Overdue Correction
Hi fellow Lions,
Today I wanted to talk about my thoughts behind this crazy economic situation we are in.
Overdue Correction
The loom can be a little scary, can't it?
I think one of the things that's likely is that we are in for a bit of a rough patch in terms of the economy and how things are going. I think this is and has always been inevitable but the timing of it is what has been the thing to look out for.
I'm certainly no economy or finance wiz, but I have been around the block a few times at this point and lived through various shit-shows. The first one was 2008 and I was caught off guard that's for sure, because, like many, I wasn't paying as much attention to that stuff as I should have. I had a bunch of money in a stock account, relatively speaking for my income and age, but lost 60% of it in a few weeks. It was absolutely brutal, and taught me that you should, at the very least, pay attention to how these things are comprised. I've since paid more attention that's for sure!
One of the things that has bothered me for years, while I took advantage of it of course, was the incredibly low interest rates for things. It is almost impossible to think of a 2 or 3% interest rate on something like a mortgage because that's a lot of money the banks are lending out. Sure there is plenty of reason to appreciate and want that low rate, but sadly it also makes good business sense to have a 4 or 5% interest rate as a business. When banks were getting away with insane 0% interest rates for a lot of things for so long, there is for sure trouble ahead. It's not sustainable to have that absolutely bottom of the barrel rate, and nor should it be. I know that there is an argument to be made against interest rates and lending period, but that is a different conversation.
These, and many other factors, have been looming over our heads for a really long time. The conspiracy realist in me has been thinking that it's been intentionally pushed off for one reason or another. To wait for a CBDC and a financial feudalism system? Or is it something more nefarious? It's easy to go into deep rabbit holes of all the ways in which there are a number of people who are hell-bent on enslaving and destroying humanity for one sadistic reason or another. At the same time though, one of the most important things to remember is that those people eat each other with envy and feuding. I doubt it's THAT sophisticated and organized because everyone is cutthroat and is always stabbing each other in the back.
Are we just at the level of greed, upon incompetence, upon bad decision making, upon time? There are a lot of factors converging and I think of it like taking a sinking business and trying to straighten it out. There are a lot of people who are employed by a sinking business because it's keeping them afloat, while at the same time hemorrhaging money. The US economy is for sure at that stage, and could likely also be the global economy. There are so many levels of corruption and greed that it's incredibly difficult to fathom.
Has this always been the plan, to bring it to a slow and controlled demolition? Or is it because the current American President, Trump, has been a businessman his whole life and also has Elon with him, who is also at least a savvy business man (as much as I dislike or don't trust either of them, they are competent in the business realm thankfully) taking that sinking ship and cleaning it up to be sea-worthy again? These are certainly things that we will be able to look back on in a few years and put some context to. Right now, it's yet another historical economic melt down that's occurring in my lifetime. I'm up to 3, and I'm not even middle aged! Lol.
Really crazy shit that's for sure LOL
What about you, what do you think is going to happen with the economy? Is it going to straighten out or are we headed for an even deeper depression? Let me know in the comments!
-CmplXty. Real human written content, never AI. All pictures are mine unless otherwise stated
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"You raised some powerful points! It really feels like we’re living through economic history in real time. Do you think this correction is the reset we need, or just the beginning of something bigger?"
It's hard to say.. I think it could certainly be a catalyst for something greater, but it could also be for something more nefarious. The challenge is going to be that the governments and companies always want something more nefarious and we have to wrestle that control out of their hands and back to the people and the middle.
https://www.reddit.com/r/Economics/comments/1jy4wkb/overdue_correction/
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I think it's becoming easier to noticed that things could get worse first before they get better. Now it's clear that the easier times we had previously with interest rates are other related economic policies were unsustainable to say the least. I wonder why it was kept for so long and why it has been decided that now is the time to tackle the problem head on.
Not that I adore him, but I think Trump has the right mindset. I disagree with him on a lot of things like his war-hawk stance he is taking currently, but I can't disagree with the strategy of running a country like you run a business. You need to have the books make sense, you need accountability and you also need to be able to justify spending money. So much of the money can't be justified and it's nuts.
At the same time - his ideas on what needs to happen with AI seem a little outdated in style. The idea of handing over 500 million or billion, whatever it was, to set up some AI warp-speed type shit is ludicrous and is only going to further worsen the corruption in those tech companies, thinking of all the money they can suck off the government. Brutal!
I also think having that mindset of running a business in terms of how you operate a country has a lot of merits. For the most parts, governments tend to be inefficient and spend in excess. The DOGE campaign for its negative publicity was an effective strategy to put check and balances into the government system. I wish it was exported to other countries also.
I think he doesn't care about AI, only what he could get for himself. These tech companies will give him a big fact cheque :)
Yeah it's all over the news in Asia.. There's always something every day, or every few hours. Tariffs, then retaliatory ones, and then retaliatory on the retaliatory ones. That said, I tend to be optimistic (sometimes a little overly) and I believe markets will always return to highs over the long term (the track record of major indices speak for themselves), so it's really all about the basics of being invested for the long term.
Yeah looking at the macro versus the micro is important! There will always be bumps up and down, but overall things should go in the better direction. It's just difficult seeing and dealing with the pain during the bumps!
