Is a financial crisis worse than 2008 going to happen within the next year?

SomethingNew
SomethingNew

Is a financial crisis worse than 2008 going to happen within the next year?

All urls found in this thread:
https://www.interactivebrokers.com/en/?f=ibgStrength&p=acc
http://www.marketwatch.com/story/billionaire-ken-fisher-says-this-is-the-most-joyless-bull-market-in-history-2016-08-31
Methnerd
Methnerd

@SomethingNew
hmmm...
let me just look into my crystal ball.

Skullbone
Skullbone

@SomethingNew
Yes

Burnblaze
Burnblaze

nostradamus here.. Yes it will be WAY worse

TalkBomber
TalkBomber

@SomethingNew

If it does I will commit suicide.

RavySnake
RavySnake

@Burnblaze
but the rebounding gains will be astronomical!

GoogleCat
GoogleCat

we must BTFD

Lunatick
Lunatick

@SomethingNew
guaranteed. There are so many different bubbles ready to bursts that it's only a matter of time until one of them starts a chain reaction and the whole world comes down.

AwesomeTucker
AwesomeTucker

@SomethingNew
Silicon Valley bubble. Yes.

JunkTop
JunkTop

I'm ready to buy the dip.

Spazyfool
Spazyfool

Within the next year? Maybe. It depends how long the Fed can stall before having to really raise rates.

Within the next 3 years? It seems very likely.

Within the next 5 years? Almost certainly. It's hard to imagine how they could keep this charade going for that much longer.

Lord_Tryzalot
Lord_Tryzalot

@AwesomeTucker
The worst affected assets will be.

Tech Stocks 2.0: i.e. 'Network' stocks. Lots of users and great ideas but no idea how to monetize, huge drain on cash. Think Uber, Lyft, Social Networking sites that aren't Facebook, other Sharing Ecommie Stocks/Companies

Commerical Real Estate: Although inflated location dependent real estate will suffer. A falling world economy and China remaining strong will be REALLY BAD for places like Philadelphia, most parts of California, Florida, Austin, Seattle, etc...

Another type of real estate that may falter is warehouse and distribution centers. Although they held up (by a string I must say, I personally rented a unit out for my business and the others were empty during the recession). These are way overvalued and vacany rates are low so TONS are being built right now. People are betting on an e-commerce economy but there's been so much growth already it's unrealistic to assume the pace will continue as such.

Government bonds: The experiment with negative interest rates is making things really fucky and when a crisis occurs people won't trust their money with certain governments for free/without higher interest. Prices will fall as such and they are more inflated than they have ever been.

Healthcare and insurance stocks - people will not be able to make a lot of payments on these services and their balance sheets are loaded as fuck right now. They are better at managing risk than they were during the 2008 crisis, but we are inventing new way to take risks in the financial system and have more capital at work than we have ever had as well as debt.

Fuzzy_Logic
Fuzzy_Logic

@Lord_Tryzalot
Just to argue counterpoints

Tech 2.0
We're already seeing smaller startups batten down their hatches, focusing on profitability and burn rate. VCs still haven't forgotten 2000. Uber's cash loss is due to investing in self-driving (lowering cost) tech and monopolizing growth a la Amazon. People aren't going to stop using it overnight like Pets.com.

CRE
In 2008, prices crashed so badly because everyone wanted to exit before their neighbor sold. Corrupt Chinese and Russian oligarchs might earning less money to pile in, but they have nowhere else to park dirty money and are completely ignorant of their neighbors.

Warehousing
Could be a bubble, true. Will people revert en masse from ordering Amazon shit to shopping at their local Mom & Pop Walmart? Personal spending will decline as median age rises and retiring boomers downsize, but will that prompt a bubble pop rather than normal stagnant/declining revenues?

Government bonds
Not everyone is a prepper. Only drug dealers use bitcoin. Everyone needs government currency to pay taxes. The Fed/BOJ/ECB/BOE are all on the same page, writing off no tool when they need it. What makes you think they won't ferociously guard their government's debt/pension assets? It's almost the inverse of 2008, because now we know the AAA bonds are backed by threat of QE & the printing press.

Healthcare
People are also older and sicker than they've ever been, so naturally healthcare debt & GDP will be massive. On the supply side, the government is hamstrung by voters, so they won't be abolishing Medicare any time soon. Again, that's a gradual flattening of revenue (even as the Fed prints money to pay Medicare bills, screwing everyone else via inflation).

What kind of bubblicious, negative-feedback loops am I missing?

Stupidasole
Stupidasole

@Fuzzy_Logic
What kind of bubblicious, negative-feedback loops am I missing?

Shit, I mean positive-feedback loops. Unexpected things that make the bubble drop precipitously as everyone flees for the exit.

