Do you think there could be a second Great Depression?

[Atticus Finch]

At an increadibly slow rate.

Hi John. Yeah, not increadibly slow, but slow. Here's the thing, though. After living through the near total meltdown of '07 and '08, I'm happy as a pig in poop with even a slow recovery.

AF

 

[Atticus Finch]

And consequently meat, cheese, etc. as grain is what is fed to a large portion of the meat we eat. Even dog and cat food is effected.
Let us also remember that our current level and measure of the Dow is not the same as it was before all of this got started as many companies that have gone broke, fell below the earnings threshold or sold out have been delisted. If you account for all of that and the fact that the Dow has gone through zero every day in the last year then you would be surprised as to where we truly are. If you remove the Fed support of the market then it would be even worse.:eusa_doh:

James, when I was a kid, our local television weatherman was famous for his nightly predictions. "Folks, tomorrow looks to be variable to terrible. Temps will range from eight to eighty."

AF

 

[PrettySquareGal]

James, when I was a kid, our local televesion weatherman was famous for his nightly predictions. "Folks, tomorrow looks to be variable to terrible. Temps will range from eight to eighty."

AF

It's nice that you are immune to the market...and weather. I understand that soothsayers, weatherman and snake oil peddlers sometimes offer pretty much the same thing--a wide range of nothing, but that doesn't mean that you should discard the obvious. I do get that from your standpoint you aren't seeing signs of economic hardship. But that doesn't mean it isn't terrible and 8 degrees someplace in the world, or much of America, economically speaking.

 

[sheeplady]

Everything is going to be higher because of the drought. Take the drought and not passing the farm bill, everybody is going to get crunched to the wall. Granted, in the United States we pay one of the smallest portions of our incomes for food compared to other countries, but doubling it will put it past most developed countries. Not passing a farm bill is going to really hurt farmers in the end.

A couple years ago the average household was spending 14% of their money on food. If that is still true today (I would imagine it to be slightly higher) doubled prices would mean 28% of their income- nearly a third- on food. And that's not for higher quality or quantity food- that's the same food.

Take a look at this calendar (upper left corner of the page) to see how often our hard working representatives are working for us: http://www.house.gov/legislative/date/2012-12-12. I am surprised they came back during break. In reality, they shouldn't get any time off until they do something. If I have a project at work that needs to get done by a deadline, I have to stay late, pull all-nighters, whatever it takes to get it done. I don't get to throw my hands up in the air and say "oh, well, I need my multi-week holiday because I've worked 6 days this month."

A couple years ago a former governor proposed that legislators in NYS shouldn't get paid until they passed a budget since they missed the deadline. I also supported the idea that they should be locked in their meeting rooms and not let out except for potty breaks until they did their jobs. (NYS at the time was kind of an example of corrupt politicians, at one point one of the branches couldn't meet because a couple people in one party hid the key to the room.) If people are going to act like preschoolers, perhaps they deserve to be treated like them.

 

[John in Covina]

Hi John. Yeah, not increadibly slow, but slow. Here's the thing, though. After living through the near total meltdown of '07 and '08, I'm happy as a pig in poop with even a slow recovery.

AF

Increadibly slow, there is no arguing otherwise because I live in Kalifornia.
I recall Carter and stagflation.

You cannot bring up those on the bottom by cutting down the top.

Who is John Galt?

 

[Atticus Finch]

It's nice that you are immune to the market...and weather. I understand that soothsayers, weatherman and snake oil peddlers sometimes offer pretty much the same thing--a wide range of nothing, but that doesn't mean that you should discard the obvious. I do get that from your standpoint you aren't seeing signs of economic hardship. But that doesn't mean it isn't terrible and 8 degrees someplace in the world, or much of America, economically speaking.

No, no. I'm not immune to investment market trends nor am I immune to the weather. But what you say about soothsayers and snake oil peddlers couldn't be more true. I've been following this thread since it started in '07. Over those years, I've read some of the most incredibly dire economic predictions here. Thankfully, almost without exception, they haven't come true. Our economy is the most complex of any in human history. There are so many variables that affect how it moves that no single person could understand all of the relationships among those variables...much less assimilate them into any meaningfull multiyear prediction. The one thing that I've learned in my years of trying to predict economic trends for my own investment purposes is that what seems most "obvious" is probably the very thing that won't happen.

