Could Our Economy Be Any Worse Than It Is Now??

It could get alot worse. I was talking to my dad over dinner the other night and he was telling me about how it was in the 70's in with the gas lines, the 80's with the ressesion and in the 90's while everybody was getting rich, he lost alot of money in a business venture and made a big carrer change. Through it all, he said it never felt anything like the ecomonic hardships in Egypt, Jordan or Syria. Sure they are no comparsion to the US, but it could be ALOT worse and we are no where near those points yet.
 
Wait until you see the old guys heading for the bunkers, then you can worry. Man this is just another cyclical thing, did you think that everything is always going upwards? Just that there is alot more hype and news about everything and just before the election, it all gets spun to try to get some political messiah elected who is gonna magically turn things around and save us all from a looming disaster. When the elections are over, the spin will reverse and they will try to make you feel better by glossing over or ignoring the problems. It is cyclical, but if you are young, you cannot have experienced enough of a variation to get a grip on it. Like did you get to experience job hunting during Carter years? Now that was a downer. Lot of sitcoms on TV about hard times and middle class anxiety. It passed.
 
Much of the problem is the price of oil. One of the nations that has supplied us with oil has huge, untapped reserves that are not available to us, due to their being controlled by radical elements in that country who seem bent on our destruction. That country is the USA and those radical elements seemingly bent on our destruction are our congressmen. Pathetic, ain’t it.

The bad news about the economy is also partly a result of the bad news about the economy. The mainstream news media has been screaming ‘The sky is falling, the sky is falling’ for so long and so loud that many begin to believe it. I’ve been around for more than 6 decades, and remember many, many time when if unemployment was down to 5.5% we would be partying in the streets, but now we read in the papers about how bad that is.

Perhaps the greatest problem with the economy is the uncertain future. How bad will the policies of the next president be toward business and how badly will our investments be taxed. Just how much of what we have earned is going to be redistributed to those who did not earn it? What rights will be redefined to be meaningless? And just how in the heck do you plan ahead when we will probably be faced with an egomaniac president supported by a power-mad congress, whose only ‘plan’ is hope, appeasement of our enemies, and tax anybody who can be taxed for the benefit of our bloated government, and the remaining crumbs used to buy more votes.

The question should not be "Could Our Economy Be Any Worse Than It Is Now?" but "Can America survive the next 4 years?"
 
"Much of the problem is the price of oil. One of the nations that has supplied us with oil has huge, untapped reserves that are not available to us, due to their being controlled by radical elements in that country who seem bent on our destruction. That country is the USA and those radical elements seemingly bent on our destruction are our congressmen. Pathetic, ain’t it."

Outstanding statement that really sums up what our congress has done to appease the radical tree huggers... We need to throw then entire congress - both the house and senate - Dem, Rep, and Ind - and start over.
 
I don't know that Obama is going to be able to "fix it" or even have much effect on it. I have a feeling that it may take multiple terms from several Presidents to actually fix it. That's a scary thought huh?
Click to expand...

Scary that it may take several Presidents to "fix" our problems, Obama or McCain being the originator of "fixing" our problems, or the simple fact that the general public thinks a President actually "fixes" our problems?

I vote the latter. The average American needs to wake up and smell what they've been shovelin'. We have nobody to blame for the current economic situation but ourselves. With that, it's up to Americans to fix our own dang problems.

It starts with giving up the false pretense that a President will actually bail us out like he's the Savior or something. Then, elect individuals that actually will follow the Constitution and BOR. Then, MAYBE Americans need to wise up and understand the concept of living within their means and save money.

Of course, with the continuing increase of failure rate of the typical college graduate to balance a checkbook in Economics 101, I don't see my perfect little dream becoming reality any time soon...

If our economy is so bad as the OP states, then I think we'd be in shambles right now. We have a solid foundation. We just keep cutting corners on the framework and finishing...
 
The president is not a dictator, yet. He has marginal direct effect on the economy and a large effect in terms economic principals. We all it "leadership". The president in his capacity as lead should be the front man for efforts to life the dead hand of congress, bureaucracy, environmentalists, financial pirates, trial lawyers. Just a few well placed laws would provide a breath of fresh air to this country. Alas, all three candidates are mouthing more of the same which created our current mess. None of the candidates would I consider a leader. In my view with the exception of a few issues one could place a quarter over the differences in the three candidates.
 
