The message from history is that bubble markets can continue as long as general ‘confidence’ is maintained within the marketplace. Money is a confidence game and bubble markets will continue until they end. At some point problems will overwhelm the inaction of our leaders and administrators and this means a serious crash in investor/consumer ‘confidence’ is coming.
The comments above and below are excerpts from an article by Don Swenson (kingdomecon.com which has been edited ([ ]) and abridged (…) to provide a fast & easy read.
Psychology must now continue to pump UP our markets AS LONG AS POSSIBLE. We live in markets which are illusionary and psychological.
The continuing support for these bubble markets is shocking to a thinking person, but it reveals that MOST leaders/administrators/traders/investors do not think.
What is happening today could be reported as dire/ominous to a person of discernment and understanding…but to financial administrators and political leaders who need pumped-up markets to prevent chaos this mindset is unlikely to change.
Group think is very powerful within the arena of finance/politics and within our global capital markets! Just look at all the hype being given to these markets by those who are temporarily prospering from the gains.
Money and making more money has a powerful psychedelic effect on the human mental state. We need to watch this unique psychology for future understanding of human behavior.
Since the financial crisis of 2008 up until today…government leaders, our political advisers, and our banking administrators have essentially accomplished ‘nothing’ meaningful. Our financial problems today are actually much worse than during the last crisis.
- Our National Debt in 2008 was $9.8 trillion vs. $20 trillion today.
- Our deficit was $278 billion vs. $592 billion today.
- Our total personal debt was $17 trillion vs. $18.2 trillion today.
- our credit card debt was $944 billion vs. $1 trillion today.
- Total U.S. debt (including State and Local and Financial institutions) was $50 trillion vs. $67 trillion today.
- Gross debts to GDP was 71.5% in 2008 vs. 105.6% today.
- M2 money supply was $7.6 trillion vs $13.3 trillion today.
See the numbers at: http://www.usdebtclock.org for the two comparative periods.
I think the message is clear. Our Central bank has pumped up the monetary digits to ‘paper’ over the problems but there has been ZERO progress in resolving (solving) any of our financial problems. Can this trend continue forever? I don’t think so! At some point problems will overwhelm the inaction of our leaders and administrators and this means a serious crash in investor/consumer ‘confidence’ is coming.