It's a... Depression

Discussion in 'Economics' started by Misthos, Jul 8, 2009.

  1. Jim McTague Washington Editor of Barron's no less, used the "D" word on Fox Business. And he backed it up.

    Nothing many of us here don't already know. But I think it's one of those milestone moments when the MSM slowly comes to grip, in public, of the realities the man in the street sees everyday.

    As more public figures use the D word, I would imagine the markets will react negatively. Been ready to buy up SH and SKF or some of the ETFs again. But fear of inflation also has me worried that the market will rise. Thoughts?

    here it is:
  2. Don't know about you, but when a preponderance of public figures (publicly proclaim and) lean towards a certain direction, I generally tend to lean the opposite. But that's just me.
  3. I agree - but I try to catch the trend just as the news starts spreading. When it becomes accepted knowledge - it's too late. Unless of course, this turns into a multi year/decade slowdown.

    Just want to time the ride down again. I think now is it.

    The (ignorant) public's perception is our reality.
  4. It started spreading about 2 yrs ago.
    Pretty long time to disseminate through the collective conscious, wouldn't you agree?
  5. um so you dont believe in green shoots?

    man, remember santa claus? those were the days, werent they?
  6. logikos


    I think there are more that are bullish on the economy than bearish. Not extreme bullishness, but there seems to be a consensus that the worst is over and things will be flat for a while, but the economy will generally trend up.

    You saw the shock last Thursday when the employment report came out much higher than expected. Sentiment was definitely bullish prior to the report.

    I personally think things will get much worse.
  7. No kidding - but never underestimate the power of gov't or the ignorance of the population in the early stages. Major cyclical downturns, much like the 1929-early 1930s have their own mini booms and busts within the greater downturn.

    We'll be approaching phase II - when gov't power weakens or slows down, and the public's growing acknowledgement combines for significant drop.

    Phase I of the public's belief in "green shoots" and the Treasury/Fed's firing of "bazookas" is drawing to a close.

    My real concern now is the potential for inflation. Timing that is still too early.
  8. The "path of least resistance"...............down.
  9. There can be little doubt we're in a depression.

    Don't take it from me - hell, don't do that.

    Does anyone here dispute the real unemployment rate of 18+% that we've seen credibly published?

    Housing values just keep plunging, as do exports AND imports.

    Many of these stats are all time highs in terms of their 'badness.'

    Hell, we're approaching Great Depression style unemployment if we calculate unemployment in the same manner they did back then. How long will it be if things continue on this path until we're 'there?'

    In the meantime, I see China stretching credulity talking up its economy when I personally know someone who travels there regularly on business and tells me there are factories shut everywhere, and comparing China of today and just two years ago doesn't even feel like the same place.

    Japan has tent cities, including a large one in Osaka Park, and a record number of small factories going Bankrupt, and Korea has 20 somethings that were flying high a year ago working on farms and fishing boats, while Spain, Ireland and Italy have OFFICIAL unemployment rates approaching 20% (who knows what the real number is).

    This is an unstoppable disease at this point.
  10. I agree that we're in deflationary depression. I am unconvinced by any of the hyperinflation arguments. We're still well above NAIRU so even the seemingly huge monetary and fiscal stimulus doesn't seem to pose a threat yet. It could in the future if NAIRU shifts higher for permanent structural reasons and we keep mashing on the money pump.
    #10     Jul 8, 2009