I certainly meant no harm by my questions here. While I haven't agreed with all that I've read, I truly do value the opinions of others on this thread.

AF

 

[PrettySquareGal]

No, no. I'm not immune to investment market trends nor am I immune to the weather. But what you say about soothsayers and snake oil peddlers couldn't be more true. I've been following this thread since it started in '07. Over those years, I've read some of the most incredibly dire economic predictions here. Thankfully, almost without exception, they haven't come true. Our economy is the most complex of any in human history. There are so many variables that affect how it moves that no single person could understand all of the relationships among those variables...much less assimilate them into any meaningfull multiyear prediction. The one thing that I've learned in my years of trying to predict economic trends for my own investment purposes is that what seems most "obvious" is probably the very thing that won't happen.

I certainly meant no harm by my questions here. While I haven't agreed with all that I've read, I truly do value the opinions of others on this thread.

AF

Understood!

I think, though, that there have been millions of micro meltdowns that might not be apparent on a macro level since many people try to keep their economic hardships to themselves when able. Others opt for getting another credit card to prolong the inevitable. (Who ARE these creditors?!)

 

[Atticus Finch]

Understood!

I think, though, that there have been millions of micro meltdowns that might not be apparent on a macro level since many people try to keep their economic hardships to themselves when able. Others opt for getting another credit card to prolong the inevitable. (Who ARE these creditors?!)

Yes, I should have said...but didn't...that my comments were based on national trends and national information. I'm sure that in many local areas people would be hard pressed to believe that any sort of recovery is underway.

AF

 

[sheeplady]

Understood!

I think, though, that there have been millions of micro meltdowns that might not be apparent on a macro level since many people try to keep their economic hardships to themselves when able. Others opt for getting another credit card to prolong the inevitable. (Who ARE these creditors?!)

I think that the part of the problem with people's perceptions is their baseline. I live in an "economically depressed" part of the country (rust belt). We have very low home values, low incomes, and relatively high stable rates of unemployment (as well as low wages). Simply put, we didn't have much to lose. The whole recession (even though we knew it was bad) hasn't impacted us much here, because we already were suffering. In the past several years, I've only known one family who lost their house, and that was due to them losing their jobs years before the financial crisis hit.

That's a heck of a lot different than some areas that are practically ghost towns, where you'd swear some sort of bomb went through and left the houses standing but took all the people. I can remember traveling in the midwest and we went through a suburb/ town outside of Chicago, and we actually drove around an entire deserted development and several strip malls with foreclosure signs on nearly every property.

I'm pretty sure that if I had lived in that place outside of Chicago, I'd feel pretty differently about the recession than I do living here, because my baseline is so different.

 

[AmateisGal]

Take a look at this calendar (upper left corner of the page) to see how often our hard working representatives are working for us: http://www.house.gov/legislative/date/2012-12-12. I am surprised they came back during break. In reality, they shouldn't get any time off until they do something. If I have a project at work that needs to get done by a deadline, I have to stay late, pull all-nighters, whatever it takes to get it done. I don't get to throw my hands up in the air and say "oh, well, I need my multi-week holiday because I've worked 6 days this month."

A couple years ago a former governor proposed that legislators in NYS shouldn't get paid until they passed a budget since they missed the deadline. I also supported the idea that they should be locked in their meeting rooms and not let out except for potty breaks until they did their jobs. (NYS at the time was kind of an example of corrupt politicians, at one point one of the branches couldn't meet because a couple people in one party hid the key to the room.) If people are going to act like preschoolers, perhaps they deserve to be treated like them.

Agree completely with this. Instead of all these silly petitions going around to secede and deport Piers Morgan, why don't we do something useful and actually get a law passed that forces our representatives to actually DO THEIR JOB???

 

[sheeplady]

Agree completely with this. Instead of all these silly petitions going around to secede and deport Piers Morgan, why don't we do something useful and actually get a law passed that forces our representatives to actually DO THEIR JOB???

That would never work, sadly, because this is the only group I've ever seen were people set their own wages and work days without consequence. (Even CEOs and self-run companies lack those kinds of privileges.) Every time I see one of these stupid idiots on TV I want to strangle them, even more so when they use words like "working through the break" and "giving up vacation time" like they're making some type of epic sacrifice to work more than 6 days in December.*

I think it would be highly beneficial to make every one of these idiots work a real job sometime so that they can understand that most of us get vacation time as a privilege- those of us who get vacation time.

