Larry Posted March 17, 2008 Share Posted March 17, 2008 You mean, foreign investers don't want to buy bonds at 5%, in a currency that's falling 10% (and may fall more)? :whoknows: Link to comment Share on other sites More sharing options...
JMS Posted March 17, 2008 Share Posted March 17, 2008 Well, the stupid policies you refer to were originated by Hoover but most of those policies were implemented by Roosevelt and did exacerbate the depression. That's false revisionist history.... It's true that Roosevelt could have done more, by borrowing more money and deficit spending. But Hoover's policies of actually tightenning credit, while leaving the labor markets alone to sort themselves out crushed the economy. If you look at a graph of GDP, or unemployment almost the moment Roosevelt took office the economy started to grow again. It was that dramatic. Black Monday Oct 29 1929 happenned in Hoovers first year of his first term. In three years of working the problem he had made it marketly worse. Roosevelt took over in 1933. Employment, GDP, bank failures, and industrial output all turned around immediately. ( highlight the graph to read the numbers.. ) http://en.wikipedia.org/wiki/Great_Depression_in_the_United_States Unemployment Industrial Production Bank forclosures... In Roosevelts first complete year in office bank forclosures went from.. 4000 down to 57. Every year of the Hoover Administration bank forclosures got worse.. 1928 Same with GDP.. Link to comment Share on other sites More sharing options...
JMS Posted March 17, 2008 Share Posted March 17, 2008 Well, our government, if it can do anything, will continue to bail out those stupid people like the execs at Bears and Sterns. They bailed out the company. Not the employee's. 30% of that company was owned by the employee's. Last week it was severly undervalued at 40$ / share. The Fed engineered buy out priced the stock at 2$ a share. The fed sold the company at several times less than the value of just the realistate holdings of the main headquaters in down town NY. It definitly wasn't a favor to the employees. Link to comment Share on other sites More sharing options...
Fergasun Posted March 17, 2008 Share Posted March 17, 2008 So are we going to have to pay China in Joint Strike Fighters, DD(X) and Carrier Strike Forces? Or will we just give them Taiwan and parts of Japan and Korea and call it even? Link to comment Share on other sites More sharing options...
Fergasun Posted March 17, 2008 Share Posted March 17, 2008 Why do you guys say BSC was worth more than it was sold for? Frankly what if it's only worth like $2/share... it looks like the Fed is trying to force "price discovery". Prove to us you're really worth as much as you say you are and then complain about being under-valued... Link to comment Share on other sites More sharing options...
DjTj Posted March 17, 2008 Share Posted March 17, 2008 So are we going to have to pay China in Joint Strike Fighters, DD(X) and Carrier Strike Forces? Or will we just give them Taiwan and parts of Japan and Korea and call it even?Why would we give them real stuff when we can pay them back in worthless dollars?Paying our debts with inflated currency ... brilliant! Link to comment Share on other sites More sharing options...
Metalhead Posted March 17, 2008 Share Posted March 17, 2008 So, um, is now a bad time to get a $8K loan for a car? at like 6.5% over 5 or 6 years? or will it even matter anymore...? This is so depressing...I'm stuck with a 1988 Olds Sedan... Link to comment Share on other sites More sharing options...
JMS Posted March 17, 2008 Share Posted March 17, 2008 Why do you guys say BSC was worth more than it was sold for? Frankly what if it's only worth like $2/share... it looks like the Fed is trying to force "price discovery". Prove to us you're really worth as much as you say you are and then complain about being under-valued... JP morgan agreed to buy it for 2$ a share. That's aboout a couple of hundred million dollars. I heard that's about a third of the value as their headquaters building in down town NY. Your right... that's scary.. Link to comment Share on other sites More sharing options...
A Walton Posted March 17, 2008 Share Posted March 17, 2008 Short Lehman Brothers Link to comment Share on other sites More sharing options...
SnyderShrugged Posted March 17, 2008 Share Posted March 17, 2008 with all of America suddenly awakening to the fact that there is an economic problem of potentially huge proportions, will we ask the "Big 3" candidates what there plan is? I have yet to hear either MCamnesty, Hilliary, or Obama actually discuss this with candor. Link to comment Share on other sites More sharing options...
The 12th Commandment Posted March 17, 2008 Share Posted March 17, 2008 Wasn't it Donald Trump who said if you owe the bank 100K they own you, if you owe them 100 million you own them? I know he was being somewhat facetious but can the foreign investors really afford to have us go bankrupt? They'd have no chance of getting their money then. It could be economic warfare then they wouldn't care. Or is that being a bit tinfoil hattish? Link to comment Share on other sites More sharing options...
