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I think I would be an instant property bull, get some gold too.
Imminent and severe market correction
- Thread starter Uncle Festivus
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I think I would be an instant property bull, get some gold too.
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not everyone is convinced of this depression/recession
Depression?? Probably not.
From The Kiplinger Letter
How does it Compare?
What are the odds this recession will become another Great Depression?
Slim, in our judgment. Yes, this is the worst financial crisis since then.
But it’s not as bad an economic crisis…more comparable to, say, the mid-’70s.
The Depression was a global economic collapse on an immense scale,
measured in multiples of today’s statistics of pain.
It was preventable, and the lessons learned greatly cut the likelihood of
a reprise of that decade.
So…we foresee a moderately severe recession, more akin to the
declines of the mid-’70s or early ’80s.
The contraction in GDP won’t be as extreme: Several quarters of declines
in the low single digits, resulting in about a 2.5% drop from peak to trough. From ’29 to ’33, real national output dropped 30%.
Joblessness won’t hit one in four workers as it did in ’32, when most families
depended on a single wage earner. Just north of 6% today, unemployment is likely to top out below 9% next year.
In the ’30s, millions lost their life savings…
wiped out as 9000 banks across the country failed. With federal deposit insurance in place today, losses are minuscule in comparison.
Of course, stock equity worth billions has evaporated, and more people
own stocks now than in the ’30s…directly or in funds, in IRAs and 401(k)s.
But the market drop isn’t as drastic. The Dow Jones index is down
a bit more than in ’00-’02 and ’73-’75, but less than the 89% plunge of ’29-’32.
Though no one can predict the bottom, we expect that stocks purchased now will see strong gains over the next few years as the global economy recovers.
In contrast, the Dow didn’t return to its pre-Depression high till the mid-’50s.
Homeownership was lower and foreclosures massive in the Depression.
Today, an estimated 5% of U.S. homes are in foreclosure or at risk of being lost. As layoffs mount, that figure will climb, but home losses will also be dampened by government programs. Though double five years ago, 5% is still a small slice.
The sustained deflation of the early ’30s isn’t likely to be repeated today.
Then, as soaring unemployment eroded consumer purchasing power, the Fed
foolishly shrank the money supply by nearly a third…just the wrong medicine.
Today’s wiser Federal Reserve is pulling out all the stops to get credit flowing.
Another big difference: Trade policy. The Smoot-Hawley tariff legislation
of ’30 hiked duties on imports, leading other governments to do the same:
From ’29 to ’33, U.S. export value fell by nearly two-thirds. Exports, still booming for much of this year, will grow again next year, though only by a modest 1%.
Key in both time frames: Government spending. The national debt
grew over the ’30s by 150% and continued to soar through World War II.
Today Congress and the White House (both the outgoing and incoming president) seem inclined to spend whatever is necessary to forestall a deep, long recession...
budget deficits be damned. Next year, the deficit is likely to top $1 trillion.
At 7% of GDP…a modern record but well short of the 30% of GDP it hit in ’43.
Finally, America’s financial safety nets were absent in the early ’30s.
Though under severe and growing financial pressure, Social Security, Medicare and Medicaid, unemployment and bank deposit insurance, and private pensions all provide support to millions of Americans…employed, retired or jobless.
Depression?? Probably not.
From The Kiplinger Letter
How does it Compare?
What are the odds this recession will become another Great Depression?
Slim, in our judgment. Yes, this is the worst financial crisis since then.
But it’s not as bad an economic crisis…more comparable to, say, the mid-’70s.
The Depression was a global economic collapse on an immense scale,
measured in multiples of today’s statistics of pain.
It was preventable, and the lessons learned greatly cut the likelihood of
a reprise of that decade.
So…we foresee a moderately severe recession, more akin to the
declines of the mid-’70s or early ’80s.
The contraction in GDP won’t be as extreme: Several quarters of declines
in the low single digits, resulting in about a 2.5% drop from peak to trough. From ’29 to ’33, real national output dropped 30%.
Joblessness won’t hit one in four workers as it did in ’32, when most families
depended on a single wage earner. Just north of 6% today, unemployment is likely to top out below 9% next year.
In the ’30s, millions lost their life savings…
wiped out as 9000 banks across the country failed. With federal deposit insurance in place today, losses are minuscule in comparison.
Of course, stock equity worth billions has evaporated, and more people
own stocks now than in the ’30s…directly or in funds, in IRAs and 401(k)s.
But the market drop isn’t as drastic. The Dow Jones index is down
a bit more than in ’00-’02 and ’73-’75, but less than the 89% plunge of ’29-’32.
Though no one can predict the bottom, we expect that stocks purchased now will see strong gains over the next few years as the global economy recovers.
In contrast, the Dow didn’t return to its pre-Depression high till the mid-’50s.
Homeownership was lower and foreclosures massive in the Depression.
Today, an estimated 5% of U.S. homes are in foreclosure or at risk of being lost. As layoffs mount, that figure will climb, but home losses will also be dampened by government programs. Though double five years ago, 5% is still a small slice.
The sustained deflation of the early ’30s isn’t likely to be repeated today.
Then, as soaring unemployment eroded consumer purchasing power, the Fed
foolishly shrank the money supply by nearly a third…just the wrong medicine.
