How GOOD can the global economy get?

[memenode]

It is easy to get depressed when reading articles on sites like LewRockwell.com. If I didn't actually believe them (or most for that matter) I would be tempted to call it fear mongering because the general attitude seems to be that what we are facing is a global depression worse than the last one, martial laws and just in general doom and gloom.

But even in the worst of times there's got to be things that happen which are actually positive and those positives may in fact carry the whole of the cure, the way out for individuals who recognize it and seize the opportunities they present.

These good things that are happening can be both economic and social. Some might say that what's going on is waking a lot of people up to the truth about economy (austrian economics) and liberty in general, which is one good thing to point out. I'd like specific examples if anyone has them. But I would also like to hear about the actual economically positive events which we can individually use as reasons for hope that we will survive, that after this storm passes a new era of prosperity might begin, that (if you believe such things) the agenda of central bankers will somehow fail to materialize (the establishment of the global fascist state) etc. They could also be opportunities we could take advantage of to not only survive, but grow ourselves and the liberty movement.

So, anyone has any of that to share?

Thanks

[Kat Kanning]

No, but we paid $2.65/gal for gas yesterday.

[Friday]

Here are some good JOKES about the global economy. 

Joke 1
Q: With the current market turmoil, what's the easiest way to make a small fortune?

A: Start off with a large one.

Joke 2
Q: What's the difference between an investment banker and a large pizza?

A: A large pizza can feed a family of four. 

Joke 3
A rich, dying man, laid on his deathbed, requested to be joined at his bedside by his vicar, his bank manager and his lawyer.
He instructed them that he wished to be buried, when he finally passed away, along with all his money. He gave each of them fifty thousand pounds and asked them to throw the money on top of his coffin, in the burial plot, when he died.
A couple of days later the old man passed away and was buried within the week. At the wake, the three men were chatting and the vicar was suddenly overcome with guilt. He confessed to the other two that he had only thrown only half of the money onto the coffin, as the church needed urgent repairs to the roof. The bank manager thought, 'What the heck if we are having a confession,' and told the other two men that he had also only thrown half the money in, as the 'Credit Crunch' was hitting hard and he needed some money for the bank to stop it going bust. The lawyer jumped up and said to the other two, 'I think that is a shameful act on both of you. I threw a cheque in for the full amount!"

Joke 4
Record unemployment levels have been announced today as the Credit Crunch tightens it's grip.
Worst hit sectors are the construction trade and Icelandic bank robbers.

Joke 5
Q: What's the definition of optimism?
A: An Investment Banker ironing five shirts on a Sunday evening.

Joke 6
I went to the ATM this morning and it said "insufficient funds".
I'm wondering is it them or me.

Joke 7
The credit crunch is getting bad isn't it? I mean, I let my brother borrow $10 a couple of weeks back, it turns out I'm now America's third biggest lender.

Joke 8
Talked to my bank manager the other day and he said he was going to concentrate on the big issues from now on.
He sold me one outside KFC yesterday.
[NOTE: The big issue is a UK magazine sold by homeless people to make some money]

Joke 9
Resolving to surprise her husband, an investment banker's wife pops by his office. She finds him in an unorthodox position, with his secretary sitting in his lap. Without hesitation, he starts dictating, "...and in conclusion, gentlemen, credit crunch or no credit crunch, I cannot continue to operate this office with just one chair!"

Joke 10
Q: What's the difference between Investment Bankers and London Pigeons?

A: The Pigeons are still capable of making deposits on new BMW's.

Joke 11
Q: What have Icelandic banks and an Icelandic streaker got in common?

A: They both have frozen assets.

Joke 12
Quote of the day (from a trader): "This is worse than a divorce. I've lost half my net worth and I still have a wife."

Joke 13
Q: How do you successfully freeze your financial assets?

A: Invest in an Icelandic bank

Joke 14
A lobbyist on his way home from Parliament is stuck in traffic. Noticing a police officer, he winds down his window and asks: 'What's the hold-up?' The policeman replies: 'The Prime Minister is so depressed he's stopped his motorcade and is threatening to douse himself with petrol and set himself on fire. He says no one believes he can get us through the credit crunch. So we're taking up a collection for him.' The lobbyist asks: 'How much have you got so far?' The officer replies: 'About 40 gallons, but a lot of people are still siphoning.'   

Joke 15
You know it's a credit crunch when...
1. The cashpoint asks if you can spare any change.
2. There's a 'buy one, get one free' offer - on banks.
3. The IRS is offering a 25 per cent discount for cash-payers.
4. UK Prime minister Gordon Brown has stopped chewing his nails and started sucking his thumb.
5. Your builder asks to be paid in Zimbabwean dollars rather than US dollars.

Joke 16
Q: What's the capital of Iceland?

A: About $3.50.

Joke 17
Uncertainty has now hit Japan. In the last seven days, Origami bank has folded, Sumo Bank has gone belly up and Bonsai Bank has announced plans to cut some of its branches. Yesterday, it was also announced that Karaoke Bank will go up for sale and will likely go for a song, while shares in Kamikaze Bank were suspended today after they nose-dived. While Samurai Bank is soldiering on after sharp cutbacks, 500 staff at Karate Bank got the chop and analysts report that there is something fishy going on at Sushi Bank, where it is feared that staff may get a raw deal.   

Joke 18
Why have real estate agents stopped looking out of the window in the morning? Because otherwise they'd have nothing to do in the afternoon.

Joke 19
Q: What's the difference between an American and a Zimbabwean?

A: In a few weeks, nothing.

Joke 20
Q: George Bush was asked today "what did he think of the Credit Crunch?"

A: He replied: "It was his favorite Candy Bar." 
Jokes sourced from: BBC News, Sickipedia, and The Daily Mail

[Mike Barskey]

A lot of those are funny (thanks for them), but my favorite is #15, response 5.

