'We're on the verge of a great, great depression'

[jackoroe]

The economy created a pathetic 38,000 jobs in the private sector last month. Stocks are down over 270 points today, the largest loss since August last year. The housing market has been in a depression rivalling what happened during great depression, durable goods sales are down and the FED is preparing to embark on yet another money printing spree and despite being $14,000,000,000,000 in the hole and counting, some swear we aren't broke.

What if Glenn Beck was right?

http://www.dailymail.co.uk/news/article-1393237/US-economy-Were-verge-great-great-depression.html#ixzz1O3rYslMN

 

[Telstra]

wondering if the US produce many goods or they are all imported from overseas.

In Aust, most goods are imported.

 

[rareboy]

And yesterday, when the market went ripping upwards....where was everyone talking about the new Bull Market?

I'll keep you posted though.

I know we're due for a correction and I'm sitting on a pile of equities.

 

[maxpowr9]

It's a terribly written article really.

Yes, an article from a non-American, right-wing newspaper is considered a viable source on the US economy.

While the housing market will probably never recover [insert baby boomer crack here], the market desperately needed to correct itself and all it needed was some dire news to make it happen.

 

[swerve]

I read the article earlier today...

And although there are some REAL CONCERNS -- I'll have to agree with GiancarloC in that it was pretty horribly put together...

Almost high-schoolish...

 

[maxpowr9]

...Really?

I work in finance and moreso, the stock market specifically. Go, go junior fund manager! Whenever a topic in CE&P comes up related to economics or finance (and usually followed by some grumble related to congress or the President) I try to make a comment on it because many people here haven't the daffiest clue on how our economy works outside of typical partisan fodder. Again, why we as Americans keep asking lawyers aka congressmen/women to solve economic problems confounds me to no avail.

 

[M4P]

The markets go up and down like a whore's pants. I don't lose sleep over it anymore

 

[WillMc88]

Tide comes in. Tide goes out. No miscommunication there. Why not here?

 

[maxpowr9]

Tide comes in. Tide goes out. No miscommunication there. Why not here?

That depends, are you riding the wave in or are you stuck in the undertow? BIG difference there in investing.

@ Toriko. That depends, you willing to stimulate my fund?

 

[Telstra]

Tide comes in. Tide goes out. No miscommunication there. Why not here?

The tides repeating it self for billions of years.
A country's evolution is different. If not careful, disaster might comes ...

 

[CowboyBob]

The dow drops one day and already you're panicking? It's dropped before it will drop again and it will go up again.

Wasn't the world supposed to end on May 21st? There were people who believed that too.

 

[JB3]

The dow drops one day and already you're panicking? It's dropped before it will drop again and it will go up again.

Wasn't the world supposed to end on May 21st? There were people who believed that too.

Its not just stocks. Only a pitiful 38,000 jobs were created. Home prices and sales have collapsed. All of the economic indicators are pointing the wrong direction. ALL of the indicators point to another collapse and that the fledgling recovery has been cut off at the knees.

http://www.cnbc.com/id/43239387

Robert Reich also has a great analysis of the situation that lays out why the US is at great risk, and why it won't get any better. (hint: the 2012 election is to blame)

http://www.ft.com/cms/s/0/aa81cf92-8c3f-11e0-b1c8-00144feab49a.html#axzz1O4xi5fUp

 

[JB3]

Isn't that expected from a bubble bursting though?

No. Because they're actually WORSE than they were at the worst of the crisis. We're past the point of the bubble collapsing. Something more serious is going on.

 

[JB3]

This article said that prices never hit rock bottom --- http://www.economywatch.com/in-the-...rse-now-than-during-subprime-crash .02-06.htm And that even then, the foreclosures remain out of control. Who thought massive foreclosures for years is somehow good for the housing market? The "something more serious" that is going on is that there is no moral compass at all in the banking industry. People losing their homes while others can't find a sustainable job to afford to buy a home, pretty obvious. The handwriting is so plainly on the wall.

We've gone through rock bottom already. They're in freefall.

You can also blame the supposed 'bailouts' of mortgages that haven't actually happened. Its the biggest failure of the Obama plan, and of Bush's plan. They claim to be helping with mortgages but haven't.

And I don't quite understand your comment about banking. Are you saying that they should just be giving up and forgetting about asking for their money? Or that they should make mortgages more readily available? Its not clear.

 

[MoltenRock III]

The economy created a pathetic 38,000 jobs in the private sector last month. Stocks are down over 270 points today, the largest loss since August last year. The housing market has been in a depression rivalling what happened during great depression, durable goods sales are down and the FED is preparing to embark on yet another money printing spree and despite being $14,000,000,000,000 in the hole and counting, some swear we aren't broke.

"Why waste your time worrying about something you can't do anything about? Normal economic cycles are going to happen. Trying to stop them usually doesn't work. Look at the upsides. You can get a really good deal on a house now and a great deal on a car if you're in the market." - Jackoroe Oct. 9, 2008


COBob is exactly right. We aren't in a recession. The MSM has done a wonderful job of telling us we've been heading into one for the last two years. 0.6 is lame growth, but it isn't negative for two quarters. That's a recession! - Jackoroe May5, 2008

After Bush's last budget and he sailed out of office at over $12 TRILLION in debt, where was your outrage then about America being "broke"? Remember, you supported fully the tax cuts late last year.

