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0 pointsjillesvangurp1mo ago0 comments

Economic crashes are hard to predict. In the end stock markets are a bit irrational. They don't crash just because there are good rational reasons. And then some irrational thing triggers a mass panic when you least expected and the whole thing crashes.

The circumstances and timing (it's been a while) suggest we are probably closer to a crash happening.

From a loan/interest point of view, the dollar de-valuating a bit is actually not a bad thing for the US. It stimulates exports and inflation. And at the same time that reduces the value of the debt (and that is paid in dollars). The downside is that inflation going up usually also means interest going up. And Trump resisting that because he wants to accelerate the economy might not be a good thing.

The big picture here is oil. The world is slowly moving away from oil as the key driver for economies and paying for it in dollars. China is well on its way electrifying large parts of its economy. To the point where it is starting to import less diesel. And they border on Russia with whom they trade in Yen, not dollars. A world that is going to trade less and less oil is going to be less dependent on dollars.

I'm not an economist though. But planning for some kind of crash/correction seems prudent.

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pyrale1mo ago

> Economic crashes are hard to predict.

Some of them are, some of them aren't. An economic crash is pretty much guaranteed if international relations break down in such a way that international partners believe trading with the US is a liability. Dollar going down won't stimulate exports if the cause for it was an aversion to buying US products in the first place.

Whether or when that will happen, and to which extent, is another story, all we can say is that the momentum created by the current US administration moves us closer to that point. Will they come to their mind before that happen? Will they be able to restore trust? Will the lingering effect from the damage already done subside? These are hard questions.

ezconnect1mo ago

The next crash will probably be a race for assets or hard assets for the people who can afford it. It means the stock market will reach all time high, gold all time high and land prices skyrocketing as people try to escape from the dollar currency. The US President will still be proud the economy is still good because the stock market is at all time high and the people are rich because their homes are at all time high valuation but the middle class can barely afford food because there are no available jobs that pays good enough.

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