It is going to get a lot uglier. Sadly hitting rock bottom is the solution, and only then can we rebuild.
We need to pay the piper and he hasn't even taken his interest yet, let alone the principle.
care to expand on this? what do you base this on? what will the low in the S&P be?
Well for starters I think we are going to be in for another round of foreclosures. We got nailed by the sub-prime borrowers already. But the real problem will be when all that commercial real estate that was bought and built and financed, that no longer has tenants goes kaput.
Starbucks is a perfect example. They have pulled out of 100's of places. They grew too big too quick and took advantage of the inflated buying/spending bubble.
Now I don't think they will be in trouble. But 1000's of businesses all over the country who are unable to make ends meet in this economy will be.
Who is going to pay the mortgages on these empty buildings, strip malls, etc.
Inflation is definitely gonna come. Unemployment hasn't come nearly close to the bottom as many companies are trying to prolong the layoffs; that may sound crazy now, but it's very possibly/likely that we'll see double digit unemployment rates in the next 4-8 months. Also, as backwards as it seems, the worse our economy gets and larger our debt grows (within reason) through bailouts and large budgets, the more stable the US dollar becomes in the global market because most of the world economy is predicated on our economy in some fashion as well as well invested in US debt and bonds (basically creditors making sure their debt lending investments will be secure and paid back over time). Anyways, like I said previously, the average US citizen is only dependent on Wall Street and the Dow because we've willingly placed our long term financial security (retirement funds), healthcare and stability into the hands of greed through privitization. So as we see GM go bankrupt or all of these banks and insurance companies being bailouted rather than nationalized or let to go under, please recognize it is not in the US citizens welfare for their survival, but instead the welfare of privitized wealth and business. Most of America aren't investors and have no primary stake in Wall Street, but because the government has now handed out taxpayer funds for their self-created issues, we are on the hook to lose out with nothing to significantly gain.
Also, forgot to mention, housing prices and lending rates will level out if left alone without tinkering. Obama's current plan for housing doesn't address the problem so it will not go away.
CONservative governMENt
Our government is the potent, the omnipresent teacher. For good or for ill, it teaches the whole people by its example. Crime is contagious. If the government becomes a law-breaker, it breeds contempt for law; it invites every man to become a law unto himself; it invites anarchy. - Louis Brandeis
We will drift sideways for the next 6 to 12 months, baring anymore unpredictable catastrophic events at the large scale institutions.
The central banks have flooded the markets with enough liquidity to fend off anymore significant downside.
A range of 7000-9000 sounds about right for the DOW for the near future.
Expect things get ugly again when the real money supply starts an inflation snowball.
There are several things that can happen if things "get better". Because of all the government intervention and manipulation, there are a series of events that are likely to transpire juts when people think we are "out of the woods".
Among the most potentially destructive of these are
1. A bond market crash
the PRECEIVED turnaround in global markets will likely lead to a mass sell off of US Treasury securities which in turn will prompt hikes in nominal interest rates, which means loan (and particularly home loan) rates will start to soar.
2. massive inflation
once bank reserves (which have been stuffed full by the Fed) start actually CIRCULATING in the system ... meaning, once lending resumes and all this issued (but UNcirculated) credit actually finds its way in to the market place, the value of the USD will have hell to pay.
Thats my quick take.
I'm with out a steady net connection for the next week or so, if anyone is wondering.
Again, welcome back Jlew.
wad up driftin. I tend to agree with you here. bonds are bound to crash at some point and inflation is on the horizon. my hope is the fed will set their policies accordingly to keep this in check (avoiding "massive" inflation). but after this long period of deflation, inflation might not be so bad.
It is going to get a lot uglier. Sadly hitting rock bottom is the solution, and only then can we rebuild.
We need to pay the piper and he hasn't even taken his interest yet, let alone the principle.
care to expand on this? what do you base this on? what will the low in the S&P be?
Well for starters I think we are going to be in for another round of foreclosures. We got nailed by the sub-prime borrowers already. But the real problem will be when all that commercial real estate that was bought and built and financed, that no longer has tenants goes kaput.
Starbucks is a perfect example. They have pulled out of 100's of places. They grew too big too quick and took advantage of the inflated buying/spending bubble.
Now I don't think they will be in trouble. But 1000's of businesses all over the country who are unable to make ends meet in this economy will be.
Who is going to pay the mortgages on these empty buildings, strip malls, etc.
yea, all possible. anyone know where do gather some vacancy data?
It is going to get a lot uglier. Sadly hitting rock bottom is the solution, and only then can we rebuild.
We need to pay the piper and he hasn't even taken his interest yet, let alone the principle.
care to expand on this? what do you base this on? what will the low in the S&P be?
Well for starters I think we are going to be in for another round of foreclosures. We got nailed by the sub-prime borrowers already. But the real problem will be when all that commercial real estate that was bought and built and financed, that no longer has tenants goes kaput.