Maybe, maybe not. I'm still hoping to retire in 6 years, and start my new career as parttime summer sporting goods employee...can't wait.:)
 
A big part of it is the strength of the dollar. Compared to two years ago, the dollar has lost a third of its purchasing power.

In 2006, $1000 would buy:

1.66 ounces of gold, versus 1.08 ounces today- a 35% decrease,
or
847 Euros, compared to 680 today, a 20% decrease,
or
363 gallons of gasoline, versus 256 gallons today, a 30% decrease.

So you can see that anywhere from 2/3 to the full increase in gasoline cost is due to a weaker dollar.
 
Could Our Economy Be Any Worse Than It Is Now??
Click to expand...

Well, we could all be enjoying the per capita GDP of Zimbabwe and the same growth prospects. Quitcher bitchin', 'cause we got a long way to go before it's unendurable.
 
Stop crying.

The economy is receding but it is not in a recession.

We're going the way of the Roman Empire. Soon we'll have our very own Ceasar too.
Click to expand...
Obama will come into office with less strings attached than any president in the last 50 years at least. He will also have the support of the youth, many of whom will find themselves graduating from high school or college and unable to find jobs.

The problem here is that the dollar is getting weaker,
Click to expand...
Actually the weakening dollar helps our economy a lot. When the dollar weakens it makes imports relatively expensive and things we export relatively cheap. We are shipping a lot more to the EU since the dollar fell, and things from China are not as cheap as they used to be. The weakening dollar is mostly a response to China's currency games.

being illegal Mexicans without education nowadays, what else can the result be?
Click to expand...
I went to a walmart a few days ago and the woman at the cash register had previously practiced law in Turkey. It was her first job in the US and she was trying to improve her English. American product were going downhill long before immigration problems got as bad as they are. Too many "buy American" campaigns even when the products are junk. I am probably going to buy a new Toyota Tundra in the next few weeks. Made in the US by Americans for a foreign company which I own stock in. GM, tool manufacturers, and everyother manufacturer along with the union workers who demanded absurd wages and benefits for unskilled labor a drunk monkey could perform dug their own grave and I am more than happy to fill it above them.

One of the nations that has supplied us with oil has huge, untapped reserves that are not available to us, due to their being controlled by radical elements in that country who seem bent on our destruction.That country is the USA and those radical elements seemingly bent on our destruction are our congressmen. Pathetic, ain’t it.
Click to expand...
We should just sell all the national parks at public hunting grounds and use the proceeds to fund a gas rebate. Who cares about wildlife, pollution, or ensuring our grandchildren will be able to hunt anything besides mutant zombies spawned by Alaskan pipeline failures. Gas should absolutely be as expensive as it is now. Adjusted for inflation it is not "record setting". Just because we know of oil somewhere doesn't mean it can be drilled anyways. Most of the huge coastal reserves are in the Bearing Sea. Guess what, oil platform+Bearing Sea=haha.

The bad news about the economy is also partly a result of the bad news about the economy.
Click to expand...
I think the economy is actually in worse shape than the media realizes(I admit if they realized it they would be making it seem worse than it is). I don't think the US, and possibly no country in the world has ever dealt with an economic downturn resulting from an upturn which drove interest rates up and caused a housing slump. Look on craigslist and see what people are welling and for what price. This housing debacle will take years to sort out. Good thing I have excellent credit and a stash of cash on hand, I may make more money in the next 5-7 years than most make in a lifetime. Most of the people in foreclosure never should have had houses, just like they shouldn't have had credit cards.

Sound advice:
1. With ammunition prices going up like they are it is just about the soundest investment you can make. Even if we pull out of Iraq the power vacuum will still lead to a lot of fighting for years to come. Solid prospects on ammo prices. If the **** does hit the fan you won't have to laugh maniacally as you burn your t-bills to keep warm.
2.When I lived in Taiwan most of my friends lived in corrugated metal buildings and cockroaches/geckos/rats were always around. Taiwan is one of the "East Asian Tigers." Be glad you have what you have accepting that part of this correction is punishing you for terrible financial decisions, or at least go back to watching your 52' plasma TV while cleaning your brand new Weatherby rifle and stop thinking about how you are going to get booted from your house b/c you can't make your mortgage payment.

also, as my personal bail out offer, if you are about to be foreclosed on, live in Ohio, and have payed the majority of your mortgage, contact me and I will consider taking over you payments. At least your credit won't be screwed for the next 7+ years.
 
Could Our Economy Be Any Worse Than It Is Now??
Click to expand...

