The governor of New Jersey was on Squawk this morning
These are the kind of things I was talking about the other day. Does anyone think that the States, or the Federal government will send all these folks a letter and say, “ Thanks for your service for 20 years, but your benefits package has been cut by 50%”?
This is just not going to happen, as it would cause riots in the streets. Rather, the Federal government will play BIG brother once again and just print the money for the short falls.
One of the problems I have with Glenn Beck, Rush, etc. is that they need to spend more time telling the folks how to prepare, rather than holding out false hope that this can all be corrected.
This cannot be corrected unless we STOP funding the right side of the ponzi scheme, and if we do, that millions of angry people will tear our major cites apart.
If we think the Tea Party people are angry, and have guns, just wait until we see teachers, firemen, and police, mailmen, and gov. workers with no checks coming in.
In my small town I have seen two mailmen retire here in the last 5 years. Both were in their 50’s, both get $60,000 a year for the rest of their lives with full medical. Funny thing is, both are very active Tea Party people. Be very careful what you wish for!
<< <i>This is just not going to happen, as it would cause riots in the streets. Rather, the Federal government will play BIG brother once again and just print the money for the short falls. >>
Someday we're going to have to take that hit though... The current system is unsustainable, so eventually someone is going to get screwed. The only question is how long will the politicians wait to screw the people? There is no way to peacefully undo the ponzi scheme. You take the hit now or you take the hit later. I wish we'd do it sooner than later, but I'm sure it will drag out until a year before I'm due to start receiving my take off the ponzi scheme I've been contributing to.
More than anything, I wish they'd let me "opt out." I'll forfeit what I've contributed, just let me stop paying!
I think the main point of misunderstanding of most of the media, as well as the Tea party protestors is just exactly who is running the world.
Most folks think it is the politicians, I do not, I think it is the Bankers.
In a world awash in debt politicians can do very little unless they can BORROW the money.
In out current ponzi scheme here in the U.S. it is the Bankers that keep the scheme going.
Our total current debt and liabilities exceeds by double the entire net worth of the country, and it will take some pretty sophisticated gamesmanship to keep the ponzi scheme going during the next decade.
Central and commercial banks deal in most part in paper and their very worst nightmare is that they must devalue the paper they are holding by 10 or 20 to one.
It is therefore in their best interest to keep the system from going to that extreme which is the end game.
As I mentioned in my other post, there are many games yet to be played before we get the new 20 for 1 multi colored hologram notes to exchange for our current dollars.
Keep in mind that the Chinese central bank, the Japanese central bank, etc. are all part of the world wide scheme to suck the public dry of their money and make them economic slaves to debt, credit cards etc.
This is why I believe that Mr. Sinclair, Mr. Schiff, etc. are wrong in their assessment. There will be NO selling off of our treasury debt that will cause a major collapse.
If my assessment is correct, this is good news for the informed. This extra decade will allow many folks to correct their bad spending habits of the past, and prepare for the inevitable.
This is why I believe that Mr. Sinclair, Mr. Schiff, etc. are wrong in their assessment. There will be NO selling off of our treasury debt that will cause a major collapse.
The CPAC speech given by Mario Rubio (reiterated by Glenn Beck a few minutes ago) illustrates a point which might prove you wrong, GS.
A union employee who retired at 49 and contributed $124,000 to his pension throughout his career - stands to get back $3,800,000 in total benefits.
Um, does anyone know how this can be sustainable without pumping up the currency? Medicare and Social Security will be almost as bad, worse in terms of total dollars. 7,000 baby boomers are now retiring every day.
I do agree with you about who has the power - no doubt that the bankers are running the whole shootin' match.
Q: Are You Printing Money? Bernanke: Not Literally
The governor of New Jersey was on Squawk this morning and stated that a state employee contributes about $124,000 during his lifetime and will receive back over 3.2 million in pension and health benefits. Rounding that off to a rough estimate of say about 4 million federal and state employees. 4 million x 3.2 million= $120,000,000,000,000. The Unions have to give something up that is a given because it is unsustainable. Just Federal Employees xxxx Just State Employees
Of course this is unsustainable even in the short term. But it looks good on paper to the unsuspecting employees. In the end, something will have to be done with govt and state pension plans, possibly even military as well. The numbers are unsustainable unless they are inflated away by a factor of 10X or higher. I wouldn't bet on any private corporation pension plans remaining in existence 10 yrs from now w/o them being wildly revamped or inflated away to nothing.
I had 19 years put in towards a pension with a former employer that wasn't set to pay out until hitting age 65+. That was 10 yrs away for me when I left them. I figured by age 65 the dollar would be a shell of its former self. So I opted for an immediate monthly payout at a much reduced rate (a bird in the hand for a wish far down the road). This pension plan is NOT inflation adjusted either. I figured it would be about age 72 when the normal payout rate and the early option evened out. If inflation is factored in over the next 17+ years I estimated at best the programs would equalize out in my late 70's possibly into my 80's depending on how far the dollar gets sacked...assuming I live that long (very few of my relatives on either side have made it past 78). Then of course there is the thought that the pension plan just goes poof sometime over the next 17 years due to bankruptcy, takeovers, etc. Anyone else have to deal with a similar choice recently?
<The world has too much debt, and if it all blows up, we can all kiss our assets goodbye.>
The US and EU are not the world. JMHO. MJ
<<China has no debt? Malaysia has no debt? Dubai, Argentina, Hong Kong, Canada, Australia, ect?
Here's a link to List of countries by external debt>>
Wow, we are worse off then I thought thanks for posting. You are comparing the US to Argentina and Malaysia? Boy you are stretching! China's debt is non existant to that of the US. Thank you for illustrating my point. MJ
<<But sovereign debt is not entirely what I am talking about. Consumer debt may be even more important. I would be very interested to see what the world would look like without demand from the US and EU. I imagine it would be a world of subsitance farmers>>
You are such a homer and couldn't be more wrong : ). Consumers vs Producers is a delicate balance, but I know which side of the street I would like to be on WTSHTF. We eat like an elephant and cr@p like a bird. MJ
<<I like Jim Rogers, but why has he been less successful--in terms of creating wealth--than both Chanos and Soros?>>
Pound for pound I'll take Rogers. MJ
<<I dont consider believing China being in a bubble to be a populist view. I think the opinion is split 50-50. Meaning China will continue on its tear for a little while longer, implying the bubble gets bigger>>
It's populist view for China bashers. How long is a little while longer anyways? Six months, a year? Three years? Five years? Ten years? Twenty years? Otherwise you are just covering all bets with a statement like that and you are bound to be right one day. MJ
Walker Proof Digital Album Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
<< <i>This is why I believe that Mr. Sinclair, Mr. Schiff, etc. are wrong in their assessment. There will be NO selling off of our treasury debt that will cause a major collapse.
