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US going into a depression worse than 1929?


radish

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The US is definately in a recession...how long and deep will it go is the question?>..most people are in denial about it for now...

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The article is nothing new, been saying that for the last six month.

I agree with the whole premise, except that it is three problems. In reality it is only one: Deficit spending, both public and private and consuming more than it produces ... but it won't be a worse recession, it will be a different recession.

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If your invested in the defense industry you should be fine...if your left with a soul...

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If your invested in the defense industry you should be fine...if your left with a soul...

Defense industry returns are only as good as the governments capability to pay for new armament. Once the train goes backwards they'll be as likely to give anything on credit as Uncle Scrooge will give you a penny....

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We are stocking up on canned food, rice, beans, pet food, paper products, etc. Buying it at today's prices. Even if nothing happens, we will use these items.

I think it's a better investment to take $500 - $1000 and buy these things than to let that money sit in an account earning next to nothing.

We are also expanding our vegetable garden.

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We are stocking up on canned food, rice, beans, pet food, paper products, etc. Buying it at today's prices. Even if nothing happens, we will use these items.

I think it's a better investment to take $500 - $1000 and buy these things than to let that money sit in an account earning next to nothing.

We are also expanding our vegetable garden.

good idea...wanna buy a bus and bury it in your yard?...

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Let’s be clear: this is not just an ordinary economic downturn, an inventory cycle where firms have accumulated excess inventories. In this case, banks have suffered a major hit to their balance sheet and, given the lack of transparency, we don’t yet know how big a hit. But we know there is some missing matter: with more than two million anticipated foreclosures, the losses are likely to run to much more than the banks have announced so far.

Moreover, there is a vicious circle: foreclosures drive down housing prices, leading to more foreclosures. And as individuals find it increasingly difficult to make mortgage payments (as interest rates get “reset” automatically at higher rates, a built-in feature in millions of these mortgages) and as the economy slows down, the problems will spread to other credit markets. Indeed, this is already happening.

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The European stock markets fell this morning, January 21st, in the fear of an escalation of the financial crisis and the economic recession in the United States.

In the Paris Stock Exchange, the CAC 40(PARIS STOCK INDEX) moved back of 4,73 % after 12 hours, in 4 851,29 points, passing under the bar of 4 900 points having pushed the threshold 5 000 in the morning, under which it had not come down any more since July, 2006.

The CAC 40(PARIS STOCK INDEX) stays on four consecutive sessions of decline and displays in recession of more than 10 % since the beginning of the year. The banking values are the most touched and press heavily on the CAC 40(PARIS STOCK INDEX).

Other European places were also in strong decline: at the same moment Footsie of London lost 2,61 % and Dax of Frankfurt 4,04 %, the indication of the German place falling under 7 000 points.

Madrid, Amsterdam, Stockholm and Zurich lost also approximately 2 %.

Asia gave the tendency of a day which should be still very difficult for the world financial markets, the Tokyo Stock Exchange losing 3,86 % in the close, Shanghaï 5,14 %, or Seoul 2,95 %.

The stock exchange of Bombay fell, giving up 7,41 % to the close, that is its strongest decline never recorded in a session, to end in 17 605,35 points.

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The European stock markets fell this morning, January 21st, in the fear of an escalation of the financial crisis and the economic recession in the United States.

In the Paris Stock Exchange, the CAC 40(PARIS STOCK INDEX) moved back of 4,73 % after 12 hours, in 4 851,29 points, passing under the bar of 4 900 points having pushed the threshold 5 000 in the morning, under which it had not come down any more since July, 2006.

The CAC 40(PARIS STOCK INDEX) stays on four consecutive sessions of decline and displays in recession of more than 10 % since the beginning of the year. The banking values are the most touched and press heavily on the CAC 40(PARIS STOCK INDEX).

Other European places were also in strong decline: at the same moment Footsie of London lost 2,61 % and Dax of Frankfurt 4,04 %, the indication of the German place falling under 7 000 points.

Madrid, Amsterdam, Stockholm and Zurich lost also approximately 2 %.

Asia gave the tendency of a day which should be still very difficult for the world financial markets, the Tokyo Stock Exchange losing 3,86 % in the close, Shanghaï 5,14 %, or Seoul 2,95 %.

The stock exchange of Bombay fell, giving up 7,41 % to the close, that is its strongest decline never recorded in a session, to end in 17 605,35 points.

Time for a healthy correction anyway... or since when is it healthy to get $5 dividend for a share valued at $250 on the market? Such a share should never cost more than $100, and even than it is more lucrative to put money in money markets or a savings account.

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Let’s be clear: this is not just an ordinary economic downturn, an inventory cycle where firms have accumulated excess inventories. In this case, banks have suffered a major hit to their balance sheet and, given the lack of transparency, we don’t yet know how big a hit. But we know there is some missing matter: with more than two million anticipated foreclosures, the losses are likely to run to much more than the banks have announced so far.

