Financial Armageddon?

[Peter Hansen]

Financial Armageddon.......is it just another "Chicken Little" article .....or should we be concerned?

http://usawatchdog.com/when-will-financial-armageddon-begin/#more-2117

[wooish]

I'm have been holding 400 shares of FAZ, please bring it on

[peanuts]

Given the current political and financial regime, there is no other practical way to pay for the amount of recent debt obligations than to inflate the money supply.

If we are to make positive steps away from debt then the country has to act just like a household... increase productivity and reduce expenditures. By going further into debt to pay for current obligations, the country is being told to keep digging in order to get out of the hole in which we currently reside.

The Baby Boomer generation is supposed to be in the prime productivity of their careers. This is typically 40-60 years of age. Instead, many are unemployed or underemployed. Additionally, productivity has also been shifted overseas and a consumer economy is prevalent. Net savings is a thing of the past. Today we have lending corporations and especially individuals who spend more than they make and then ask the taxpayers for more money to spend. Assets are undervalued and claims on future production are overvalued.

At some point in time there HAS to be a shift of value realization. Lenders will demand higher quality... The value placed on potential future production will decrease, but the value placed on assets will not compensate for this. This tightening of lending standards means that even fewer will qualify for loans, as the default on debt obligations that are backed by today's assets will force a transfer of assets to lenders. Then lenders will have too much inventory and not enough cash. Either they get infused with cash from the FED, or they sell assets on the cheap and realize large losses. Either action will stagnate the already battered economy. In this scenario the people will be left with a huge production deficit and few assets. Lenders and the government will hold the majority of assets. But, who will buy them?

The huge Baby Boomer generation will cry out for a government to take care of them. Those who promise to give handouts will win elections. The nanny state that will ensue will seal the deal on financial Armageddon.

These are forces that are too big for any one person to change or even influence. All that you can do now is to take care of yourself and loved ones. Plan for the worst. Get your financial and spiritual house in order. Take the first step today.

[wooish]

I came to America for over 20 years and I'm still not get used to the fact why Americans put themselves into heavy debts to buy, enjoy the things that they could never afford. In a culture where I came from, people would try to save $9 if they make $10, just to prepare for the rainy days. While there are many good things to learn from Americans but irresponsible spending is definitely not one of them.

[Peter Hansen]

Wooish You Speak The Truth!

I came to America for over 20 years and I'm still not get used to the fact why Americans put themselves into heavy debts to buy, enjoy the things that they could never afford. In a culture where I came from, people would try to save $9 if they make $10, just to prepare for the rainy days. While there are many good things to learn from Americans but irresponsible spending is definitely not one of them.

Wooish my parents ran away from a communist regime in the Ukraine , and came to the US , not asking for a handout .....but just the OPPORTUNITY that is available here. My dad never had a credit card and always paid in cash , and actually bought his first home for cash . He bought 2 more rental properties , and did extremely well! I have SIX credit cards but keep a zero balance on all......actually it is stupid for me to pay cash , because I continually receive "Cash Back Bonuses"! Currently one of my cards gives me 5% back for gas and grocery purchases.
My house is paid for with No mortgage, and I have no other loans. Anyone can do it with just a little discipline.
My parents always said .......put some mony away for a rainy day , and I am glad I did.
One of my relatives came to the US about 10 yrs ago, he worked as a day laborer doing construction and brickwork building new homes. I remember dropping him off at a Dunkin Donuts shop for his work pick up.
He saved money brought over his wife and family , could not get citizenship here so he went to Canada........he started buying and fixing up 2 family homes .......today he owns several and is a millionaire. Nobody ever gave him a loan or a dime......he did it his way!

[wooish]

Wooish my parents ran away from a communist regime in the Ukraine , and came to the US , not asking for a handout .....but just the OPPORTUNITY that is available here. My dad never had a credit card and always paid in cash , and actually bought his first home for cash . He bought 2 more rental properties , and did extremely well! I have SIX credit cards but keep a zero balance on all......actually it is stupid for me to pay cash , because I continually receive "Cash Back Bonuses"! Currently one of my cards gives me 5% back for gas and grocery purchases.
My house is paid for with No mortgage, and I have no other loans. Anyone can do it with just a little discipline.
My parents always said .......put some mony away for a rainy day , and I am glad I did.
One of my relatives came to the US about 10 yrs ago, he worked as a day laborer doing construction and brickwork building new homes. I remember dropping him off at a Dunkin Donuts shop for his work pick up.
He saved money brought over his wife and family , could not get citizenship here so he went to Canada........he started buying and fixing up 2 family homes .......today he owns several and is a millionaire. Nobody ever gave him a loan or a dime......he did it his way!

Exactly. Most of the people I know save their $$$ and make their fortune like that using cash they earned and using cash to make more cash. A lot of people that I know never own a credit card and get a business loan and still able to thrive their business.

[steelman]

I agree completely. However, it's been really hard to save money lately. My business is down. We are getting half the leads, which means half the sales and half the income. My wife stays at home with our children. I also have a mortgage, 2 children, 2 car payments and some credit card debt. We had zero credit card debt and have never carried balances until this past year. Oh yeah, we kept our first house as a rental and it's upside down lol but, we do have some new tenants in it. We carried both mortgages for 4 months in between tenants last year. That was hard. I suppose I could have done what many did and just let it go into foreclosure but we managed to keep up the payments. I do hope our economy gets better and banks start lending again. People need money to buy my steel buildings. Trickle down economics is very real and it just him my house about 6 months ago. Best to everyone.

[Peter Hansen]

Steel Yes It is Tough Out there !

I agree completely. However, it's been really hard to save money lately. My business is down. We are getting half the leads, which means half the sales and half the income. My wife stays at home with our children. I also have a mortgage, 2 children, 2 car payments and some credit card debt. We had zero credit card debt and have never carried balances until this past year. Oh yeah, we kept our first house as a rental and it's upside down lol but, we do have some new tenants in it. We carried both mortgages for 4 months in between tenants last year. That was hard. I suppose I could have done what many did and just let it go into foreclosure but we managed to keep up the payments. I do hope our economy gets better and banks start lending again. People need money to buy my steel buildings. Trickle down economics is very real and it just him my house about 6 months ago. Best to everyone.

Steel owning rental property now is a pain in the ass because of all the restrictions placed on you by the government ........my dad sold his rentals several years ago...putting up with all the BS was not worth it.
My son works as a hedge fund trader but because of the downturn he will soon be out of a job.....he has some leads , but jobs are hard to find.
Hope and Change is not working out ......but I never did drink the Kool Aid vote for the rockstar, unfortunately many that had are now out of a job!

[Peter Hansen]

Wooish

Exactly. Most of the people I know save their $$$ and make their fortune like that using cash they earned and using cash to make more cash. A lot of people that I know never own a credit card and get a business loan and still able to thrive their business.

Wooish I wish they would teach money management and investing in the High Schools ......many graduate with absolutely no concept of money management. They all want to start work at $20 per hour, and spend money like water ......never denying themselves anything .
With the Millions that have just graduated college , the shock of no job is settling in, and there could even be social insurrection if jobs are not forth coming!