Blog Post

I am constantly engaged in conversation with my broker (he seems to be the only one who agrees with me) about the current generation of people that have no memory of the Great Depression and who seems to believe the more credit the better.  The habit of “buy now, save later”.  I don’t think it can last, not here in SA, not in the US or in the rest of the world.  The savings of the Asian countries will not forever finance the spending of Western nations. 

Credit growth is still high here in SA as well as in the US it seems.  The  document (click here) and the discussion here,  by Ives smith of Naked Capitalism all confirm my beliefs that the world as we know it currently is not sustainable in terms of credit growth and a return to the normal is inevitable.  This is not good news for stocks generally.  Look at the graph, it is eye opening stuff!

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