Did anyone here predict the 2008 crash?

[Arthur Hucksake]

I recall saying to the other half. We've been in a long term war with no end in sight, lots of lending going on. Places seem to be hiring plenty but without any real expansion. Things seem a little too good for the situation. When doing a mortgage search the offers seemed too good to be true for our circumstances. Something isn't right here and a fall is coming. Six months or so later....bam!

 

[Arthur Hucksake]

The economy will be fine for a while.

Our economic system relies on growth, and it was the lack of growth in the west that was partially responsible for the crash. However, over the last few years the corporations forced the EU and Britain to open the floodgates to immigrants, so we can attain more growth and stabilise the economy.

I predict that in a decade or so, the floodgates will be reopened, no doubt using some unjust war as an excuse.

We had the illusion of growth. Jobs a plenty for one.

 

[pooley]

boom bust rinse repeat..

 

[jsmoke]

As they said on The Big Short, people trust 'The System' to much to bother about these things. It must happen again as it's similar to a Ponzi scheme.

I wish I had both, bought shares in BP when they when down and secondly put a large bet on Donald Trump when he was at 100/1. I thought both were very good bets at the time.

 

[Greebo]

I predict a 2017 crash. Maybe even 2016.

Interesting fact. In the Northeast ALL house building has stopped. Full stop. On hold.

in 3 weeks time there will be no work for brickies, joiners, plasterers unless things change.

 

[Mr Jack]

I absolutely did not predict the 2008 crash, in fact I was confidently predicting not long before it happened that there was no reason to think growth would end in the next few years. Ah, the folly of youth.

 

[V F]

Martha Stewart?

 

[Mr Jack]

A handful of people do nothing but predict impending economic crashes all the time. As the saying goes; even a broken clock is right twice a day.

A very good point indeed.

It's not really enough to have predicted the crash, to be impressive you need to show a clear understanding of why it crashed and why it crashed then. I'm not sure how many people can really claim that?

 

[dowie]

. I'm not sure how many people can really claim that?

not many at all (worldwide), certainly not many on here

though there are plenty of people who no doubt felt they did 'I said houses were too expensive, knew this would happen...' etc..

 

[Silly Goose On The Loose]

A very good point indeed.

It's not really enough to have predicted the crash, to be impressive you need to show a clear understanding of why it crashed and why it crashed then. I'm not sure how many people can really claim that?

The film "The Big Short" which inspired my making this thread would seem to suggest that at least one person understood why it would and did crash.

 

[dowie]

It made clear that a few people understood that there would be a crash and indeed profited from it... though actually even they didn't necessarily realise quite how big the problem was.

 

[muon]

The film "The Big Short" which inspired my making this thread would seem to suggest that at least one person understood why it would and did crash.

The problem is, whilst there are people that are always predicting doomsday.

There are also many people that only predict a crash once (or a few times), and are even very specific and put money on it. If there are enough of those people, then at least some of them must be right purely through probability.

Its like hedge fund performance. Some hedge funds appear to perform extremely well. However, if you have 10,000 hedge funds, then some will do very well through random chance alone as long as they have differing strategies.

Betting against a bubble is also perilous, as you saw in the Big Short. There is a famous quote:

"Markets can remain irrational a lot longer than you and I can remain solvent."

 

[silversurfer]

Pre-recession economic imbalances

I'm not sure how you could predict ice crystals forming in the fuel oil heat exchanger under that certain set of circumstances no. It's an inevitability that it'll happen again, what goes up must come down.

Whats the reference to the ice crystals thing ? It wasnt a random event, it was result of government actions over many years. There was a policy of backing sub prime debt, it turned out very badly but its a pretty deliberate thing not random. Hopefully people can see at least a sign thats true with some investigation

I'm curious if anyone here predicted the crash and profited from it?

My other question is, to these people: will it happen again?

Events on that scale will reoccur, not a repeat but its a relatable ongoing effect so far as Ive seen and heard from studies by various people.
Over a decade ago I saw a program on mortgage fraud, serious enough to cause one banks failure perhaps. I did not realise it had become normal due to various government programs ie. subsidy

I dont think current economics teachings respect natural effects in an economy (and by extension maybe the knowledge of boards of various reserve banks)and that tension between arrogance of fixed policy and the actual dynamics of capitalism cause the volatility and crashes to become apparent.
I might be wrong, best off finding those who study such things an economist even but I like this guy or similar, who refute standardised thinking

https://twitter.com/nntaleb
I dont think anyone in power especially listened before or listens enough now, its not a clear enough message perhaps. Hence I think events are ongoing, certainly you can see the debt overhang

didn't necessarily realise quite how big the problem was

The magnitude of the wave is the surprising thing. Normal problems, fraud, corruption and failure is all an every day event.
People dont see the sense of leaving EU, its possible we are distancing ourselves from a line of failure like a buffer in a line of dominoes. Not the pizza chain
My guess is its best not to blindly follow doctrine and there isnt enough feedback in EU democracy imo. Ie. be the guy who wants to pick his own toppings lol

 

[Schlong&Stable]

I did not predict the 2008 crash. I had read some of the people warning of it in the media, but didn't think much about it.

I did predict the oil crash about 18 months before it came. I felt pretty good about that one as it happened exactly when and why I said. I didn't profit from it though, which is a shame.

 

[PhysicsMan94]

My other question is... will it happen again?

In short, yes. Don't have time to write a long post but the next crisis coming has every chance of making 2008 look like a picnic. The problems are far worse now and there is very little monetary policy maneuvering left given that interest rates are already at record lows and now over $13tn in government bonds are yielding negative worldwide.

Global corporate defaults have already hit 100 this year and are on course to exceed the 2009 figure, but all the talking heads in financial media don't want you to know about that - just "keep buying stocks" they say, "market can only go up from here"...

 

[lafemmefatale]

Whats the reference to the ice crystals thing ?

First thing that came into my head when OP mentioned 2008 crash was BA038.

 

[RaohNS]

The credit bubble is meant to be four times bigger than it was in 2007/08 isn't it?

 

[McPhee]

A broken clock is correct twice a day...

 

[Ryan-3]

Interesting fact. In the Northeast ALL house building has stopped. Full stop. On hold.

Such is the lack of investment in our area. What do you think of the proposed metro expansion? They've talked about it happening, new trains, carriages, longer lines, new lines, etc. But I personally believe none of it till it actually has begun. And then I'll believe it's a cut down plan that is nothing like what was proposed.

 

[KillBoY_UK]

I'm curious if anyone here predicted the crash and profited from it?

My other question is, to these people: will it happen again?

Most people knew there was huge/growing amounts of consumer debt in this country and sooner than later the bubble was going to burst, beyond that I don't know.