Posted on 09/15/2007 2:24:18 PM PDT by AuntB
The new numbers on consumer confidence are out. They show American consumers very confident that the economy is going down the tubes.
Over in Asia and Europe, stocks plunged on fears that Americans may no longer be able to find the second jobs and recklessly borrow the money needed to buy imported stuff. Economists now freely use the "recession" word following the report that American payrolls fell in August, the first monthly decline in four years.
American consumers, in other words, are all dried up. And the discussion has begun on what kind of baloney economy kept them lubricated for so long.......
Of course, some professions thrive in tough economic times. Business should be brisk for bankruptcy lawyers. And we will need auctioneers to help unload foreclosed properties........
Today's "partying," he said, would lead to tomorrow's "hangover."
So here we are: The partygoers have downed a bottle and still they can avoid a hangover.
A recent article on the Motley Fool's British Web site offered "Five Ways to Prepare for a Recession." The prescriptions: Don't make big luxury purchases you can't pay for with cash. Build an emergency fund. Live more frugally. Reduce your debt. Find more work.
All sound advice, but consumers had better act fast — like five years ago.
(Excerpt) Read more at seattletimes.nwsource.com ...
Keep these gloom and doom articles coming. Good for us bulls.
Not long. I've been very bad and irresponsible, never saving a dime and living only for the latest sneaker and auto fashions, electronic gadgets and cable TV. I guess I would need the Democrats to come save me with handouts and welfare.
We are all going to have to cut back.
One of the most visible ways to assess the economy is the number of trucks on the highways. In the year 2000 or 2001 trucks were almost non existant on the highways.
Good idea; I was told the first thing to worry about is the government debt one may owe, then mortgage debt.
They are the ones who will show up first knocking, and then more than knocking afterwards, i.e., strong-arm tactics.
Where would our economy be today if the feds had not put $200 billion into it since August 9th? Would you still be a bull?
Cheer up Auntie, I would take anything I read in a Seattle newspaper as the gospel. Of course if I lived there and had to listen to west coast liberals all day every day I might cut my wrists.
I would say most people certainly DO NOT have a 401k plan.
According to the Wall Street Journal, less than two-thirds of all workers save to 401k plan.
http://online.wsj.com/article/SB118861107481015416.html
Next, consider how many government employees and even private employees such as big utilities, auto-manufacturers, Airlines, etc... still will be getting a retirement pension, and are not contributing to separate savings accounts, but relying ONLY on that future pension.
Finally, consider how many illegal immigrants work off the books, how many welfare families and entitlement families don’t save a penny.
I don’t see any evidence to back up your claim that most people have a 401k. Futhermore, of those who do, how many are putting in $200 a month, which really is WAY too low to fund their future retirement.
The savings rate of this nation is pathetic. A true recession will crush consumer confidence and stymie consumer spending, which IS 70% of our GDP. It is going to hurt.
You forget economic policy is set by the Fed (an international conglomeration of bankers): if our currency was issued by the government instead or backed by ALL common commodoties (GDP-Gold+Silver+other metals) then you would be correct (Americans are industrious), but in the words of milton friedman “The Federal Reserve caused the great depression”- they may do it again..
What is the point of your question? At no time in American history have more than a very small number of people have been able to live on inherited or accumulated wealth. Indeed, throughout human history, the number of people who lived on accumulated wealth or the labor of others has always been so exceedingly small as to be statistically insignificant, until recently.
So most Americans can’t live very long without a paycheck. What does that prove about the overall economy? Exactly nothing. That’s been human reality since the Stone Age. Modern Americans forget, or have not been taught, that the concept of “retirement” is only decades old. Until very recently in human history it was the norm to live hand to mouth and work until you dropped dead at your labors. Those who could not work were taken care of by family if they were lucky, or starved to death if they weren’t.
That huge numbers of Americans accumulate savings at all, much less the enormous amount they have invested in equities, debt instruments, hard and real assets, etc. is a testament to the vibrancy of the modern capitalist economy, not an indictment of it.
Agree...
Since there was no prior depression, the fed’s had no idea of their actions. I doubt they would repeat. With the war and current events, there would be riots in the streets not food lines.
The sad reality is that huge number of Americana's you speak of that accumulated all this savings/wealth, are from the past generation, or those that currently own the businesses and corporations. For the most part, many of those working for these people are now treading water and twisting in the wind.
“How many months could your family survive with NO household income?”
With current savings, about 10 years.
The fed is sham used to controll (steal) and devalue your currency. For one, many know that they can mainpulate our currency especially when they create both it and inflaction-as does the Fed. They are bad news-Congres should eliminte it, and take back the power to issue currency through the Department of Treasury, and back that up by our national GDP-or rather commodoties.
I work in an industry that is another good indicator of the economy.
I make cement.
The facility I work at currently produces an average of 3500 tons of cement per day. And right now, we're selling every bit we make. Over 90% of what we make goes right to the Phoenix market.
In fact, we're in the planning stages right now to build another preheater/calciner kiln system along with raw and finish mills (and extra storage!) that will double our capacity to over 7000 tons per day. We're looking at over $150M before we're done. If the forecast was as gloomy as some here say it is, my employers would not be wanting to spend this kind of money. As a side note, just 40 miles to the south of me, another company is in the beginning stages of building a brand new cement plant.This is just Arizona. There are similar stories coming out of Texas, Kansas City and elsewhere.
Somebody's forecasting big things in the coming years. IF - and that's a BIG if- there's going to be a recession, it'll be short-lived.
Illegals actually have a good record for saving....sort of. They send their money back home.
And if the economy tanks, that's where they'll head back to.
That's true if you're reasonably intelligent. If you're stupid, all bets are off.
Financial threads on FreeRepublic are almost completely worthless.
Most homeowners here think the RE market has bottomed and prices won’t be affected.
Most renters here think the bottom will fall out of the market and they were brilliant not to own real estate.
People in equities see only a bull market ahead once the Fed cuts interest rates later this year.
People in cash on the sidelines see a coming recession they are buffered from and will get great deals in stocks and real estate when both investments crash.
The fact is, these threads are ridiculous. If there are a handful of intelligent, knowledgeable and reasonable people on this forum, their voices are certainly drowned out by all of us who only see what we want to see.
I am a renter with cash and so I see a false US economy supported only by consumer confidence built upon debt and see it all unraveling into recession and a subsequent deep correction on Wall Street. I am looking to get deals when the long, drawn recession drags on. I am looking to buy a house when property values plunge in Sacramento and I think housing is going to continue tanking until 2010 and flatten until 2015.
I am no economic expert. I’m just seeing what I want to see and believing what I want to believe. But at least I am willing to admit it.
Complaints about over-consumption hold democracy in contempt.
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