Starbucks is a perfect example. They have pulled out of 100's of places. They grew too big too quick and took advantage of the inflated buying/spending bubble.
Now I don't think they will be in trouble. But 1000's of businesses all over the country who are unable to make ends meet in this economy will be.
Who is going to pay the mortgages on these empty buildings, strip malls, etc.
Can you take a look at this video and give me your opinion? It's about 5 minutes. I watched the entire interview and she has a lot of interesting things to say. The point that stuck with me is when she was talking about regulations. Which way do you think we'll go?
Can you take a look at this video and give me your opinion? It's about 5 minutes. I watched the entire interview and she has a lot of interesting things to say. The point that stuck with me is when she was talking about regulations. Which way do you think we'll go?
thanks jimmydean, who were u in a previous life? (the old board).
Elizabeth Warren is a very smart lady. I think we are going to over regulate and pull out the strings again down the road like she mentioned. but I think that will be a good thing. the financial world (hopefully) has learned some very important lessons. one major regulation that I think will happen is in the lending industry. and rightfully so. banks are going to be smarter about who they lend money too. where this regulation will end up hurting is with businesses. they might find it harder to get much needed money. but that might be some of the strings we pull down the road....
Can you take a look at this video and give me your opinion? It's about 5 minutes. I watched the entire interview and she has a lot of interesting things to say. The point that stuck with me is when she was talking about regulations. Which way do you think we'll go?
thanks jimmydean, who were u in a previous life? (the old board).
Elizabeth Warren is a very smart lady. I think we are going to over regulate and pull out the strings again down the road like she mentioned. but I think that will be a good thing. the financial world (hopefully) has learned some very important lessons. one major regulation that I think will happen is in the lending industry. and rightfully so. banks are going to be smarter about who they lend money too. where this regulation will end up hurting is with businesses. they might find it harder to get much needed money. but that might be some of the strings we pull down the road....
I was the same name, haha. I didn't post too much (still don't), but I remember being impressed with your arguments and taking time to explain some financial/market things that some of us didn't quite grasp.
Thanks for taking the time to watch the video. I remember seeing Elizabeth Warren in a documentary about credit cards. It was pretty interesting. She seems pretty sharp.
Comments
Well for starters I think we are going to be in for another round of foreclosures. We got nailed by the sub-prime borrowers already. But the real problem will be when all that commercial real estate that was bought and built and financed, that no longer has tenants goes kaput.
Starbucks is a perfect example. They have pulled out of 100's of places. They grew too big too quick and took advantage of the inflated buying/spending bubble.
Now I don't think they will be in trouble. But 1000's of businesses all over the country who are unable to make ends meet in this economy will be.
Who is going to pay the mortgages on these empty buildings, strip malls, etc.
Also, forgot to mention, housing prices and lending rates will level out if left alone without tinkering. Obama's current plan for housing doesn't address the problem so it will not go away.
Our government is the potent, the omnipresent teacher. For good or for ill, it teaches the whole people by its example. Crime is contagious. If the government becomes a law-breaker, it breeds contempt for law; it invites every man to become a law unto himself; it invites anarchy. - Louis Brandeis
wad up driftin. I tend to agree with you here. bonds are bound to crash at some point and inflation is on the horizon. my hope is the fed will set their policies accordingly to keep this in check (avoiding "massive" inflation). but after this long period of deflation, inflation might not be so bad.
yea, all possible. anyone know where do gather some vacancy data?
here is a good article in the matter
http://money.cnn.com/2009/04/16/markets ... 2009041614
Can you take a look at this video and give me your opinion? It's about 5 minutes. I watched the entire interview and she has a lot of interesting things to say. The point that stuck with me is when she was talking about regulations. Which way do you think we'll go?
http://www.thedailyshow.com/video/index ... rren-Pt.-2
thanks jimmydean, who were u in a previous life? (the old board).
Elizabeth Warren is a very smart lady. I think we are going to over regulate and pull out the strings again down the road like she mentioned. but I think that will be a good thing. the financial world (hopefully) has learned some very important lessons. one major regulation that I think will happen is in the lending industry. and rightfully so. banks are going to be smarter about who they lend money too. where this regulation will end up hurting is with businesses. they might find it harder to get much needed money. but that might be some of the strings we pull down the road....
I was the same name, haha. I didn't post too much (still don't), but I remember being impressed with your arguments and taking time to explain some financial/market things that some of us didn't quite grasp.
Thanks for taking the time to watch the video. I remember seeing Elizabeth Warren in a documentary about credit cards. It was pretty interesting. She seems pretty sharp.
Hell Yeah! It's so nice to hear the roar again. Well, except tonight...
Fuckin flames...
yea, I thought we played though but just couldnt score when we needed it
Had Habby been a bit better, we probably win that game. Oh well... Looking forward to game 4!