Posted on 02/06/2016 6:13:48 AM PST by Red in Blue PA
Signs of recession are intensifying. The global economy is near or in recession, and we’re seeing that pressure begin to appear here in the U.S. It’s important to be on “recession watch†because the stock market suffers significant declines during recessions. However, you can position your portfolio to mitigate downside risk when recession signals are flashing.
A few of quick facts: 1.Recessions tend to occur one to two times each decade. 2.The last U.S. recession was in 2008, seven years ago. 3.Economies naturally cycle between growth and recession. 4.The stock market declines more than 40 percent on average during recessions. 5.The last two recessions saw equity market declines of greater than 50%.
6.If your portfolio declines 50% from $100,000 to $50,000 you will need a subsequent 100% return just to get back to even.
Therefore, we must defend our portfolios against recession. Fortunately, the equity market is one of the best leading indicators for periods of economic expansion and contraction. Let’s take a look at a simple process with a statistically significant 79% correct signal history with data back to 1948 (Chart 1 below).
(Excerpt) Read more at forbes.com ...
Maybe it is just because of the area in which I live (the NYC metro area), but any story that pretends the Greater Depression ever ended is from Bizarro World. There has been no recovery here, just more jobs lost/employers leaving and a steady stream of foreigners coming in to replace the disappearing American populations that were the mainstay of the area in days past. The whole economy here is increasingly based on wealth transfers from taxpayers in other parts of the country (as well as debt).
it is too late
My other favorite is inflation is non-existent.
Just the other day I bought a pack of underwear at Target Same bran, same quantity, I bought at the same store 5 years ago.
This week they were almost $15. Back then, they were around $10.
Anyone who says inflation does not exist must work for the government or the media.
What doublespeak...we’ve been in a depression for many years now with 20% un/underemplyment ...the 4.9% phony unemployment due to shrinking the denominator.
Layoffs in droves...store closures...balticdryindex plummeting...costs have been cut to the bone at companies and stock buybacks have been done already...one time charges have been done...factories closing...there are only so many more lies that can be told and no more Fed bullets.
Buy more .22, .223, .9 ammo.
I don’t think we ever left the first Obamao recession.
Exactly. The big lie is that there is no inflation. Blue jeans. I have worn the same pair for years that were between $15 and $20. Now $40. Cowboy boots. The same pair that was $100 ten years ago is now $200. That is a rate of inflation of 7% annually.
You’re right; they point to gasoline prices (at a time when young people have probably never owned fewer cars) while ignoring grocery prices. Amazon and Craigslist are used by people that are “priced out” of the traditional means of buying everyday goods; in my area we have a weekly flea market where people buy food, clothing, toilet paper, etc. - next to a brand-new mall that never opened because of the economy.
Every restaurant we go to has raised prices considerably over the past few years
“Exactly. The big lie is that there is no inflation. Blue jeans. I have worn the same pair for years that were between $15 and $20. Now $40. Cowboy boots. The same pair that was $100 ten years ago is now $200. That is a rate of inflation of 7% annually.”
I hate to admit it but I get good quality jeans from Walmart for under $10.
As far as inflation it seems that as soon as prices for certain commodities (eg. fuel) start rising they remove them from the list of items used to calculate the inflation rate.
Yes. You can’t decline if you barely grow.
Nearly all new jobs since ‘07 went to foreigners:
http://www.zerohedge.com/news/2016-02-05/dont-show-trump-chart-all-job-gains-december-2007-have-gone-foreign-born-workers
In the eighties, when my kids were little, I used to buy a standing rib roast just for an everyday dinner. They weren’t outrageously expensive. Today I wouldn’t even buy one for a holiday since they’re between fifty and sixty dollars.
There’s nothing natural about a recession cycle. Every so many years, the banking community decides that wage-earners are making enough money and the employment market is getting tight, so they invert interest rates, making investment impossible and destroying business caught holding debt. The mega-rich take huge losses with the rest of us, but they get taxpayer funds to replace what they lose... and then go right on making higher and higher profits.
No recession ever occurred in the era of the federal reserve without the federal reserve purposely and knowingly inverting interest rates.
I’m not for cheap money, but interest rates should be slowly increased far sooner after a recession.
...and because the kids are now grown up - thus, fewer hungry persons seated at the dinner table?
Seriously: Wouldn't it take about as long now as then to earn the money (at a minimum-wage job) to buy the same quantity of rib roast?
Regards,
I have to admit that I don’t remember the price I paid for the roast back then,I just know that I wasn’t shocked at the price, and we certainly had less money then. But you could be right.
Great time to buy gold and junk silver.
That's the booming nation-wide franchise chain - "Space Available"...
That’s right...along with the new realtor splashed across signs: “For sale by owner” (because they can’t lose the commission in order to pay off their mortgage).
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