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lettuceLeafer wrote

Tbh most of the bearist economist mostly think that the US economy is on the constant verge of popping and is mostly being help up by government policy. Not preventing it but just delaying it. (year bubbles are often cause by the market but mostly due to government policy). 2008 was due to government policy on mortgages and the great depression was caused by interest rate for loans being too low. I.e. how they regulate banks being artificial which causes problems and them proping everything up with QE.

So tbh from what I tell it's hard to accurately predict when a recession will happen. Most of the people who actually predict say rightfully so that the market will crash but it's hard to pinpoint due to federal reserve and general gov policy.

So to be honest this isn't anything special. To say that the US economy is on the verge of collapsing is like calling the sky blue bc it's always pretty close to doing that. Hence why the federal reserve and the gov as a whole have to manage it so carefully and constantly

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existential1 OP wrote

I generally agree with the sentiment but not even all bearist economists have a track record of calling when things are likely to happen and when they won't. Most stick to "the sky is falling" forever and happen to be right once a decade or two. This dude isn't one those folks.

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existential1 OP wrote

This is written by the dude that correctly predicted both of the previous 2 crashes.

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[deleted] wrote

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existential1 OP wrote

It is scary...here's some quick help.

The author uses the term "sigma" a lot, which is very helpful if you like math or statistics and very unhelpful if you're not knowledgable of them. Sigmas mark deviation from a standard within a set of data. +1 sigma = means that the point in question is higher than 68% of all data. +2 sigma = 95% of all data. and +3 sigma = ~99.7% of all data.

In sports terms, you can think of most players of a sport being within 1 sigma....professionals of varying degrees being between around +2 sigma...and the best of the best (like Lebron or Messi or Gretzki) being the +3 sigmas. That isn't perfect, but you get the idea...hopefully.

Basically, for the first time in our history, we have 3 3-sigma outlier bubbles (real-estate, stocks, and bonds) while also having ridiculous price inflation (hence the .5 in the title of this post and in the article). So pick your sport, but you basically have 3 "greatest of all time" type players on the same team about to dominate the rest of the field...which is us.

The author predicts this will end worse than 2000 or 2006 in the US and is only somewhat comparable to what Japan endured in '89. However, even Japan didn't have all the issues we currently have. On the flipside, who knows how the FED and gov will try to handle it (likely bailing out the rich, again) and how that response will further sink the market.

Sidenote, the author also does a decent job talking about how all this shitty policy plays out for the common person in terms of not being able to buy a house and generally feel that older, wealthier, generations rigged the system.

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