Yes, and it will be. But we'll be fine, this is a much needed and long overdue correction, not to our markets but to us- consumers. The market is putting Americans in touch with economic reality, we'll adjust and move forward.
 
The economy is receding but it is not in a recession.
Click to expand...

That is the most obvious case of doublespeak that I have ever heard in my life.

As to anyone believing that the government's official inflation figures have any relationship to the real world, give me a break. All sorts of basic things are experiencing double digit annual inflation currently, from utility rates to common foods.

As far as the housing market goes, yes, I agree that excesses caused the problem. But the fact remains that before now, we had not experienced a nation-wide drop in home values since the Great Depression. Nor have we had a negative national savings rate since then, until now.

I actually live in a small modest home myself, that is all paid off. So I myself don't have to worry about losing my home. But even my home last lost about $25,000 in its value the past year, according to a realtor that I spoke with. And my investments have lost another $15,000 too. And while I realize that things like the market are indeed cyclical, we seem to have a sort of "perfect storm" of factors all hitting the economy at once lately.

If gas really does hit $5.00 a gallon next month, as some are now predicting, I think we are going to see a lot of economic indicators getting even worse soon.

.
 
That is the most obvious case of doublespeak that I have ever heard in my life.
Click to expand...
The economy is shrinking
The economy has not shrunk for two straight quarters yet. We are probably actually in a recession, but until we have figures for two quarters indicating it no one will say we are in one. Ask any economist or politician if the economy is receding and you will get the answer you are looking for.
A recession as you hear in speeches is a technical definition used by economists. If economists declared a recession every time the economy took a small hit for one quarter the term would be useless. There was some thought that as the actual Q4 '07 numbers came in the quarter would be worse than forecasts, but it wasn't. No one will say we are in a recession until we have two quarter's figures indicating a receding economy and then we may be out of the recession b/c that won't be known until the third quarter at which time we may be recovering. Sorry everyone gets confused about this. Just be glad you do not have to decipher a Solow-Swan model with Harrod neutral technical change. These things get a lot more complicated than the straight line supply demand curves most think of when they hear economics.
Think of this as Bush's "I did not have relations with that woman," except on an issue closely tied to his job as president instead of a criminal assault case. Not sure which is worse, but I think Bush wins again.
I would guess this will get a lot worse. Especially if the government continues to try to prop up the economy by synthesizing bubbles with $600 rebate checks.

But even my home last lost about $25,000 in its value the past year, according to a realtor that I spoke with. And my investments have lost another $15,000 too
Click to expand...
I think what everyone should start looking at is the very real possibility that, adjusted for inflation, you may never see these losses returned.
 
My goodness, the Dow Jones almost lost 400 points today.
Click to expand...

That's about a 2.2% loss. Not too large by historical standards.

We also learned today that unemployment had its biggest increase in 22 years last month.
Click to expand...

Unemployment is at 5.5%. Full employment used to be defined as 4% unemployed. I can recall 11% under Nixon and Carter.

A barrel of oil jumped $10 in price just today alone! Apparently an Israeli government statement that war with Iran was inevitable sent jitters into the market. My local gas station has raised its prices 5 times in the last week!!! Gas is nationally well over $4.00 a gallon, and it is now being predicted that it will hit $5.00 a gallon by the 4th of July!!
Click to expand...

Hang on to your SUV. When the oil bubble bursts, as it will sooner or later, you'll be glad you didn't follow the lemmings over a cliff in a Toyota Yaris.

Prius automobiles have totally disappeared from Toyota dealers, despite the fact that Toyota doubled their production of the car a year and a half ago. Buyers are now being told they will have to wait months for one, or pay as much as $5,000 over list price.
Click to expand...

Prius stocks are low because of supplier issues Toyota is having with the batteries. Increased demand isn't the whole story.

And, so what? Sales of small cars are increasing and this is a sign of economic collapse?

On top of all of that, it was also reported today that a whopping 9 per cent of home mortgages in the nation are in serious trouble, and either already in foreclosure, or delinquent and risking foreclosure. These are all record setting numbers too.
Click to expand...

Great time to buy, and an overdue correction to house prices that were increasing by 20% per year in some areas. This is how it's supposed to work.

Yet, there are prominent people still claiming that our economy is not in a recession.
Click to expand...

Those would be economists who are well versed in the definition of a recession: two consecutive quarters of negative growth. That hasn't happened yet. In fact, we haven't had even one quarter of negative growth in years.

