Stock advice in actual English.
Joined Sep 2, 2009
1,224 Blog Posts

The Next Four Years

Let us now segue from the political elections to the developments we can expect over the next four years and how they are likely to be responded to.

Any one or combination of these events I would not be surprised to see derail affairs in this country, making our new old-president’s life hell.

EU Debt Crisis

This remains the first and foremost issue with regards to global economic activity. Europe is the largest single contributor to economic activity on the planet. And they are in trouble. Still.

Most recent acknowledgements from the ECB put expectations for recession increasing and any hope of lowering unemployment years away.

In the interim, expect another trillion euro easing from the ECB to pave the way to 2014. Coupled with price pressures and economic contraction, we’ll feel the ripples of these developments here at home.

HCR Implementation

Obamacare was here to stay the moment Roberts pulled a Benedict Arnold. But for mostly political reasons, the costs of the program were delayed until after these elections and into Obama’s second turn. Only a handful of the taxes to pay for this program have gone into effect. The majority are yet to come.

And Obamacare is disruptive. Very disruptive. Most businesses, I’m convinced, remain uninformed about the impact the law has on their operation and have been keeping their head in the sand, hoping it would go away.

Complex penalties, mandates, a mountain of required paperwork, loopholes, a bungle of disperse agencies with various territory to enforce, and any thousands of contradictive issues that could pop up mean that, by 2014 when the final provisions are supposed to be in action, American business will likely be pulling its hair out.

Pension Funding Gap Expiration

Private pension funds are required by law to maintain a minimum funding, actuarially determined, in order to meet obligations.

In the event that these funds do not meet their funding criteria, provided they are at minimum funded greater than 60%, they have 7 years to get things back in order.

Let’s say, 2008. Now start counting.

Hey 2014, nice to see you again.

US Debt

At the moment, US debt still remains popular, largely for its liquid characteristics and large volumes making it accessible anywhere. But, with the Fed buying as much paper as they are, eventually you’ve got to start asking, “how is this stuff valuable?”

For the moment, deflationary pressures should help keep the US dollar strong. But when the recovery (or specter of recovery) starts to infatuate the US markets again, that leaves us with our monetary supply almost triple from before the housing bust.

Should credit begin to expand again in this country, that leaves treasuries being pretty much worthless.

And thanks to the long term rollover and the Fed purchasing up assets like distressed mortgages at what have to be overpriced levels to keep the banking sector solvent, there is almost no recourse to getting that extra money back out of the system.

State Funding

Some states, like Illinois or California (usual suspects), are pretty fucked from being stupid. No more need be said.

US Retirement

The Baby Boomer generation (sometimes referred to by their proper name, The Worst Generation Of Assholes To Have Every Been Birthed On This Piece Of Shit Rock) are getting old. I mean really old.

And this generation, thanks to taking a triple leveraged position in housing they never had a viable exit strategy for, are also sitting on underfunded retirement accounts and in chronic need of cash. Plus those retirement accounts will begin to force liquidation in pre-specified amounts starting at retirement.

Couple that with these old codgers needing to buy down in housing to accommodate those knee replacements, and the Baby Boomers’ retirement looks to be as bleak for markets as it will be for their children having to listen to them bitch about how smart they think they are.

If you enjoy the content at iBankCoin, please follow us on Twitter


  1. Ken

    That about sums it up.

    • 0
    • 0
    • 0 Deem this to be "Fake News"
  2. charlie

    Long story short…. the boomers drove the Titanic right into the fucking iceberg.

    • 0
    • 0
    • 0 Deem this to be "Fake News"
  3. fake amish

    Great post. The Obamacare assfucking has not happened yet. Amazing how many retards out there do not know that. Crazy eurotard dump today. lol. Any thoughts on the euro short term?

    • 0
    • 0
    • 0 Deem this to be "Fake News"
  4. hattery

    Eliminate education costs completely, give every kid 5-18 an ipad and the internet ($65B once and $65B/yr) and a one time severance package for teachers (100k each 200B once) and you save like $700B per year… Fiscal “cliff” problem solved… at least until baby boomers really start to retire and unfunded liabilities grow and become a bigger problem.
    Sure you might need to have apps that track their progress and have mandatory testing 4 times a year, but you don’t need the laborious high expense $800B per year expense of education that is 5 times greater than anyone in the world in cost but fails to produce results.

    • 0
    • 0
    • 0 Deem this to be "Fake News"
  5. Mad_Scientist

    Plus those oldies will have generic statin prices, but they’ll need to pay for pcsk9 inhibitors coming to the marketplace within the next 3 years or so. (and all the other old age medications). With medicare being robbed by obama, and with the obamacare “death panels,” who knows what kind of turmoil we will begin to see with the elderly population as all of this unfolds.

    • 0
    • 0
    • 0 Deem this to be "Fake News"
  6. unclehar

    they will be housed in great wards, unable to afford private rooms.

    it is not a good story when one these underfunded pensions has its sponsor go bankrupt. the underfunding seems to grow over night. and then whatever is left evaporates away.

    • 0
    • 0
    • 0 Deem this to be "Fake News"