The Dow will drop 300 points today.....Question for financial professionals

[Taylor4Life]

Book it. Thanks to GM, and China not intiating a stimulus program the DOW is dropping. We are heading for a full scale depression. On the brighter side 1st time Jobless claims dropped last month. But hold your breath the Job report is coming out tomorrow. It will be another month of over 600,000 job lost in a given month. What are we going to do? When do we start feeling the stimulus plan?

Things won't get better until the currently insolvent big banks start lending again. Our entire economy is built upon the principal of financial leverage, which in layman's terms means that most businesses need to borrow money in order to make money.

This is a very muddled and confusing issue that not even financial professionals fully understand. Nobody knows exactly how strapped for cash the banks really are, or how long it will take for them to be in a position where they can lend in order for new businesses to be able to obtain the capital they need in order to grow.

However, there is NO mistake about the source of these economic problems, which lie largely with the big banks such as Citibank, B of A, etc.

To answer your question, in the short run the economic stimulus will provide some extra cash to the population in order to prop up demand. This will provide a temporary boost in demand, but without the financing necessary for businesses to grow, the supply side of the equation will fall short and we'll be right back where we started.

On the other hand, if the banks are able to dig themselves out of this mess through the bailouts, then the hope is that increased financing will coincide with increased demand through the stimulus package, thereby creating an economic recovery. We all need to cross our fingers that this happens.

[GibbsFactor]

You guys want to see a market drop, wait till the unemployment numbers come out tomorrow.

:yikes:

[SkinsHokieFan]

So let me make sure I understand everything.

Economy bad under Bush 1 - Carters faults, 8-12 years earlier.

Economy good under Clinton - Thanks to Regan and Bush 12 to 20 years earlier

Economy bad under Bush early on - Fault of 9/11

Economy bad under Bush at the end - Clinton's fault

Economy bad under Obama's first month in office - Obama's fault.

Is this all correct?

Let me guess -If the economy DOES recover next year - It will be thanks to the end of the Bush term?

OLS- AGREE!

I won't blame the administration for the mess they inherited

HOWEVER this economic dream team needs to quickly start showing some serious leadership

Summers, Rubin, Geithner so far have been busts. Every time Bernake or Geithner speak the market responds negatively.

It'll take Geithner coming out saying "the government has bough X amount of CDOs from Y bank" to get these goobers on Wall St to get going

Unfortantley at the moment, these 4 men seem totally in over their heads. And no its not their fault the economic situation, but it would be nice to see some signs of leveling off, if not moving up.

It'll take years for the economy to start to recover, but hopefully these guys can fulfill some investor expectation to stem the negative momentum.

[Jumbo]

Someday, twa, if ther's any justice left in the mixed-up crazy multiverse, you and I will have our own radio show. I'm thinking something like "Ig & Natz--The Political Analcysts"

[Toe Jam]

We get to now show how collectively stupid the voting masses are:(

This is the kind of crap that makes my blood boil but, at the same time, I've come to expect it from posters like you.

Now that's something to about.

[DjTj]

Summers, Rubin, Geithner so far have been busts. Every time Bernake or Geithner speak the market responds negatively.

It'll take Geithner coming out saying "the government has bough X amount of CDOs from Y bank" to get these goobers on Wall St to get going

Unfortantley at the moment, these 4 men seem totally in over their heads. And no its not their fault the economic situation, but it would be nice to see some signs of leveling off, if not moving up.

I posted this in another thread, but one big problem is that the Obama administration hasn't named a single undersecretary for the Treasury Department yet.

With an awkward first television appearance, a bank rescue plan that lacked promised specifics and two restructured bailouts that raised taxpayer risk, Geithner has failed to calm financial markets desperate for answers.

Critics say part of the problem is that Geithner is flying solo: Not one of his top 17 deputies has been named, let alone confirmed. And without senior leadership, lower-level Treasury employees can't make decisions or represent the government in crucial conversations with banks and others.

http://www.google.com/hostednews/ap/article/ALeqM5jpXe0jNEHGvyr0Vz_J-oYoclV-nAD96NUUQ80

They may be gun-shy because of all the problems with earlier appointees, and the vetting process is probably taking too long, but it's hard to get work done when there aren't people to do it.

[twa]

I posted this in another thread, but one big problem is that the Obama administration hasn't named a single undersecretary for the Treasury Department yet.

Actually he has named two,both dropped out

Though I understand he has 40 or temps in the interim

[twa]

Someday, twa, if ther's any justice left in the mixed-up crazy multiverse, you and I will have our own radio show. I'm thinking something like "Ig & Natz--The Political Analcysts"

It would be a honor to be your co-analcyst;) ,though you would have to carry the load.

I'm a man of few words,and I fear the strong silent type won't carryover on the radio:(....perhaps a cable special?

[ccsl2]

That and some leadership from Turbo Tax Tim

Geithner has been a 100 percent disaster so far. He needs to show action, not get up in front of cameras and announce "plans"

Basically, he needs to DO SOMETHING because investors are EXPECTING something

LOL @ Turbo Tax Tim

[hkHog]

"We have nothing to fear but fear itself."

We need Obama to create some more confidence in this market or we will literally scare ourselves into a deeper recession. We will not recover anytime soon unless we believe we will, and that's just as big a problem as any other driving this downturn.

If he comes out tomorrow and says no more stimulus plans, we can't unfreeze the credit markets when the US government is borrowing trillions of dollars from it and that he WILL NOT raise capital gains taxes on ANYONE, things might start to turn around. If we keep following the current plan though we are just going to keep making things worse and worse, credit markets will never recover and investors will remain in a panic.

