Recession Deniers?

[timhau]

My problem is with the reality deniers - those who think that for some reason a cyclical economic recession is reason to act hysterical and tell everyone that the end of the US Empire is nigh and that we should all buy gold and flee for the hills.

Yup. They're every bit as irritating as the dolts who believed in the "DOW will hit 36000 soon" predictions 10 years ago.

Identify the trend and go interview someone who goes wildly overboard, that's how you get the headlines that sell papers.

 

[macdoc]

those who think that for some reason a cyclical economic recession is reason to act hysterical and tell everyone that the end of the US Empire is nigh .

you mean like Bill Gross

What we are witnessing is essentially the breakdown of our modern-day banking system,

http://money.cnn.com/2007/11/27/news/newsmakers/gross_banking.fortune/


If you think this is a cyclical recession you are in for a rude surprise.

 

[bobrayner]

My problem is with the reality deniers - those who think that for some reason a cyclical economic recession is reason to act hysterical and tell everyone that the end of the US Empire is nigh and that we should all buy gold and flee for the hills.

A pessimistic bias is one of the four cornerstones of economic illiteracy, according to Caplan.
I've seen all four of them today. Maybe we need a checklist.

 

[Old Bob]

Who's lost money on blue chip investment? Where has 40% of Europe wealth gone? I had a relation who would say " Nothing can go wrong" No we are not in recession it's depression, next WW3. Only minor nothing to worry about.? Reality denyer's can't face the truth, and in most cases are in sheltered gov. jobs.

 

[bobrayner]

Where has 40% of Europe wealth gone?

It's still there. Did you think it had gone? Where?

No we are not in recession it's depression, next WW3. Only minor nothing to worry about.? Reality denyer's can't face the truth, and in most cases are in sheltered gov. jobs.

Do you expect us to take any part of that seriously?

 

[Old Bob]

It's still there. Did you think it had gone? Where?


Do you expect us to take any part of that seriously?

Please yourself, did you see the stock market today? Have you noticed the price of oil? Industry has almost stopped and you wonder where the wealth has gone? Whole towns in China shutting down, invest any money there?

 

[bobrayner]

Please yourself, did you see the stock market today?

Yes. Have you? Are you thinking of any particular stock or index? And how does this support the silly claim about 40% of Europe's wealth disappearing?

Have you noticed the price of oil?

Yes. Have you? It's just one commodity; how does this support the silly claim about 40% of Europe's wealth disappearing? Perhaps you think "oil" is the same as "European wealth"?

Industry has almost stopped and you wonder where the wealth has gone?

Wrong again. Industry is still running.

Whole towns in China shutting down, invest any money there?

China is not in Europe. Even if it were, it still wouldn't help your point; Chinese output is growing, not falling. How does this support the silly claim about 40% of Europe's wealth disappearing?

Do you have any more non-sequiteurs or nonsensical scaremongering for us? Or could you, perhaps, defend some of your claims? If you have any more info about WW3, I'd love to hear it.

 

[drkitten]

Yes. Have you? Are you thinking of any particular stock or index? And how does this support the silly claim about 40% of Europe's wealth disappearing?

Oh, be reasonable here.

All the major European indices are down substantially.

DJ Euro Stoxx was at 450, is now at 200. DAX was at 8,000 and is now at 4,500. FTSE 100 was at 7000 and is now at 4000. S&P Euro was at something like 1500-2000 (my feed is flaking) and is now at 850.


What major European index is down less than 30% from its 2006-2008 high?

 

[bobrayner]

Oh, be reasonable here.

All the major European indices are down substantially.

DJ Euro Stoxx was at 450, is now at 200. DAX was at 8,000 and is now at 4,500. FTSE 100 was at 7000 and is now at 4000. S&P Euro was at something like 1500-2000 (my feed is flaking) and is now at 850.


What major European index is down less than 30% from its 2006-2008 high?

Well, yes, but these indices are not the same thing as "wealth".

 

[macdoc]

Well, yes, but these indices are not the same thing as "wealth".

Somebody gets it....

Bubble money is NOT wealth.

I concur that the nominal GDP for the G8 will drop 30-40% bringing monetary values closer into line with real wealth.

Not gonna be pretty.

 

[Old Bob]

bobrayner if wealth is not governed on what one owns or produces to sell= $ what is it? I will look forward to hear from you as your high IQ indicates you must know. China doing well?? ask the sacked 26000000 from the agriculture sector alone. Did you really think I would believe you and not realise you were bull s------g

 

[macdoc]

Money is a construct - it is not wealth.

Money is a form of exchange.

If you take Zimbabwe as an extreme example.

