United States Heading towards a Depression?

One is too busy collecting welfare check and drinking beer in his trailer and the other one is too busy playing video games and in his own mind be a great general.

 

Are you saying you're schizophrenic?

 

Housing has hit a bottom officially now. The rest of the economy should follow within the next few months I figure.

http://www.marketwatch.com/story/us-may-case-shiller-home-prices-up-05-2009-07-28-95100



I still think the government intervention and spending and future inflation is a more chronic problem that hasn't been dealt with. That shoe has yet to fall and may happen within the next few years. That would be much more devastating this this "recession".

 

Did you know that for saying something witty, you need to be intelligent? So don't try it again, you fail miserably.

 

So you are saying you are a Narcissist too?

 

Failed again but not surprising.

 

Be careful what you wish for. 625,000 soldiers and and uncounted number of civilians died in the last American civil war. That was back when the total U.S. population was only 30M.

Are you really anxious to see somewhere between 10M and 30M dead Americans?

Revolutions are things which should be considered carefully.

There is still hope, albeit small and distant, that America may be able to pull back from it's headlong plunge into tyranny.

I don't see a half a percent bounce as a signal that housing has hit bottom.

Deflation is currently spiraling out of control, and that's going to cause more businesses to shrink or fail -- which will in turn create more unemployment and even more foreclosures.

The recent hefty boost in the federal minimum wage will also cause more business shrinkages and failures, further lowering the value of real property. And, the looming waves of tax hikes will make the current business climate seem positively rosey. With fewer jobs, more Americans will be unable to pay their mortgages. This will increase the foreclosure rate and put a glut of houses on the market -- and you know what rising supply and falling demand does to prices.

I would not be looking for a V shaped recovery or a U shaped recovery. I'd think more in terms of an L.

 

If you look at the graph you will see the price decline has been slowing down and then basically flatlined the last couple months. It may not be 100% bottom yet, but its basically a bottom as far as im concerned.

Like I said earlier though housing hitting bottom is far from the end of the story. OBama and Bernanke are killing the economy in other ways. I think we may have a "double dip" recession similiar to the 80's but much more severe.

 

Housing bottom? lol!



Housing might stop falling by 2012. The current gain in sales goes with the seasonal spring/summer uptick. The prices they're selling at is still 21% lower than last year and the total volume of sales only looks good if you compare it to winter 08/09.

This is what the "surge" in real estate activity really looks like:

 

Dow above 9000 and people still think we will see a double dip recessoin... The market is ahead of the economy, once the jobless claims tops and housing is over with, then credit we will be fine... We will move up slowly.

 

It will be fun to see couple of red necks loony running in the forests in the weekend playing soldiers try to raise against a modern army or even a police department.
I think the realistic number of dead will be between 5-6 red neck loony.

 

Once again the folks that are full of hot air politics and have virtually no knowledge of real economics are taking basic economic facts and twisting them into some stupid political theory. Then on top of that they use wierd language like statism. Frankly I feel like I'm reading some kind of stupid fraternity cr@p that has no real meaning.

Take a look at the summary data above. Take a look back at the last 3 US recessions. Get a feel how real economies and real recoveries occur.

First off, forgetting the political commentary in the bulleted points above, all of that data is on target.

Anyone who thinks that the retail/services part of the economy is going to come roaring back is living in dream world. Nobody in the current administration is promising that.

Here is some reality.

1. The recession destroyed $ trillions of dollars of net worth. The crash of real estate and the stock markets destroyed enormous amounts of wealth.

There isn't the level of wealth or confidence to spend our way out of the recession. Its not there.

2. The consumer economy we've been living off, exploded in the last decade into consumer spending fueled by borrowing. That ride has ended. Across the board credit adjustments will change that.

3. The last 2 recessions saw recovery from areas that ran counter to the root causes of each recession. For instance:

A). The recession of the early 90's was primarily caused by a financial/commercial real estate bubble and crash.

The recovery was fueled by hi-tech technology.

B.) The recession of the early 2000's was caused by a bubble specifically in the telecom portion of technology...and its fast growth little brother, the dot.com explosion of the late 1990's.

The recovery was primarily a result of a boom in real estate.

This recession was caused by a bubble in residential real estate and humongous overleveraging in the financial worlds. The bubble has ripped apart abilities to have widespread spending. If anything is an indicator of that it is the incredible swing by consumers into savings. The savings rate is soaring from an unbelievable low.

For all the traditional economists....savings usually converts into hard investment. That should be differentiated from speculative investments that were made into the real estate bubble economy of this decade.

Hopefully technology based in the US soars again. Don't bet against the US.

Frankly we have miles to go on infrastructure and energy investment. Just to get a clear long term picture on energy....roughly at the mid 1970's or early 1980's the US imported 50% of its oil/gas. Today the US imports 70%.

Invest in domestic energy sources....and that changes a lot.

Finally, why all these facts referenced above should reference "statism" is beyond me.

Its a reflection of the economy...not anything having to do with real facts.

Of course only hot air "partisans" that try and tie real economics with some stupid political premise are the typical carriers of that message.

