"This is a Period of Wealth Destruction"

George Soros: 'We face the most serious recession of our lifetime'

'This is a period of wealth destruction. The people who make money will be few and far between. There will be a lot more money lost than made."

I'm a believer since 2004. That's why my blog is named Illusion of Prosperity. It is and has been my goal to simply lose less than the next person. It also explains why I think toilet paper is a relative bargain and why the majority of my net worth is sitting in TIPS and I-Bonds. If I end up losing money (which I may if inflation truly spirals out of control), heaven help the fence swingers.

"I think the dislocations will be greater because you also have the implications of the house price decline, which you didn't have in the 1970s - so you had stagflation and transfer of purchasing power to the oil producing countries, but here you also have the housing crisis in addition to that."

Deflationary Great Depression meets 1970s style stagflation. In the grand [ponzi] scheme of things, does it really matter what the inflation rate ends up being? I see no way these two wrongs can make a right. The trends are not our friends.

In the UK, the economic clouds are particularly dark, he says. "House prices have risen over the years and are further away from sustainable than in practically any other country, in terms of household indebtedness and the relationship of house prices to incomes." The slump may be more gentle than in the US, he adds, but it will be more drawn out.

Once again, this is not investment advice. Please don't take it as such. I've been a bear for nearly four years. It is always possible that I'm pessimistic as opposed to realistic. In any event, I'm still questioning my financial sanity. Therefore there's at least a decent chance that I might not be financially insane. Who knows?