A union employee who retired at 49 and contributed $124,000 to his pension throughout his career - stands to get back $3,800,000 in total benefits. >>
<< <i>This is why I believe that Mr. Sinclair, Mr. Schiff, etc. are wrong in their assessment. There will be NO selling off of our treasury debt that will cause a major collapse.
A union employee who retired at 49 and contributed $124,000 to his pension throughout his career - stands to get back $3,800,000 in total benefits. >>
As the gentleman said on the deck of the sinking Titanic, "I believe I will have a glass of Merlot".
I can think of no way out of our problem, that will not involve intense, extensive and prolonged, financial pain. It will be so bad, that just stories about what happened, will be enough to cause nightmares to our great grandchildren.
I seem to have become the financial court of last resort for my family. However, the end of the line is not far away, I fear.
I think the point you are missing is just HOW MANY people are carrying soooo much debt.
I think the credit card debt per household was $11k?
11k? Are they out of their minds? I felt the same way as you do, or the same way as many who post on this forum.
But just to set the record straight......we are not the majority any more. We are the minority.
The vast majority of US households have far too much debt on their plates, credit cards, car loans, adjustable rate mortgages.
Not good-----and the reason why rates will not be increased.....anytime soon.
Unless, of course, our welfare state would like to wash the prinicpal clean on all of those loans. That'll work. No BS about being in NEED to get it. EVERYONE gets it that is a US Citizen.
The top down bank bailouts doesnt work, how about the bottom up approach.
Then raise rates.
$100k for every couple, $50k for every single over 18. Use it to pay your debt only. Anything. Mortgages, Credit Cards, Car Loans. No refundable portion in cash. Pick a date in the past where the amounts are locked to avoid running up debt currently.
"I seem to have become the financial court of last resort for my family."
As prognostications go, we know the current US middle class will be trimmed considerably over the next two years as the median standard of living erodes. It is hard to prepare for what comes next and just what exactly are you to prepare for financially? The new middle class will have less access to goods and services that were common just a couple of years ago. We also know that our pensions, jobs, interest income, even our investment opportunities will be diminished considerably. We know that the gov vig is going up as the our leadership struggles to make the worker bees pay for ever expanding programs. And we also know that something is taking the place of the US model that evolved from about 1950 to present. The outcome can be postulated upon, even guessed at but no one knows just how things are going to settle out. We are working a defunct model, outdated by current circumstances and functional only in the sense that we have always done it that way before. It is really difficult to financially handicap the outcome of what comes next.
So, if we suddenly find ourselves in the role of "financial court of last resort" in what ever capacity, it is good. It is good that we have something to give to our families and friends. It is our individual good fortune that we are in a position to help...for as long as we can.
To be fair though, while the middle class will be trimmed, perhaps some people never belonged there to begin with? Union factory worker wages were (IMO) far too high and provided an elevated living status for people who arguably didn't deserve it for the work they were doing... To a large extent, a lot of things are going to be corrected, and it's not necessarily a bad thing...
<< <i>The governor of New Jersey was on Squawk this morning and stated that a state employee contributes about $124,000 during his lifetime and will receive back over 3.2 million in pension and health benefits. Rounding that off to a rough estimate of say about 4 million federal and state employees. 4 million x 3.2 million= $$120,000,000,000,000. The Unions have to give something up that is a given because it is unsustainable. Just Federal Employees xxxx Just State Employees >>
Eisenhower also warned about the Military Industrial Complex. We have been in a perpetual state of war since 2001(welcome to Orwell's 1984). Even World War II only lasted 6 years.
I'm more concerned about what the dollar and it's measuring basket of competing fiat currencies are worth against gold/hard assets than they are against each other. Since 2004 both are down sharply vs. the gold measuring stick. In the end, that's the ultimate measuring stick, until that day comes when central banks trot out a new stick.
Fiat comparisons do matter in the world of short and intermediate term trading. But in the long run they all wind up in the same place.
What's in the basket? How has the government been in those areas? Are they companies like ADM? Really Dairy, crops, farming, etc are heavily subsidized and setup for you guessed it big business not the little producer.
<< <i>What's in the basket? How has the government been in those areas? Are they companies like ADM? Really Dairy, crops, farming, etc are heavily subsidized and setup for you guessed it big business not the little producer. >>
The basket I am referring to is the currency basket which has the following components.
Currency units per U.S. dollar Weighting Euro 57.6% Japanese yen 13.6% Pound sterling 11.9% Canadian dollar 9.1% Swedish krona 4.2% Swiss franc 3.6%
The US dollar is trading today at a value of approx 80. It was also at this level in late 2004. The Euro is still up about 10% since late 2004.
I agree with RR's comments though. In the race to the bottom, it can look like the USD is holding up relative to other currencies in the basket, but all I really care about is how far my dollar goes with the things I buy during the year. And it's kind of hard to tell since I make significantly more today than I did 6 years ago, I do know that my dollar doesn't buy me anywhere near what it used to.
<< <i>Eisenhower also warned about the Military Industrial Complex. We have been in a perpetual state of war since 2001(welcome to Orwell's 1984). Even World War II only lasted 6 years. >>
Except for brief periods, we've been in a perpetual state of war since 1861: Civil War and Reconstruction, Indian Wars, Spanish-American War, WWI, Prohibition, WWII, Cold War, Korean War, Vietnam War, War on Poverty, War on Drugs, Gulf War I, Gulf War II, Iraq and Afghanistan, War on Terror, plus innumerable other skirmishes worldwide. No wonder we as a country have no idea what peace or freedom is anymore.
