Comments on: Prepare for the Dead Certainty: The Next Boom/Bust

By: Tim Ward

Tim Ward — Wed, 05 Aug 2009 23:29:31 +0000

Unfortunately, pro-cyclical forces pervade market structures. The bankers that pumped the bubble with SIVs and various investment vehicles, are also primary dealers and market makers. They knew they were peddling junk, and so were in the perfect position to short the markets, using high frequency computer trading and fictitious shares/fails to deliver. The markets are highly controlled, and not free. The rules that are intended to level the playing field, do not apply to market makers. I believe we have witnessed the most hostile take over in history, with out military assistance.

The boom bust cycle is a certainty, in part because market structures allowing almost perfect manipulation have been created by the bubble makers, so that they make the bubble and pop it at will. From their point of view, something went terribly right.

By: Adrian Sherman

Adrian Sherman — Mon, 27 Jul 2009 09:59:09 +0000

Reading your excellent book ‘Boom Bust’ I thought that the four down years of property were to be 08, 09, 10, 11; have you revised this to end in 2010?

Also I think you predicted a drop of around 22% but it sems to be slightly more savage than that – possibly 30%+.

By: 51ck-6-51x

51ck-6-51x — Wed, 22 Jul 2009 13:30:45 +0000

An economist is someone who will tell you tomorrow why what he predicted yesterday did not happen today.
– Laurence J. Peter ( the inventor of the Peter Principle )

Economy, n. Purchasing the barrel of whiskey that you do not need for the price of the cow that you cannot afford.
– Ambrose Bierce, The Devil’s Dictionary.

By: Fred Harrison

Fred Harrison — Fri, 10 Jul 2009 08:38:09 +0000

Sorry to disappoint you, Free Drive Ro, but although the new CYCLE starts at the end of next year, the ECONOMIC CONDITIONS of the next few years will drag out into a decade-long depression (or, as I prefer to call it, a period of “arrested growth”). Recall the terrible pattern of events of the last depression. The crises of 1929-1933, and the Depression of that decade, did not prevent the property boom in the mid-1930s (especially in England’s South-East, with the construction of suburban housing estates around the new Tube stations). The house price peak would have been followed by a recession in 1938. This did not happen, for one bad reason: European governments expanded their investments in munitions (and Hitler built autobahns, the better to shift his armies around), and they hired people off the dole queues in readiness for a world war. The outcome was a heavy price to pay for the “counter-cyclical” measures that prevented the bust of 1938.

Fred Harrison

By: Paul Smith

Paul Smith — Fri, 10 Jul 2009 08:17:42 +0000

Fantastic article. The Governments will never change the system because they make so much money from the boom and bust cycles.
In the U.K the politics have been found out for using the property bubble to make a lot of money on second and third homes paid for by the tax payer.

It is a very sick system of abuse we live in but if we are educated to the facts at least we can steer ourselves around this mess and not be to burnt by there wrong doings.

Keep up the good work of educating us on whats happening out there.
I have produced a blog about government and political failures, if people would like to take a look and leave some feed back that would be great.
http://www.governmentpolitics.blogspot.com

By: Free Drive Ro

Free Drive Ro — Wed, 08 Jul 2009 18:25:38 +0000

So that’s it? Depression is over, we have a new business cycle starting in 2010?
I expected the fall to be bigger and depression to last till 2020. Good news from Fred in this article!