[ccsl2]

OLS- AGREE!

I won't blame the administration for the mess they inherited

HOWEVER this economic dream team needs to quickly start showing some serious leadership

Summers, Rubin, Geithner so far have been busts. Every time Bernake or Geithner speak the market responds negatively.

It'll take Geithner coming out saying "the government has bough X amount of CDOs from Y bank" to get these goobers on Wall St to get going

Unfortantley at the moment, these 4 men seem totally in over their heads. And no its not their fault the economic situation, but it would be nice to see some signs of leveling off, if not moving up.

It'll take years for the economy to start to recover, but hopefully these guys can fulfill some investor expectation to stem the negative momentum.

Well it will help if Obama could get the rest of his appointees for treasury nominated. Geithner still doesn't have a deputy yet. It is plain to see, he can't solve the bank situation and the foreclosure mess all by himself. He needs some more foot soldiers.

It would also help if these folks made sure their back taxes were in order.

[Hubbs]

Point well taken. It is the Congress that controls the pursestrings. Only now the POTUS is on board with the Communist Congress:chair:

Double Digit Unemployment by the end of the Year... Count on it because it is coming.

We get to now show how collectively stupid the voting masses are:(

To recycle a line I used in another thread...

Hey, what did McCain "suspend" his campaign to do again? I forget.

[FuriousD]

Maybe you guys that want to argue Obama's politics could do it in one of the other political threads but seeing as this thread is titled (sort of) "question for financial professionals"......

I have a question:

I continue to put the 15% into my 401K that I can, plus a little extra (the over age 50 catch-up clause) but I'm seriously thinkinging about cutting my contributions back significantly (for obvious reasons) and paying that cash against the principle on my morgage.

Thoughts?

:helmet:

[G.A.C.O.L.B.]

BTW December90, nice sig. Way to stay classy.

(And I'm not talking about the Hussein part.)

[IbleedBnG83]

BTW December90, nice sig. Way to stay classy.

(And I'm not talking about the Hussein part.)

Wow, I just caught that.

Really shows the level of ignorance that still exists in todays society.:doh:

[Duckus]

BTW December90, nice sig. Way to stay classy.

(And I'm not talking about the Hussein part.)

Calling for the death of a President. Some people are just twisted.

[Toe Jam]

Hmm.. how can you report a sig?

EDIT: Nevermind. Done.

[Duckus]

Hmm.. how can you report a sig?

EDIT: Nevermind. Done.

Maybe the Secret Service is knocking on his door .

[Toe Jam]

Maybe the Secret Service is knocking on his door .

LOL.

:saber:

[footballhenry]

People can listen to his "centrist" but they can SEE his far left almost socialist policies

Aheem, I think you made a typo...you accidentally typed 'almost'

[GoSkins561]

One person can't screw up the economy any more than one person can fix it. There are so many factors out there. But people would rather dumb it down and point fingers.

The economy didn't go bad totally because of Bush.

It's not getting worse totally because of Obama.

There are boom-bust cycles that happen regardless of who the sitting president is.

We are talking about the Dow and what investors like, if you havn't noticed, watch what happens to the DOW when the governement mentions the word "bail out". It is very predictable, Obama mentions bail out, the dow drops a couple hundred points. I am starting to think Obama wants the stock market to stay low so the people become more dependant on the government instead of their own investments.

[Hubbs]

We are talking about the Dow and what investors like, if you havn't noticed, watch what happens to the DOW when the governement mentions the word "bail out". It is very predictable, Obama mentions bail out, the dow drops a couple hundred points. I am starting to think Obama wants the stock market to stay low so the people become more dependant on the government instead of their own investments.

Come on, statements like this are just dumb. Obama isn't secretly part of some government conspiracy that wants the American public to swing towards government control. He's doing what he's doing based upon recommendations from economists who argue that government spending can efficiently replace private spending. I disagree with those economists, but to suggest that he's cackling in an underground lair as public dependence on government spending goes up is simply incorrect.

[GoSkins561]

Come on, statements like this are just dumb. Obama isn't secretly part of some government conspiracy that wants the American public to swing towards government control. He's doing what he's doing based upon recommendations from economists who argue that government spending can efficiently replace private spending. I disagree with those economists, but to suggest that he's cackling in an underground lair as public dependence on government spending goes up is simply incorrect.

I wouldn't call it dumb, I would call it "outside the box". I don't think Obama is a a bad guy, and I think he believes what he is doing is best for the country. If you havn't noticed, Obama has Socialist tendancies, which involves people being dependant on the government in order for it to work.

[GibbsFactor]

I wouldn't call it dumb, I would call it "outside the box". I don't think Obama is a a bad guy, and I think he believes what he is doing is best for the country. If you havn't noticed, Obama has Socialist tendancies, which involves people being dependant on the government in order for it to work.

I don't know man, the social stuff he's pushing is what got him famous in the first place.

[G.A.C.O.L.B.]

Calling for the death of a President. Some people are just twisted.

It's pretty unreal.

December90's sig:

:hungry:

Barack Hussein Obama II -- Psalm 109:8-9

http://www.biblegateway.com/passage/?search=%20Psalm%20109:8,%209;&version=47;

Psalm 109:8-9

8May his days be few;

may another take his office!

9May his children be fatherless

and his wife a widow!

And I take the :hungry: guy to mean that he's hungry for it or he eagerly awaits it. Seriously, what an idiot.