 

A few amusing words from Doug Casey's talk at the Agora Financial Symposium:

It seems to me that it’s almost the endgame for this financial system. Since the depression of 1929 to 1946, we’ve had a worldwide economic boom; in its early stages it was quite real, since it was based on the savings that were accumulated during the depression. But over the last generation, starting in the 1980s, we’ve had a phony boom, driven entirely by debt.

The whole world is awash in debt. Individual consumers are head over heels in debt. State and local governments are head over heels in debt and going bankrupt. National governments all over the world are deeply in debt. And businesses that are catering to old patterns of consumption are going to find they have no earnings to service their debt with, and their assets are unsalable at acceptable prices.

One of the problems we’ve got here is that people confuse paper money with real capital. This is an important distinction that’s being overlooked. Capital is actually just another word for “savings” – the excess of production over consumption. I can’t emphasize that enough.

Unfortunately, people are used to thinking of capital as being the same as the dollar bills or other paper money in their wallets – and that can be created out of thin air. But capital can’t be created out of thin air.

So, I’m very concerned that all these governments are going to destroy the world’s monetary system in tandem. I don’t know exactly how it will end up, but it’s going to be really ugly. This is compounded by the fact everybody is looking to the governments to solve these problems. Government is the cause of these problems. And the people it employs are not the best and the brightest (how that ridiculous canard ever got traction astounds me) but the poorest and worst part of humanity. [...]

The talk of green shoots is all PR, because the morons running the government actually believe the economy is based on psychology. In fact, psychology has zero to do with it. If it did, then all the Zimbabwe government would have to do to solve their depression would be to slip everyone a Prozac tablet every day. But maybe we’ve already tried that here, since something like 50 million Americans are already on antidepressants….

There may seem to be green shoots in the same way it seemed that way for a while in 1930. After the stock market went down for six or eight months, it reached a temporary plateau and bounced back up. People thought it was just another recession that they’d pull through as they did after World War I.​

I can't agree everything Doug says, of course. He's bullish on metals, and I don't see worldwide demand for metal recovering quickly enough to justify current investment in those commodities. Of course, he is careful to state that he is bullish on metals "long term."

I don't see worldwide demand for anything returning to previous levels for many decades. I think the solution for the average family is going to be learning how to live on significantly less money.

I see the average family being squeezed between lower salaries (caused by increased corporate taxes) and higher personal taxes. That is, when they are receiving any salaries at all. Increased corporate taxes, mandatory benefits, a myriad of new regulations for employers, and a nightmare of compliance costs should push unemployment above 10% within the next nine months.

It seems to me that, for the average family, frugality is the only solution that is within their powers.

 

all's not well with Obama's stimulus package...

http://www.google.com/hostednews/ap/article/ALeqM5g0c80lvkIYZF4eoTIcnV67SGZpqwD99P6R600

throwing money into the economy without proper planning is never a good idea.

 

Its already here. All indications are any recession that was, is now at its end. Now if Obama keeps fucking with shit, we're likely on our way into a depression.

 

Um the recession is nowhere near the end. You obviously don't know how they calibrate what is a recession or not. And all 4 indicators are far from positive. HINT: GDP is not how they calculate it. GDP fluctuates between positive and negatives during recessions. GDP is only used as a trend by traditional economist to know if we are entering a recession. It is officially decided by a independent committee on 4 factors.

 

According to everything I have read and what every sane economist has said, based on most recent numbers including the fact that the economy shrunk much less than expected, based on the slower contraction its a safe bet that if government stays out of the way, we will start expanding again.

http://money.cnn.com/2009/07/31/news/economy/gdp/index.htm?postversion=2009073108

Lets also keep in mind that not all of the economy contracted, and not everyone was in a recession. Many of us were hit by the results of one however. There is no denying that. But the sky certainly was never falling.


The "recession" is the sole result of the last 30 years of muddling by the government via the CRA, Fannie/Freddie and democrat policy that forced lending on people that could not afford it, forced banks to loan money to people that could not afford it, and an overall sense of greed - entitlement and stupidity that lead to an artificial inflation of the housing market and overvaluations to aid in those crazy lending practices.

Couple this with the energy crisis we felt as the result of an enemy hell bent on breaking us by any means possible. All the while those that tried to break our economy had their oil money invested in the very economy they broke. The result? Lower oil prices, and tons of lost money in a stock market that went poop.

Then enters more government. Lets spend our way out of it. Leave it alone, let those that are going to fail fail, and the economy shrinks (contracts). Next comes consolidation, and those that failed are rebuilt by someone else into something newer, better and bigger. These things are cyclical.

Back to those sectors not in a recession? The industry I am in has seen a 60% increase in net sales this year alone.

There are no signs of this slowing, and assuming the government stops meddling, inflating and printing, this too will pass!

Why on earth everyone is still wishing doom and gloom is beyond me. Even when you have the entire government now, why hope for more doom and gloom? What does it take to satisfy you people?

 

Well the government hasn't gotten out of the way. In fact every day they are meddling even worse. So thats why the recession isn't ending now.




GDP report is just plain wrong

http://www.financialsense.com/fsu/editorials/martenson/2009/0731b.html

 

And Obama is right... I know.

We should really be spending more money than we have. That will fix everything!

 

Why is that surprising? It is quite natural and logical that during the recession and hard times, the number of welfare recipient increases.