Evil_kitten
Evil_kitten

Looking at the market, it'll happen. Market usually goes down at the end of a presidential cycle. Start putting and shorting

Emberfire
Emberfire

@Stupidasole
dollar devaluation. The dollar is a reserve currency because it's stable and foreigners hold huge dollar reserves as a result. This can easily create a feedback loop, where a devalued dollar leads to even greater inflation, since foreigners have no implicit need for dollars and will dump them if it looks bad.The timeline could look something like this:

Recession
Fed launches QE4, which they've already said will be 2-4 trillion
Doesn't work, so they bail out the banks and drop interest rates negative
Meanwhile inflation starts to spike, at this point they will have printed 1/4 of GDP within about a year, Foreign holders are beginning to sell off dollars as the trend becomes apparent.
Federal funding dries up as new treasury auctions have no buyers. Direct debt monetization by the Fed begins in order to keep the lights on.
They're faced with a choice: Raise interest rates to control inflation and force the government to default on it's debt since it can't even afford to service the it above 2.5% or just stay the course and inflate the debt away. "inflationary escape".
At this point, it doesn't matter which option they choose, the dollar is worthless as both the direct default or gradual inflation have the same final effect.

Ignoramus
Ignoramus

Fuck your crystal ball and that shitty joke faggot.

Garbage Can Lid
Garbage Can Lid

It will have to end in hyperinflation.

That is the only outcome when debt accumulation is rapidly outstripping ability to repay

happy_sad
happy_sad

Assuming it is going to happen, what would be some good ways to use prior knowledge of the oncoming recession to financial advantage?

What opportunities will open up?

New_Cliche
New_Cliche

@SomethingNew

Hopefully, I already took my money out.

When it comes ill be waiting to cash those gains.

Ive already toldto much to u suqaz

Nojokur
Nojokur

@SomethingNew
Ow yeah nvm buy printed cotton papers and use plastic lol

farquit
farquit

@SomethingNew
Yes. There's too many bubbles and the 2008 recovery was a false one, people are doing worse.

We're due a recession anyway, they happen every 7 - 8 years.

Problem is there are so many different doom and gloom warnings flying around that it can be difficult to figure out who to believe or not.

One of the warnings I've heard is that tech start up declines and busts will be the canary in the coalmine, and once they go, it will be a sign that thing are going to go south.

But yeah, a recession seems inevitable and the consensus seems to be that it will be much worse than 2008.

So hold on to your butts.

viagrandad
viagrandad

@happy_sad
Buy the dip

Emberfire
Emberfire

@SomethingNew
Yes. It has been really interesting few years with negative rates in EU. Usually when economy is in deflation, value of currency has risen. But not this time, which is very interesting reaction. Shame that people lose they savings and pensions but it was nice experiment <{:^)

Methnerd
Methnerd

@farquit
wasnt the recent apple taxation scandal in Ireland the canary ?

SniperWish
SniperWish

Here is a important question to be considering: when the major market decline happens and is accompanied by major debt deleveraging, how safe is my assets in my broker? In years past during hard times there have been brokerages that collapse and go bankrupt and their customers lost their investments and cash. How can I find out if my broker is in danger or is safe?

StonedTime
StonedTime

@SomethingNew
For most people, the 2008 crisis is still ongoing.

VisualMaster
VisualMaster

@SniperWish
Those deposits are FDIC insured up to $200k.

askme
askme

@VisualMaster
FDIC doesn't insure brokerage accounts.

hairygrape
hairygrape

@askme
Are you fucking joking? I am naive child and just assumed it would only make sense... I just tried to look into it, and it was not reassuring, but I could not find explicit language from the FDIC saying "we do not insure brokered deposits." Is there really no form of guarantee that your funds are safe and available for withdrawal? ...

Poker_Star
Poker_Star

@SniperWish
@askme
@VisualMaster

Its the SIPC that protects them, at least for IB.
https://www.interactivebrokers.com/en/?f=ibgStrength&p=acc

RumChicken
RumChicken

@Lord_Tryzalot
CommRE
In Property here in Australia.
All three tiers of property Commercial, residential and industrial, are massively over supplied.
In Commercial in less popular areas we are already seeing a very high vacancy rate, with more surrounding commercial being built. Another GFC would gut our realestate market, the only saving grace would be if you're a landlord with a national retailer lease, eg supermarket chains.

