[GHung]

Stoneleigh from down under on too many claims on real stuff, and other things....

Podcast:

http://ec.libsyn.com/p/a/2/2/a2257d6077 ... id=9396778

..... or at TAE:

http://www.theautomaticearth.com/2015/0 ... cole-foss/

I've always enjoyed Nicole's clarity on what I see as the core human issue: Too many humans laying claims to planetary resources and, financially, to unsubstantiated assets, defining wealth in terms of made-up shit; what I call virtual overshoot. Not sure how we've managed to pretend and extend this long, but it's bound to end sooner than later.

[Cog]

Did Stoneleigh recommend going balls deep in the stock market in 2009? If not she isn't much on predicting the economy. At that point you could have thrown money into any stock and made at least 30%.

From the article you cited her friend had to file bankruptcy on a failing business venture. Doesn't sound like Stoneleigh is much of a friend.

[GHung]

You're pretty cocky with your hindsight, eh Cog?

Note to Cog: Some people don't define their lives by the stocks they own, or their incomes.

[Outcast_Searcher]

You're pretty cocky with your hindsight, eh Cog?

Note to Cog: Some people don't define their lives by the stocks they own, or their incomes.

Where does it say ANYTHING about Cog's income?

I think the point was that bad track records don't build credibility for future financial predictions. (Especially given how many randomized "future predictor" financial newsletter writers (for a fee of course) there are out there giving their OPINIONS about the future of financial markets).

Is the best you have to make a fact-free attack on someone who points out a weakness in your idea? If so, that's mighty weak.

Side note: Funny how ALL the financial newsletter writers need to charge fees over time for their predictions. Funny how few of them retire to live in luxury on all the gains they made off their own financial wisdom. Funniest of all how none of their subscribers seem to notice how random they are.

Now, why do I say financial "gurus" are pretty random? Here's a site I like that points some of this out (you don't have to pay to get a good overview -- I've never paid and have no connection to the site aside from occasionally reading "guru" reviews). What I like is that they use math and point out their confidence based on how much data they have, instead of just making random statements.
http://www.cxoadvisory.com/gurus/

[PeterEV]

I've been following a number of economic pundits and predictors and have a high regard for Ms. Foss. While no one is 100%, she did predict that we would see oil go back down in price due to higher prices killing the world economy. Her in depth analysis is something that we don't see on television nor with many of the financial gurus out there. While Ms. Foss's prediction did not come true in the time frame of the above commenter, we are seeing it unfold in Greece where debt repayment is greater than than the country can afford. To me, it says that she was early but the mechanisms she describes are building in the markets. We will likely see what she is talking about soon; some say before the 2016 election but the economy can drag while bad debts mount. Some day, the piper has to be paid.

I am amazed that Greece has held on for so long. During that time when many were saying Greece is about to implode, the amounts of money loaned to Greece have increased substantially to where there is no hope for Greece to pay back those loans. If the loans are defaulted upon, what happens to the creditors? What happens to all those derivative bets that were placed by Wall Street?

Another thing to keep an eye on: Congress is trying to enact legislation where they will borrow coercively (read: raid) the Federal Employees equivalent to a 401K called the Thrift Savings Plan (TSP) to fund Highway Trust projects. Why do they **need** to raid the TSP? Why can't they get the money from issuing more bonds? Did the bond market dry up? Where did all the TARP, QE, etc. money go? This stinks.

If you don't like Ms. Foss's predictions, who do you follow that makes better sense or has better timing?

[Pops]

If you don't like Ms. Foss's predictions, who do you follow that makes better sense or has better timing?

I worship at the HTML of many gurus. LoL

Actually I'm pretty well done with predictions, more into simply trying to understand. I used to read TAE daily. Obviously Nicole has a POV and opinions just like everyone else and a daily diet of debt-based doom gets a little old. I still take a shot now and then, tho.