techboy Posted March 17, 2008 Share Posted March 17, 2008 Thanks. It looks like I'll head to the bank tomorrow and open a Euro account. It seems like yesterday the Euro was at 1.42/$. I wish I had done as much then. How far can the $ really fall? When Latin American currency are gaining on the $ then clearly we're in the gutter currency-wise. I think it would be a big mistake for you to try to time the market. No one really knows where the currency's going, so you're effectively just gambling. Unless you have some kind of future purchase in Euros coming up, and you want to hedge against the dollar falling further, of course. As you note, there's no way to really know how much farther (or if) the dollar will fall. One underreported side-effect of the strong Euro is that it's killing companies like Airbus and BMW, and they're complaining more and more loudly to their governments, so we may see actions taken by the European central banks soon to try to rectify this (which would have the side-effect of killing you). Also, there's usually transaction costs in currency exchange, so you'd need to beat that as well. If you have money to invest, a far better idea would be to determine a good, broadly diversified, low cost portfolio of index funds and ETFs, and then stick to it, no matter what the markets are doing. A lot of people have lost a lot of money trying to time the markets. I saw a study in one of the finance books I was reading a while back, which showed that although costs were a significant factor in investor returns, investors in load funds ended up doing better than those in no-load funds, even though the load funds had much higher costs. When the study authors dug deeper, it turned out that the reason for the outperformance wasn't how well the mutual funds did (the no-loads did better, generally, as costs matter). It was because the no-load investors lost a bunch of money jumping in and out, trying to time the market, while load fund investors felt trapped by the loads from buying or selling, and so stayed the course. Link to comment Share on other sites More sharing options...
Burgundy Burner Posted March 17, 2008 Share Posted March 17, 2008 On the commodities market today... Oil had a huge drop - lost about 4%. Gas lost about nineteen cents a gallon. It would be nice if that held or went lower. In about three weeks, that equates to about a four to six cents drop at the pump (taking into account that it was going higher based on today's opening prices). Could be an interesting week. Link to comment Share on other sites More sharing options...
GibbsFactor Posted March 18, 2008 Share Posted March 18, 2008 I think it would be a big mistake for you to try to time the market. No one really knows where the currency's going, so you're effectively just gambling. Unless you have some kind of future purchase in Euros coming up, and you want to hedge against the dollar falling further, of course.As you note, there's no way to really know how much farther (or if) the dollar will fall. One underreported side-effect of the strong Euro is that it's killing companies like Airbus and BMW, and they're complaining more and more loudly to their governments, so we may see actions taken by the European central banks soon to try to rectify this (which would have the side-effect of killing you). Also, there's usually transaction costs in currency exchange, so you'd need to beat that as well. If you have money to invest, a far better idea would be to determine a good, broadly diversified, low cost portfolio of index funds and ETFs, and then stick to it, no matter what the markets are doing. A lot of people have lost a lot of money trying to time the markets. I saw a study in one of the finance books I was reading a while back, which showed that although costs were a significant factor in investor returns, investors in load funds ended up doing better than those in no-load funds, even though the load funds had much higher costs. When the study authors dug deeper, it turned out that the reason for the outperformance wasn't how well the mutual funds did (the no-loads did better, generally, as costs matter). It was because the no-load investors lost a bunch of money jumping in and out, trying to time the market, while load fund investors felt trapped by the loads from buying or selling, and so stayed the course. I don't think he wants to time the market, but just wants to hedge the falling dollar. If I can put my cash in something other then dollars, I would. Link to comment Share on other sites More sharing options...
33 Posted March 18, 2008 Share Posted March 18, 2008 I don't think he wants to time the market, but just wants to hedge the falling dollar. If I can put my cash in something other then dollars, I would. Basically, yes. My bank allows accounts in Dollars, Euros or the local currency. I was thinking I probably waited too long to open a Euro account to make money for the long term, but it might be smart to hedge against a falling dollar if it's going to be as bad as everyone on here thinks it is. Link to comment Share on other sites More sharing options...
techboy Posted March 18, 2008 Share Posted March 18, 2008 I don't think he wants to time the market, but just wants to hedge the falling dollar. If I can put my cash in something other then dollars, I would. Hedging the falling dollar makes a lot of sense, but only if one has an upcoming purchase in another currency. I have a trip to Germany this summer, in which I know I will be spending several thousand dollars. It would make sense for me to hedge by buying a currency ETF now, so that if the dollar falls further against the Euro, the hit to me is diminished. Otherwise, a falling dollar has little direct effect on purchasing power, so there's nothing to hedge. A Big Mac is still going to be $1.99 here, even if it gets to $6 when bought in Europe. The dollar, for instance, has been weak against the Pound for years, I believe, since well before the current crisis. While it sucked (and still does) for Americans buying products in London (and was great for Londoners in New York), the price of a steak for an American in Knightsbridge didn't really affect the price of a T-Bone at Morton's in D.C. If one is trying to hedge against indirect effects of the falling dollar on purchasing power, well then we're back to gambling on the market. I think there's a place for a portion of one's portfolio to hedge against inflation (and actually, foreign stock fund returns benefit greatly from a weak dollar, as I understand it), but I think it's a mistake to up that percentage (be it commodities, or foreign funds, or whatever) just because one thinks that the dollar is going south. Market timing is a dangerous business. Link to comment Share on other sites More sharing options...
