Originally Posted by
gloopy
Yep. When (not if) this massive money printing fiat Keynesian bubble economy experiment fails it will be the biggest global mega-depression (in the form of long term stagflation, not anything Mad Max, etc) ever seen on a long term basis and China will be the hardest hit by far. This little fake stock rally built on the booby trap foundation of debt/stimulus and liquidity by edict is a great time to bail out of the market before all this fake wealth goes to "money heaven". There may be a little more upside before the fall, but realistically this is a good floor to get off on.
As for DL, we need to be able to compete and win. Everyone, not just "HVC's". We need to win coach pax and even belly cargo to survive the new economic reality that's coming. We need to take back control of our brand and wind down these inflexible long term outsourcing contracts and start insourcing. If we start it now and do it right, we might be able to avoid furloughs and maybe hire even as we shrink (and we will shrink...the entire industry will for a while before it grows again) and do so with a respectable contract of SWA plus reasonable premiums including scope. Our brand just may depend on it.
Gloopy;
People think this is nuts. Why? Because they believe the value assigned the paper they call money. It would not be surprised to see a lot of debt forgiveness between governments. It allows the paper to still be used as currency, and the current governments and political systems throughout the world to stay in power. Our crisis is about debt, and as soon as the Europe, US, China, and Japan realize that the paper currencies that only have value in their promise to pay the debt are about ready to implode, we will see a lot of government to government and bank to bank loan/debt modification/forgiveness to allow the fiat money supply to continue. We trade paper with little to no backing anyway.
The world's people will go on without much of a hiccup if this occurs because after all we live and work based upon a piece of paper that someone else assigns value to. We cal always inflate our way out of it, but the current debt crunch is so large that drastic measures may need to be taken.
Heck our Fed is backing the Euro right now. When this fails, there will be another extreme measure. The markets may balk, but when they realize that their good deal goes with the current governments of the world, they will begrudgingly play along. Of course this may take a few more decades to be realized, but inflating our way out of this debt would be very painful for the average citizen, and has dangerous repercussions. If they want the world to "right" itself, the paper fiat mediums will have to be adjusted. How and when this will happen is unknown, but I do agree, the current trajectory is unsustainable.
80, no tin foil hat, but one must realize that all of the major governments and their banks own a lot of each others' paper. They can create a solution that keeps them and their way in power.