.....GOD
"Ask, and it shall be given you; seek, and ye shall find; knock, and it shall be opened unto you." -Luke 11:9
"Hear, O Israel: The LORD our God is one LORD: And thou shalt love the LORD thy God with all thine heart, and with all thy soul, and with all thy might." -Deut. 6:4-5
"For the LORD is our judge, the LORD is our lawgiver, the LORD is our king; He will save us." -Isaiah 33:22
Except for brief periods, we've been in a perpetual state of war since 1861: Civil War and Reconstruction, Indian Wars, Spanish-American War, WWI, Prohibition, WWII, Cold War, Korean War, Vietnam War, War on Poverty, War on Drugs, Gulf War I, Gulf War II, Iraq and Afghanistan, War on Terror, plus innumerable other skirmishes worldwide. No wonder we as a country have no idea what peace or freedom is anymore."
The primary reason we are all screwed: Too many voters are sucking on the government teet. None want to be weaned off of it. Most Americans realize that personal sacrafice is our only hope but they expect others to do the sacraficing.
There are only two ways out. (1) Revolt (which I hope to never see) (2) or a constitutional amendment that allows only taxpayers to vote. As long as Washington is able to give money to non-producing voters, those voters will keep those politicians in office.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>So no one really has an idea why the dollar is worth the same (vs the currency basket) today as it was 5 years ago? >>
Okay thanks. I guess if you wait until the dollar rallies to a peak you can make all kinds of claims. It reminds me of PM's they go up and there's a euphoric frame of mind, wait 6 months and it the opposite. Will the dollar hold? I'm not sure but we've lost 97% of the dollar value since the FED so bragging about a little bump isn't all that to me. I do agree it's a race to the bottom just like these big companies racing to jump off a cliff by outsourcing. Oh they save money all right but in the end they're getting what they pay for. What could be done in a day is now taking weeks by replacing school educated foreigners with seasoned professional that's been doing their job for decades. Talk about trying to get something done JMO
<< <i>Eisenhower also warned about the Military Industrial Complex. We have been in a perpetual state of war since 2001(welcome to Orwell's 1984). Even World War II only lasted 6 years. >>
Except for brief periods, we've been in a perpetual state of war since 1861: Civil War and Reconstruction, Indian Wars, Spanish-American War, WWI, Prohibition, WWII, Cold War, Korean War, Vietnam War, War on Poverty, War on Drugs, Gulf War I, Gulf War II, Iraq and Afghanistan, War on Terror, plus innumerable other skirmishes worldwide. No wonder we as a country have no idea what peace or freedom is anymore.
<< <i>So no one really has an idea why the dollar is worth the same (vs the currency basket) today as it was 5 years ago? >>
Although I appreciate the notion of coordinated proportional devaluation (gold), I think your chart of the basket holding 57% euro would be my vote of the day.
<< <i>So no one really has an idea why the dollar is worth the same (vs the currency basket) today as it was 5 years ago? >>
The real understanding has to be that the dollar will not buy what it would buy five years ago. As pointed out earlier, the dollar's value has continually fallen since the creation of a central bank with power to manipulate interest rates. Gold prices fluctuate because of the changing value of what is being used to by the gold. Gold's value doesn't really change. This is why it is a great "store of value" against declining prices in other assets, including currency. It is considered an "inflation hedge" because inflation destroys the value of the dollar. The best way to protect the value of the dollar is to limit it's creation out of thin air and to let the market determine interest rates.
Now what you have to ask yourself is this: "What is the future for the value of the dollar." Investment decisions based on a correct answer should be your goal.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>So no one really has an idea why the dollar is worth the same (vs the currency basket) today as it was 5 years ago? >>
Okay thanks. I guess if you wait until the dollar rallies to a peak you can make all kinds of claims. It reminds me of PM's they go up and there's a euphoric frame of mind, wait 6 months and it the opposite. Will the dollar hold? I'm not sure but we've lost 97% of the dollar value since the FED so bragging about a little bump isn't all that to me. I do agree it's a race to the bottom just like these big companies racing to jump off a cliff by outsourcing. Oh they save money all right but in the end they're getting what they pay for. What could be done in a day is now taking weeks by replacing school educated foreigners with seasoned professional that's been doing their job for decades. Talk about trying to get something done JMO >>
Im not bragging about a GD thing. Just staing fact. All the doom and gloom about the dollar going to zero and here it is at the same level as 5 years ago.
we've lost 97% of the dollar value
These are nice little concepts that the newsletter and doom and gloomers like to claim, but what is the value of that dollar if put in the bank and it earned interest for the last 80 years? 80 years ago a typical worker made $2 day, now he makes $200 a day. So what is the importance of the "97%" decline?
But back to the topic, no one here has any idea why the dollar is at 2004 levels with all this "massive" printing of money? I have an answer and it can be found in a chart of the YEN.
The only race to the bottom will be our bodies in a hole 6 feet deep. As thats where ww will all be before the US dollar goes to 0.
I don't care what kind of "value" you assign to the dollar. That doesn't change the fact that it buys less today than it did in 2004. And in 2004 it bought less than it did in 1996 and in 1996 it bought less than it did in 1990...... Looks like we might have a trend going on here.
The massive money printing is not yet having its inflationary affect because the Federal Reserve is paying interest to the banks that hold all the new money to keep the money on deposit with the Federal Reserve. When the flood gate eventually opens the dollar will devalue overnight. The irony here is that the "too big to fail" banks are making a profit with taxpayer dollars. Very little of the "bailout" money has made it outside of the banks that received it.
Importance of the 97% decline in the dollar's value? You're 80 year span where wages gained by 10 times sounds impressive until you realize that inflation devalued the dollar a whole lot more. The reason behind the increase in wages from $2 to $200 a day over the last 80 years is because of the loss of value in the dollar.
The importance of a crumbling currency is that it eventually takes the country down with it. Read up on the Roman Empire.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>I don't care what kind of "value" you assign to the dollar. That doesn't change the fact that it buys less today than it did in 2004. And it 2004 it bought less than it did in 1996 and in 1996 it bought less than it did in 1990...... Looks like we might have a trend going on here.
The massive money printing is not yet having its inflationary affect because the Federal Reserve is paying interest to the banks that hold all the new money to keep the money on deposit with the Federal Reserve. When the flood gate eventually opens the dollar will devalue overnight.
Importance of the 97% decline in the dollar's value? You're 80 year span where wages gained by 10 times sounds impressive until you realize that inflation devalued the dollar a whole lot more. The reason behind the increase in wages from $2 to $200 a day over the last 80 years is because of the loss of value in the dollar.