Real wealth.....a productive farm as one classic example....has been destroyed by mismanagement while their currency...money...has devalued beyond belief to the point where the paper has more real value than the denomination printed on it.

That's always the problem with bubbles - they never reflect the real value.

A tulip, known as "the Viceroy", displayed in a 1637 Dutch catalog. Its bulb cost between 3000 and 4200 florins depending on size. A skilled craftsman at the time earned about 300 florins a year, working around 260 days a year and in Summer twelve hours a day.[1]

http://en.wikipedia.org/wiki/Tulip_mania

http://www.businessweek.com/2000/00_17/b3678084.htm

You are in the midst of the busting of the greatest bubble in history.

[FONT=arial,helvetica] Economist Calls Housing Boom 'Biggest Bubble in History'[/FONT]

[FONT=arial,helvetica]Jim Myers, NewsMax.com[/FONT]
[FONT=arial,helvetica]Friday, June 24, 2005 [/FONT]​

The current worldwide boom in residential real estate prices is "the biggest bubble in history," according to a disturbing new report in the Economist magazine.

http://archive.newsmax.com/archives/articles/2005/6/24/115349.shtml

From that article

The total value of residential property in developed countries rose by more than $30 trillion, to $70 trillion, over the past five years – an increase equal to the combined GDPs of those nations.

Now did the real wealth of those houses increase?????....nope not one jot or tittle.

You are now seeing around the world the results of when monetary values get enormously out of step with real value.

Look for a "notational" contraction on a similar scale.

party is over....

an increase equal to the combined GDPs of those nations.

Did the GDP really increase - no.....wages were stagnant and some costs went up yet govs and banks and consumers acted AS IF that GDP - PRODUCT do recall what the P stands for......actually increased the national wealth the way in the past a developer building a house with a loan from the bank did.

A new house with sane values = new wealth and new money in the system.
That's what fractional lending is supposed to achieve.

The monetary valuation got way way out of step with the real value....a shelter worth 25% of the net income of the owner to carry.

 

[LightinDarkness]

you mean like Bill Gross



http://money.cnn.com/2007/11/27/news/newsmakers/gross_banking.fortune/


If you think this is a cyclical recession you are in for a rude surprise.

Doom mongering is fashionable. That you want to buy into it is not my problem. I find idiots predicting the End of the System As We Know It for every year. They will be right eventually, but not because they have any idea what they are doing.

If you think we are in for a great depression every time the economy hits its normal cyclical recessions, you are going to be in a rude surprise.

You are a prime example of a reality denier. Your nickname should be "chicken little" - OH NOES, THE SKY IS FALLING! EVERYONE RUN AROUND IN CIRCLES AND PANIC!

 

[macdoc]

You don't even know who Bill Gross is do you???

Usually a guarantee of BAU head in the sand unaware of the wider world.

Let's see.... a Republican who manages 1 Trillion of client's money OR

a wonk on the internet who doesn't know who said money manager is.....

next.........

 

[LightinDarkness]

You don't even know who Bill Gross is do you???

Usually a guarantee of BAU head in the sand unaware of the wider world.

Let's see.... a Republican who manages 1 Trillion of client's money OR

a wonk on the internet who doesn't know who said money manager is.....

next.........

Lets see - thousands of PhD economists - let's just take the opinion of 1 of thousands who agree:

"President Barack Obama has turned fearmongering into an art form. He has repeatedly raised the specter of another Great Depression. First, he did so to win votes in the November election. He has done so again recently to sway congressional votes for his stimulus package.

In his remarks, every gloomy statistic on the economy becomes a harbinger of doom. As he tells it, today's economy is the worst since the Great Depression. Without his Recovery and Reinvestment Act, he says, the economy will fall back into that abyss and may never recover.

This fearmongering may be good politics, but it is bad history and bad economics."
http://online.wsj.com/article/SB123457303244386495.html

Oh gee this is a hard one. People who study economics for a living, or a kid who is way out of his league and knows nothing but hysterical doom mongering based on nothing. This is what happens when you don't stay in school.

Dismissed, troll.

 

[bobrayner]

Edited to remove duplicate post. Sorry.

 

[bobrayner]

Somebody gets it....

Bubble money is NOT wealth.

I concur that the nominal GDP for the G8 will drop 30-40% bringing monetary values closer into line with real wealth.

Not gonna be pretty.

Ooh, a testable prediction - thanks! I wish we had more of those!

I just have a couple of questions for you:
1. How long do you expect it will take to drop? A year or two? Or what?
2. How much would you like to bet?

bobrayner if wealth is not governed on what one owns or produces to sell= $ what is it?

