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RE: Oompa Loompa Now: The coming Apocalypse
"In fact, about 70 percent of people who win a lottery or get a big windfall actually end up broke in a few years, according to the National Endowment for Financial Education."I'm in the US and using US stats. Not sure about the rest of the world, but seriously doubt that it's any different.
Very interesting. Financial literacy is at an alarmingly low level. But is it any wonder because ballooning consumer credit is the only thing that has kept the US economy afloat in recent decades with the median salary falling behind. This is a problem in many developed countries, not just the US.
On the flip side people with a poor mentality always find a way to become poor again.
Absolutely.
Without ballooning debt loads the US economy would be in serious trouble. The public and the government both rely heavily on debt to fuel their purchases and lifestyle.
That could come to an ugly end.
Completely agree. What I think most miss is that the ugly end won't just be an US issue, but a far reaching global one. US consumerism fuels economies around the world. Without it the house of cards will fall.
Yes, it will. It would be best if consumption increased in those countries and manufacturing increased in the US. Rebalancing world trade is one of the themes that got Trump elected. But what can one national government do about it?
Forcing China to stop manipulating their currency is critical. They have kept it artificially low to make their goods look very attractive on the global markets while making import goods very expensive for the Chinese people. This one action alone would help rebalance a significant amount of trade in the US (and I'm sure other countries too).
Really feel that the tariffs on Steal and Aluminum were targeted at China as they won't bend on the currency manipulation. They were warned, they ignored, and now they are going to pay a hefty price.
A tariff war with China has 1 winner, the US. China would be decimated if the US made their goods more expensive via tariffs across the board. All Trump wants is an equal playing field for US companies to compete with, China wants to keep the deck stacked in their favor. I'll gladly pay a minor surcharge short term on products to put China in their place and I think most Americans would agree.
I think Trump was exactly right in talking about this.
China is a sorry example of what happens when the state meddles with the economy too much. The large imbalances created by force (such as the real estate bubble artificially inflated by the government - there is no independent central bank or independent anything in China for that matter) have caused Chinese capital to want to flee the country. Hence the Bitcoin enthusiasm of the Chinese and the subsequent government crackdown. For example, the Vancouver, BC, housing bubble has been created largely by Chinese money. My relatives in their fifties who live there own ordinary houses that are now valued at over 1.5 million CAD. Their children are incapable of buying anything there.
This is happening in more then just Vancouver. Trump is actually looking to limit investment from China into the US. They are buying up companies, real estate, and bonds. These investments drive up costs to US residents causing bubbles. Once the bubble is large enough they can pull out creating a vacuum and the end of the bubble. This leaves US residents, banks, investors, and the government on the hook as prices collapse.