Is An Economic Collapse on the Doorstep?

Jim Willie collapseSociety’s veneer is down to rice paper. After Christmas, it’ll be gossamer.
So what happens when interest rates revert to reality and spike up, destroying even the ability to pretend all is well? 
That’s when the fun starts.

Maples Sale(2)

 
Submitted by Truth in Gold:

As I have been saying would happen, the housing market bounce of the last 18 months is starting to crack.  This is a crack that I expect will widen into a big canyon, into which home sales and prices will fall.  It will be a resumption of the bear market trend in the housing market that began in mid-2005 and which needs to go a lot lower and exact a lot more pain before the excesses of the Greenspan/Bernanke/Bush/Obama era have even a chance of being cleansed and fixed.

Existing home sales for October were released yesterday.  And while the year over year headline result was announced as being a big positive, it turns out that if you dig into the actual month-to-month numbers the housing market is slowing down – quickly.  You can read my analysis of the numbers and the overall housing market here:  October Existing Home Sales

Meanwhile, as the stock market plows inexorably toward the moon and then, with a lot more QE, onto Pluto, I was discussing with a friend how QE has done nothing for the economy other than help out a few homebuilders, realtors and most of the corporate insiders who are unloading their company shares at a record pace.  In the context of chatting about the rampant systemic Government and corporate corruption, we discussed how small businesses and individuals have been left in the satanic dust created by the Government and Wall Street.  His commentary on this was too priceless not to share:

It’s a horror show.  I know 2 guys in their 50′s and 60′s who are close to running out of money.  For younger people, generally blue collar guys are the only ones who’ll talk openly and freely about reality, and they’re angry. The white collar set is brainwashed into pretending that they’re keeping up with the Joneses, too stupid to question if their neighbors are living an illusion propped up on credit cards. I freely tell whitey to stop watching TV or it’ll finish the chemical conversion of their brains into cat food.

The real “tell” is the Kohl’s parking lot (visible from McDonald’s where I take coffee every day w/a friend), always brimming with minivans and hot mommy ass. Whence comes Kohl’s meteoric popularity of late?  The answer lies in the high-end faux upper middle class stores like Williams-Sonoma–barren without stragglers seeking elusive bargains there.

Society’s veneer is down to rice paper. After Christmas, it’ll be gossamer.

So what happens when interest rates revert to reality and spike up, destroying even the ability to pretend all is well?  That’s when the fun starts.

sic semper tyrannis

As a nation, we’re a kerosene-doused tinder box awaiting a flame. No accident, this.

I strongly suspect that even the very well-to-do are hurting, fretting many a country club membership and private school tuition check.

I wasn’t kidding about the cat food thing…

“Even a dog knows the difference between being tripped over and being kicked.” -Oliver Wendell Holmes

Americans are being kicked to death, and do nothing but expire in the lambent glow of TV’s illusion, less significant than dead dogs.

Comments

  1. “Americans are being kicked to death, and do nothing but expire in the lambent glow of TV’s illusion, less significant than dead dogs.”
    Very much resembles Münchausen syndrome
    We allow ourselves to be kicked harder and harder, as we make excuses why the kickers should be able to continue kicking, hoping that will keep us safe, in their favor….if ya catch my drift.

  2. Society is but a thin veneer is one of my favorite metaphors, and we shall see just how thin it is ere long, I fear

  3. Even a lazy dog bites eventually…

  4. Fear is a powerful force, denial is just part of the overall delusion.
    Billions more  will be poured into the Stock Market as people lose faith in the USD and Gold continuous to fall in price.
    But when the market tanks AND the dollar collapses… GOLD will be the last refuge.
    Keep Stacking… better a year early than a day late!

  5. “The well to do are sweating country club membership.”  That sums up America for me. How friggin well to do are you if your sweating country club dues?  I mean really? What the hell goes on at country clubs anyway?
    I wouldn`t piss on a country club if it was on fire!!!!!!!!!!!!!
     
    This is my own definition of “wealth”, in terms of dollars:
    If you lost half of it overnight, would you still be wealthy?
     
    I do measure “wealth” by other standards. Health, Family, Friends, and Freedom.
    The country club set is no more FREE than the rest of us. But, they do think they are the Monitors.
    Till you get in their face.

  6. Hmmm  Grim
    The housing starts were up over  a million, reported today.  Who are they going to sell to? 
    Maybe the imaginary immigrants coming for a bit of the good life.
    Something of a certainty—The new banking regs  are holding mortgage standards way above Average Joe’s ability to qualify was something written into Frank Dodd that will collapse the housing market.  If Joe can’t buy a home or refi, we are screwed.   My contacts tell me that the scoring to qualify means you must be near perfect with a Debt to Income and credit score way above average
    Business loans will be tough too.   And businesses are going to get hammered starting early next year
    Maybe the action this Black Friday won’t be people shopping.  It’ll be orchestrated flash mobs helping themselves to those $500 TV with the 5 finger discounts. 
    Don’t stand in the way.  They will run you over. 

  7. Any society based on an economy of mass internal consumption, one day will consume their own flesh. Housing is the final resort to a mad establishment trying to get a free lunch, sell mortgages, create more fake money, pump money into stock market, rinse, repeat. Repackage debt into new financial packages, sell them, create more fake money, pump into stock market, rinse, repeat.
     
    There is only so many rinse, repeats one can do before there is nothing left to rinse or repeat. Its a bubble, and its going to blow….the suspense is killing me, its like watching one of those fellas blowing up a washing up glove over his head, blowing it and waiting for it to blow, its just a matter of time…but when….when….when!!!!
     
    keep stacking….

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