(*I do realize that they are supposed to be spending some of that non-meeting time in committees, meeting with people, and at home in their own districts. But seriously, being in session for 6 days when important legislation is pending??? And getting 3 to 4 week chunks of time off at a stretch???)

 

[jamespowers]

James, when I was a kid, our local television weatherman was famous for his nightly predictions. "Folks, tomorrow looks to be variable to terrible. Temps will range from eight to eighty."

AF

We shall see. It is always interesting to get a call from the dope broker that was assigned to my self directed stock account. They always want to do something for me. I tell them to take a look at my account. When they find that I am up 156% for the year they often disappear. lol lol Over the last twenty years or so, I have developed my own system that I use to predict what will happen. I have never been wrong. There may be a first time but I am prepared either way. All I am saying is be prepared because it looks very bad unless a man on a white horse comes riding in to fix everything, then again not even my six year old believes that will happen. lol lol lol

 

[jamespowers]

That would never work, sadly, because this is the only group I've ever seen were people set their own wages and work days without consequence. (Even CEOs and self-run companies lack those kinds of privileges.) Every time I see one of these stupid idiots on TV I want to strangle them, even more so when they use words like "working through the break" and "giving up vacation time" like they're making some type of epic sacrifice to work more than 6 days in December.*

I think it would be highly beneficial to make every one of these idiots work a real job sometime so that they can understand that most of us get vacation time as a privilege- those of us who get vacation time.

(*I do realize that they are supposed to be spending some of that non-meeting time in committees, meeting with people, and at home in their own districts. But seriously, being in session for 6 days when important legislation is pending??? And getting 3 to 4 week chunks of time off at a stretch???)

Amen! What this is also doing is setting up an uncertainty that businesses and markets hate. There needs to be a stable environment in which you can make economic decisions and plan for the future. So far that has not materialized and thus businesses do not expand, hire or buy high ticket equipment if they do not know what they are going to get hit with in the near future. You really cannot blame them. The same is true of individuals and families. It could get ugly fast.

 

[Old Rogue]

Very interesting discussions over the last few days on this thread. It is obvious that my fellow loungers, no matter which side of the discussion on which they fall, are better informed and have given the state of our economy a lot more thought than the average citizen. Just a few of my thoughts humbly submitted...

- I heartily agree with most of what has been said about the work ethic (heck, ethics in general) of our politicians. All of them, not just one side or the other. Anyone who can call a slight reduction of the annual rate of increase in a budget line a spending cut is a snake-oil salesman of the lowest order. On second thought, my apologies to snake-oil salesmen for that last comment.

- What really frightens me is what is going to happen to the service on our national debt when interest rates inevitably rise. Government deficit spending is already at historical levels. I shudder to think of what a rise of two or three percent in the cost of government borrowing will do to our economy.

- Finally, returning to my earlier point about the intelligence level of the average lounger vs. the general population; something I saw on YouTube a couple of days ago really disturbed me. I was looking at the video of Felix Baumgartner's extreme high altitude free fall jump. When reading through some of the comments I came across a thread in which the posters were seriously discussing whether or not if he had jumped from a bit higher if he would have been sucked into space by the vacuum. Just knowing that some of these people hurdle a few feet past me at 55 mph in a 4000+ pound vehicle every day really scares me. Almost as much as knowing that there are enough of these geniuses to impact the outcome of our elections!

 

[1961MJS]

Yes, I should have said...but didn't...that my comments were based on national trends and national information. I'm sure that in many local areas people would be hard pressed to believe that any sort of recovery is underway.

AF

Hi Mr. Finch

I don't trust the accuracy of the "national trends" from our news programs showing that the recovery is underway. I work in Oklahoma and Kansas, my Mom lives in Illinois and I talk to Californians a little. No one thinks that there is any sort of recovery going on at all. Most business owners are scared to spend any money to expand. If an electrician buys a truck it's because the old one can't be repaired etc. The ONLY guy I know who's doing well is my accountant who is busily giving gifts (to avoid the new higher gift tax), selling land to children to avoid the high tax on capital gains, and selling stock to avoid the same.

No one with a job or any money has any confidence in the current and newly elected set of politicians (new dirty word of 2013).