[Russell Kanning]

I am optimistic that we can survive Obama or McCain

[K. Darien Freeheart]

I'm a fan of #14.

[memenode]

I love those jokes, especially #5, but most of them are great.

Thanks

[memenode]

One really positive thing I'm seeing these days is the surge of the dollar. I never thought I'd see it this high ever again. The general sentiment was it's gonna tank and I need to run away from it as much as possible. Yet these days it's just about breaking a two year record compared to local currency, which is a boon to me. Just look at this 180 day graph: http://www.exchange-rates.org/history/HRK/USD/G/180

So I wonder... one reason my be as was said before elsewhere that people are liquidating their USD investments into dollars and thus pushing it up, but that could also mean that they're just a step away from "liquidating" dollar too.. I mean, converting en masse to other currencies and then allowing the dollar to finally crash.

But I've been thinking... this crisis was caused by bad credit basically. And dollars today are nothing but someone's promise of debt. If debts fall through the money essentially disappears into nothingness, where it came from, thus there is technically less dollars in circulation. I've seen loss estimates as high as 60 trillion. Not even the biggest government bail outs we've seen can make up for that. So if I understand correctly, government bail outs cannot boost inflation, because what is happening is deflation, money supply is contracting due to all of the dollars simply vanishing into thin air.

I've read about where all of the money lost in stocks goes also and the conclusion is basically that it doesn't go anywhere, it simply disappears. Or better yet, the money never even existed. It was all in the mind, all pure speculation.

Could, then, the dollar surge be explained by a deflation? Temporarily it is a good thing I suppose... but long term.. well, great depression was caused partly by deflation..

[dalebert]

Could, then, the dollar surge be explained by a deflation? Temporarily it is a good thing I suppose... but long term.. well, great depression was caused partly by deflation..

That's exactly what's happening. We're having a deflationary cycle. I talked about this a while back after I saw this video where the speaker suggest that we not buy gold (yet).

Sorry, I should add that an inflationary cycle is still expected but the deflationary pre-cycle was predicted by some. That's why he said not to buy gold "yet".

[Raineyrocks]

My favorite was joke #10, thanks Friday! 

[memenode]

Interesting video, although if inflationary cycle is sure to follow a deflationary one then it still makes sense to buy gold or silver, just as long as you don't put all your surpluses on it and save some cash too. In deflation gold and silver are supposed to be cheaper so you can buy more for less and be better prepared when deflation is replaced with inflation again. Although there's something funny going on with silver and gold prices since there's a disparation between physical and spot price.

I just wonder how long would the deflation last.

[dalebert]

Although there's something funny going on with silver and gold prices since there's a disparation between physical and spot price.

I just wonder how long would the deflation last.

Not very long as the government starts to implement more desperate measures on behalf of their wealthy buddies.

It's important to note the date on this video. He was saying this a while back before the deflationary cycle had already started. It appears now to be good advice.

As for the disparity between spot and actual price, well, the spot price IS the actual price if you buy it a certain way. The spot price of silver is based on the actual trading price on specific 50lb blocks of silver. The difference would be based on a market preference for a more convenient unit that's prettier.

UPDATE: Just found this.

What is Spot?
Spot Price in the United States is the price being paid per troy ounce for a "contract" for 5,000 ounce silver bullion bars at the Commodity Exchange (COMEX) a part of the American Mercantile Exchange in New York.

The "Spot Price" does not include fees to take "physical delivery" of the Silver, broker commissions, transportation, or distribution between dealers down the supply chain.

The amount above "Spot" is called the "Premium' and is higher per coin in smaller quantities.  Coins having "collector" demand will command an additional amount based on the coins "numismatic" (collector) value above the value of Silver.

Sure are a lot of conspicuous quotes in there though. 

[Raineyrocks]

I can't answer this question today, I have to write the darn bills out and hope we can make it. 

[memenode]

Some say the spot price is being manipulated, but in light of this deflation cycle theory it seems to make sense to an extent that it is low. I'm just not sure if it should be as low as it is.

These additional costs related to physical delivery seem to explain the disparation, but I'm not sure if it covers the whole of a difference. The difference seems a lot bigger.

But anyway, I think all this is enough to stop worrying much about the spot price and look at the actual price of physical bullion, coins etc. Those are the real thing. For a while I thought ebay was unique in having higher prices until I realized this disparity. Now I am not all that worried about ordering from ebay more expensively. It's likely to reflect a more realistic market value of silver than the spot price does.

[memenode]

This seems like a good related article: First Comes Deflation, Then Comes Inflation.

Speaking of good, something that crossed my mind is that deflation is in fact a sign that the market forces are winning over government forces, at least temporarily. The way we can determine this is to ask what would the market do if government suddenly stopped interfereing at all, and people knew that. Well I think we would see deflation, exactly what's going on, as the excess value and companies which depend on it simply go bust. And then, if there's place left in the market for it, new fresh thinking players come up. Deflation would only go as far as necessary to eradicate the valueless money. Then some sort of a transition from fractional reserve lending to sound banking would procede and more means of exchange would start to be adopted (like silver coins), which might be a little turbulent..

So in any way in which the scenario may differ from that which would occur if only the market were at play is a scenario where government managed to change the course. But also any point at which the scenario fits what it would be if only market existed, could be counted as a win for the market. Government only has so much power. I think the market is always primary. Government is merely (and often cluelessly) trying to "control" the beast which isn't really controllable entirely, so the outcome is never truly controlled economy, but an amalgation between market forces and government coercion. So it's hard to always accurately say that government did something and now we're all doomed when the less predictable part is in action as well, the market, which could always change the course, at least slightly - and who knows, maybe it'd be for the better than we hoped?