Wasted money or just a friendly transfer to few good men?

Below is the DJIA chart for the last 3 years. Note that exactly in October 2008 to the day the DJIA was in the same place. That is why I am saying that whatever has been done until now to spur economic growth it has not been working. All of the last three years’ work was done to transfer debts from private sector to public sector. Of course during this process the financial sector managed to look good for a short while and this justified more “partying”.

But now all of this is blowing up in our faces in the most horrible way. In 2008 the world was coming after a decade of good times. Now it is coming after three years of crisis.

Somehow I think this time will hurt more.





4 thoughts on “Wasted money or just a friendly transfer to few good men?

  1. It depends on how you see this growth, and what is the reference point. If you look at 2007, yes, a lot companies just got there, or didn’t got there yet, are close to. If you look at 2009, things are much better. I think is not proper to judge this only by the market :).

    1. If I look at other indicators like economic growth, gross government debt, size of public sector and real purchasing power things will appear much worse.

      Sent from my iPhone

  2. Well you know what they say, it gets worse before it gets better and maybe it HAS to be this way in order to get structural change.
    OF course if you take the 1929 crisis….it got worse and then we got worse off with a world war so but let’s say that’s the exception that strengthens the rule!

    1. I think this is the mistake we are making. We are not dealing with an economic crisis alone. For me the risks are higher from losing faith in the market. I am afraid that the world is shifting too much to the left. And the left, i.e. governments, love it. In this sense the ideological crisis is more dangerous as it can have very long lasting effect. We are manipulated into hating the market solutions while governments highjack capital and distribute it to their own liking.

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