recession--this time is different

Discussion in 'Trading' started by Warrior4g, Feb 22, 2008.

  1. we all hear that everyday; "this time its different" . anyway,i was listening to asome guy who runs a fund and he said usually a recession is cause by the fed raising rates but this time the fed was not raising and rates were very low by historical standads. this was cause by a steep decline in housing and mortgage related debt as well as a tightening of credit. we all know this already and it is certainly not anything new to us. however,real estate crash's and credit crunch's tend to weigh on the economy for long periods of time.
  2. That is exactly right. Most past recessions have been caused by tightening of monetary policy. Just look at how much Greenspan raised rates at the end of the dot com economy era.

    As a result, loosening of monetary policy has had a substantial reversing effect in getting us back out of the monetary-induced recession.

    But that's not the case this time around, therefore, looser monetary policy will have a much less beneficial effect.

    Some even claim that it is the loose monetary policy that got us into the recession in the first place. As such, how could it be both the cause of the disease and the cure?

    We have to get through this mess ourselves. I don't think people have even accepted that fact yet.
  3. World War; period.

    Getting into it before our military demands EUR for their payroll.

    :) ;
  4. so true. most recessions are cause my the fed raising rates,this time it was caused by rates being too low.

  5. Since you can't move on..

    Bring on the recession , tank the stock market, get wiped out and be done with that. Why constantly worry and worry to the moon? Have it and go down with.

    Stop these agonizing posts and weeping rivers like a coward.

  6. There is nothing more anyone can do for you.

    Feds have cuts rates, Congress has done a wonderful stimulus package etc etc. You are own your own mental patient, walk the streets alone. Tank the stock market, get foreclosed, lose your job, kill your wife and childern and down in your bath tub.

    Good riddance cowards.
  7. WRONG

    This was caused because the Fed kept rates too high for too long. Initially, yes, the Fed created the bubble by keeping rates low. HOWEVER, what's happening now could have been lessened had the Fed not been so data-dependent and began lowering rates sooner, and more incrementally.
  8. jem


    It was not the rates being low as much as the fact that the lending standards were almost not existent.

    This happened because wall street figured out a scam to increase their short term bonuses and tank institutions in the long run.

    When people could get liar loans and buy house with nothing down - they bought 2 or 3. caused prices of existing stock to go up and caused a glut at higher price levels.

    there is nothing that can stop prices from coming down accept liar loans - for exogenous capital.

    The capital will not come from wall street.

    We could inflate like crazy and hope foreigners come in and buy.

    Otherwise prices must fall.

    Americans will see their next egg wiped out - and eventually China will have exports cut in half.

    If you wanted to go one step back - if you were to prove that the low interest rates caused excess liquidity which caused wall street to make stupid loans.

    You might have and chicken or the egg argument. But I believe it was liar loans.
  9. Day, do you believe the markets runs in cycles? How about the economy? Why is it so hard for you to understand this? The market is a discounting mechanism, the future looks a bit cloudy right now huh? The fed cuts, the markets sell off. This ridiculous "stimulus package is passed, the market yawns and goes lower. You feel the need to blame this on someone? Why? If you are looking for someone to blame for your shortcomings, try looking in the mirror. You should find a new career path, pronto.

  10. 1/Unless you change your negative frame of mind nothing good will come. Yeah you can scalp pennies on the downside but real wealth comes when equities flourish and not trampled upon.

    2/US economy is heavily regulated and tied to the Feds monetary policy. Why donot you get this in your numb skull?

    3/Its not the planetary solar system that runs with the help of God and seansons come and go every year. What a dumb ass!
    #10     Feb 22, 2008