After reading an article from North, I went to one of his source documents, Required Minimum Distributions Spell Disaster (& Even Greater Intervention) As Sellers To Overwhelm Buyers.
It’s looking ugly for the stock market in the coming years and decades. Put simply, we are facing a huge wave of retirees (70 1/2+ year olds) who must for tax purposes sell their shares… but there are fewer and fewer people who can buy those shares at a good price.
When they realize this – and they will – there’s going to be a tidal wave of selling in the coming years. This will have an impact right down the economic line: a hard “economic headwind”, in North’s words.
Can the FED simply buy all the stocks? Sure they can… and, as North notes, this will destroy their use as a way to allocate capital just as QE destroyed interest rates as a way to allocate capital.
If the FED buys up all the stocks, we’re going to be flying with both eyes blinded (instead of just one eye blinded, thanks to QE). Which means that we’re in for a horrendous economic crash (not just the ugly economic recession that’s coming up, but the full-on Great Default of government promises and debt.
A visualization of the problem is provided below:
But for the full story, read North’s (firewalled) article.
(Hint: $20 million is just the tip of the iceburg…)
On the underlining demographic problems behind this crushing debt load, see Economica’s other articles,
- Why This Time is Completely, Utterly, Totally Different…Like the Difference between a Hurricane and an Ice Age
- The US Real Estate Big Picture…A Thesis in Moral Hazard
In the end, a pagan, aging, meaningless society is a sterile and impoverishing society.
The Walking Dead will have to be left to bury the dead: we have a future to build, with children and hope and the call of Dominion under the authority of Christ, directed by the Holy Spirit, as outlined in the Holy Bible (both testaments).
God is the Victor over His enemies: let God be pleased to count us among His blessed and hardworking servants, and not his damned and dying foes!