Hi guys, so I just want to discuss lots of economists are coming out now and talking about the debt cycle and the recession that is overdue and all this sort of thing. I think one of the key things here, and one of the key understandings is, if you go back, a lot of these guys are saying they predicted the last recession and they're going to say they predicted this recession, and a lot of the stuff they're saying back then ... Which is a great thing YouTube was about then, so you can actually go back and see a lot of their videos from back that far, if they haven't taken them down. But for the most part they're in the news and things like that. What they were saying was longterm debt cycle needs to be corrected, blah, blah blah, and that was back in the 2008 recession. That was the, you know, the big one. That was the short term-debt cycle. The long-term debt cycle hitting both the same time, in a productivity dropping and a Whopper of a recession and let's face it, it has been, yeah, it. It's been a recession that has lasted over 10 years. Well, 10 years now, probably it is over 10 years.
So why would those same people be predicting the same thing again 10 years after the last one? I think this is really interesting because on the one hand you can go, "Well, hold on a second, most of these experts are wrong most of the time. Most of these experts are going to predict this on a continuous basis, or some form of this. Because why? It gets them on the news, it gets then column inches, it gets people interested in what they're saying. It works. Unfortunately bad news sells, and that is the state of who we are and what we're becoming, and it's been amplified with the social media life.
Here's the reason why is because we didn't solve the problems last time. So if you go back 10 years ago the debt cycle meant that what we should have done was rebalanced everything. That either means prices come down or inflation takes off. There's a couple of ways you can do it. You can do inflation, but effectively, look, what it comes down to is this, we didn't address the issues that were the present back then.
All we did was print more money and we've been printing more money. One of the problems we've got right now, too, is they're still printing money and we've got low interest rates. So what is called monetary policy, which is where we lower interest rates or raise interest rates to sop up and get rid of the excess, or put more into the economy, money effectively. Money supply, increasing or lowering money supply through interest rates primarily. That can't work because everything's at zero now virtually or near zero. So, there's very little maneuverability there. That takes away one of the biggest tools that governments have used, realistically since the '60s.
So, that only leaves us realistically with fiscal policy. So fiscal policies, things like taxes, and spending, and all those sort of things. Well, for the most part, you know, if you look at the UK for an example they've been austerity for the last 10 years. They've only now looked at coming out of it, so we've still got a lot of issues that weren't addressed.
Unfortunately for us we've rented, hired, we have politicians who won't address the issues. All they'll do is bandaid it, and by band-aiding it doesn't fix it, it still comes back and bites them in the ass. I think this recession is as much about our pathetic politicians as it is about a recession that we have to have, or a cyclical short-term debt cycle, long-term debt cycle. We just didn't fix the problems that we had back then. I think that is one of the real problems.
One Great Property Idea
How Property Investors with Little Time Can Invest in New Build and Off Plan Property using a Regeneration Strategy and Where Exactly to Invest in 2022.
THIS WEDNESDAY @
1230pm London GMT
1230pm GMT London
What has happened is those with money ... The wealth gap has become even more in most countries, and so that's why people that are voting all over the place. It's not a two-party system anymore. It's a 20-party system, and people are willing to go, "Well, I normally voted for these guys but I'm going to vote with these guys this time just to stick it up their you know ... I won't it say anyway, but yeah. So, that's just my thoughts on why these guys are saying the same things they said 10 years ago now, because we didn't address the issue. So, that's just food for thought and I'll be presenting more and more just snippets of why and then what we can do about it as property investors.
I think that's really the keys. What can you do about it to make sure you get through this next three, four, five years and come out on top? Because there's always opportunity and I think for the most part when you make the most money is when times are tough, which let's face it in the UK right now the last three years have been tough, and they're not looking like they're going to get any better soon. So just some food for thought there.
Subscribe down, click the button, subscribe. Leave any comments/ I do answer them, and I'm happy to have a conversation about your thoughts and what you think. You might think I'm a bloody idiot. Well, fantastic. Write it in the comment and let's have a bit of a discussion and see if we can get to the bottom of it, and see if we can't work out the best way to make money and see ourselves through all this fun and games until the world gets back onto some sort of sanity. All right, guys, have a great day. Live with passion.