Spazyfool
Spazyfool

It's going to be worse than the Great Depression. I'm not sure exactly when it's going to happen. But I can tell you it will be soon, maybe even before the end of the year. Start stocking up on food, water, guns and ammunition. We're gonna be in this for the long haul. It's going to get bad and stay that way. The only way we'll be able to overcome this is by government intervention. Maybe we'll go to war again like we did during the Great Depression. It's funny, really. This impending collapse is the fault of the Federal Reserve, particularly Greenspan. He's the one who lowered the interest rates below their natural rate. This completely changed the markets;the Fed was able to entice everyone to borrow and use credit, since it was suddenly cheaper to borrow money. This led to the housing bubble that caused the 2008 Financial Crisis. Fast forward to current times-- 5 years post-recession-- and we aren't nearly as robust as we were pre-recession. This current recovery is the weakest one since WW2. And how is the Fed planning on fixing this? By holding rates low and augmenting its balance sheet. The Fed has backed itself into a corner and is now stuck: It has a 6 trillion dollar balance sheet, and it can barely move interest rates. All of this, coupled with the decline of China and notable decline in American productivity, indicates a weak global economy. Another financial crisis could be sufficient enough to initiate the collapse. There needs to be an overhaul of the Federal Reserve. As millennials, we should take it upon ourselves to mandate and reform the central bank and put it under more Congressional oversight. But doing that won't change anything for years to come. This collapse is going to happen, and we're all going to be affected by it. We're screwed. The Jews did this.

Dreamworx
Dreamworx

@Fuzzy_Logic
Just to give some perspective. There are multiple warehouses being built in my area. I have talked about leasing units for a lot of them, and I would say maybe 70-80% of them have 0 tenants signed before construction.

Just think how bad it would be when so many new constructions of warehouses are happening and then get plagued with vacancies.

There aren't exactly cheap to build either. They cost 7-8M+ to construct.

Garbage Can Lid
Garbage Can Lid

@RumChicken
Yeah, I didn't even think of Australia. But I live in Illinois, and I couldn't even imagine how bad it must be in places like California, Australia, London, etc..

Boy_vs_Girl
Boy_vs_Girl

Pic related

hairygrape
hairygrape

@hairygrape
usually a brokerage has fdic insured sweep funds that hold you cash, managed by retail banks, as well as sweep funds that are not so watch out

JunkTop
JunkTop

Yes the market is going to crash within the year you retards

question is, which stocks go long on, what to short? potentially massive gains shorting tech companies in silicon valley here

Nojokur
Nojokur

@Emberfire
Hell yea. I hope we have a ton of inflation coming soon. It's a beautiful thing.

america highest debt to income ratio
a lot of that debt is held by foreign lenders
inflate dollar dramatically
in effect this does nothing to most americans since income rises to compensate
foreign lenders BTFO as now the interest on the debt they hold barely compensates for a devalued dollar
trump becomes president
america wins again

Need_TLC
Need_TLC

@RavySnake
It's coming...

Raving_Cute
Raving_Cute

http://www.marketwatch.com/story/billionaire-ken-fisher-says-this-is-the-most-joyless-bull-market-in-history-2016-08-31

Lord_Tryzalot
Lord_Tryzalot

@Spazyfool
2008 wsn't even close 2 the great depression.

busts get smaller and smaller.

the reason scaredey cucks like u are constantly crying for doom and gloom is actully the reason the market keeps puttering on , cause ppl are so shaken by 2008 and playing it much tighter and responsible/safer.
you can really worry when shit starts 2 get conspicous , cocky and out of hand.

Boy_vs_Girl
Boy_vs_Girl

@RumChicken
I'm an Australian currently renting and it's worrying the shit out of me.

How the fuck do I avoid this eventual economic meltdown?

I'm a uni student who is trying to find work, assuming there is another financial crisis how fucked am I in finding work when it happens?

kizzmybutt
kizzmybutt

@Boy_vs_Girl
uni student
not being an apprentice

Its over boyo

WebTool
WebTool

Trump will be elected and the markets will tank.

Screen shot it boys

BinaryMan
BinaryMan

what's with all the doomsaying on this board anyway? Is it just /pol/ leakage of edgelords who are chomping at the bit for society to collapse, so that all the normies will finally pay?

AwesomeTucker
AwesomeTucker

@Nojokur
That's not really how it works.

Boy_vs_Girl
Boy_vs_Girl

@Need_TLC

So, when do we genocide 99% of the global population and sort things out?

cum2soon
cum2soon

@WebTool
Alternatively, Hillary gets elected and they go to the moon

kizzmybutt
kizzmybutt

@Need_TLC
implying any resources besides oil are going anywhere

at the very worst nuke the gooks and currys

Playboyize
Playboyize

@SomethingNew
financial crisis
It will happen in 5 minutes, tomorrow, in a week, in a month, and in a year according to the experts on Veeky Forums.

Crazy_Nice
Crazy_Nice

@AwesomeTucker
Thats exactly how it works nigger.

