Bailouts Will Push US into Depression: Manager
BANKS, FINANCIAL SERVICES, NORTH AMERICA, POLITICS AND GOVERNMENT, ECONOMY, INFLATION, CURRENCIES, DOLLAR, FREDDIE MAC, FANNIE MAE, MORTGAGES, DEBT, CREDIT
By CNBC.com
CNBC.com
| 11 Sep 2008 | 09:11 AM ET
The end result of the global economic slowdown may be the U.S. announcing national bankruptcy as the government cannot afford the bailouts that it promised and the market will not bail out the government, Martin Hennecke, senior manager of private clients at Tyche, told CNBC on Thursday.
“We expect a depression in the United States. We expect a depression, very possibly, also in Europe,” Hennecke said on “Worldwide Exchange.”
The estimated $300 billion cost of the Fannie/Freddie bailout will probably be considered as a loss that the government will have to take, therefore passing it on to taxpayers, he explained.
“We already have $3 trillion of debt, as far as the U.S. government is concerned. These debt figures across the U.S. economy are rising very sharply.”
When the government can no longer pass the United States’ “immense debt” on to taxpayers, it will turn to the holders of U.S. dollars, leading to the eventual downfall of the currency, Hennecke said.
“Definitely, it (the dollar) is not a safe place to be invested in, as real inflation is closer to 10 or 11 percent than the actual inflation numbers given by the U.S. government,” Hennecke said on “Worldwide Exchange”.
Investors should avoid exposure to debt and stay away from leveraging on any investment or asset, including property, Hennecke advised, adding that “banks have been too highly leveraged in the past, private households, everybody.”
Hennecke’s stock allocations are mainly Asian-based, especially in the Chinese market as the country’s government has a large amount of cash and the macroeconomics are fundamentally strong.
He also suggested investing in gold, despite the recent fall in price.
© 2008 CNBC.com
URL: http://www.cnbc.com/id/26656750/site/14081545/
Tags: Depression, depression
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Tags: Bailout, Chinese Market, Debt Credit, Fannie Freddie, Fannie Mae, Global Economic Slowdown, Macroeconomics, National Bankruptcy, Safe Place, Worldwide Exchange
canada is going down too now
emerging markets collapsed becoz foreign investors[read american instituitions] pulled their money out.
Fuck America. your economy will completely colapse in 2009. people in this world will see the new third world country named america is going to come or even fourth country maybe
SOMEONE TALK TO ME
energetic fun smart and loves this video 9y
Hennecke is spot on. i had only heard of the likes of schiff, rogers, etc calling it as it really is. i will add this guy to my searches
They’re on TV. A few of their names are Congressman Ron Paul, Gov. Mike Huckabee, and Larry Kudlow. The Socialists and CFR have most of the government and media, but they don’t have it all.
someone want to chat
great vid dS
I feel terrible about the innocent Americans who voted against the Bush administration…they do not deserve this! Now the stupid middle class deluded right wing scum who can’t get it through their heads that the republican party is for the wealthy as opposed to working families, deserve what they get.
dont get your panties in a bunch
and if there is a recession the american people brought it upon themselves
i dont care how many people get upset about what i say. al ot of americans are uneducated and spend money they dont have.
i never said there was no recession.
Well maybe this recession is just hogwash libra032. Dont pay any attention to it. Recession, depression, whats all the fuss right?
I bet your an economics major and graduated summa cud laude?
eat a dick
your so worng in all of your points
i live in the city an know a lot of people
all of my friends are students or have jobs or both
libra032,
A. maybe because all your friends were already unemployed
B. You dont know anyone
C. You live in wyoming, North Dakota, or idaho
Lucky7wins, that’s what so many people find so very hard to understand. It’s simple fundamentals.
fuk you all bastards. people will learn to live without the fuken corps. go fuk yourselves.
weird i havent met anyone that has been layed off from their job
Right on! You get it. China has 25% savings and 2 trillion dollars of US treasuries. US has negative savings, and 10 trillion national debt. US is going to cry uncle first.
alway remember …. when the last tree is fallen and the last fich has ben fished in the water, you will see, that you can´t trink gold and silver ….:)
Or gold and silver.
tomniemiller,
I agree, communism cannot stay in power to run something as free as capitalism. With no press or free speech the Chinese people are in danger of dangerous products. Not to mention the fact that they have no human rights policies. I believe that China will have a revolution to bring a free government.
Right now, I think the people in power in China are more afraid of losing their power b/c of a crisis and socio-economic change, then they are about making themselves “rich”.
China sees this as prime opportunity. They will come out in a much richer position than the US will when all is said and done.
The way Earthquake affected people afraid of their cracked walls & roofs to be falling on them are sitting under the open sky in the chilled cold, similarly the US investors afraid of declining economy are not investing any more in the collapsed US financial crisis scared of their investments to distort in the suicide economy, thus making the US economy balloon burst altogether. 3:54 And (the unbelievers) plotted and planned, and Allah too planned, and the best of planners is Allah.
Funny to hear an adult woman from Asia say, “They’re getting hammered big time!”
Yah the us is heading for a depression as the hole world is but us will be worse of then the rest of the world
“Some trust in chariots and some in horses, but we trust in the name of the LORD our God.”-Psalm 20:7