The importance of a crumbling currency is that it eventually takes the country down with it. Read up on the Roman Empire. >>
After the recent teetering-on-the-edge-of-total-economic-and-financial-meltdown couple of weeks it seems economic systems and their workings have pushed their way into the need-to-know-category. Well, we can now simplify this all by explaining 9 economic models with cows.
Socialism You have 2 cows. You give one to your neighbor.
Communism You have 2 cows. The State takes both and gives you some milk.
Fascism You have 2 cows. The State takes both and sells you some milk.
Nazism You have 2 cows. The State takes both and shoots you.
Bureaucratism You have 2 cows. The State takes both, shoots one, milks the other, and then throws the milk away...
Traditional Capitalism You have 2 cows. You sell one and buy a bull. Your herd multiplies, and the economy grows. You sell them and retire on the income.
An American Corporation You have 2 cows. You sell one, and force the other to produce the milk of four cows. Later, you hire a consultant to analyst why the cow has dropped dead.
2008 Venture Capitalism You have 2 cows. You sell three of them to your publicly listed company, using letters of credit opened by your brother-in-law at the bank, then execute a debt/equity swap with an associated general offer so that you get all four cows back, with a tax exemption for five cows. The milk rights of the six cows are transferred via an intermediary to a Cayman Island Company secretly owned by the majority shareholder who sells the rights to all seven cows back to your listed company. The annual report says the company owns eight cows, with an option on one more. You sell one cow to buy a new president of the United States, leaving you with nine cows. No balance sheet provided with the release. The public then buys your bull.
Comparative economics. That's pretty funny. Just goes to show that there really is no science or discipline of economics. Just another philosophy that was created to institute, monitor, and justify the siphoning off the proceeds of a working nation.
Im not bragging about a GD thing. Just staing fact. All the doom and gloom about the dollar going to zero and here it is at the same level as 5 years ago.
Yes. But the critical thing is that gold in all major currencies is not at the same levels of 2004 or 2006. It's much, much higher. And probably some of these same currencies had the same comparative value back in 1913 and we might still have it in 2013. Bottom line is that the devalued 97% was redistributed and went somewhere. When one understands where that 97% went to then you'll understand "economics." The sins of monetary and economic policies of the 1980's and 1990's have taken a long time to roost. One only has to look at the takedown of Glass-Steagall in 1999, fudging BLS stats since the mid-1990's, central bank gold supression schemes of the 1990's, and then multiplying otc derivative's by a factor of 10X over 10 years to see how a normal cleansing process was long delayed. The bankers created their own monetary/credit system outside the normally reported one.
One also has to concede that at some point the potential to essentially kill currencies is quite real. At that point they can essentially become worthless. The US or the world has never had to deal with a debt crisis of this magnitude (along with $604 TRILL in illiquid and well-hidden derivative bets) while fueled by pure fiat currencies.
It's also possible at anytime (such as the USDollar in 1934) where the dollar or any other fiat currency can be instantly devalued 40+% overnight. Anyone sticking their retirement money into savings accounts over the past 45 years knows quite well that it has not kept up with the cost of living. It's also related to why real average working wages peaked back in 1973 and why 2 bread-winners now support most families. The first 50 years of the dollar's devaluation wasn't so bad. It's over the last 50 years where things have really gone astray.
China has confirmed the intention to purchase 191.3 tons of gold from the International Monetary Fund at an open auction, Finmarket news agency said.
World central banks started to increase their gold reserves after prices on gold began to climb in 2001. The IMF sells gold within the scope of a program to diversify sources of income and achieve an increase in lending.
The IMF announced an intention to sell 403.3 tons of gold in accordance with the adequate decision made by the board of directors of the fund in September of 2009. India, Mauritius and Sri Lanka purchased about 212 tons of the amount at the end of 2009. India purchased most – 200 tons.
China has confirmed the intention to purchase 191.3 tons of gold from the International Monetary Fund at an open auction, Finmarket news agency said.
World central banks started to increase their gold reserves after prices on gold began to climb in 2001. The IMF sells gold within the scope of a program to diversify sources of income and achieve an increase in lending.
The IMF announced an intention to sell 403.3 tons of gold in accordance with the adequate decision made by the board of directors of the fund in September of 2009. India, Mauritius and Sri Lanka purchased about 212 tons of the amount at the end of 2009. India purchased most – 200 tons. >>
<< <i>I want to know with all the "printing" and negative sentiment, why isnt the dollar lower? >>
That's what they are saying... it IS lower in terms of gold and other assets/commodities and real purchasing power. >>
All right, well I give up then. No one knows.
I do believe one can buy a vehicle or house with less dollars than in 2004, even equities. But I digress. >>
That is a pretty broad statement. In some places you can indeed pay less for comparable housing than you would in 2004. In some places you will still pay more, although I think if you wait the prices in those "sticky" areas will come down much more still. The median MSRP of cars is almost certainly higher now than 2004. Leasing is dramatically more expensive today as automakers are for the most part no longer subsidizing leases like they did for a long time, including in 2004. You used to be able to lease a Grand Cherokee, Jeep Liberty, Ford Taurus, etc for $179-229/month from any dealer. Those types of vehicles now cost $379/month to lease. Oops! Inflation!!
I do know for a fact one can buy a house today for much less gold than in 2004...
<< <i>I do believe one can buy a vehicle or house with less dollars than in 2004, even equities. But I digress. >>
That's rather selective.
I bought a new truck with lots of options in 2004, and today the best I can do for the same money is a stripped, bare-bones version. That truck is at least 20% more. My wife's Toyota replacement a year ago was porbably about 15% more than the one it replaced.
The housing situation is the way it is because of an over-supply situation - something that doesn't exist in most other markets and is a poor choice for comparison.
Equities are not cheap either. The P/E of the SP500 on 9-29-09 was 26.69 (don't have a more recent figure), compared to about 18 for 2004.
You have to be careful when looking at consumer good prices - it often isn't a good measure for inflation or deflation. Look at flat panel displays. They aren't cheaper today than 10 years ago because of deflation. Many other consumer goods are cheaper because production has been moved to low-cost labor centers. These are one-time cost improvements and can't be used to judge the value of the dollar any more than you could have said inflation was rampant when oil was $140-150.
Comments
The governor of New Jersey was on Squawk this morning
These are the kind of things I was talking about the other day.
