patrick.net

The small business guy buying a tractor instead of a big screen TV, gives the impression that there is still SBA loans. Which isn't the case.
Nobody is buying or starting a business on credit. Which he suggested is what drives his fantasy ecconomy. This is an Establishment ecconomy, of hand picked winners to be monopoly players in their industry.
The reality of what is happening right now has nothing to do with that video. Banks are lending money period.

That's not how the ecconomy works, that video is trying to justify the last 16 years. Which I think the video got spot on.

But it's not how the ecconomy should work. He glossed over way to much to make it fit the scenario like it's all just part of the act.
Never in history of modern ecconomics has there been a recovery without a middle class driving the ecconomy.

Tenpoundbass says

The small business guy buying a tractor instead of a big screen TV, gives the impression that there is still SBA loans. Which isn't the case.

Tenpoundbass says

Nobody is buying or starting a business on credit. Which he suggested is what drives his fantasy ecconomy.

Sure they do

Tenpoundbass says

This is an Establishment ecconomy, of hand picked winners to be monopoly players in their industry. Especially with the help of the nanny state, too big to fail and all of that.

The bigger businesses, you bet.

Tenpoundbass says

Never in history of modern ecconomics has there been a recovery without a middle class driving the ecconomy.

The lion's share of that is due to demographics.

(Logan gives me a nickel whenever I say that) But it is also true.

Additionally what Dalio is saying is that you have a credit cycle. This was the case big time in 2008, this is when over-investment gets sorted out through a recession. The problem is that the Fed buying MBSs perverted this process and stalled the recovery. Which is what caused this:

Have you heard of Ray Dalio?

In 2012, Dalio appeared on the annual Time 100 list of the 100 most influential people in the world.[4] In 2011 and 2012 he was listed by Bloomberg Markets as one of the 50 Most Influential people. Institutional Investor’s Alpha ranked him No. 2 on their 2012 Rich List.[5][6] According to Forbes, he was the 30th richest person in America and the 69th richest person in the world with a net worth of $15.2 billion as of October 2014.[7][8]

https://en.wikipedia.org/wiki/Ray_Dalio

BTW from 24:26 to 25:12 he explains what I have been talking about regarding the money supply and the S&P

www.youtube.com/embed/PHe0bXAIuk0?t=24m30s

i never knew that interest rates were also zero during the great depression.

That is the long term debt cycle he was talking about. I wish he would explain that more.

No comments on the long term debt cycle and 50 trillion in credit?

This guy didn't put any dates up to go along with those curves.
I got to thinking about that last night. I felt like I got hoodooed by the HooDoo man.
Bamboozled by the nifty info graphics. We've been in uncharted territory, that cartoon was to revise the history of economics from Classic Economic model to that Keynesian model.
I think he had all of the moving parts right, but the order the timing and how the recoveries work. Have been different for pretty much every crash of the last century. I don't remember any recovery happening the same way. And most always, a new industry popped up to save us all from the brink of depression. The 80's when we were hit hard there was high interest rates and deflation of food and other commodities.
The 70's recession was they had high interest rates and high food and commodity prices. This time was in a recession we had inflation, high food and commodity prices but Interest rates was zero.
This has been the worst even worse than the great depression thanks to that greed. Now because of that video I understand better why. But that's not how the economy always worked. Just the last 16 years.

It was you who said a while back: "The economy never comes back the same way"

He does put some dates in the video, the long cycle hit the low point in the 30s we are now close to the high point with 50 trillion is credit out there. IOW over priced everything.

Well OK let's say it is right. But there's still room to pick winners and losers.

Which has been uncharted off the rails territory.

Probably for a couple of years the stock market will be good.

But I wonder about buying an index fund if the whole economy is deleveraging.

E.G. if you bought in 29 you did not get back to even until many decades later.

Except the reality is that Dalio is one of the most successful investors ever..

I didn't realize I was slobbering. He doesn't so much predict inflation cycles as deleveraging and the long term business cycle. This country currently has 50 trillion dollars in credit.

I don't agree with him that money printing increases income. As it just increases the wealth of those with assets.

The long term cycle reminds me of the Elliot Wave.

I don't think Dalio is an Austrian.

Also what he doesn't talk about is Logan's demographics. Although there is probably a correlation to that as well.

Like I said your comprehension abilities are suspect.

The three phases of the long-term debt cycle
According to Dalio, the long-term debt cycle has three phases.

1. Leveraging

This phase takes about 50 years. The economy sees debt and incomes rising. Asset values soar, as we saw real estate prices soaring during the housing bubble, and people continue to borrow and invest in these inflated assets, believing they will rise further.

2. Depression

This phase lasts about two to three years. The economy’s total debt burden becomes unsustainable, leading to a crash. This crash usually occurs when the rise in debt repayment outpaces the rise in income, forcing a cutback on spending. We see

stock markets crash
asset prices drop
credit disappears
banks are squeezed
incomes fall
people cut spending
social tensions rise
3. Reflation

This phase lasts about seven to ten years. The US (VFINX) has been leveraging since the Great Crash of 1929. Then the economy fell into a depression from 2007 to 2009, and the economy has been trying to reflate since then. The problem?

In a recession, the economy can be revived by lowering interest rates. This means debt (BND) would rise.
However, in deleveraging, interest rates are already at (or near) zero, and the economy’s debt is already huge. So the economy looks to deleverage rather than generate more debt.
Which phase is the US economy currently in?
The US economy is currently, as Ray Dalio confirms in his talk with Marketplace Morning Report host David Brancaccio, “a little bit past the midpoint of that business cycle, at the end of a long-term debt cycle.”

indigenous says

The US economy is currently, as Ray Dalio confirms in his talk with Marketplace Morning Report host David Brancaccio, “a little bit past the midpoint of that business cycle, at the end of a long-term debt cycle.”

I've watched this before, and it does have some truth to it, but is very much over simplified especially when considering interest rates.

http://www.hollywoodreporter.com/news/new-birth-a-nation-poster-911730

So is this the kind of stuf the Government can issue bonds to create money to buy stuff like this?

The latest poster for Nate Parker's Birth of a Nation continues the theme of powerful historical images for the movie's marketing campaign.
...
The one-sheet, which debuted on Tidal, shows Parker's character, Nat Turner, being hung by a noose made out of the American flag. The Sundance standout, which sold for $17.5 million to Fox Searchlight, is already expected to play a big role in the upcoming awards season. It is set to hit theaters on Oct. 7.

Dude is a Baller.
From Wikipedia:
Ray Dalio (born August 8, 1949) is an American businessman and founder of the investment firm Bridgewater Associates.[3]
In 2012, Dalio appeared on the annual Time 100 list of the 100 most influential people in the world.[4] In 2011 and 2012 he was listed by Bloomberg Markets as one of the 50 Most Influential people. Institutional Investor’s Alpha ranked him No. 2 on their 2012 Rich List.[5][6] According to Forbes, he was the 30th richest person in America and the 69th richest person in the world with a net worth of $15.2 billion as of October 2014.