http://charleshughsmith.blogspot.com/2020/05/why-assets-will-crash.html Well........... It is always fun going UP, it is the crash that is..........."DEPRESSING".
EXCERPT: "Consider a pleasure craft that retails new for $120,000. In the boom era of rising stocks and housing, a used boat might fetch $65,000. But as the wealth of the small pool of households able to buy and maintain a costly craft evaporates, the number of qualified buyers evaporates, too. The seller might be aghast by an offer of $35,000 and reject it angrily. Six months later, he's praying someone will take it off his hands for $15,000, and in another six months, he'll accept $500 just to get out from underneath the insurance, slip-rental and licensing fees. This is how it happens that boats that were once worth tens of thousands of dollars are set adrift by owners who can no longer afford to pay slip fees, and vacation homes are abandoned and auctioned off for overdue property taxes: the market for these luxuries dries up and blows away, i.e. goes bidless--there are no buyers at any price.
Good morning Sourdough, A real good article; enjoyed reading some correct material for a change. I love gallows humor. Re "The Fed ...... can "save" the junk bonds ..."; They don't really exist less the paper or cyber space used for them. Junk bonds are really equity - ownership in a company a/k/a/ "stock" or "shares". These companies are just under-capitalized to even open the company doors for customers or the cyber version thereof. For the real, traditional bond; When a bond loses half face value, it's a de- facto default even if the public does not understand this nor care. The party's over.
