lets talk about a potential all around economic recession/crash/deleveraging. in my humble opinion i believe a big fucking crash is coming, the sort of end of the long debt cycle crash. why do i believe this? other than monetary conditions and the staglation that is going on the media lens of current events just reads to me like a big crash is coming, and not like in the way it goes every week. the main points are the energy crisis(which i have to say i dont know how it goes in the us but in europe at least its severe) and the supposed nato war with russia over a backwater russian province(which ukraine is in essence). other than that the price action of the markets rn reads to me like a sort of bull trap, which i wont say it is for certain, but at the same time it feels like all momentum and hope is lost, things got real/realistic again and people are just trying to play a game of hot potato with each other, waiting for small pumps in order to liquidate stocks, btw i'm not talking about crypto in any capacity, i just dont know enough about it and it may very well go up/down/sideways, i'm strictly speaking of traditional asset markets.
i may be very wrong, or only partly wrong about all this, but for the people who are bearish on this next year/years, how would you invest in order to play defense with your gains, or how are you planning to go on the offense?
for me at least, i'm not liquid at all so my best bet would be to increase my wage as fast as possible and hold onto cash in order to buy up assets from people who lived too large on credit and inflating prices hopes and dreams.
We will indeed see the end of a 40 year credit cycle this year, but not until after we see an unprecedented parabolic melt-up across effectively all markets. It probably won't last long, maybe 3-6 months, and it will be followed by a rapid 50% correction, minimum.
The melt-up started on Friday and was confirmed today. Time to move into risk assets. Start to sell as we climb. Want to hold dollars, treasuries, and some precious metals as we near the peak. All risk assets will collapse. Swoop back into them with cash and treasuries near the bottom. Metals may not correct much.
Plan carefully and don't get greedy. It's going to be fucking nasty. Like nothing anyone under 95 has ever seen.
Brody Russell
I bump it for you but im going to bed now! Stagflation is here, but money supply is huge so assets still moon
Aiden Jenkins
that's certainly an interesting take, and makes sense.
any reason why you think the markets still have room for going up? they very well may be, i'm usually just blindsided by pessimism
Isaac Nelson
I am thinking the same thing.
Value stocks, commodities, miners, precious metals. Anything that can pass on rising costs to their customers. Some cash to buy the dip once shit starts really hitting the fan. We are either going into stagflation or straight out recession.
Nolan Ramirez
I'm not reading all that, just shill a ponzi coin or get out
Kevin Lee
you wrote a lot, but that won't save you from getting liquidated
>he still believes in credit cycles Lmao how exactly do you see deleveraging working out at this stage? It's too late, US will inflate the debts away and slowly lower the standard of living until it's just another Latin American country. There will be no collapse, just a decline in real terms for half a century.
Julian Hill
i sort of agree with you, in the sense that i think value stocks will take a hit also. i may be too much of paranoid, but when i look back on the previous "crashes" i remember value stocks taking big hist as well
Jeremiah Allen
I’d also say that this is probably the most likely scenario. They’re so fucking over leveraged, there’s no way they can turn this ship around. They’ll try to keep it afloat as long as possible with the help of jpows money printer etc., and while they may successfully do so for another decade or two, we’re all ultimately fucked unless you’ve already made it once the party is finally over. Same thing for the EU
Nathaniel Sanders
bump for interest, especially EU analisys.
poorfag question: Assuming it pops as you say, overall living standards would be less, would that mean mostly consumer goods getting slashed first? the amount of economic value of those consumer goods now being considered overpriced/unnecessary? Maybe the right question is: when it pos, what's the order of the domino's falling?
Nathaniel Lopez
pos ==> pops
Gavin Martin
yeah the credit cycles theory is a bit meme-y, but it sort of describes how and why the economy is going up/down. even if the theory is bullshit, which it sort of is, the situation rn looks just like how a textbook "economy at the end of a credit cycle" would look. which is bad. and idk about slow decline, people in the eu got energy bills that are on average x5 times bigger compared to last year, and they would have been even worse had the gubments not implemented fixed prices. already pensioners can't afford to live at all and all those debtors who got a loan for houses and cars are going to end up in the streets or going to go live with their grandparents in the countryside.
the western world is fucked, add on to that the supposed conflicts, raw goods shortages and supply chain issues, with possibly another year of restritctions, i just dont see how a major crahs and DELEVERAGING wont happen.
not to mention the shrinking population and stagnation of growth of productivity.
what do you mean by consumer goods getting slashed?
Christopher Jenkins
remember this is literally the result of wealthy individuals and corporations extracting an inordinate amount of money from everyday people so they cant spend money and live the lives they need to keep the velocity of money in the economy healthy
>what do you mean by consumer goods getting slashed?
user over here described better what i mean. As living costs rise dramatically (luxury) consumer goods trade would be one of the first thigns to drop. If you have €10 to buy a NFT or €10 to buy a few kilo's of flour...
Matthew Ramirez
i don't believe we'll see a "crash" in the sense that you're expecting, imploding asset prices reflect a retreat into the dollar, but assets have bubbled because the dollar is a failing currency, and as others have noted itt, the state of global leverage has reached historically high levels. i agree with the idea that we will see melt-up inflation and living conditions will deteriorate for many people. i think ultimately this will resolve itself through another bretton woods type global monetary agreement between banks, transitioning to a new currency. let's just hope we won't need another war to bring everyone to the negotiating table. in the short term, the volatility has been insane because no one really knows yet the lengths to which the Fed will go to maintain the illusion of the dollar's value, are they ever going to let the leash slip? unlikely, but it seems even more unlikely that they're going to yank on it. but we don't know. so hold at least some cash to cushion yourself... beyond that, i personally favor risk-on assets, and just pay attention to what's going on in the world and how banks are reacting to increasingly uncontrollable monetary conditions
Xavier Wilson
context i am a poorfag and the call to be a homeowner is very appealing, however my little financial sense says to me that engaging into a mortgage right now with all these disruptive factors would be a very dum thing to do, and would ruin the little amount of funds we managed to save.
Xavier Barnes
why would we even see a parabolic melt-up? what's the scenario here?
Evan Diaz
IIUC you're saying "wait and see what (central) banks are going to do in regards to load policy and re-evaluate intents?"
Brayden Ross
oh yeah definitely. but most people with fixed incomes, incomes that rise very slow are boomers, that dont have any nfts. most have an apartment/house, a car or a few of them and maybe some bank, oil or automotive stocks. and when consumer prices will go so high and their dear parents wont be able to sustain their living standards, on top of the kids requiring money for their schooling and medical expenses, i think we'll see sell off on all fronts just to make ends meet(this already happened in 2008-2010) and all in all the economy will slow down.
i just realises here we're in an echo chamber of young guys with no expenses, but most people are heavily invested into the traditional economy and have no other option than to liquidate their assets bc of kids and grannies they have to take care of, which is unfathomable for people who consume "web3" content non stop
Charles Campbell
honestly yeah, you're better off renting and even moving in with old folks for the next 1-2 years. i am not personally a landowner, but i know some, and the yields are miniscule. on top of that rates are rising and rent prices and rent demand is going down(at least where i live) and i just dont see how renting will still be profitable. and in that sense i think you're better off "ripping off" a landowner for the next year(s), let him worry about repairs and whatnot, while you hopefully start earning more when you decide to settle down into your home
Thomas Russell
what are those risk-on assets
Oliver Gray
Safe bet is precious metals, cryptos if you are religious