And our Congress still cannot come up with any comprehensive energy plan either.
Click to expand...

Thank God. Maybe those incompetent clowns will stop screwing around with things and allow market forces to work. Thier energy plans to date have included things like: foisting Ethanol off on everyone leading to huge run ups in food costs, and choking off oil exploration in the US.

Am I being too pessimistic here??
Click to expand...

Yes.
 
I guess what younger people on this forum don't realize is that this downturn in the economy is not a one-time thing. It has happened before, and will happen again, especially with respect to housing prices.
Click to expand...

I'll bet people were saying exactly that in France circa 1789, China circa 1912, Russia circa 1916, and in hundreds of different places and different times. Not saying SHTF is around the corner, but a smart man puts a few less dollars into dinner out, and a few more into cans of Dinty Moore and a couple battle packs.

Most of the recent downturns have pretty much stemmed from foreign factors, whereas this downturn is primarily US based.

"Labor Force Participation Rate" in the us have been dropping steadily over the last year. You should totally ignore the unemployment rate, the only use of this statistic is to calm people down on issues like downturns. Because the unemployment rate eliminates anyone who is no longer actively looking for a job, and most people stop looking after a few months, it automatically minimizes any long term trend like what you would look for in this situation. Not to mention that working ?1?hour payed makes you employed. So there can be vast demand deficient underemployment without much change in the unemployment ratio.
 
I think that much can be learned from financial collapses of the past. There are parallels here to the Great Depression:

After an amazing five-year run when the world saw the Dow Jones Industrial Average (DJIA) increase in value fivefold, prices peaked at 381.17 on September 3, 1929. The market then fell sharply for a month, losing 17% of its value on the initial leg down.

According to estimates by The Economist, the total value of residential property in developed economies rose by more than $30 trillion over the past five years, to over $70 trillion, an increase equivalent to 100% of those countries' combined GDPs. Not only does this dwarf any previous house-price boom, it is larger than the global stockmarket bubble in the late 1990s (an increase over five years of 80% of GDP) or America's stockmarket bubble in the late 1920s (55% of GDP). In other words, it looks like the biggest bubble in history.

That's right, the housing bubble that is currently bursting is larger than the Stock Market bubble that brought about the Great Depression. Austrian theorists who wrote about the Depression include Hayek and Murray Rothbard. In their view, the key cause of the Depression was the expansion of the money supply in the 1920s that lead to an unsustainable credit driven boom. (Sound familiar?)

We sustained high levels of employment in that period with the aid of an exceptional expansion of debt outside of the banking system. Private debt outside of the banking system increased about fifty per cent. This debt, which was at high interest rates, largely took the form of mortgage debt on housing, office, and hotel structures, consumer installment debt, brokers' loans, and foreign debt. The stimulation to spending by debt-creation of this sort was short-lived and could not be counted on to sustain high levels of employment for long periods of time. (Again, sound familiar?)

The time came when there were no more poker chips to be loaned on credit. Debtors thereupon were forced to curtail their consumption in an effort to create a margin that could be applied to the reduction of outstanding debts. This naturally reduced the demand for goods of all kinds and brought on what seemed to be overproduction, but was in reality underconsumption when judged in terms of the real world instead of the money world. This, in turn, brought about a fall in prices and employment.

Unemployment further decreased the consumption of goods, which further increased unemployment, thus closing the circle in a continuing decline of prices. Earnings began to disappear, requiring economies of all kinds in the wages, salaries, and time of those employed. And thus again the vicious circle of deflation was closed until one third of the entire working population was unemployed, with our national income reduced by fifty per cent, and with the aggregate debt burden greater than ever before, not in dollars, but measured by current values and income that represented the ability to pay. Fixed charges, such as taxes, railroad and other utility rates, insurance and interest charges, clung close to the 1929 level and required such a portion of the national income to meet them that the amount left for consumption of goods was not sufficient to support the population.
 
johnwilliamson062
You should totally ignore the unemployment rate, the only use of this statistic is to calm people down on issues like downturns. Because the unemployment rate eliminates anyone who is no longer actively looking for a job.....
Click to expand...

OK, help me out here. If the unemployment rate "eliminates anyone who is no longer actively looking for a job", hasn't it always done so? If that is true, then utilizing that statistic to compare one time period against another time period is comparing apples to apples, and is valid. Or do you know something that the rest of us don't which makes the unemployment rate no longer valid?
 
Last edited:
You must log in or register to reply here.
Back
Top