I had this bookmarked

Nicole Foss’s checklist
1) Hold no debt (for most people, this means renting).
2) Hold cash and cash equivalents (short term treasuries) under your own control.
3) Don't trust the banking system or deposit insurance.
4) Sell equities, real estate, most bonds, commodities, collectibles.
5) Gain some control over the necessities of your own existence.
6) Work with others to enhance personal and community resilience and security.
7) Get out of managed funds and don’t rely on middlemen.
Change your bank account to a New Zealand-owned bank.
9) Buy durable goods and quality tools.
10) Educate yourself and your children; read, watch and discuss documentaries.
11) Download material from the internet while it’s still working!
12) Watch your local and central government indebtedness and risk-taking.

I like Korowicz, his description of systemic tipping points was pretty important to me. Much the same as Nicole but more of a generalist I think? http://www.davidkorowicz.com/publications

Of course Gail, another generalist: http://www.OurFiniteWorld.com

Charles Hugh Smith is another guy who tries to get the bigger picture and doesn't keep beating the same old hobby horse. (great blog roll too)

D Short is the chartmeister

[GoghGoner]

Her take was deflation. More countries are fighting deflation than inflation that is why we have major economic stimulus ongoing in US, Europe, Japan, and China right now. Now that stimulus has failed and is causing more problems than it is solving, I think we will see how right she was...

[PeterEV]

Hi Pops,

I'll throw in Mish Shedlock at http://globaleconomicanalysis.blogspot.com/
I read Denninger but I have occasional issues with his stances. He's at http://market-ticker.org/

Harry Dent, his books (e.g. The Great Boom Ahead, etc.) relates the S&P 500 to demographics and provides a partial explanation for some of the meltdown we are seeing. I don't think he has gone far enough in his analysis but he present some compelling dynamics. He is not a "peak oilist". The remarkable thing is that his S&P 500 vs. the relative number of 40-50 year olds in this country was graphed back in the early 1990's and extends into the 2040's. If you add all our QE to the debt of the S&P 500 companies, I would venture his graph would be accurate. I suspect TPTB will attempt to transfer that debt to us.

With regard to Nicole's check list in your reply, is that a ""had" or "have" this bookmarked."

I think her list is for someone who really believes the system will crash and crash hard. She does say "Sell ... real estate..." which is something the Australian Economist Steve Keen has done and has been happy with his decision. If the system does crash, many will wish they had followed her advice.

If the system does **not** crash, what would keep it afloat or on life support?

Mentally, I am not ready to throw in the towel. I maybe sorry but I see some possibilities. I am working on some of her other items in her checklist which are common sense items even if the system doesn't crash (e.g.,
5) Gain some control over the necessities of your own existence.
Okay, I can plant a garden, generate some of my heat and electricity, and read up on homeopathic medicines and practices
6) Work with others to enhance personal and community resilience and security.
Neighborhood watch, get to know the neighbors, etc.
9) Buy durable goods and quality tools.
Especially if you learn how to use them.
10) Educate yourself and your children; read, watch and discuss documentaries.
Above all learn to ask good questions, increase your analytic skills, and be an asset to your family.
11) Download material from the internet while it’s still working [ed. or before someone takes the page down]!
12) Watch your local and central government indebtedness and risk-taking.)
There are many civic things a person can do to make your local government better.

If you truly think the system will crash,
1) Hold no debt (for most people, this means renting).
Is a good idea if you can swing it. My house is paid for and somewhat enhanced for tougher times.
The only good debt is that which increases your skills or productivity, etc. and should not be used to buy trinkets and baubles.
Personally, I think taxing revolving credit and credit cards would be a good thing.
Paying with cash is a good idea, if you can swing it.
2) Hold cash and cash equivalents (short term treasuries) under your own control.
In the Bank of Sealy Postepedic?
3) Don't trust the banking system or deposit insurance.
Bail-ins are likely. Witness Cyprus and Greece. Others to follow.
4) Sell equities, real estate, most bonds, commodities, collectibles.
Sell high, buy low ... later. However, commerce provides us with a lot of good stuff like food, transportation of that food, and those goods and services.
I've also been witness to "one-percenters" who fund long term projects that have the potential for much good. I'd hate to see that dry up.
7) Get out of managed funds and don’t rely on middlemen.
This would go along with Item 4 above but I think she means actively traded funds and where sales people take a cut of any investment.