I just pointed you to evidence that production is still going - value is still being created - in both Europe and China. It hasn't collapsed. Did you misunderstand, or are you trying to misrepresent me? Whatever, it doesn't matter. Your claim about 40% of europe's wealth disappearing was wrong. Plenty of your other claims were wrong too, of course.

China doing well?

China's output is still growing rapidly, if that's what you mean; china's output is increasing at a rate that would make most other countries jealous. However, countries are big and complex, so it's always possible to find some number that looks really bad:

ask the sacked 26000000 from the agriculture sector alone.

See? In this case, presumably you're referring to this story. It's not actually about "the agriculture sector alone" but we can hardly expect you to be accurate. Anyway. It's bad news, for sure, but I should remind you that it's less than 2% of the population of China. 2% unemployment? Global disaster!

Did you really think I would believe you and not realise you were bull s------g

You don't have to believe me. I'm just another faceless person on the internet. I only ask that you look at the evidence. Please, look at the evidence.

Do you have any more non-sequiteurs or nonsensical scaremongering for us? Or could you, perhaps, defend some of your claims? If you have any more info about WW3, I'd love to hear it.

 

[macdoc]

I answered this earlier and the damn site crashed - grrrrr

Ooh, a testable prediction - thanks! I wish we had more of those!

I just have a couple of questions for you:
1. How long do you expect it will take to drop? A year or two? Or what?
2. How much would you like to bet?

For the US pretty solid drops for the next 18 months at least which will get pretty close given that much of the damage is still hidden by gov woo numbers. I think 24-30 months before anything significant slows the contraction if inflation is contained.

Britain gonna be a horror show.

I bet with my business positioning - go to Vegas

This assessment is based on a current baseline in the US - there are some signs that hyperinflation may loom... then ALL bets are off.

Wholesale Inflation Takes Biggest Jump in 6 Months

By MARTIN CRUTSINGER
The Associated Press
Thursday, February 19, 2009; 8:53 AM

WASHINGTON -- Inflation at the wholesale level surged unexpectedly in January, reflecting sharply higher prices for gasoline and other energy products.

The Labor Department said Thursday that wholesale prices increased by 0.8 percent last month, the biggest gain since last July and well above the 0.2 percent increase that economists had expected.

The acceleration was led by a 3.7 percent surge in energy prices with gasoline prices jumping by 15 percent, the biggest gain in 14 months.
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Even outside the volatile food and energy sectors, wholesale prices showed a bigger-than-expected increase, rising by 0.4 percent. Economists had expected a slight 0.1 percent rise in so-called core inflation.

If oil prices go back over $100 - which I expect .....gonna be even nastier.

 

[macdoc]

You still interested in that bet......

Failure to save East Europe will lead to worldwide meltdown

The unfolding debt drama in Russia, Ukraine, and the EU states of Eastern Europe has reached acute danger point.

By Ambrose Evans-Pritchard
Last Updated: 2:05AM GMT 15 Feb 2009

If mishandled by the world policy establishment, this debacle is big enough to shatter the fragile banking systems of Western Europe and set off round two of our financial Götterdämmerung.

Austria's finance minister Josef Pröll made frantic efforts last week to put together a €150bn rescue for the ex-Soviet bloc. Well he might. His banks have lent €230bn to the region, equal to 70pc of Austria's GDP.
"A failure rate of 10pc would lead to the collapse of the Austrian financial sector," reported Der Standard in Vienna. Unfortunately, that is about to happen.

The European Bank for Reconstruction and Development (EBRD) says bad debts will top 10pc and may reach 20pc. The Vienna press said Bank Austria and its Italian owner Unicredit face a "monetary Stalingrad" in the East.

Mr Pröll tried to drum up support for his rescue package from EU finance ministers in Brussels last week. The idea was scotched by Germany's Peer Steinbrück. Not our problem, he said. We'll see about that.
Stephen Jen, currency chief at Morgan Stanley, said Eastern Europe has borrowed $1.7 trillion abroad, much on short-term maturities. It must repay – or roll over – $400bn this year, equal to a third of the region's GDP. Good luck. The credit window has slammed shut.

Not even Russia can easily cover the $500bn dollar debts of its oligarchs while oil remains near $33 a barrel. The budget is based on Urals crude at $95. Russia has bled 36pc of its foreign reserves since August defending the rouble.
"This is the largest run on a currency in history," said Mr Jen.

more dire news here

http://www.telegraph.co.uk/finance/...t-Europe-will-lead-to-worldwide-meltdown.html

 

[kevinquinnyo]

Hey guys, I predicted this current economic crisis back in 1940. Way to jump on the bandwagon everyone.