Does anyone think that the States, or the Federal government will send all these folks a letter and say, “ Thanks for your service for 20 years, but your benefits package has been cut by 50%”?
This is just not going to happen, as it would cause riots in the streets. Rather, the Federal government will play BIG brother once again and just print the money for the short falls.
One of the problems I have with Glenn Beck, Rush, etc. is that they need to spend more time telling the folks how to prepare, rather than holding out false hope that this can all be corrected.
This cannot be corrected unless we STOP funding the right side of the ponzi scheme, and if we do, that millions of angry people will tear our major cites apart.
If we think the Tea Party people are angry, and have guns, just wait until we see teachers, firemen, and police, mailmen, and gov. workers with no checks coming in.
In my small town I have seen two mailmen retire here in the last 5 years. Both were in their 50’s, both get $60,000 a year for the rest of their lives with full medical.
Funny thing is, both are very active Tea Party people. Be very careful what you wish for!
Sounds like a jobs stimulus idea.
Tear 'em down and build 'em back up. Might just work.
Knowledge is the enemy of fear
<< <i>This is just not going to happen, as it would cause riots in the streets. Rather, the Federal government will play BIG brother once again and just print the money for the short falls. >>
Someday we're going to have to take that hit though... The current system is unsustainable, so eventually someone is going to get screwed. The only question is how long will the politicians wait to screw the people? There is no way to peacefully undo the ponzi scheme. You take the hit now or you take the hit later. I wish we'd do it sooner than later, but I'm sure it will drag out until a year before I'm due to start receiving my take off the ponzi scheme I've been contributing to.
More than anything, I wish they'd let me "opt out." I'll forfeit what I've contributed, just let me stop paying!
Unfortunately, just about every politician asks the following question: "Will this became a problem before or after the next election?"
If it's finally going to blow up after the next election, then, to them, it's not a problem - let the next guy worry about it.
Member ANA, SPMC, SCNA, FUN, CONECA
And gold drops $10 instantly. USD breaks through resistance at ~80.85. SP500 down 10 points.
And gold drops $10 instantly. USD breaks through resistance at ~80.85. SP500 down 10 points.
Knowledge is the enemy of fear
I think the main point of misunderstanding of most of the media, as well as the Tea party protestors is just exactly who is running the world.
Most folks think it is the politicians, I do not, I think it is the Bankers.
In a world awash in debt politicians can do very little unless they can BORROW the money.
In out current ponzi scheme here in the U.S. it is the Bankers that keep the scheme going.
Our total current debt and liabilities exceeds by double the entire net worth of the country, and it will take some pretty sophisticated gamesmanship to keep the ponzi scheme going during the next decade.
Central and commercial banks deal in most part in paper and their very worst nightmare is that they must devalue the paper they are holding by 10 or 20 to one.
It is therefore in their best interest to keep the system from going to that extreme which is the end game.
As I mentioned in my other post, there are many games yet to be played before we get the new 20 for 1 multi colored hologram notes to exchange for our current dollars.
Keep in mind that the Chinese central bank, the Japanese central bank, etc. are all part of the world wide scheme to suck the public dry of their money and make them economic slaves to debt, credit cards etc.
This is why I believe that Mr. Sinclair, Mr. Schiff, etc. are wrong in their assessment.
There will be NO selling off of our treasury debt that will cause a major collapse.
If my assessment is correct, this is good news for the informed. This extra decade will allow many folks to correct their bad spending habits of the past, and prepare for the inevitable.
About the same as the average American.
Knowledge is the enemy of fear
There will be NO selling off of our treasury debt that will cause a major collapse.
The CPAC speech given by Mario Rubio (reiterated by Glenn Beck a few minutes ago) illustrates a point which might prove you wrong, GS.
A union employee who retired at 49 and contributed $124,000 to his pension throughout his career - stands to get back $3,800,000 in total benefits.
Um, does anyone know how this can be sustainable without pumping up the currency? Medicare and Social Security will be almost as bad, worse in terms of total dollars. 7,000 baby boomers are now retiring every day.
I do agree with you about who has the power - no doubt that the bankers are running the whole shootin' match.
I knew it would happen.
Of course this is unsustainable even in the short term. But it looks good on paper to the unsuspecting employees. In the end, something will have to be done with govt and state pension plans, possibly even military as well. The numbers are unsustainable unless they are inflated away by a factor of 10X or higher. I wouldn't bet on any private corporation pension plans remaining in existence 10 yrs from now w/o them being wildly revamped or inflated away to nothing.
I had 19 years put in towards a pension with a former employer that wasn't set to pay out until hitting age 65+. That was 10 yrs away for me when I left them. I figured by age 65 the dollar would be a shell of its former self. So I opted for an immediate monthly payout at a much reduced rate (a bird in the hand for a wish far down the road). This pension plan is NOT inflation adjusted either. I figured it would be about age 72 when the normal payout rate and the early option evened out. If inflation is factored in over the next 17+ years I estimated at best the programs would equalize out in my late 70's possibly into my 80's depending on how far the dollar gets sacked...assuming I live that long (very few of my relatives on either side have made it past 78). Then of course there is the thought that the pension plan just goes poof sometime over the next 17 years due to bankruptcy, takeovers, etc. Anyone else have to deal with a similar choice recently?
roadrunner
The US and EU are not the world. JMHO. MJ
<<China has no debt? Malaysia has no debt? Dubai, Argentina, Hong Kong, Canada, Australia, ect?
Here's a link to List of countries by external debt>>
Wow, we are worse off then I thought thanks for posting. You are comparing the US to Argentina and Malaysia? Boy you are stretching! China's debt is non existant to that of the US. Thank you for illustrating my point. MJ
<<But sovereign debt is not entirely what I am talking about. Consumer debt may be even more important. I would be very interested to see what the world would look like without demand from the US and EU. I imagine it would be a world of subsitance farmers>>
You are such a homer and couldn't be more wrong : ). Consumers vs Producers is a delicate balance, but I know which side of the street I would like to be on WTSHTF. We eat like an elephant and cr@p like a bird. MJ
<<I like Jim Rogers, but why has he been less successful--in terms of creating wealth--than both Chanos and Soros?>>
Pound for pound I'll take Rogers. MJ
<<I dont consider believing China being in a bubble to be a populist view. I think the opinion is split 50-50. Meaning China will continue on its tear for a little while longer, implying the bubble gets bigger>>
It's populist view for China bashers. How long is a little while longer anyways? Six months, a year? Three years? Five years? Ten years? Twenty years? Otherwise you are just covering all bets with a statement like that and you are bound to be right one day. MJ
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
<< <i>This is why I believe that Mr. Sinclair, Mr. Schiff, etc. are wrong in their assessment.