[Pops]

Harry Dent, his books (e.g. The Great Boom Ahead, etc.) relates the S&P 500 to demographics and provides a partial explanation for some of the meltdown we are seeing.

Very cool, I've been spouting something similar recently, I'll have to check him out. I love people who agree with me!

With regard to Nicole's check list in your reply, is that a ""had" or "have" this bookmarked."

I'm not a doomer to the extent I was 15 years ago post 9/11; I'm older, with fewer responsibilities and have seen a whole lot of drop-deadlines and predictions flow under the bridge. I don't get as wigged out packing and repacking my bug out bag as I used to. Which isn't to say I don't still have one packed; I was a prepper before prep was cool ;^)

[americandream]

Hi Pops,

I'll throw in Mish Shedlock at http://globaleconomicanalysis.blogspot.com/
I read Denninger but I have occasional issues with his stances. He's at http://market-ticker.org/

Albert Bartlett has done a video on resourcing and population exponentiality...he was a mathematician so its pretty straight forward as opposed to a philosophical explanation. Google his name and that should bring him up.

[dohboi]

The problem with folks who preach that they know for absolute certain that the whole system is going to crash in X number of months is that it actually tends to undermine real community preparedness, 'cause people tend to go straight to bunker mentality.

A friend of mine hosted Nicole in here house when she came to speak here, and this friend got so convinced and freaked out that the collapse was going to be that very fall that she went out and bought 100 cakes of soap at Target, convinced that there would be none available and that this would not only keep her relatively clean, but would be something she could barter for other goods.

Now she's stuck with a whole lot of fairly crappy soap.

Now we actually have quite a local craft business in homemade soaps. If this friend didn't feel like she had to rush right out and get as much as she could for as little cash as possible (she is of quite modest means), she is exactly the kind of person who would have tried to support local soap makers. As it is, all her cash went to a multi-national corporation will give exactly 0% of a shit about her survival when things get tough, while depriving the local market--that needs all the help it can get--of that cash.

So the very urgency, immediacy, and certainty with which Foss presents her prognostications goes against her own recommendations, particularly #6: "Work with others to enhance personal and community resilience and security"

Obviously, Foss didn't force this person to go out and buy all that soap, but it is a very predictable response from anyone who actually would take the timing of her predictions (always 'within a few months' it seems to me) seriously.

[ennui2]

Not to mention the damage in overall credibility when those few months go by and doom doesn't arrive on schedule.

These sorts of predictions show up here like clockwork, but nobody seems to ever hold these people accountable. Every prediction of doom is taken seriously, then nothing happens, people conveniently forget, and move on. Most people aren't so forgiving.

[americandream]

Any storm likely to crash the system globally will be preceded by tell tale signals. Massive shifts of funds to Switzerland and Japan for example as decoupling commences and the capitalist class go into damage mode. For the moment, Greece should signal that globalisation is well underway and local working class dramas will not be allowed to shake this momentum in any way. When you see a would be Che Guevara do a rapid about turn, that should tell you something.

[SeaGypsy]

What is a 'would be Che' & how does one do a 'rapid about turn'?

Considering the excellent capital consolidation coming about for the precious few from the recent market crisis, I would guess we are in for a few rinse & repeat exercises wouldn't you AD? If interest rates will somehow allow it.

Meanwhile isn't open capital access goal number one for those outside the BRICS? (Meaning of course aside from industrial consolidation, standard business contracting arrangements not time limited agreements putting foreign owned businesses on the chopping block according to a schedule or change of government).
Will the beginning largesse among BRICS force matching largess on the part of Anglo American Empire? (Surely no American Government can sustain building massive infrastructure in 3rd/ 2nd world countries at a time where trillions are needed urgently at home for infrastructure maintenance & rebuild, let alone modernising PT?)

How nasty will the US/NATO get if/ (more like) when /as the BRICS go from being ahead in momentum to being ahead in mass?

