were not at least somewhat addressed through the strength of the union? Hard to contemplate.






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