There will be NO selling off of our treasury debt that will cause a major collapse.
A union employee who retired at 49 and contributed $124,000 to his pension throughout his career - stands to get back $3,800,000 in total benefits.
>>
I saw that. Now that's sustainable !
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>
<< <i>This is why I believe that Mr. Sinclair, Mr. Schiff, etc. are wrong in their assessment.
There will be NO selling off of our treasury debt that will cause a major collapse.
A union employee who retired at 49 and contributed $124,000 to his pension throughout his career - stands to get back $3,800,000 in total benefits.
>>
I saw that. Now that's sustainable !
This is one years bonus for a FAT CAT = CEO!
"I believe I will have a glass of Merlot".
I can think of no way out of our problem, that will not involve
intense, extensive and prolonged, financial pain. It will be
so bad, that just stories about what happened, will be enough
to cause nightmares to our great grandchildren.
I seem to have become the financial court of last resort for my
family. However, the end of the line is not far away, I fear.
Camelot
I think the point you are missing is just HOW MANY people are carrying soooo much debt.
I think the credit card debt per household was $11k?
11k? Are they out of their minds? I felt the same way as you do, or the same way as many who post on this forum.
But just to set the record straight......we are not the majority any more. We are the minority.
The vast majority of US households have far too much debt on their plates, credit cards, car loans, adjustable rate mortgages.
Not good-----and the reason why rates will not be increased.....anytime soon.
Unless, of course, our welfare state would like to wash the prinicpal clean on all of those loans. That'll work. No BS about being in NEED to get it. EVERYONE gets it that is a US Citizen.
The top down bank bailouts doesnt work, how about the bottom up approach.
Then raise rates.
$100k for every couple, $50k for every single over 18. Use it to pay your debt only. Anything. Mortgages, Credit Cards, Car Loans. No refundable portion in cash. Pick a date in the past where the amounts are locked to avoid running up debt currently.
family."
As prognostications go, we know the current US middle class will be trimmed considerably over the next two years as the median standard of living erodes. It is hard to prepare for what comes next and just what exactly are you to prepare for financially? The new middle class will have less access to goods and services that were common just a couple of years ago. We also know that our pensions, jobs, interest income, even our investment opportunities will be diminished considerably. We know that the gov vig is going up as the our leadership struggles to make the worker bees pay for ever expanding programs. And we also know that something is taking the place of the US model that evolved from about 1950 to present. The outcome can be postulated upon, even guessed at but no one knows just how things are going to settle out. We are working a defunct model, outdated by current circumstances and functional only in the sense that we have always done it that way before. It is really difficult to financially handicap the outcome of what comes next.
So, if we suddenly find ourselves in the role of "financial court of last resort" in what ever capacity, it is good. It is good that we have something to give to our families and friends. It is our individual good fortune that we are in a position to help...for as long as we can.
Got cash?
<< <i>
<< <i>The governor of New Jersey was on Squawk this morning and stated that a state employee contributes about $124,000 during his lifetime and will receive back over 3.2 million in pension and health benefits. Rounding that off to a rough estimate of say about 4 million federal and state employees. 4 million x 3.2 million= $$120,000,000,000,000. The Unions have to give something up that is a given because it is unsustainable. Just Federal Employees xxxx Just State Employees >>
More on the story...
Raising taxes to fill pension coffers would be a difficult sell to taxpayers >>
Entitlement baby. It's so...20th century.
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Knowledge is the enemy of fear
Fiat comparisons do matter in the world of short and intermediate term trading. But in the long run they all wind up in the same place.
roadrunner
<< <i>What's in the basket? How has the government been in those areas? Are they companies like ADM? Really Dairy, crops, farming, etc are heavily subsidized and setup for you guessed it big business not the little producer. >>
The basket I am referring to is the currency basket which has the following components.
Currency units per U.S. dollar
Weighting
Euro 57.6%
Japanese yen 13.6%
Pound sterling 11.9%
Canadian dollar 9.1%
Swedish krona 4.2%
Swiss franc 3.6%
The US dollar is trading today at a value of approx 80. It was also at this level in late 2004. The Euro is still up about 10% since late 2004.
Knowledge is the enemy of fear
<< <i>Eisenhower also warned about the Military Industrial Complex. We have been in a perpetual state of war since 2001(welcome to Orwell's 1984). Even World War II only lasted 6 years. >>
Except for brief periods, we've been in a perpetual state of war since 1861: Civil War and Reconstruction, Indian Wars, Spanish-American War, WWI, Prohibition, WWII, Cold War, Korean War, Vietnam War, War on Poverty, War on Drugs, Gulf War I, Gulf War II, Iraq and Afghanistan, War on Terror, plus innumerable other skirmishes worldwide. No wonder we as a country have no idea what peace or freedom is anymore.
"Ask, and it shall be given you; seek, and ye shall find; knock, and it shall be opened unto you." -Luke 11:9
"Hear, O Israel: The LORD our God is one LORD: And thou shalt love the LORD thy God with all thine heart, and with all thy soul, and with all thy might." -Deut. 6:4-5
"For the LORD is our judge, the LORD is our lawgiver, the LORD is our king; He will save us." -Isaiah 33:22
This is the post of the day!
At a minimum...
Knowledge is the enemy of fear
Too many voters are sucking on the government teet. None want to be weaned off of it. Most Americans realize that personal sacrafice is our only hope but they expect others to do the sacraficing.
There are only two ways out.
(1) Revolt (which I hope to never see)
(2) or a constitutional amendment that allows only taxpayers to vote. As long as Washington is able to give money to non-producing voters, those voters will keep those politicians in office.