What I would be watching for in terms of 'bunker time' or 'batten down the hatches me hearty's' is massive & sustained private equity divestment in US bonds. Not because the world hinges on the US bond market, but it does hinge on the USA behaving itself. The biggest risk of short-medium term absolute disaster is a cranky USA.

[SeaGypsy]

This may be the most dangerous time since the Cuban missile crisis.

As we chat, BRICS are consolidating. The petrodollar is rapidly approaching being an artifice of history. Same goes for dollar reserve status, the new trading block is going to demand both. It is also going to keep growing, while the US tries to reinvent itself with manufacturing wages competing with China & everyone else in the service sector, with IT services thoroughly globalized, including financial, a heck of a lot of people competing for a rapidly decreasing piece of the pie.

We are about to find out, if we hadn't already, what 'not negotiable' means.

[americandream]

What is a 'would be Che' & how does one do a 'rapid about turn'?.

Whoops, hit the submit button too soon.

Having set himself up as anti capital and a revolutionary (whom I have read emulated Ches charisma) Tsipras promptly did an about turn when the chips were down...which that comment was intended to convey.

Capital as it moves around the globe is largely agnostic. The huge capital pools could be from anywhere and in the hands of the large institutions are like the blood flow of capitalism as it flows through London and New York and then onto the various allotted uses, mostly in China where the return on a dollar is well above returns elsewhere. In that mix you have government treasuries, pension funds, short term liquidity for forward contracts....the whole works. Our governments are mindful not to disturb this flow unduly with panic at the banks....we cannot have panic disturbing this flow simply because one too many dollars was used in building a hospital or school....hence the austerity/subsidy mix where taxpayers are alternately tapped and subsidised out of austerity returns. So capital flows merrily on its way whilst local worker intrigues are paid out of austerity treasures.

Hope that makes sense.

edit. Watch the swissie closely for tell tale signals of decoupling and a return to regional blocs.

[PeterEV]

Hi dohboi,

Sorry to hear about your friend. 100 cakes of soap is a bit of soap especially if their income is marginal. Like a Rain Dance during a drought, it's all in the timing.

I listen to Nicole and try to understand the dynamics which she is basing her action upon. I also look at the markets to see what they are saying. She predicted that oil prices would crash based on poor economic conditions. The demand for oil would contract. What we saw was over drilling, over production, and poor economic conditions causing the decline in oil prices. China is contracting. We are driving higher mpg cars and using alternative transportation more.

There have been a lot of people calling for a crash of some sort. Again, it is timing mixed with dynamics. They are basing it upon debt and as we have seen with the Greeks, their country has been receiving bailout and loans; one after the other. Austerity is kicking in each time like increasing flagellation. Anyone from the outside viewing this can see that it will end badly. The question is when? I have read a number of bloggers who thought it should have ended a couple of years ago. the Greeks could have gone through an Iceland experience and there would have been little damage. Since then, the amount of debt has increased and any default will have greater consequences. Spain, Portugal, and Italy are in a similar boat. It could be a domino effect. What are the ripple effects? Who stands to lose the most? Who will be hurt by it?

When the Greeks were likely to default several years ago, there was panic on Wall Street as a number of derivative bettors where on the wrong side of their bets. The Greek default was termed not to be a default. What happened to those derivative bets? Nicole could have been right but wasn't. This is a complex mess and one of the reasons "market timers" are rarely accurate in their timing. In the long run, she might be spot on.

In the meantime, the establishment is fighting tooth and nail to keep the wheels from coming off the gravy train. I've noticed a number of days when the markets should have declined, they went up.

So where do we go from here?

[Pops]

My personal opinion is to read things other than just those that agree with your personal opinion and stew on them a while. You don't have to read crazy stuff diametrically opposite to your basic beliefs, just something different than your normal.
Then noodle up some general rules (Read This) so you can have a gauge.
Then make a list of the things that worry you, give each thing a worry rank and a ease of mitigation score and do some easy things to see how it feels. I don't see anything wrong with buying extra soap if that makes you feel better—we spend money we'll never see again on feeling better all the time.


