What Happens When Our World Changes from Not Enough, to TOO Much?
There is coming a window of time when everything will be on fire sale.
And then, there will come a time when most of what we consider assets today, will be left at the edge of the road with a sign on it, FREE.
The Time of the Fire Sale
There is coming a time when many people will be selling all their toys.
Food prices will have gone UP.
People will be having problems getting money/cash.
And, to make ends meet, they will be selling all their toys. All those trailers, all those four wheelers, all those vacation homes. If they have an extra vehicle, it will be up for sale.
And, already, people who cannot afford their auto loans are getting their cars repossessed. And, they aren't moving at auction. There is a pile up of used cars, and most people aren't even aware. And the salespeople aren't saying anything.
Soon, there will be so many extra autos in the system, that people will be trading them for food, or repairs to their house. The high prices on new cars may make them unsellable, except to rich people (like the crypto rich). I do not believe the new car lots will be able to drop prices fast enough. New cars, with too high of a price, will be left "brand new" for years.
So, if you want an RV, a quad runner, a trailer, a jet ski, all those things are going to be on sale. Just have cash or crypto, even food, and you can get whatever you want.
It was all held up by retirement funds
The boomers have been starting to draw against their retirement funds. Funds which are not really being replenished by the younger generations.
Basically, the only real money in the market is what the boomers put in. (the rest is bank money and bank loans, basically, hot air) And depending on how much of the money has been moved out, the paper market may be completely a bubble.
"Market Cap" is just a number you can use for comparison. It really has no meaning. The price of the stocks being sold is equal to the amount of money comping into the market. If nobody buys stocks, no stocks are sold. And if stocks aren't selling, and people are desperate to sell, they lower the price. And will lower the price, and lower the price. Until the amount that want to sell equals the amount of money coming into the market.
The market cap doesn't matter, all that matters is the amount of money coming in. Fortunately, or unfortunately, that money can come straight from the Fed. And they can print as much money as they want. It is already believed that the Plunge Protection Team owns a good portion of the stock and bond market. And, if this is the case, the stock market can plunge soooo fast, that people may just abandon their shares. Like Weimar Germany Marks.
The boomers will be dumping their vacation homes.
The Biggest Ghost Towns You Ever Did See
People will be moving away from the cities. Especially blue cities. The jobs will be gone. The restaurants will be gone. The night life will be gone.
Crime will increase. Gangs, especially the ones in blue, will get worse. Utilities will be in jeopardy. Shipments, trucking will be delayed, harassed, and in some places just too dangerous to ask men to do. Shipment, UPS, USPS, FedEX will be stolen off of people's porches. That is, if the UPS/FedEX driver doesn't take them himself/herself.
Everyone that can leave, will leave. All that will be left is people who don't have enough resources to go somewhere better.
And, before this time we will see house prices falling like a rock, after this point, people will just find an empty house and move in.
The story of "invest in a well diversified portfolio of stocks and bonds" will be found to be false. When the falsity is seen, many people will puke.
The story of "your house is your biggest asset" will be shown to be completely false, unless you have a homestead, with a greenhouse, and cattle. So many people believe this, and will try to hold onto their mental value of their house. Only those who get in front of the falling prices will get their houses sold.
The importance of automobiles will drop. This will be demonstrated by the amount of cars that will just be left on the side of the road, or in parking lots. We may even see it sooo bad as to find a dealership that has gone out of business, and cars are still on the lot.
So much of what we value today, will just be junk tomorrow.
And that is what happens when there is too much of a commodity item.