Here's a pretty scary glimpse of the future from a reputable advisor:
Why you should be buying gold
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>So no one really has an idea why the dollar is worth the same (vs the currency basket) today as it was 5 years ago? >>
Okay thanks. I guess if you wait until the dollar rallies to a peak you can make all kinds of claims. It reminds me of PM's they go up and there's a euphoric frame of mind, wait 6 months and it the opposite. Will the dollar hold? I'm not sure but we've lost 97% of the dollar value since the FED so bragging about a little bump isn't all that to me. I do agree it's a race to the bottom just like these big companies racing to jump off a cliff by outsourcing. Oh they save money all right but in the end they're getting what they pay for. What could be done in a day is now taking weeks by replacing school educated foreigners with seasoned professional that's been doing their job for decades. Talk about trying to get something done
<< <i>its a race to the bottom in tandem >>
A race to the bottom and the other currencies have been winning lately. But that won't last long. The USD will catch up.
How else will Obama double exports without trashing the dollar?
And, even though it may be a radical idea, proficiency in English and reading comprehension?
I knew it would happen.
<< <i>
<< <i>Eisenhower also warned about the Military Industrial Complex. We have been in a perpetual state of war since 2001(welcome to Orwell's 1984). Even World War II only lasted 6 years. >>
Except for brief periods, we've been in a perpetual state of war since 1861: Civil War and Reconstruction, Indian Wars, Spanish-American War, WWI, Prohibition, WWII, Cold War, Korean War, Vietnam War, War on Poverty, War on Drugs, Gulf War I, Gulf War II, Iraq and Afghanistan, War on Terror, plus innumerable other skirmishes worldwide. No wonder we as a country have no idea what peace or freedom is anymore.
Post of the year.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>
<< <i>its a race to the bottom in tandem >>
A race to the bottom and the other currencies have been winning lately. But that won't last long. The USD will catch up.
How else will Obama double exports without trashing the dollar? >>
Markets free of repressive regulation and arcane tax laws and rates?
usd vs euro click 5 and 10 year chart.
<< <i>Text >>
<< <i>So no one really has an idea why the dollar is worth the same (vs the currency basket) today as it was 5 years ago? >>
Although I appreciate the notion of coordinated proportional devaluation (gold), I think your chart of the basket holding 57% euro would be my vote of the day.
<< <i>So no one really has an idea why the dollar is worth the same (vs the currency basket) today as it was 5 years ago? >>
The real understanding has to be that the dollar will not buy what it would buy five years ago. As pointed out earlier, the dollar's value has continually fallen since the creation of a central bank with power to manipulate interest rates. Gold prices fluctuate because of the changing value of what is being used to by the gold. Gold's value doesn't really change. This is why it is a great "store of value" against declining prices in other assets, including currency. It is considered an "inflation hedge" because inflation destroys the value of the dollar. The best way to protect the value of the dollar is to limit it's creation out of thin air and to let the market determine interest rates.
Now what you have to ask yourself is this: "What is the future for the value of the dollar." Investment decisions based on a correct answer should be your goal.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>
<< <i>So no one really has an idea why the dollar is worth the same (vs the currency basket) today as it was 5 years ago? >>
Okay thanks. I guess if you wait until the dollar rallies to a peak you can make all kinds of claims. It reminds me of PM's they go up and there's a euphoric frame of mind, wait 6 months and it the opposite. Will the dollar hold? I'm not sure but we've lost 97% of the dollar value since the FED so bragging about a little bump isn't all that to me. I do agree it's a race to the bottom just like these big companies racing to jump off a cliff by outsourcing. Oh they save money all right but in the end they're getting what they pay for. What could be done in a day is now taking weeks by replacing school educated foreigners with seasoned professional that's been doing their job for decades. Talk about trying to get something done
Im not bragging about a GD thing. Just staing fact. All the doom and gloom about the dollar going to zero and here it is at the same level as 5 years ago.
we've lost 97% of the dollar value
These are nice little concepts that the newsletter and doom and gloomers like to claim, but what is the value of that dollar if put in the bank and it earned interest for the last 80 years? 80 years ago a typical worker made $2 day, now he makes $200 a day. So what is the importance of the "97%" decline?
But back to the topic, no one here has any idea why the dollar is at 2004 levels with all this "massive" printing of money? I have an answer and it can be found in a chart of the YEN.
The only race to the bottom will be our bodies in a hole 6 feet deep. As thats where ww will all be before the US dollar goes to 0.
Knowledge is the enemy of fear
The massive money printing is not yet having its inflationary affect because the Federal Reserve is paying interest to the banks that hold all the new money to keep the money on deposit with the Federal Reserve. When the flood gate eventually opens the dollar will devalue overnight. The irony here is that the "too big to fail" banks are making a profit with taxpayer dollars. Very little of the "bailout" money has made it outside of the banks that received it.
Importance of the 97% decline in the dollar's value? You're 80 year span where wages gained by 10 times sounds impressive until you realize that inflation devalued the dollar a whole lot more. The reason behind the increase in wages from $2 to $200 a day over the last 80 years is because of the loss of value in the dollar.
The importance of a crumbling currency is that it eventually takes the country down with it. Read up on the Roman Empire.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>I don't care what kind of "value" you assign to the dollar. That doesn't change the fact that it buys less today than it did in 2004. And it 2004 it bought less than it did in 1996 and in 1996 it bought less than it did in 1990...... Looks like we might have a trend going on here.
The massive money printing is not yet having its inflationary affect because the Federal Reserve is paying interest to the banks that hold all the new money to keep the money on deposit with the Federal Reserve. When the flood gate eventually opens the dollar will devalue overnight.
Importance of the 97% decline in the dollar's value? You're 80 year span where wages gained by 10 times sounds impressive until you realize that inflation devalued the dollar a whole lot more. The reason behind the increase in wages from $2 to $200 a day over the last 80 years is because of the loss of value in the dollar.
The importance of a crumbling currency is that it eventually takes the country down with it. Read up on the Roman Empire. >>
ok
Knowledge is the enemy of fear
Comparative Economics
After the recent teetering-on-the-edge-of-total-economic-and-financial-meltdown couple of weeks it seems economic systems and their workings have pushed their way into the need-to-know-category. Well, we can now simplify this all by explaining 9 economic models with cows.
Socialism
You have 2 cows.
You give one to your neighbor.
Communism
You have 2 cows.
The State takes both and gives you some milk.
Fascism
You have 2 cows.
The State takes both and sells you some milk.
Nazism
You have 2 cows.
The State takes both and shoots you.
Bureaucratism
You have 2 cows.
