Spot on jack. The economy remains weak despite headline numbers. Industrial stocks are down this a.m. They did not buy into the strong GDP b.s.
But u r NOT the main reason why we are in an economic hole. Situations like yours existed in the 90s but we ran budget surpluses and full employment.
We wasted trillions fighting dumb wars on the credit card and are now saddled with huge numbers of newly minted PTSDAs. Don't even ask what it costs us overall in homeland security and the destructive effects of spying on our closest friends.
rim, u correctly identify the massive housing bubble as the immediate cause of the 2008 disaster but one must step back and identify WHY the bubble occurred. It wasn't the popularly infamous Glass Steagall whipping boy which dated back to the 1990s. What the powers to be have managed to hide was the stark lowering of the fed funds rate to a then record low of 1% in June 2003 by the closet Neocon Greenspan in a RISING economy in June 2003 to finance cheaply the very costly Iraq war declared 2 months earlier. That one act lowered mortgage rates sufficiently to start the disastrous housing bubble which began inflating 2003-2004. No one to date has asked Greenspan WHY he lowered fed funds to record low in a RISING economy and hold them down for a full year? No one wants to directly link the total cost of stupid wars and their aftermath to the sick economy and huge deficits. The mainstream news media won't let u. They will talk "black swans" and "chaos" when a linear answer is hiding in plain sight.
Fact is the British once said "Honesty is the best policy" I would say "Fair play is vital for one's pocketbook" IOW "fair play is enlightened self interest". We and even the British have forgotten that. Since the beginning of this century we have become a seriously dishonest and hypocritical country masquerading as moral & upright. The world does not see us as the latter. Important? Yes. Fair and honest? No. Did not used to be such in the 80s and 90s. What started it was our response to 9/11. We became a massive hammer to whom all problems looked like nails. No questions asked. Well this behavior is incompatible with LONG TERM health of the pocketbook. Why? Becoz its a law of nature very poorly understood i.e unfairness and hypocrisy is incompatible with long term economic well being. Admittedly fairness is not SUFFICIENT but it is NECESSARY for long term prosperity.
That's why are pockets are empty. From budget surpluses of the 90s to massive deficits is evidence.
First of all thank u for taking so much time answering my query.
Interesting that even u, a well meaning and well read person gave a litany of reasons, even "structural, beyond policy", which tends to absolve everyone of blame. To me it just shows how deep our real problem is.
My counterpoint is that most if not all the reasons u give did not appear suddenly yet the dramatic change in the recovery rate appears to be sudden. I mean from less than 2 years to 6+ years and counting. Even the stock market recovery is pallid if compared to year 2000 when the Nasdaq was higher than today 14+ years later!!
There has to be something more dramatic and something which began early this century because until 2000 we were in far, far better shape running budget surpluses, low unemployment, moderate inflation and a stock market boom starting 18 years earlier in 1982.
Just compare the 18 years from 1982 to 2000 and then the 13 years from 2001 to present.
The difference is so stark that no gradual stuff like aging of population, government handouts, tax policies, OSHA, EPA ACA or whatever can explain. From a tremendous 2 decades of the 80s and 90s we have landed in this terrible quagmire of the last 13 years with NO END IN SIGHT!!
U r pessimistic about the economy but I am even more so. I will emphatically state that we will NEVER get out of the current quagmire unless we make the correct diagnosis and apply the right treatment. Now with most of my assets in a diversified stock portfolio I personally have done relatively well, hitting nominal highs like the S&P. But 99% of Americans are in the doghouse with assets failing to keep up with real inflation, stagnant wages, insecure jobs and mounting debt (personal and national) etc. This was clearly not the case in the 80s and 90s.
So we have to look for something dramatic which happened in the very early part of this new century.
jack I agree that the economy remains weak and fragile. However what in your mind, is/are the main reason(s) preventing the economy from mounting a proper recovery? Its been 6 long years now from the onset of the last recession of 2008. Other than common stock holders virtually everyone else remains in the doghouse. In sharp contrast all post WW2 recessions lasted barely 2 years if that. So what gives?
You have started to scream in capitals again.
Sure sign u r off ur meds so please get back on them. Its too painful to behold.
I realize u may have lost a bunch shorting MITT but going off ur meds is not the answer.
No wonder reik got beggared in his so called "pair trading". He just picks the wrong pair. He bashed/shorted mitt. Big mistake.
jack i usually agree with u but the sentence:
"a. High and growing government debt, which requires high taxes to service;" is very imprecise.
By taxes do u mean tax revenues or tax rates? If the former then i agree but if the latter then its a terrible idea as it will reduce incentive and may actually decrease revenues. The best way to raise tax REVENUES is by increasing employment i.e. number of tax payers and consequently less numbers on govt. handouts. A lower tax RATE is more likely to achieve this by increasing incentive to work. It has been estimated that a tax rate in the mid-high teens is the optimal rate. Higher rates tend to decrease revenues and increase unemployment.
reik never fails. He says he bot mtge and bashed mitt.
So mtge goes down while mitt keeps going up.
Now he is to embarssed to post.
reik the contrary indicator:
So mtge starts under performing as soon as reik allegedly buys calling it good value. He bashes mitt which of course shoots up.
Hey folks, reik has no money to buy anything of consequence so don't get psyched out by this loser's calls.
Who r u trying to fool?
U always post supposed buying price when it looks good. And even if we believe it u seldom hold anything beyond a few nanoseconds. All u possibly can do is make the broker richer. As I've said U r probably broke and post imaginary feel good trades. As evidence, ur sidekick Jtrader who used to slavishly follow ur advice went broke and no longer posts. Recall I used to warn him repeatedly to no avail. Sad isn't it?
reik its u who's jammed up with gibberish. Take ur meds please and stop polluting this board.
Ha ha ha....
predictably the 2 losers nick and reik have become mutual admirers. Figures. Misery loves company!
hey reiky what did happen to jtrader?
He would always come out to defend u fiercely within milliseconds. Now no more for months or even a year..
He used to polish up ur zany gibberish trying to make u look sane. But at least he was understandable which u seldom are. Nevertheless he traded too much following ur advice which was probably his undoing.
Tho he probably no longer has serious money to trade he still needs to appear smart and offers short term trading ideas.
Interesting that if one used him as a contrary indicator it would be very profitable. Of course one has to understand him first which isn't always possible.
He had a follower and loyal defender...Jtrader who no longer posts. Suspect he lost his shirt. Feel bad for him.
Feel yer pain as that faker Bill Clinton used to say.