There is a great tendency to imagine we each are completely logical, realistic and unemotional. I'm pretty sure we are just the opposite. If we were rational beings we would easily come to identical conclusions — but we don't. The initial flush when we for the first time imagine things might go sideways is where you make those "100 soap bar" mistakes because we act on impulse; emotion, rationalized of course, LoL.

Gotta realize that there have been people making a living scaring other people since forever. It is us who are new to the game.


I think if you are susceptible to the doom suggestion you should get a doomer mindset. That doesn't mean constantly freaked out and bunkerd up because doom is imminent; rather it is simply staying aware that shit can happen and taking it into account in ALL your decisions. I'm not talking (just) zombie doom, or Mad Max doom (necessarily) but pink slip doom; chemical railcar accident evac doom; house fire, weather event, credit freeze, blah blah.

I rarely get too upset at unforeseen mistakes, how could I know? But I've always been most aggravated with myself when I proceed ahead in spite of misgivings and encounter the very trouble I imagined.

[GHung]

Regarding Dohboi, PeterEV and soap. The question of soap, and so many other things, isn't whether there is, or will be, local production, but for how long and in quantities to meet demand? Methinks many of the local soap makers still rely on long, complex supply chains to produce their product. Several years ago I scored a box (gross) of Ivory bars at a thrift sale for a paltry $10 (IIRC). It went into the very back of a bathroom cabinet to be forgotten; long shelf-life I assume. May or may not be worth something more than a few cents/bar, but it'll still be soap, eh? Unlike the woman mentioned above, it wasn't a panic buy, just something I came across.

I'm not into predictions so much; just paying attention to processes and trends. Most of the things that Foss mentions are, indeed, playing out; just not in real time. Slow wearing away of our ability to sustain industrial levels of consumption, as Greer points out, in a fractal manner. Coming soon to a neighborhood near you? At some point, at some level. I just do what I do and watch things play out from the cheap seats. Meanwhile, we're having another exceptionally wet summer, not so much in terms of unusually high rainfall, just that things never get a chance to dry out. Really tough for the food producers. Just one of the many things I'm concentrating on mitigating, and I'm one of the few folks around who can continue to garden (now that my high tunnel is complete), rain or shine. Got to go plant some beans. Got the soap.

[PeterEV]

Nicole has a 2 hour video up on TAE. Basically saying many of the things she has said before. In one part she is thinking the financial system will come to a head in 6 to 18 months. This is her only timetable. A number of people have said the same thing but years earlier.

After 1987, 2000, 2008, etc., it takes a while for the system to regain its feet. The dynamics according to Dent (us oldsters aren't buying as much) is likely to hamper our recovery as well as the effects of the financial shenanigans. After 2020 or so, the sons and daughters of the boomers move into the 40 to 50 year old age group in growing numbers and whatever economic clout and entrepreneurship that exists, spurs the economy. We may have to just ride out a bad bubble burst.

The late Matt Simons said we have a liquid fuels problem. He was expecting oil to go to $200/barrel. We used to use 21 million barrels of oil a day. We are down to around 18 million barrels of oil a day. With 200 mile range+ EVs coming in 2017, I think we will see a change over to EVs fueled in part by PV; either directly or indirectly. In other words, as oil depletes, we switch over to renewables. This spurs battery and PV development. There is farmland 100 miles out from most big cities. Plenty of farmland with in that range of rail heads. Things might not be as bad as she paints them to be.

Long term we still face depletion of a lot of resources. By then, you and I will likely be pushing up daisies. May we educate our kids to be wiser than us and to ask good questions.

Take care Pops...

Pops, I read the many suggestions on your link. My only thought is that I think it would be hard to gain crede with the neighbors if you are on the move.

My kids live near us. Plenty of farm area around, water, sunshine with a relatively mild but humid climate. I don't see moving but staying and facing what ever comes our way. My kids know my concerns and I know that they are trying to keep their debts low. Mortgages on their houses are the big ticket item. My wife and I have talked about talking some of our retirement money and pay off their mortgages and student debt. What they earn until a crash comes back to us as if we are holding the debts. If a crash comes, they only have to worry about taxes, food, clothing, and heat. I think they can manage that. They have skills.