T Nation

Next Bubble to Burst?

We had the dotcom bubble in 2000, then real estate in 2006 and beyond. Is US Government debt the next bubble? Looks like one to me.

"There is a massive paranoia in the marketplace, a ?safety-at-any-cost mentality,? that has knocked the 30-year Treasury yield to 2.63%, the lowest in history, and 10-year yields have plunged to 2.15%, the lowest since 1962. The same sophisticated bankers that bought toxic sub-prime mortgages, and ?off-balance sheet? items, such as collateralized debt obligations, structured investment vehicles, and credit default swaps, are now locking in Treasury yields at historic lows.

However, most Americans are playing it a bit safer. Money market funds invested in T-bills have surged 150% over the past year, to $726 billion. Overall, US-money market fund assets have climbed for an 11 th straight week to a record $3.72-trillion, and nearly half of US money market mutual funds posted no returns as T-bills dipped to zero-percent. The nightmare scenario has arrived after the US stock market lost roughly $8-trillion of its value during a brutal 14-month bear market, and Zillow.com estimates that US-home values also lost $2-trillion this year.

Most remarkably, bond prices are soaring, and interest rates are plunging, even as the US Treasury expects to auction a record $2-trillion or more of new debt in fiscal 2009."

http://www.marketoracle.co.uk/Article7843.html

hmmm…

I have been thinking the next bubble would be in alt energy. Some people say health care. Either way, another one has to come eventually. Just keep watching where prices are rising the fastest.

Considering the gov’t spending “bubble” has never burst because they can monetize any debt they want I don’t ever see it happening. Yay! hyperinflation.

[quote]LIFTICVSMAXIMVS wrote:
hmmm…

I have been thinking the next bubble would be in alt energy. Some people say health care. Either way, another one has to come eventually. Just keep watching where prices are rising the fastest.

Considering the gov’t spending “bubble” has never burst because they can monetize any debt they want I don’t ever see it happening. Yay! hyperinflation.[/quote]

Should that happen, you could always trade away all those goats.

It is long but in my opinion it is good

http://video.google.com:80/videoplay?docid=5232639329002339531

And if any one does watch it I would be curious of what they think I hope this is not a hijack it seem right up the same alley

[quote]pookie wrote:
LIFTICVSMAXIMVS wrote:
hmmm…

I have been thinking the next bubble would be in alt energy. Some people say health care. Either way, another one has to come eventually. Just keep watching where prices are rising the fastest.

Considering the gov’t spending “bubble” has never burst because they can monetize any debt they want I don’t ever see it happening. Yay! hyperinflation.

Should that happen, you could always trade away all those goats.
[/quote]

I only have one goat…and a car that I just won.

Health care is the next bubble to burst. Things cannot continue as they are and won’t. The costs are just ludicrous and like anything else that’s over inflated, it will be deflated.

[quote]pat wrote:
Health care is the next bubble to burst. Things cannot continue as they are and won’t. The costs are just ludicrous and like anything else that’s over inflated, it will be deflated. [/quote]

Add in college tuitions. Prices can’t continue to go up 10 or 15% every year, especially in a stagnant economy. Who wants to graduate into a $40,000/year job with a debt burden of 100 or 200k?

Fiat money just fucks everything up.

[quote]pat wrote:
Health care is the next bubble to burst. Things cannot continue as they are and won’t. The costs are just ludicrous and like anything else that’s over inflated, it will be deflated. [/quote]

We can only hope

[quote]pittbulll wrote:
pat wrote:
Health care is the next bubble to burst. Things cannot continue as they are and won’t. The costs are just ludicrous and like anything else that’s over inflated, it will be deflated.

We can only hope [/quote]

Health care deflation would be great for everyone but so long as the government is footing the bill it cannot happen. They will just keep printing money and that will only prop prices up should it look like it is about to “fail”.

[quote]LIFTICVSMAXIMVS wrote:
I only have one goat…and a car that I just won.[/quote]

You still haven’t picked that door. Come on, a 50/50 chance of shutting me up? How can you let that pass?

The next bubble?

Gold.

As long as there is a push from all sides to go “green” - the government will continue to offer substantial green credits for the development of alt energy.

Old fucks will keep getting older. We are currently contemplating starting up a home health care nursing business. Very little downside over the next 25 years, or until the last fucking baby boomer dies.

[quote]rainjack wrote:
As long as there is a push from all sides to go “green” - the government will continue to offer substantial green credits for the development of alt energy.
[/quote]

Precisely why I think it will be a bubble. There will be malinvestment as long as government has anything to do with alt energy.

[quote]LIFTICVSMAXIMVS wrote:
pittbulll wrote:
pat wrote:
Health care is the next bubble to burst. Things cannot continue as they are and won’t. The costs are just ludicrous and like anything else that’s over inflated, it will be deflated.

We can only hope

Health care deflation would be great for everyone but so long as the government is footing the bill it cannot happen. They will just keep printing money and that will only prop prices up should it look like it is about to “fail”.[/quote]

I personally don’t see that happening until insurance dies. If everyone had to pay for their health care prices would drop considerably

I would invest heavily in typewriters and pay phones booths. Their bubble has deflated a lot in the past 25 years, but I have a feeling they are creeping on a come up.

If people “really” had to pay for healthcare and if we didn?t subsidize illegal aliens ER visits maybe aspirin wouldn’t cost $74.

The problem with bubbles is that they tend to fly under the radar until it’s too late.

On a related note, did anyone else notice those commercials extolling the rise in gold? It suggested that everyone was getting rich on gold and that mom and pop were too… so hurry up and get in.

I’m pretty sure you can figure out what happened to the price of gold shortly after that.

[quote]El Juggernaut wrote:
If people “really” had to pay for healthcare and if we didn?t subsidize illegal aliens ER visits maybe aspirin wouldn’t cost $74.[/quote]

Or a telfa pad and 4 raps of gauze $200

What ever can be spun like sugar will be next.

It has to have no real value, or at least a value that can be grossly overstated. Even better if it is a negative that mathemagicaly can be turned into a posative of great value.

Not sure what it will be cause I’m still kind of new to this investment thing, but those are the things I look out for as bad. Especially if it takes off like a wildfire.

[quote]vroom wrote:
I’m pretty sure you can figure out what happened to the price of gold shortly after that.[/quote]

If you buy gold don’t sell it ever. The point of gold it to hedge against devalued currency. In the event of that happening gold will be priceless.

[quote]rainjack wrote:

Old fucks will keep getting older. We are currently contemplating starting up a home health care nursing business. Very little downside over the next 25 years, or until the last fucking baby boomer dies. [/quote]

My aunt in Denver bought a franchise with a home care company, I think they are based in Phoenix, and she is doing very well. It helps because she is a registered nurse and can do just about anything people need.

Most of the people she employs just go spend time and help out the customer a few hours a day/week. My cousin works for her and a lot of the time he’ll just go grocery shopping for them, help them make a nice meal, or just play cards and talk to them. So think entertainment to full on hospice and that’s what she does.

I’m seriously considering going into the elderly rentals market. Most of the time the government pays the checks and the requirements aren’t too bad. You do have to provide furniture and little things like dishes but the profits are up to 3-5 times what normal rentals are and old people don’t move out constantly like college kids.

Prediction for next Bubble: Service jobs that don’t really produce anything in this country. How bout just the work force that sounds like a pretty solid bet.