Turley Blog

Our difficult economic situation is not a recession or depression it is a “RESET-SSION”. What we need is a reset of our expectations in many areas of our life. Until we understand the deeper issue driving much of this “reset-ssion” we will struggle with our expectations.

Here is the deeper issue: our population is rapidly aging. Ten years from now the United States will have 100,000,000 people 65 years or older, in a country of 300,000,000 – 30% of our population! Here are 5 Significant Perspectives from Resolve Lending, Inc. (5SPRL) concerning the other economic and demographic spill the government cannot cap.

1. “Demographic trends are the most critical drivers of our economy in modern times, as they predict not only the peak spending and productivity but also innovation early on and retirement later through consumer and work life cycles.” Dent

2. I have never been so aware of how demographics affect our lives. Let me ask you, how productive are you at 30-40 years old? Boomers were 30-40 from 1975-2005 -- How productive will they be at 65 years old?

3. “A resurgence of inflation will be one of the fears of the late 2009-10, just before the worst deflation crisis since the early 1930’s! It’s not that the government will not try to inflate its way out of the next crisis. It’s that the massive write-off of real estate and business loans will outweigh those efforts and contract the money supply—which means fewer dollars chasing goods or deflation in prices.” Dent

4. Catch the last part of #3 – I have a long running debate with a good friend about why there will not be massive inflation – as many pundits believe. The write offs and massive pay downs of debt is so much faster than the government can spend. Massive debt reduction is a deflationary tool; the government cannot spend fast enough to outstrip the massive balance sheet reduction going on.

5. What we are experiencing is not a recession or depression; it’s just “reset-ssion”! Reset your thinking to 40% less. I have called it the 40% recession and on average most people will be worth 40% less (combined stocks and real estate).

I have been around for a long time and I’ve never seen rates this low – if you are not in the mid to low 4’s on your loan give me call to review. We can even do loans when you house is well over 100% of its value.

Jeff

425-802-3019