Later

 

[Atticus Finch]

Hi Mr. Finch

I don't trust the accuracy of the "national trends" from our news programs showing that the recovery is underway. I work in Oklahoma and Kansas, my Mom lives in Illinois and I talk to Californians a little. No one thinks that there is any sort of recovery going on at all. Most business owners are scared to spend any money to expand. If an electrician buys a truck it's because the old one can't be repaired etc. The ONLY guy I know who's doing well is my accountant who is busily giving gifts (to avoid the new higher gift tax), selling land to children to avoid the high tax on capital gains, and selling stock to avoid the same.

No one with a job or any money has any confidence in the current and newly elected set of politicians (new dirty word of 2013).

Later

Again, our economy is vast and mind-bogglingly complex. It is imposible to generalize about our nation's overall economic health by extrapolating upon one person's localized observations...even if those personal observations are made in several different states. Of course, your lack of trust of the news media is a whole different issue. I don't know that this is fool proof, but I try to gather news information from several different sources including both print and broadcast media...and I tend to discount almost everything I read on the internet. I feel like somewhere in that mix is the truth.

AF

 

[LizzieMaine]

I think "national trends" can be very deceiving for the simple reason that the idea that we live in one country is, in itself, deceiving. The economy here, in the upper Northeast, is completely different from that of, say, Southern California. The price of Number 2 fuel oil is irrelevant in San Diego, but if it gets above four dollars a gallon a great many people in Maine will be forced to choose between food and heat. We had Depression conditions here thruout most of the 1980s -- unemployment passed 20 percent in my home county in 1987, a period of supposed great prosperity for "most of the country." So, basically, I don't *care* what "the rest of the country" experiences. For most people, I think, the economy is local -- and when they're feeling the pinch they couldn't much care less if somebody a thousand miles away is doing just fine thanks. The question, then, is how expansive these "depression pockets" might become?

 

[Atticus Finch]

I think "national trends" can be very deceiving for the simple reason that the idea that we live in one country is, in itself, deceiving. The economy here, in the upper Northeast, is completely different from that of, say, Southern California. The price of Number 2 fuel oil is irrelevant in San Diego, but if it gets above four dollars a gallon a great many people in Maine will be forced to choose between food and heat. We had Depression conditions here thruout most of the 1980s -- unemployment passed 20 percent in my home county in 1987, a period of supposed great prosperity for "most of the country." So, basically, I don't *care* what "the rest of the country" experiences. For most people, I think, the economy is local -- and when they're feeling the pinch they couldn't much care less if somebody a thousand miles away is doing just fine thanks. The question, then, is how expansive these "depression pockets" might become?

Lizzie, I think you are correct about the localized feelings of individual people. But the title of this thread is Do you think there could be a second Great Depression?, and I have to believe the author was asking about the entire economy. It reminds me of the fable of the six blind men touching an elephant and trying to describe the animal they were touching.

AF

 

[John in Covina]

The greatest thing to show that there is much work being done to manipulate the view is that fact that few news outlets will give any coverage to things like the unemployment numbers are vastly skewed as to be totally unrepresentative of the actually number. The stories for supposed positives are given great weight and negatives are covered as quickly as possibe. For me, I'd say that the media slants the news to give approval to their favorites and disapproval to their adversaries. They moved from being the checks on government to a frigging fifth column.

 

[Maj.Nick Danger]

The greatest thing to show that there is much work being done to manipulate the view is that fact that few news outlets will give any coverage to things like the unemployment numbers are vastly skewed as to be totally unrepresentative of the actually number. The stories for supposed positives are given great weight and negatives are covered as quickly as possibe. For me, I'd say that the media slants the news to give approval to their favorites and disapproval to their adversaries. They moved from being the checks on government to a frigging fifth column.

I find this particularly alarming, the current trend of multi-media monopoly. Seems we are rapidly headed toward one newspaper conglomerate, one broadcast radio network conglomerate, one television "news" network, probably one periodical publishing company. And it isn't just national, but worldwide in scope. The owner or owners of such a multi- media giant will literally have a captive audience, that is, most of the human race. They can influence public opinion with such a network in any way they wish to achieve any political ends they desire. That sort of power is truly terrifying!
This is why I don't really watch current television, especially the "news", and I take everything I hear or read in any modern media outlet with the proverbial grain of salt.