Flipping homes was a thing of the past and home prices plummeted. 401ks had become 201k and now that happy retirement everyone imagined they would have by selling their home for fantasy prices had burst like a balloon.
Lest we forget about the CRE crisis hidden off the books of most commercial banks. Small regional banks went down weekly taken over by the FDIC. Can you still remember the meteoric climb of the ETF SRS only to see it collapse in flames taking many players with it?
Then there was the Credit Crisis and Hank Paulson called all the big shots from the Too Big to Fail banks to Washington and force fed them federal dollars to try and stop the whole banking/money markets system from collapsing? Freddie Mac and Fannie Mae were already on life support, AIG was for the most part caught with the CDS’s that Goldman Sachs so conveniently bought as they sold MBS’s that only an MIT graduate could understand. Let’s not forget the rating agencies that were in bed with the biggest bankster of all time.
The collapse had investors running for the hills and the market kept going down until Obama and Bernanke came up with a stimulus package for everyone. Savers be damned as the government stepped in as the spenders of last resort and if "We the People" won’t spend, then we will give the money away. Soon every car manufacturer was bailed out. Cash for Clunkers and free down payment money for homes was the new rage, but it still wasn’t enough.
The people were losing their jobs and they suddenly realized that the US didn’t make anything any more. All we had were Financial, Insurance and Real Estate jobs and they had all evaporated in a death spiral of deflation.
Unemployment was running out so the executive order was to extend, then extend again and when 99 weeks runs out, they will extend again.
Now don’t get me wrong, the market turned a corner in March of 2009 and what a rally it was! From the depths of 7500 the market rebounded to 11,000 and everything looked rosy again. We were all investing again and making money, but where was the money coming from? It was obvious that the Federal Reserve was printing it as fast as they could.
Everyone knew this and gold started to make new highs. 800-900-1000-1100-1200 the sky is the limit as we all knew that money wasn’t worth the paper it was printed on.
Now we have an even worse situation brewing. The US is broke. We have future obligations in Medicare and Social Security that cannot be met. We still have two wars going on with no end in sight. The Eurozone is collapsing as Greece is just the first domino the fall. China is in a real jam as the US can no longer buy their junk and this affects commodity rich Australia as demand has dried up. Even the BRICs are not invulnerable. So is there no where to hide?
Toss in the worst eco-disaster of our time in the Gulf of Mexico and we could bankrupt the 4th largest corporation in the world. So now it is your chance to tell me where do we go from here?
Thank you BP. It this what you meant when your commercials said Beyond Petroleum?