I feel like there should be a different term to describe Trump and Elon types rather than 'businessmen'. Businessmen, to me at least, describes people who build up businesses and create economic opportunities within the rules and laws. Trump and Elon both disregard rules and laws entirely and crush everyone who stands in their way... I genuinely think that neither of them would have had any success in other developed countries, but the US judicial system is set up in a way where the wealthy can avoid or delay legal consequences.
I do think a correction has been a long time coming, but I also think this administration will turbocharge it as they try to get as much out of their positions of power as possible. I don't believe they're here to run the country like a business.
Well I think sadly there is a lot of pain to be had, but mainly because people relied on the government for SO MUCH, including employment.
I personally know someone who worked for the government and holy fuck batman, is it INEFFICIENT AS FUCK. This person got LECTURED because they did too much work. They showed up their colleagues and they were reprimanded for it. They took initiative and helped someone out with something outside of their wheelhouse but wanted to learn. They were AGAIN reprimanded.
The government, as a source of employment, is one of the most reprehensible places because it is so full of inefficiencies and corruption it is so difficult to fathom.
It's okay to be looking to work for the government as a council member or something like that, but there is so much administrative bloat and unnecessary roles and departments it's so difficult to imagine unless you are familiar with it. I feel bad for the people who work there, truly, because they do not know what it is like to work in the normal world where you need to be efficient, lean and flexible. Sure not everyone can attain that type of level, but there are lots of opportunities not at the government for folks to work at while also being productive employees instead of leeches.
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As far as them being businessmen, I certainly don't like either of them but I can't deny their intelligence at running things. They use the system the way it's set up, much the way as many people in their positions as possible do yet they are not in the headlines. There are VERY few people like Henry Ford left in this world where they build a successful business from the ground up by themselves and their merits. I could be completely wrong about Ford and he might be a piece of shit himself, but I hope you get the point. I think it's sadly a little too naive to think that is possible in the current world business, economic and political climate.
Do I like this being the case? Absolutely not!
Have I seen that someone like Elon took Twitter, a company suffering from massive bloat and unnecessary administrative middle management, turning it into a profitable company with the right amount of people? Yes and I have respect for him for that aspect.
I will also admit that it disgusts me that Elon relies so heavily on H1B Visa employees in all of his companies. That type of thing pisses me off because there are hundreds of thousands of brilliant Americans that could fill those roles but they don't because we have a higher standard of living in terms of wages, and these H1B visa people rely on the companies to sponsor them so they can't say squat about it, otherwise they lose their job and their visa.
Totally agree with a lot of this... there are a couple of reasons governments are full of inefficiencies - the main one being that people can literally die if they get things wrong, so working at a snails pace, checking everything a billion times and getting everyone's approval is so important because if they don't, they could mess things up way worse than any corporation ever could. Another reason is that the heads of the agencies keep changing... imagine running an organization different ways every 4 years - it must be ridiculous. I'm not defending governments, I'm 100% certain there are all sorts of bloat and inefficiencies, but I also understand we can't really know all the nuances unless we had full visibility ourselves.
I have worked on lots of projects, mostly in the private sector but I have worked on projects within both state and federal governments, and I will say that corporations often just throw money at problems to fix them, but the agencies I've worked with had to justify every dollar spent and it all got so scrutinized... it was frustrating to work with, but they did take spending tax payer dollars extremely seriously... obviously governments are massive so everyone'll will have very different experiences.
I think the next few years are going to teach us exactly how much the government impacts our lives.
I would honestly bet money on Twitter not being profitable.
They were profitable as a public company, but Elon came in, reduced the workforce by 75% and lost all their major advertisers. Their costs dropped dramatically but so did their revenue... and Elon saddled the company with $13B of debt, which costs $1B in interest annually. Is Twitter making over $1B more in revenue than its operating costs with less advertisers? I doubt it. I think that's why xAI had to buy Twitter/X, because it's probably nearly bankrupt.
Tesla isn't even profitable. It's operating costs were way more than its revenue from cars and powerwalls... the only reason it was in the black last quarter was because of its Bitcoin holdings and the carbon credits. I truly don't think Elon is a genius of business. If those Californian carbon credits go away, or Bitcoin drops too much, Tesla is in big trouble.
You're 100% right about the H1B visas. Elon doesn't want to pay for the best and brightest, he wants to pay low and he wants people who'll endure abuse.
It might sound completely bonkers, but could MrBeast be the current Henry Ford? He might be worth $1B starting from literally just him and a camera...
To your comment about Elon's businesses.. Elon and his businesses also get MASSIVE subsidies from the government. Tesla, from my recollection, was taking in gigantic amounts in subsidies from the US government. I despise subsidies because it doesn't incentivize people to do things well.
Yeah for sure agree with you on the serious impacts that government can have. I think there can certainly be ways to make it better. I say this as an armchair quarterback in a lot of ways.. I can think it would be good to do X Y or Z but I'm ultimately not in the decision making position. If I were, I suspect I would have a lot of other things that go into it. I guess I want to find a middle ground between efficient and helpful.
Yeah, absolutely agree.