Lots of doublespeak as usual… leverage is not important but toxic assets, yet he does not define them. The fact is that the whole world is a gigantic toxic asset. Or wait, does Greenspan refer to an upcoming “derivatives implosion”??? Or a combination of just everything???
EC custodians have been among those warning about the derivatives (credit default swaps mainly) for years. And today the derivatives market stands around 1 quadrillion, but a mere $100 trillion worth of them are more than enough to bring down the world economy completely. We live in a house of cards.
Warren Buffett still says derivatives are ‘weapons of mass destruction’ (2015) http://www.shtfplan.com/commodities/billionaire-warns-of-looming-disaster-derivatives-are-still-weapons-of-mass-destruction_06242015
Is This Time Really Different?
The 2008 crisis blew up about $40 trillion in assets worldwide, which EU and US central banks countered with their toxic and multiple quantitative easings, which allowed to world bubble to grow back to its pre-crisis conditions.
2016: Study: Housing prices are back to pre-2008 levels (CBS) … The subprime mortgage is back: it’s 2008 all over again(sovereignman.com) … (2018) Subprime mortgages have been rebranded, and demand is growing. (inc.com)
The ARTIFICIAL DEMAND for housing was well advertised to say the least, and the social inclusion phenomenon spread it like wildfire. Everybody wants to have his/her own house. If you recall yesterday blog:
PETER JOSEPH: advertising spreads consumption like a virus, everybody wants it because we care about social inclusion, which is part of our biology. So advertising manipulates our primal sense of humanity. Without that “arm”, our society would collapse. https://earthcustodians.net/blog/2018/12/22/60-of-world-population-living-in-poverty-but-83-of-all-u-s-stocks-owned-by-1/
Case proven, Capitalism is destructive because it sells what we cannot keep forever.
Wealth disappears as we all do eventually… We all happen to die, don’t we? So why falling for the rush to own things, which then comes back to us with a vengeance? Sorry, that ‘s an Natural Law.
Capitalism profits from ignorance. Without advertising, credit and the exploitation of the “collective unconscious”, capitalism would have been abandoned centuries ago. Unlike toxic assets, leverage is secondary as it can be manipulated with below zero interest rates for long periods of time (Japan has been doing this for quite a while), ultimately toxic assets destroy leverage. That Greenspan, The Maestro, would hate to state this of course
Capitalism’s dangerous mix: artificial demand combined with irrational exuberance
Greenspan during the go-go-years, after the dotcom bust, used to refer to greed as “irrational exuberance”.
Yesterday blog made it clear that today goods and services are no longer traded but money, which are a multitude of numbers wandering megacomputers. Each hedge fund has its own AI. The world stock exchanges don’t care about how we manage from a paycheck to another. But if it has gone that far is because collusion cannot be prevented and is intrinsic to monetarism to start with. As contended several times already, capitalism only works as a theory.
Corporations are attacking the planet on many fronts, and now an investigation has revealed that even human stools contain microplatics/microfiners, pesticides and release bigpharma’s drugs into the environment. Buying goods from slave wages countries perpetuates trade imbalances. If this is not aggression what is it? Tolerating poverty is violence. There is no other way to regard it if we are serious about ending the top down game.
The price for believing in philosophical fallacies, a lack of adequate metaphysics, and unlimited greed is on our doorsteps. Anybody caring about his/her loved one has the duty to take action and spread the word about this psychopathic system to let it go down without any fears.
Only the endorsement of our birthrights can define the best social model for Humanity. Simple.
Alan Greenspan Warns Investors: Bad Economic Times Are Looming