Is the U.S. economy about to collapse?
LikeAnOcean
Posts: 7,718
I've been watching the news allot today and word is Americans are borrowing more money than they can afford and the U.S. dollar is about to collapse and be worth as much as 50% less in the next few years.. and America's homes are really worth 30 to 40% less than American's think..
I've been taking sacrifices to get ahead and save as much money as I can over the last few years. Word is to spend the money on foreign assets before it drops. What types of foreign things can you trade the U.S. dollar for?
I've been taking sacrifices to get ahead and save as much money as I can over the last few years. Word is to spend the money on foreign assets before it drops. What types of foreign things can you trade the U.S. dollar for?
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So much for hoping social security will still be around...I tell ya, whoever becomes President next has SOME job that will either make them a hero or make this country worse.
and reveling in it's loyalty. It's made by forming coalitions
over specific principles, goals, and policies.
http://i36.tinypic.com/66j31x.jpg
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look what happen today...6 billion shares traded hands. dow was down 350, rallied positive, and ended down 15.
http://money.cnn.com/2007/08/16/markets/markets_0445/index.htm?postversion=2007081618
http://money.cnn.com/data/markets/dow/?
look at a chart for the last 2 years
http://finance.yahoo.com/q/bc?s=%5EDJI&t=2y
the market is going to correct itself and be very volatile in the short term.
the fundamentals of the economy are strong..but the drop in home prices and subprime loans are hurting growth in the economy.
I read that subprime loan defaults will cost 100 billion. personally, I think the economy make up for that loss but I'm not sure to what extent it will hurt.
are you blaming bush on the market decline? did you praise him when it hit 14,000 a few months ago?
http://finance.yahoo.com/q/bc?s=%5EDJI&t=my&l=on&z=m&q=l&c=
more specifically, I think many mortgage lenders will fold. and rightfully so.
The lenders who were crazy enough to lend to people who can't afford the loans might get hurt, but they shouldn't have been lending to them in the first place. The people who got the loans, they are the ones I feel for. My 401K, I don't feel for. It will bounce back.
Don't panic, peeps.
- Bu2, Admin Assistant to the CFO of a Real Estate Investment Trust
wtf? I just posted a funny link. I'm sorry I rocked your love for the guy...
and reveling in it's loyalty. It's made by forming coalitions
over specific principles, goals, and policies.
http://i36.tinypic.com/66j31x.jpg
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( o.O)
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98 CAA
00 Virginia Beach;Camden I; Jones Beach III
05 Borgata Night I; Wachovia Center
06 Letterman Show; Webcast (guy in blue shirt), Camden I; DC
08 Camden I; Camden II; DC
09 Phillie III
10 MSG II
13 Wrigley Field
16 Phillie II
I'm just asking. I didnt know you go around posting funny links of bush jumping from an airplane. or whatever that was.
that would be called what? trolling?
I thought maybe it had something to do with the discussion. I guess not.
Oh sorry I guess I have to appeal to your humor...for it to be funny.
and reveling in it's loyalty. It's made by forming coalitions
over specific principles, goals, and policies.
http://i36.tinypic.com/66j31x.jpg
(\__/)
( o.O)
(")_(")
atta boy. I agree. when everbody sells, you buy. when everybody buys, you sell.
I didnt say it wasnt funny. it actually is kinda of funny.
again, I thought you were trying to add to the discussion, instead of trolling.
Right I got you... I can see how you police this place to your standards.
Hey please forgive me officer... Maybe I'll PM all my posts to you so you can review them for me from now on.
Thanks man!
and reveling in it's loyalty. It's made by forming coalitions
over specific principles, goals, and policies.
http://i36.tinypic.com/66j31x.jpg
(\__/)
( o.O)
(")_(")
dude you are the one you called me out for being a troll. dont get mad when you have shit on your face.
I love the way he breathes in and out real fast when he finally lands belly-up on a bubble, lol....
And Roland is NOT trolling.
dude please find it in your heart to forgive me... do it for the love of this thread if not for me.
and reveling in it's loyalty. It's made by forming coalitions
over specific principles, goals, and policies.
http://i36.tinypic.com/66j31x.jpg
(\__/)
( o.O)
(")_(")
Ratings.
