In a follow up to Mr. Sasmor's wonderfully enlightening Youtube post simplifying economics, a friend shared his thoughts with me on all the things that could go wrong in the markets. After reading this, I know for sure that we're heading to Armageddon!

Or maybe we can all just realize that there is always something out there to get the bears excited about impending doom.

Possible problems:

The potential for derivative crises
The bird flu
The next hurricane season
The Japanese demographic tsunami
Low risk premiums
Corporate profit margins at record levels
Poor US performance in math and science
Iranian nukes
Iraq war
Terrorism here and abroad
The federal budget deficit
The national debt
High consumer debt
The return of high inflation
The housing bubble

The credit bubble
The oil bubble
The commodities bubble
The coming crisis in Social Security
The US demographic tsunami
Oil supply risk
The bubble in San Francisco real estate
Oil at $100/barrel, natural gas prices
Global warming
Global cooling
Rising long term rates
Rising short term rates
Falling US dollar
Asset Inflation
Asset Deflation
The European demographic tsunami
Consumer spending post-asset bubble
Consumer spending if assets keep inflating
Exogenous events
Global imbalances
Foreign surpluses

US consumer stretched to the breaking point
The bond carry trade bubble
The unwinding of the Yen carry trade
Overvalued US stocks
The "house of cards" US financial system
The condo bubble in Miami and Las Vegas
The Chinese demographic tsunami
The hollowing of US manufacturing
Ports owned by Arabs
Reckless fiscal policy
Wage stagnation
The health care crisis
The bankruptcy of GM and Ford
Declining productivity
The impending increase in volatility
The yield curve inversion
Negative US savings rate
Corporate Malfeasance


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