The State takes both, shoots one, milks the other, and then throws the milk away...
Traditional Capitalism
You have 2 cows.
You sell one and buy a bull.
Your herd multiplies, and the economy grows.
You sell them and retire on the income.
An American Corporation
You have 2 cows.
You sell one, and force the other to produce the milk of four cows.
Later, you hire a consultant to analyst why the cow has dropped dead.
2008 Venture Capitalism
You have 2 cows.
You sell three of them to your publicly listed company, using letters of credit opened by your brother-in-law at the bank, then execute a debt/equity swap with an associated general offer so that you get all four cows back, with a tax exemption for five cows. The milk rights of the six cows are transferred via an intermediary to a Cayman Island Company secretly owned by the majority shareholder who sells the rights to all seven cows back to your listed company. The annual report says the company owns eight cows, with an option on one more. You sell one cow to buy a new president of the United States, leaving you with nine cows. No balance sheet provided with the release. The public then buys your bull.
Im not bragging about a GD thing. Just staing fact. All the doom and gloom about the dollar going to zero and here it is at the same level as 5 years ago.
Yes. But the critical thing is that gold in all major currencies is not at the same levels of 2004 or 2006. It's much, much higher. And probably some of these same currencies had the same comparative value back in 1913 and we might still have it in 2013. Bottom line is that the devalued 97% was redistributed and went somewhere. When one understands where that 97% went to then you'll understand "economics." The sins of monetary and economic policies of the 1980's and 1990's have taken a long time to roost. One only has to look at the takedown of Glass-Steagall in 1999, fudging BLS stats since the mid-1990's, central bank gold supression schemes of the 1990's, and then multiplying otc derivative's by a factor of 10X over 10 years to see how a normal cleansing process was long delayed. The bankers created their own monetary/credit system outside the normally reported one.
One also has to concede that at some point the potential to essentially kill currencies is quite real. At that point they can essentially become worthless. The US or the world has never had to deal with a debt crisis of this magnitude (along with $604 TRILL in illiquid and well-hidden derivative bets) while fueled by pure fiat currencies.
It's also possible at anytime (such as the USDollar in 1934) where the dollar or any other fiat currency can be instantly devalued 40+% overnight. Anyone sticking their retirement money into savings accounts over the past 45 years knows quite well that it has not kept up with the cost of living. It's also related to why real average working wages peaked back in 1973 and why 2 bread-winners now support most families. The first 50 years of the dollar's devaluation wasn't so bad. It's over the last 50 years where things have really gone astray.
roadrunner
China has confirmed the intention to purchase 191.3 tons of gold from the International Monetary Fund at an open auction, Finmarket news agency said.
World central banks started to increase their gold reserves after prices on gold began to climb in 2001. The IMF sells gold within the scope of a program to diversify sources of income and achieve an increase in lending.
The IMF announced an intention to sell 403.3 tons of gold in accordance with the adequate decision made by the board of directors of the fund in September of 2009. India, Mauritius and Sri Lanka purchased about 212 tons of the amount at the end of 2009. India purchased most – 200 tons.
I would say thats great. It is finally living up to its promise. This is a good thing.
But im not asking gold's performance.
I want to know with all the "printing" and negative sentiment, why isnt the dollar lower?
Knowledge is the enemy of fear
<< <i>I want to know with all the "printing" and negative sentiment, why isnt the dollar lower? >>
That's what they are saying... it IS lower in terms of gold and other assets/commodities and real purchasing power.
<< <i>Feb. 26th 2010
China has confirmed the intention to purchase 191.3 tons of gold from the International Monetary Fund at an open auction, Finmarket news agency said.
World central banks started to increase their gold reserves after prices on gold began to climb in 2001. The IMF sells gold within the scope of a program to diversify sources of income and achieve an increase in lending.
The IMF announced an intention to sell 403.3 tons of gold in accordance with the adequate decision made by the board of directors of the fund in September of 2009. India, Mauritius and Sri Lanka purchased about 212 tons of the amount at the end of 2009. India purchased most – 200 tons. >>
China buying IMF gold story unfounded
<< <i>
<< <i>I want to know with all the "printing" and negative sentiment, why isnt the dollar lower? >>
That's what they are saying... it IS lower in terms of gold and other assets/commodities and real purchasing power. >>
All right, well I give up then. No one knows.
I do believe one can buy a vehicle or house with less dollars than in 2004, even equities. But I digress.
Knowledge is the enemy of fear
<< <i>
<< <i>
<< <i>I want to know with all the "printing" and negative sentiment, why isnt the dollar lower? >>
That's what they are saying... it IS lower in terms of gold and other assets/commodities and real purchasing power. >>
All right, well I give up then. No one knows.
I do believe one can buy a vehicle or house with less dollars than in 2004, even equities. But I digress.
That is a pretty broad statement. In some places you can indeed pay less for comparable housing than you would in 2004. In some places you will still pay more, although I think if you wait the prices in those "sticky" areas will come down much more still. The median MSRP of cars is almost certainly higher now than 2004. Leasing is dramatically more expensive today as automakers are for the most part no longer subsidizing leases like they did for a long time, including in 2004. You used to be able to lease a Grand Cherokee, Jeep Liberty, Ford Taurus, etc for $179-229/month from any dealer. Those types of vehicles now cost $379/month to lease. Oops! Inflation!!
I do know for a fact one can buy a house today for much less gold than in 2004...
<< <i>I do believe one can buy a vehicle or house with less dollars than in 2004, even equities. But I digress.
That's rather selective.
I bought a new truck with lots of options in 2004, and today the best I can do for the same money is a stripped, bare-bones version. That truck is at least 20% more. My wife's Toyota replacement a year ago was porbably about 15% more than the one it replaced.
The housing situation is the way it is because of an over-supply situation - something that doesn't exist in most other markets and is a poor choice for comparison.
Equities are not cheap either. The P/E of the SP500 on 9-29-09 was 26.69 (don't have a more recent figure), compared to about 18 for 2004.
You have to be careful when looking at consumer good prices - it often isn't a good measure for inflation or deflation. Look at flat panel displays. They aren't cheaper today than 10 years ago because of deflation. Many other consumer goods are cheaper because production has been moved to low-cost labor centers. These are one-time cost improvements and can't be used to judge the value of the dollar any more than you could have said inflation was rampant when oil was $140-150.