Markets woes- blame the scarity American consumer

Discussion in 'Economics' started by HedgefundTrader2, Jan 13, 2008.

  1. American consumer is a scarity cat.

    Fearful, unsure, running at the slightest noise and a total wimp. American consumer does not have balls, its a soft baby with pink feet and a fragile ego. Slightest of adversity spooks the be juses out of him. Having grown up with a silver spoon and golden parachute of welfare system attached to its umblical cord he cannot face life when it get rough or when the rough gets going.

    What does the American consumer do at the slightest dark cloud on the horizon? He freezes like a deer in the headlights. He is sacred to death about horrible consequences that hardly materialize. He stops SPENDING MONEY and sulks in a corner waiting for a green signal that all is well and he can cross the street. American consumer's habits beguile and frustrate everyone, from realtors,bankers, lawyers, landscapers to construction workers.

    What happened in the real estate market is prime example of this behavior since late 2005. The American consumers saw dark clouds on the horizon for some reason and froze in its tracks. He immediately stopped buying real estate with bit of greed set in his eyes for bargain. Instead he sought security in renting 1 bed shacks and passing the night under someone else's roof. The magnitude of such a move killed the fledging real estate market and than the banking and mortgage lifeline attached to it.

    Things started going worse and he became ever more fearful and scared. Pretty soon lenders had no business, they started going belly up and than the sub prime mess shit hit the fan in the summer of 2007. Since than it started effecting changes in the equities market and stock markets responded negatively and the overall general economy started get threatened by it. But since market has responded accordingly as expected, the neurotic consumer is now fully convinced that sky is about to fall and a talk about recession and obsession with doom gloom has taken hold of him. He is convinced and he is holding back spending on big ticket items like homes and cars etc.

    If this scarity cats stops spending totally and tightens its belt further than I can bet the whole economy will be shattered and a recession will knock the winds out of the sails in America. And that is how American recessions usually start.

    Lets hope our Government can coax this cat out of its hole into spending money and convince his fragile ego its Ok to come out and its not as dangerous as you have imagined. Lets hope he starts buying real estate and supported businesses starts spurting.

    This is where the truth lies. How to deal with the American consumer ?

    You can always take the horse to the water, but you can't make him drink. Hope we are wrong and the horse starts drinking.
  2. The American consumer a "scaredy cat?"

    What planet are you from? How about getting out of your hole every once in a awhile and venture out into the real world.

    We're tapped out.

    Our salaries are stagnant because of outsourcing, H1B Visas, illegal immigration, busted unions, global competition, etc...

    Wall Street fat cats screw up and to save their asses the fed prints like there is no tomorrow. And what's the result? REAL INFLATION - and not the government BS you read about. I'm talking 10-15% 1970s style INFLATION.

    So we get into debt up to our eyeballs because of materialism, job loss, health costs, divorces, etc...

    Look, I'm one of the many wage slaves in the bottom 99% of Americans.

    I'll let you in on a secret. WE'RE TOAST. No more milking us and extracting from us. Bone dry we are.

    Wall Street took our 401Ks w/ the dot com bust, and now its taking our homes.

    And guess what? You traders will feel it soon too. Don't feel sorry for us.

    You'll be joining us real soon.

    Welcome to our World.

  3. You can blame the world for your woes. Blame yourself first. Look in the mirror who stopped buying real estate in the fall of 2005?

    Honey, I can get that house for $50,000 less just wait. That didn't happen, and you shot yourself in the foot. Now with strict lending you just pray your kids get to play in backyard instead on the streets maybe in the year 2008.. just pray real hard.
  4. Dear day,

    Are all the inhabitants of your country as simple-minded as this?

  5. You're not too bright are you?

    OK, for argument's sake. It's all our (middle class) fault. All we do is blame others. Fine.

    But let me make my point again, because it appears you are somewhat thick.


    Believe me, we would love to buy more things and invest. But guess what? No more money. Gas, Food, property taxes.... All getting too expenses. And salaries flat or down.

    Nothing left at end of month. You guys sucked us dry. Corporate Liberalism gave us just that - global competition. Guess who's winning?

    I'll give you a hint. They live far away, and they have the extra $$$ from trade surpluses to buy our banks.
  6. Wall Street took our 401Ks w/ the dot com bust, and now its taking our homes.


    Isn't that the truth. Everyone who got burned in 2k put there money in real estate "hi ho, land, they ain't making any more of it". The govt saw this coming by changing the bk laws, just in the nick of time. Add to that, the home equity scenario was sold on the tax deduction aspect of the loan. Use home equity to consolidate your purchases and write off the interest. Joe sixpack's tax loop hole.
    Bust 'em up good with the atm tax.

    Squeeze every last nickel out of the shift worker with a nice ripe cigarette tax and high price gasoline, but first sell them a suv cause you can't tow your boat with a hybrid.
  7. Make that "I have no more discretionary income".

    I'm doing just fine. :D
  8. So am I. But I'm taking the larger view that most are not. I see it from the people I talk to every day.

    And being that no man is an island. It will affect us all. One way or another, directly or indirectly, we are all in industries that rely on consumers.

    So yes, today, you and I are fine.

    But tomorrow?

    I see dark clouds. The middle class can't get tapped out without some major repercussions.

  9. I am an inhabitant of this country USA and I know my fellow Americans real well.
  10. a

    You have no more discretionary income? What the hell they pay your for? So you can live well and have a house and car. But at some point you got greedy ( Honey I can get that house for $50,000 less) or fearful ( we donot have discretionary income) and stopped buying. Froze in the headlights like a deer and look where things are... even the stock market not doing too well.
    Tail ( real estate ) wagging the dog ( stock market).

    How do I know this ?

    You are talking to a tight fisted mortgage banker and a trader in equities. I am the guy who wrote CDOs than went South because real estate valuations went down, because consumers stopped buying and selling collateral and millions of deers froze in the headlights..
    #10     Jan 13, 2008