 

[SteveyBoyLA]

This talk about us being on the verge of a great depression is not news. If we are to use the stockmarket as a measure of economic health, look at the many predictions from other 'experts' in 2010 that the Dow would drop below 10,000 (some to as low as 7,500) by year-end 2010. See link below, this is just one example of widely missed predictions.

http://lonelyconservative.com/2010/07/dire-predictions-for-the-economy/

Those that grade their inaccurate predictions for 2010 have simply moved the doom-and-gloom goal post to the future. "Any minute now" they warn. Kind of a Harold Camping-like revisionism of the date for the apocalypse.

Speaking of Camping, he now has changed the date for the apocalypse to October 21, 2011. If he's right, rareboy will be sitting on a pile alright, and it won't be his equities.

We'll give Camping one more chance. (What's the expression from Dubya Bush?: fool me once, shame on — shame on you. Fool me — you can't get fooled again.) If he gets this wrong, maybe the DailyMail can use his services as an economic soothsayer.

 

[JB3]

Heh, take that dispute up with my source then.

Wait, do you mean they should be helping the banks with the mortgages or the homeowners with the mortgages?

The homeowners. The government should have never helped the banks with the mortgages.

I'm saying that those who are being foreclosed on should instead be reconsidered--- is it really the case that all of those homes need to go back on the market? That those people cannot pay anything ever for those homes? That seems like it is impossible. The banks got bailed out, so perhaps they should be returning the favor. Not doing so is aiding that freefall you said the housing industry is in.

But I sense you're about to disagree with me.

I actually agree with you there. The banks lose more money by foreclosing on them than by renegotiating and working out payment plans with these people, and keeping the money coming in for the long term. Those homes certainly don't need to be back on the market, and a good number of those homeowners can afford to pay something on their house every month, even if its only a third or a quarter of their payment. Letting them do that helps both; the bank will see a higher return in the long run, and the homeowner will not suffer the financial repercussions of a foreclosure.

 

[maxpowr9]

I actually agree with you there. The banks lose more money by foreclosing on them than by renegotiating and working out payment plans with these people, and keeping the money coming in for the long term. Those homes certainly don't need to be back on the market, and a good number of those homeowners can afford to pay something on their house every month, even if its only a third or a quarter of their payment. Letting them do that helps both; the bank will see a higher return in the long run, and the homeowner will not suffer the financial repercussions of a foreclosure.

This is actually true. Especially in my state of MA (I actually very recently got my salesperson license to sell real estate if I so desire. It's very easy to do so in my state), foreclosure is the LAST thing a bank wants to do on a home. They literally have to follow a series of notices and if they are not done chronologically in a time-sensitive manner, they have to start all over at square one with a warning again (yah consumer protection laws). This is also the reason that "short sales" have become so popular. It is a way for the homeowner to avoid bankruptcy while at the same time get out of a bad investment. The bank would rather get some return on investment than little to no return due to being tied up in bankruptcy court.

The worst thing a home owner can do is actually stop making payments on their loan (even if you are able to at the cost of other goods) as due diligence will come and bite you in the ass in court.

As an aside for investment jargon: Banks do not give or issue mortgages. A mortgage is a legal, conditional contract signed between the lender and the "home owner". The main clause is the repayment of the note which people tend to call the mortgage. There are other clauses like proper building codes, land rights etc. in there also. Call it word play, but I now chuckle whenever someone says "the government should help people with their 'mortgages'".
I could go on for a bit on this and talk in circles but I will stop there.

 

[JB3]

So all that being said, Domo-kun, why are there such rampant foreclosures nationally?

A lot of those being foreclosed just gave up and stopped paying, even if they had a job, which is the wrong thing to do.

 

[Joshua_me]

I'm not saying that "happy days are here, again", but I'd take *everything* I hear between now and November 2012 with a grain of salt.

Make no mistake: Food prices are soaring, home prices are stagnant or falling, and the job market sucks. But this is the result of too few people holding all of the money.

It's a vast oversimplification, but imagine playing a game of Monopoly where the "banker" hands out no new money except what you started the game with....

What happens ? You just go round and round on the board with no results.

Sure, your "Boardwalk with a hotel" is worth $1,200 each time someone lands on it, but what does it matter if no one has the money to buy it ? There's no point in the game.

America's bankers are holding our country hostage. There's no way to start new businesses, no incentives to buy a new home, and no reason to "roll the dice" since the game is rigged.

The answer ? America's ruling one percent is not going to budge until they Republicans are back in full control.

They hold the gold, they make the rules.

This is far different than the crash of the 1920's. For one thing, there will be no run on the banks and mass hysteria, thanks to social media we are much better connected to what's going on minute to minute than those poor folks were who were relying on yesterday's newspaper headlines.

So, the bottom line, unfortunately, is to sit still. If your lucky enough to own your own home - stay there. If you're lucky enough to have a job that pays your bills - stay there as well.

They have us by the short hairs at the moment, but this too shall pass.