Today’s wiser Federal Reserve is pulling out all the stops to get credit flowing.
Another big difference: Trade policy. The Smoot-Hawley tariff legislation
of ’30 hiked duties on imports, leading other governments to do the same:
From ’29 to ’33, U.S. export value fell by nearly two-thirds. Exports, still booming for much of this year, will grow again next year, though only by a modest 1%.
Key in both time frames: Government spending. The national debt
grew over the ’30s by 150% and continued to soar through World War II.
Today Congress and the White House (both the outgoing and incoming president) seem inclined to spend whatever is necessary to forestall a deep, long recession...
budget deficits be damned. Next year, the deficit is likely to top $1 trillion.
At 7% of GDP…a modern record but well short of the 30% of GDP it hit in ’43.
Finally, America’s financial safety nets were absent in the early ’30s.
Though under severe and growing financial pressure, Social Security, Medicare and Medicaid, unemployment and bank deposit insurance, and private pensions all provide support to millions of Americans…employed, retired or jobless.
explod
explod
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But where is the money coming from, hey Ralphie, you there Ralphie ?
Oh well, to believe or not believe. BUT WHO KNOWS
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its just comment..
try reading it and hold your breath.. no one has the answers but its always interesting to read other opinion.. some cant handle opinion (obviously) seen here, others can.. life is like that.. all the best explod..
try reading it and hold your breath.. no one has the answers but its always interesting to read other opinion.. some cant handle opinion (obviously) seen here, others can.. life is like that.. all the best explod..
explod
explod
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Actually some people do have the answers and wrote about this calamity in succint detail some years ago.
Opinion is also ok as long as there is some realism present, but the tretise above is fairyland crapola but I am sure plenty pay well to hear what they want to hear.
chops_a_must
Printing My Own Money
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Hah!
The Fed's new Motto of "Daily Blurbs Will Save Our 'Burbs" seems to be working.
Shockmarkets have capitulated from the Dark Side - Good have defeated Evil!
Fear has flown the coop overnight, to be replaced by a ravenous appetite for "Risk".
Mmmmm....mmmm - tasty, tasty Risk Burgers. Yumm!
Who cares how many companies go bust when the future is UNLIMITED?
We gotta get on that gravy train now - the message is clear and present....
Or am I dreaming?
The Fed's new Motto of "Daily Blurbs Will Save Our 'Burbs" seems to be working.
Shockmarkets have capitulated from the Dark Side - Good have defeated Evil!
Fear has flown the coop overnight, to be replaced by a ravenous appetite for "Risk".
Mmmmm....mmmm - tasty, tasty Risk Burgers. Yumm!
Who cares how many companies go bust when the future is UNLIMITED?
We gotta get on that gravy train now - the message is clear and present....
Or am I dreaming?
Sean K
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DOW up 1000 points the last few days Jeff.
Hope your trading the market and not the economy.
Hope your trading the market and not the economy.
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DOW up 1000 points the last few days Jeff.
Hope your trading the market and not the economy.
DOW heading for the deep, deep South again, Kennas.
That was a nice big dead cat mirage you saw......
This leg down is going to be really nasty, with limited interest rate options left for the US and Japan.
Have a nice day.
aj
Sean K
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Well, I hope you are short..
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Wasnt sure where to post this but since its based on the U.S then here it is:
Peter Schiff is officially my hero!
http://www.youtube.com/watch?v=vweLBpE4mso
This man seriously knows his business
Peter Schiff is officially my hero!
http://www.youtube.com/watch?v=vweLBpE4mso
This man seriously knows his business
wayneL
VIVA LA LIBERTAD, CARAJO!
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Everyone from the Austrian school knew this was coming...Wasnt sure where to post this but since its based on the U.S then here it is:
Peter Schiff is officially my hero!
http://www.youtube.com/watch?v=vweLBpE4mso
This man seriously knows his business
...and our governments embark on a supercharged Keynesian binge.
F**k!!!!
wayneL
VIVA LA LIBERTAD, CARAJO!
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http://sigmaoptions.blogspot.com/2008/01/bump-lessons-in-economics.html
/\ A video series on economics from the Austrian School. I've posted them before, but worth bumping.
explod
explod
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Everyone from the Austrian school knew this was coming...
...and our governments embark on a supercharged Keynesian binge.
F**k!!!!
Absolutely Waynel. I could quote four titles by economic authors, and also several newsletters going back from 2002 who saw it coming and provided answers which will work. You, I et al. have quoted and pointed them.
Of course the answers require discipline and restraint and it seems those elements have left town.
The gummumint and that steven fella at the big bank would have done well to have logged onto this space.
I'm a Minsky fan myself, but same result: it was plain as dog's wotsits. I've been trying to get people out of financial assets all year, with a little success but not much.
Problem is, it's been dead easy to pick most of the moves until now but no longer. The October crash was right on schedule and markets are now all about on track. It gets much harder to pick what happens next, because there are so many crazy ways the governments can play it.
Next stop on the S&P should be 780-800 tests of the 2003 lows. We're still due a rally, but the 800 won't hold indefinitely. Question is: do we get Japanese lockjaw, deflation, inflation, dollar collapse or something really unexpected? Wish I knew, but it is not going to be nice either way.
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