Posted on 11/12/2007 9:18:11 AM PST by mustang buff
A Wall Street superstar this year who runs Balestra Capital Partners, Jim Melcher, says he's "worried about a recession. Not a normal one, but a very bad one. The worst since the 1930s. I expect we'll see clear signs of it in six months with a dramatic slowdown in the gross domestic product."
(Excerpt) Read more at nysun.com ...
Maybe and maybe not. This has been going on for a long time. Something has to give. I don’t know when but even the US comptroller says so.
It’s not just the decline of the dollar relative to other currencies at work here though - the commercial credit market alone requires a boatload of loans to be rolled over every thirty days. What’s happening is other countries are less inclined to purchase our debt in the amounts that they were willing in the past.
There is not going to be a depression on Bush’s watch. I make no guarantees if Hillary or Obama is elected.
Actually, many of us in the Summer of 2006 were saying it was actually quite possible that this could be as bad as, or worse than, the great depression.
It has nothing to do with a love or hate of any current government. Rather, it has to do with looking at what is happening, salted with a reasonable understanding of human nature.
Thanks for posting those donstions.
CLEARLY, you find an applicable, commendable parable in the drunken lost week end that extended into the better part of a week and a "needed recession"...CLEARLY, I do not.
Exactly what the MSM did in ‘91. Will it work again?
Nah, he's just short the market and wants to profit from a decline. If talking it down can help him, then why not?
Yeah, and it was so bad, it was endorsed by the Heritage Foundation, that notoriously leftist thinktank.
I'm really getting sick of all this disinformation spread about his healthcare plan, which was damn good and very much based on free markets.
Well OK then. I’m glad you were able to get that all straightened out for us.
If it hadn’t been for FDR and his “socialist” New Deal, a communist revolution would have occurred in the United States in the mid-1930s. Things were that bad.
Like it or not, FDR’s inefficient and largely unconstitutional New Deal saved America from becoming a People’s Republic. By giving people food, make-work jobs, and most importantly a sense of hope, the New Deal got us through the worst of the Depression.
And don’t forget that the Depression wasn’t ended by the invisible hand of the market. It was ended by government spending — massive, deficit-based government spending, in the form of World War II.
I’m all in favor of free enterprise, but sometimes the simple economic theory of Adam Smith does not match up with the facts of real life. The economy cannot be allowed to take its natural boom-and-bust course unrestricted by law and custom, because a severe-enough bust will generate a revolution. People are not going to watch their kids starve with food rotting on the ground in heaps.
We’ll see. Bonds seem to be doing just fine at the moment (federal ones at least).
If Carter's economy didn't cause that with his 17-20% interest rates on home loans, I don't see how THIS economy can cause it.
So what is their alternative? Do they plan to quit their jobs and get paid NOTHING? Sounds pretty silly to me.
Well, they can’t default, at least technically.
Years ago, (remember it took 25 years for the dow to break even again after ‘29) stockholders demanded dividends, basically, to gain a return above and beyond what bonds paid. Otherwise, why take the risk? Lots of great stocks don’t pay dividends it is true, but then a lot of great companies stock really tanked today. What I don’t get is why/how bondholders are satisfied with sub 4 per cent returns.
You’re right, of course. Unemployment reached 25 per cent - and that figure didn’t count farms/farm families.
While I generally agree with you, this is somewhat bogus. #1 Money put into a 401k isn't considered savings. #2 Money put into stocks via Roth or conventional IRA is not either. #3 more and more people are getting older and retiring. They aren't making money and are spending some of their saving/investments. It only make sense that this will be negative savings rate.
Overall though, you are right that Americans should cut back, they need to pay down debt, and both Republicans and Democrats really need to cut down on spending and reduce the federal deficit.
Quite the opposite is happening. With a weaker dollar, domestic goods production has shot UP, along with exports. The trade deficit is way down as a result.
Most stocks do pay dividends. Almost all of my investment funds have dividends around 1.5% + growth of course. We’re right near the historical S&P 500 P/E ratio average. No idea why anyone would buy a long term bond at 4%. You MAY keep up with inflation.
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