Since October, I've been blogging away, on various sites, that I thought it was significant that 2008 was a meltdown year. Housing market collapse, banks/financial institutions collapse, stock market collapse...a demand destruction/deleveraging moment of huge proportions. Clearly, a societal breakdown, and perhaps the beginning of the "real 21st century".
Oddly enough, each new century starts with the same old/same old of the previous century. Then there is some sort of global event that catapults the world into significant change, and heralds the real beginning of the new century.
To try to return stability to the "old model", which was crashing all around us, printing presses raced into full bore mode...paper currencies being printed at warp speed all around the world, to stem the changes. Huge bailouts...no one could even begin to fathom the amounts of money being bandied about, in the media...it was all rather like monopoly money.
So, after deflation comes hyperinflation, then perhaps the "real crash"? Who can say. There are no moorings to tie this boat to!
Alongside this economic turmoil, though, is the rise of national interests. China is suddenly flexing and making noises of world power. Although everyone says they won't, they could...refuse to hold anymore U.S. Dollar debt. What would that mean? The Chinese are also suggesting a world currency, and not the U.S. Dollar, for international trade purposes.
For several months, now, I've been concerned about cash itself, and have often commented that it could be the next bubble. If banks are still unstable/not liquid, and those sitting with all their worth in cash (backed only by a government), how secure is this as a preservation of capital medium? Overnight, the government could decide that 100,000 in the "old currency" is now worth 5000 in the "new". It's happened before. Might this fear generate some short term purchases of good real estate investments, just as a way to preserve capital? More unknowns!
Mmmmm....a long time ago, I studied history. They say if we don't pay attention to it, then we're doomed to repeat it. I'm going back to find those books on my bookshelves, and to remind myself of outcomes.
Who's in charge, anyway?
How may I help you to discover special Salt Spring Island & the Southern Gulf Islands? Call me!