TradeTheBeal! Posted March 18, 2008 Share Posted March 18, 2008 Part of Bush's One World Order plan Not Bush's plan, but yes. Beware the Amero! Link to comment Share on other sites More sharing options...
techboy Posted March 18, 2008 Share Posted March 18, 2008 Not Bush's plan, but yes. Beware the Amero! Let's assume for the sake of argument that the Amero actually was a realistic possibility... Why would that be a bad thing? Link to comment Share on other sites More sharing options...
techboy Posted March 18, 2008 Share Posted March 18, 2008 Oops. Wrong thread. Link to comment Share on other sites More sharing options...
GibbsFactor Posted March 18, 2008 Share Posted March 18, 2008 Hedging the falling dollar makes a lot of sense, but only if one has an upcoming purchase in another currency. I have a trip to Germany this summer, in which I know I will be spending several thousand dollars. It would make sense for me to hedge by buying a currency ETF now, so that if the dollar falls further against the Euro, the hit to me is diminished. Otherwise, a falling dollar has little direct effect on purchasing power, so there's nothing to hedge. A Big Mac is still going to be $1.99 here, even if it gets to $6 when bought in Europe. The dollar, for instance, has been weak against the Pound for years, I believe, since well before the current crisis. While it sucked (and still does) for Americans buying products in London (and was great for Londoners in New York), the price of a steak for an American in Knightsbridge didn't really affect the price of a T-Bone at Morton's in D.C. If one is trying to hedge against indirect effects of the falling dollar on purchasing power, well then we're back to gambling on the market. I think there's a place for a portion of one's portfolio to hedge against inflation (and actually, foreign stock fund returns benefit greatly from a weak dollar, as I understand it), but I think it's a mistake to up that percentage (be it commodities, or foreign funds, or whatever) just because one thinks that the dollar is going south. Market timing is a dangerous business. Well, he's in Costa Rica and has the option between Euro, Dollar and whatever CR uses. What would you have your money in right now? Link to comment Share on other sites More sharing options...
GibbsFactor Posted March 18, 2008 Share Posted March 18, 2008 Let's assume for the sake of argument that the Amero actually was a realistic possibility...Why would that be a bad thing? Now that is the better question. So let me ask you, why isn't it a realistic possibility if you can't see anything wrong with it? :2cents: Link to comment Share on other sites More sharing options...
zoony Posted March 18, 2008 Share Posted March 18, 2008 Now that is the better question.So let me ask you, why isn't it a realistic possibility if you can't see anything wrong with it? :2cents: I think it probably is a realistic possibility. But I don't see how it is necessarily a bad thing. A North American currency to include Mexico, Canada and the US would be very strong on the international market in the global economy. Can you tell us how it is bad? And you can't say that the US loses the ability to de-value. Because you've been railing against that for months. So you'll have to pick something else. Link to comment Share on other sites More sharing options...
JMS Posted March 18, 2008 Share Posted March 18, 2008 Now that is the better question.So let me ask you, why isn't it a realistic possibility if you can't see anything wrong with it? :2cents: I think the problem with the Amero is the same problem with the 21st century manifest destiny of absorbing Mexico, and onl south down to Panama. That it's going to dramatically effect the labor markets and the state of the republic and it's not been discussed with the people of the country. It's a plan which our polititions are moving forward on without the knowledge of the people. That's my problem with it. As for the Amero, It's a crazy idea. Latin American currencies are traditionally 100 times more volitable than the US dollar. Why would anybody want to merge the two. Especially since the common currency of North and South America is already the dollar. Link to comment Share on other sites More sharing options...
JMS Posted March 18, 2008 Share Posted March 18, 2008 I think it probably is a realistic possibility. But I don't see how it is necessarily a bad thing. A North American currency to include Mexico, Canada and the US would be very strong on the international market in the global economy.Can you tell us how it is bad? Back when IBM shares fell to about 40 dollars a share in the early 1990's there was talk about IBM and Apple merging and Steve Jobs heading up both before Louis Gerstner took over IBM. ( Gerstner was president of a Nabisco, made cookies, before taking over the largest technology company in the world ) Anyway the joke was.. What do you get when you mix IBM and Apple... Answer.. IBM.. The US economy is the largest in the world. GDP of 13.86 trillion dollars. Mexico's economy is about than 6.3% of our economy.. GDP of 886.4 billion (2007 est.)... Thinking we would merge the dollar and the peso in order to stabilize the dollar is not realistic. Merging with the peso would be incredible destabilizing. It's not exactly like the world turns to Mexico for sound financial advice. Remember we had to bail out their economy as recently as the late 1990's when NAFTA was implemented and every Mexican with a bank account converted his Peso's to dollars. All we have to do to stabilize the dollar is stop hemoraging cash. Get governemnt spending in check like it was during the Clinton/Newt years. Get military spending in check and back to some realistic number. Stop these insane trade deficites of $850 billion a year and growing. If we did those three things.... the dollar would stabilize. The Peso has never been stable. Link to comment Share on other sites More sharing options...
zoony Posted March 18, 2008 Share Posted March 18, 2008 JMS, when did I say anything about merging with the Peso to stabilize the dollar? And you sound very similar to the same Europeans who opposed the Euro in 1996. Link to comment Share on other sites More sharing options...
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