Jlew already used the proper term for what is happening - Correction
In bull markets, a 10% correction generally spurs on continued growth. If you're not in the market, it is time to get in RIGHT NOW. If you're in the market, sit tight.
Anyone freaking out right now has ADHD and zero long-term perspective.
That's exactly what I'm wondering...
I believe this is the beginning of a squeeze on the middle class.
and reveling in it's loyalty. It's made by forming coalitions
over specific principles, goals, and policies.
http://i36.tinypic.com/66j31x.jpg
(\__/)
( o.O)
(")_(")
Great post. My post was specifically focused on the correction happening now. You've given a great global perspective, highlighting areas we better start worrying about. We have spent way too long resting on our past successes.
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Seriously.
WTF.
Sign of the apocalypse i tell you!!!
If I opened it now would you not understand?
Or maybe buy stocks in Australian uranium mining companies. Unless labor wins the upcoming election. Then don't.
-C Addison
The current mortgage situation was caused by house flippers who's "day job" was to sit on a property for a few months and profit from selling in a surging market. These flippers got into a property for nearly zero out of pocket and theoretically got some money out. In order to accomplish this you need exotic mortgages (low doc, sub prime, adjustable rate) or otherwise as close to ZERO down and INTEREST ONLY as possible.
Starting at about 2000 everyone and their brother was opening up boutique lending operations in South Orange County to meet the demand for this kind of loan. Each new lending operation in competing with others for "bottom feeders" AKA (low doc, sub prime, zero down, interest only) was more outragious than the next. There were even 125% loans.
The only way flippers can make money is to sell the house for significantly higher than they bought it (take into account agent commissions). There are limits to everything and the start of the crash was in late 2005 when property prices and sales leveled off. Homes were no longer turning over at the expanding rate necessary to support flipping.
Flippers have therefore had to sit on houses longer than expected. The interest only loans that they were holding had an adjustment period of anywhere between 1 and 5 years when principal and a higher rate was due. The high rate of default is due to these interest only loans adjusting and payments surging up to 400% or more.
We started hearing about defaults a few months ago as the "1 year" people came due. There are still interest only loans in the pipeline most probably coming due in the next 2 years or so. They can't just refinance to a standard loan because two median incomes no longer qualify for loans covering their old loan balance.
Credit is not a bottomless pit. People must pay their mortgages in order for credit to be available (creditor's fixed income). Since people have defaulted loans are not being paid and the ability to issue credit is drying up.
Credit however is not just "mortgages" but consumer credit also in the form of credit cards, car loans, etc. It goes without saying that an increasing number of people have: no savings, living paycheck to paycheck, and have revolving credit. If consumers are unable to revolve their credit then we are going to witness personal bankruptcy increase, followed by higher interest rates, and minimum payment. This will cause consumers to reduce their spending and therefore a reduction in consumption.
Consumers are what drives the market and we are on a slow moving train wreck to true collapse if the credit situation continues. Don't beleive the Fed, CNBC or anyone else who is prolcaming "a recovery." They are using Orwellian tactics to prevent the loss of their status-quo. Sadly I don't think their campaign of disbeleif will do much good as people's bank accounts get cleaned out and their precious companies fall apart. They will loose too.
At this point the problem has grown beyond the ability of the US government to do anything about it. The total dollar losses to date (and those yet to come) are in the hundreds of billions if not a trillion. As you can see the problem is not just contained in the US but every worldwide financial insitution that aggregated credit to US consumers is exposed.
The REALITY of the situation is that the MARKET must sort the situation and the US GOVERNMENT CANNOT AFFORD to do anything about it. Because of the Bretton Woods agreement we can't just print more money (and also look how well that worked for Weimar Germany).
We're just going to have to ride out the situation until the market finds a bottom.
oh yeah most of you probably don't know the federal reserve is a private bank and was set up to rob this country a long time ago.
http://www.bigeye.com/griffin.htm
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