Common Sense Living

One SCARY Economic Chart For The Halloween Season!

Came across this chart yesterday, and I reproduced it using the online database and charting tools at the St. Louis Federal Reserve website.  This should scare you far more than a spooky Halloween ever will!

The red line is the US Gross Domestic Product (GDP) going back to 1950.  Indexed to that is the blue line representing household net worth as a percentage of GDP.

You can clearly see that each time the Federal Reserve artificially blows up asset prices, like your home or 401k, using printed money from nothing, they create an ever increasing asset bubble.  These bubbles all CRASH!

The asset bubble we are in now is the largest ever in US History!

This goes a long way to explaining why the stock and bond markets are starting to see volatility, if not outright panic (yet).  Today, the Dow Jones Industrial Average was up well over 200 points early in the day, but closed up only 64 points.  The S&P 500 and Nasdaq were again hit hard with selling, and closed in negative territory.

Until this current bubble is wiped out, financial asset prices will continue to see downward pressure, if not an outright crash!

Have a great start to the Halloween season!  Boo!

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