Permit me to get right to it. Did you know:
1) The total amount of margin debt has risen by 50 percent since January 2012 and it is now at the highest level ever recorded. (The last two times that margin debt skyrocketed like this were just before the bursting of the dotcom bubble in 2000 and just before the financial crisis of 2008.)
2) In the United States, Google searches for the term “stock bubble” are at the highest level since November 2007.
3) Facebook is trading at a valuation that is equivalent to approximately 100 years of earnings, and it is currently supposedly worth about 115 billion dollars.
4) Issuance of bonds linked to loans for the shakiest borrowers hit $17.2 billion this year, more than double the amount sold during the same period in 2010. (Deutsche Bank)
5) The proportion of so-called “cov-lite” loans (loans that are made to borrowers without the normal protections for the lenders) is twice as high as the period immediately preceding the credit meltdown in 2007/2008.
….a little more analysis HERE (be warned, there is also an advertisement)
Personally …. I’m out of most equities. Still hold gold miners and banks and Tim Hortons … but 70% of my stuff is liquid and I intend to cash in on the coming crash.
A buddy of mine is doing mortgage loans in Ontario …. grim prospects for the coming year and many already defaulting. This is from the horses mouth …. lenders are going to be holding a lot of property that they cannot sell.
Just finished reading George Gilder’s ‘Knowledge and Power’ which deals a lot in capitalism and markets. The inability of conservatives to articulate capitalist thinking is very frustrating. It could easily cost the CPC government in 2015. It is a scary reality that most conservatives have no idea why they vote the way they do other than the conviction that they could not run their home finances the same way government does. Perhaps that is enough. The CPC risk a Liebel concoction of quasi economic solutions that will appeal to enough voters to defeat the CPC.
The early sections of the Gilder book are heavy slogging. I especially loved his equating economist with historians or worse accountants. Always dealing in yesterday’s reality. His basic take way is that economist have no business forecasting as they have no idea what will happen. The worst are those who work for government.
My investment philosophy has evolved into buying companies who pay dividends and can demonstrate growth of over time. If the crap hits the fan it will all be about intrinsic value of assets.
So for people who know how to manage money and understand debt management, it means there will be some great buying opportunities coming up.
Wish I was far more versed about this but feel something isn’t right when you have USA, China and Japan all printing money like mad.
How this will affect our CDN dollar when/if it hits the wall?
How do we prepare or protect our selves on an individual basis?
Will a newly elected gov raid our savings and retirements here?
The link to read more takes you to the admin login for his blog. the real link is:
http://moneytalks.net/mikes-content/10966-5-facts-that-most-people-dont-know-but-should.html
Just a quick answer to the questions.
1)The Kanadian buck will do what every other fiat currency does. It becomes worthless.
2)There is no protection. All will suffer to some degree (except the politicians & their cronies)
3)Count on your wealth being stolen the minute a crisis occurs – regardless of who is in power. The procedures are already in place and the necessary laws already passed.
Thanks Skweeker.
thanks for that!