Moreover, there is a vicious circle: foreclosures drive down housing prices, leading to more foreclosures. And as individuals find it increasingly difficult to make mortgage payments (as interest rates get “reset” automatically at higher rates, a built-in feature in millions of these mortgages) and as the economy slows down, the problems will spread to other credit markets. Indeed, this is already happening.

Banks knew what they were doing, I really think they anticipated this and figured they made their money even if they have all this foreclosures. Lenders are accepting short sale right now like it's NORM. The situation right now has been predicted 2 years ago, and yet lenders kept doing it. House price been going up and we all know that it will eventually reach a point(or the same old cycle) of a peak and things will slow and price drop follows. It's simply the free market at work.

By the way, the article has to blame Bush for the lenders policy. Pretty much show what the articles motive is. :rolleyes:

Edited by AROCES
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Banks knew what they were doing, I really think they anticipated this and figured they made their money even if they have all this foreclosures. Lenders are accepting short sale right now like it's NORM. The situation right now has been predicted 2 years ago, and yet lenders kept doing it. Hose price have been going up and we all know that it will eventually reach a point(or the same old cycle) of a price drop. It's simply the free market at work.

If it would be free market at work it would have happened two years ago. This was free market pimped by economical interest and lending rates below healthy levels ... besides the fact that the US consumes more than it produces, therefore living on credit.

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The European stock markets fell this morning, January 21st, in the fear of an escalation of the financial crisis and the economic recession in the United States.

In the Paris Stock Exchange, the CAC 40(PARIS STOCK INDEX) moved back of 4,73 % after 12 hours, in 4 851,29 points, passing under the bar of 4 900 points having pushed the threshold 5 000 in the morning, under which it had not come down any more since July, 2006.

The CAC 40(PARIS STOCK INDEX) stays on four consecutive sessions of decline and displays in recession of more than 10 % since the beginning of the year. The banking values are the most touched and press heavily on the CAC 40(PARIS STOCK INDEX).

Other European places were also in strong decline: at the same moment Footsie of London lost 2,61 % and Dax of Frankfurt 4,04 %, the indication of the German place falling under 7 000 points.

Madrid, Amsterdam, Stockholm and Zurich lost also approximately 2 %.

Asia gave the tendency of a day which should be still very difficult for the world financial markets, the Tokyo Stock Exchange losing 3,86 % in the close, Shanghaï 5,14 %, or Seoul 2,95 %.

The stock exchange of Bombay fell, giving up 7,41 % to the close, that is its strongest decline never recorded in a session, to end in 17 605,35 points.

London is down 5.5%, the biggest drop since 9/11....there will be traders jumping soon

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If it would be free market at work it would have happened two years ago. This was free market pimped by economical interest and lending rates below healthy levels ... besides the fact that the US consumes more than it produces, therefore living on credit.

Why 2 years ago? What determined the time was when the price has reach it's peak(afrordability) and the equity disappeared that the lenders was betting on when they lend someone who can't really afford it.

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London is down 5.5%, the biggest drop since 9/11....there will be traders jumping soon

well, make sure to have a umbrella if you go through the city... its raining investment bankers....

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Why 2 years ago? What determined the time was when the price has reach it's peak(afrordability) and the equity disappeared that the lenders was betting on when they lend someone who can't really afford it.

Two years ago the fed started to lower rates against every advise to keep up "growth" ignoring that growth on credit is not.

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well, make sure to have a umbrella if you go through the city... its raining investment bankers....

Then again they were paying themselves million quid bonuses a few weeks ago so may have a bit to fall back on

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Then again they were paying themselves million quid bonuses a few weeks ago so may have a bit to fall back on

Could be.. unless they invested it in shares, as they always do....

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For those interested: most of the losses are, as expected, in the banking sector. The banks on their side are selling other assets (i.e. shares) to fill the gaps left by the mortgage crisis. So far nothing unexpected. But not over.

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Huh?

Its a mickey-mouse way to make a bunker/shelter. They had one like that at the branch davidian compound in Waco TX.

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I'm wondering, though, if America will return to the more normal savings rate of 5%. There's a lot of vested interests who want Americans to spend as much as possible and save as little as possible, and a drop in American consumption not only weakens the American economy, but the many economies who are dependent on America being the prime market for their goods.

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I'm wondering, though, if America will return to the more normal savings rate of 5%. There's a lot of vested interests who want Americans to spend as much as possible and save as little as possible, and a drop in American consumption not only weakens the American economy, but the many economies who are dependent on America being the prime market for their goods.

Trying to keep up consumption artificially has been tried the last four years in the US, and we know the results...

People are at the end of their possibilities. The economy stirrers have to face it: real growth comes from additional production, not from buying on credit.

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when you look at how money works no wonder its hit the fan. money is just an illusion :D come on someone has to say it.

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