VisualMaster
VisualMaster

@SomethingNew
How do I prepare myself Veeky Forums? I only have enough food and ramen stockpiled to last around a month.

Fuzzy_Logic
Fuzzy_Logic

@VisualMaster

Join a libertarian remote settlement.

Raving_Cute
Raving_Cute

@cum2soon
Or she gets elected, and *they* make Wall StreetgGo down just to prove a point and make Hillary their puppet bitch for the next few years.

Boy_vs_Girl
Boy_vs_Girl

@Crazy_Nice
Wage inflation is sloooooooooow

sticky prices

AwesomeTucker
AwesomeTucker

@Garbage Can Lid
you live in Shit-Cago or downstate?? I recently returned to southern Cook county after having lived in Macomb for about 7 years....blegh

farquit
farquit

@Boy_vs_Girl
You're not geared up so you'll be fine. In fact renting inner city may become easier, depemding on how companies like airbnb perform globally taking into account this @Lord_Tryzalot
@AwesomeTucker
If airbnb and others can't handle a downturn and cannot connect landlords to temporary renters then domestic long term leasing will be the only option in an over supplied market, which means incentives like discounting to attract renters.

There are people stupid enough to rely on customer delivery from companies like airbnb to pay off a 30 year mortgage.
Its great in good times, fucking disaster in bad. Screencap this post, there's going to be a wave of mortgagee auction if companies like airbnb crash.

5mileys
5mileys

@farquit
implying people cant rent out their property without air-bnb
Whatever did we do without it!

iluvmen
iluvmen

@5mileys
You're going to have a hell of a time trying to rent out your shack in Idaho to random Germans or Korean backpackers without it.

Anyway go reread the post, its pretty black and white what you the alternatives are.

But just for discussion sake, lets hear your alternatives?
You own a flat in London with a huge mortgage you've been using aribnb to generate income for repayments with.
Airbnb goes broke
You now have instant debt with no way to service it

What would you do?

Poker_Star
Poker_Star

@iluvmen
Same way we did it before airbnb kek. Craigslist, rent.com, realtor.com, zillow, etc. You act like airbnb was the only wy to access rental property information online. So how young are you, seriously?

Carnalpleasure
Carnalpleasure

@iluvmen

tfw my mortgage is $566 in Austin tx
tfw I make $1500 month airbnb my spare room

RavySnake
RavySnake

@Poker_Star
@Carnalpleasure
I read an article in a property section talking about the wonderful benefits of taking out not one but two mortgages on a property way out of your income reach to use airbnb to pay off, the same article was promoting spending between $20k-$50k on furnishings.
This is simply financial suicide.

Craigslist, rent.com, realtor.com, zillow, etc.

Craigslist
CL will not be used be a majority of the market.

Rent.com
USA only

Realtor.com. Zillow.com
seriously?

Your response is to call me a child when none of your responses show any discernible appreciation of marketing or product placement. SO how about actually giving a viable answer on how to service not one but 2 mortgages if these airbnb type of companies ever go broke?
CL and zillow are not alternatives.

DeathDog
DeathDog

@cum2soon
Doesnt the democratic platform almost want to 911 ws just to appease the 99%.

Lunatick
Lunatick

@RavySnake
I agree with this post. Taking out a 25-30 year mortgage on the basis of a website and business model who's performance is unproven through downturns is a fool's model.

idontknow
idontknow

@Lord_Tryzalot
the dotcom bubble was cocky and conspicuous, but the resulting recession was very light.

That formula just doesnt work historically.

Snarelure
Snarelure

Yes, the sky is always falling and economic Mad Max is always around the corner. Be sure to always invest based on the speculation you read on ZeroHedge, this is the surest way to make money year over year.

Flameblow
Flameblow

@DeathDog
No lol.

Wall Street is favorable to Clinton mostly because Trump is fucking crazy and unpredictable.

Also, his policies are predicted to cause a recession

GoogleCat
GoogleCat

@SomethingNew
No. 2008 was before the algos took over most of the trading volume. As humans are removed from the equation the probability of cataclysmic collapse becomes much less likely. There have been a half-dozen ~10% falls in the market since 2008 mostly due to (geo)political events and not one of them resulted in a lasting recession. The days of traders jumping out of windows are over.

Crazy_Nice
Crazy_Nice

@viagrandad
What if it never recovers. The coming crash is different from those in the past. Humanity is at a turning point, a paradigm shift is coming.

Bidwell
Bidwell

@GoogleCat
this.

Also as tech makes manufacturing cheaper and investing easier for common folk, certain market sectors will normalize to some degree.

I for one welcome a bright future that provides UBI for everyone, incentivized and facilitated by ai, work-place automation, and reduced manufacturing costs.

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