Ok, so the “plan,” as I see it, is to flood monetary systems/industries with liquidity, and at the same time, coordinate interest rates and other policies between countries.  The premise is that we all inflate together, devaluing all of our currencies at roughly the same time, while avoiding a derivatives bomb.  As we inflate (devalue), purchasing power will be maintained through coordinated global trade between “member nations” in this new economy, the G-Unit.

US Government and other nations have been throwing around a lot of money lately… And what if all the money spent so far has primarily been used to plug holes (maintain preexisting obligations, stay solvent, etc.), and they could just be staving off something horrible in ‘09, which will require much more $$$?  What if some derivatives default event occurs, which instantly creates trillions more USD?  I think it would immediately devalue the currency, and it would feel a lot like hyperinflation.  More waves of loan resets and defaults are coming, stores are going out of business, and China, Inc. won’t be able to support the growth that their new infrastructure was built for, for a long long time. Fuckers (people, cities, countries) are going broke everywhere, and other countries have even bigger financial problems.  Furthermore, war is always a possibility between anybody on this earth.

One positive, Don “Sugarcane” Harris is the greatest blues violinist I’ve ever heard.  I mean the guy was just fuckin’ amazing.  http://www.youtube.com/watch?v=2QU60y0JGOk and http://www.youtube.com/watch?v=euy3m6kV9RE If you can’t get down to this, go fuck yourself. .

OK

So maybe we go into a harsh fucking period of 6-18 months where lots of people lose homes, investments, retirement money, etc. Multitenant residential real estate will fall into the hands of hard money investors, both domestic and abroad, who have their shit diversified NOW.  They know that cash flows may be inconsistent, but the world keeps on turning & hard assets are tangible.  As long as the place isn’t a total shithole for a REALLY long time – these investments should turn out just fine.

ALSO

A whole shitload of houses could fall into the hands of FNM/FRE/GOV in order to resell or rent out (everybody needs cash flow).  Basically, I see the ultimate danger being that we hyperinflate, and foreign fucks who’s monetary systems survive a derivatives meltdown (maybe resource rich, labor intensive economies?) will swoop in and buy everything on fire sale.  I believe there will be currencies, commodities, and hard assets that people should be in right now (if you’re rich).  Maybe the fixed income market will be bullshit too for a while, what with all the auto-industry related paper.  Some great deals to be had for sure!

NOTE

If lots of foreigners invest in the USA, there might be peace for the sake of prosperity.  If our “enemies” buy our shit, they will have a vested interest in seeing their investments succeed.

ANYWAYS

In September of 1949, the UK devalued their currency 30% because their Financial wizard (left-leaning vegetarian named Cripps) fucked up. 9 other nations devalued at the same time.  This made things more expensive to UK citizens and member nations, unless they were buying things made in the within their country, or between other member nations (I have the newspaper).  The goal was to stimulate exports, bringing in a lot of USD, which worked, and the UK experienced a great recovery.  I bet there was WAY more to all of that than we know.

AGAIN

If the USD is really shits the shower due to a derivatives event, we’re fucked for a while.  We will go on sale to whoever has the buying power.  Maybe that leads to the AMERO scenario to fight off foreign investment (invasion).  However, if the USD is devalued due to current and future spending policies, and no derivatives bombs go off, then we just inflate along with participating G-Unit countries as expected and trade with each other.  If you can figure out the playbook insofar as which currencies will do the best (whoever will best be able to maintain cash-flows is my guess/resource rich, labor intensive economies), then you can hop into another currency now, wait until some bad USD inflation takes place, and buy hard assets in the USA right after devaluation.

OR,

Maybe the last bullet is that the GOV/TREAS steps in and restructures all debt to low interest rates, and resets (”regulates”) the derivatives markets, placing safeguards in place to slow down, or suspend, a massive default event.

This would only put the brakes on, is my guess.

Who the fuck knows?

Whatever happens, fuckers (people, cities, countries) will be left with these tools:

LABOR FORCE:  Labor = output = earning potential = value

RESOURCES:  Oil/Gas/Other Commodities/Bullets/Food/Water/Women/Dilithium

MILITARY/DEFENSIVE POWER:  This could fuck us all anyway, making everything I just wrote irrelevant.  Maybe dolphins will evolve after we nuke ourselves.  Remember to make finger puppets if you see the nuke go off and you’re in front of a wall.  You will be funny forever.

And, on the flipside:

DEAD WEIGHT – human beings who consume resources, yet do not contribute to economic output

That’s all I got for now.  This market is like a gigantic “choose your own adventure” book, except shit doesn’t make sense, and it’s not that fun.

==========================

EOM

UPDATE: http://www.marketwatch.com/news/story/Hong-Kong-Shanghai-shares-dive/story.aspx?guid={30B88564-73CA-4501-8AE7-3AB4DEEAAB7D}