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The State of the Economy Thread - “Falling inflation, rising growth give U.S. the world’s best recovery”

PleaseBlitz

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Larry

Larry

Posted
Posted

BTW, just heard from Disney.  

 

(Cause I know Disney is the most important thing about this thing, amiright?)  

 

In addition to supposedly paying all of their employees while they're shut down, they're also extending my annual pass for however long they're closed.  

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Springfield

Springfield

Posted
Posted

The only thing about the housing market crisis that was good is that it was gradual.  I actually took my 401k out of aggressive investments and put it into bonds, more or less, so I would be more isolated.  I think now, it's too late for me to do it with coronavirus.  I haven't looked since it was down 14% on Monday or Tuesday this week.  I'm just not going to bother looking until it's over I think.

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TheGoodBits

TheGoodBits

Posted
Posted

Markets right now are pricing in the likelihood we have economic pain in 2020. They’re not yet to the point they’re pricing in significantly reduced economic output for years to come. If you think the latter scenario is likely, it makes sense to liquidate. We’d still be way off from the bottom of the market. 

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techboy

techboy

Posted
Posted
21 hours ago, Corcaigh said:


No, ‘not selling’  assumes you don’t know what’s next up or down. Unless you are desperate for the money now you are gambling/market timing.

 

cue @techboy

 

As I mentioned earlier, the big problem is knowing when to get back in. Stock market returns are pretty lumpy, and missing just a few days at the wrong times is pretty brutal. This article references missing just the 5 best days lowers total return  by 35%. I'm writing this on my phone, so I'll just provide the link for details if anyone is interested.

 

https://www.thesimpledollar.com/investing/stocks/tempted-to-sell-missing-just-a-handful-of-the-best-stock-market-days-can-tank-your-returns/#:~:text=

 

People with decades left should probably just ride it out. I believe @Renegade7 commented that a 401k which isn't there when needed isn't there at all, but for millennials, this is not when it's needed.

 

The market does go down, sometimes a lot. That's why it gets a risk premium... It's risky.

 

Of course, "ride it out" is easy to say, harder to do. 

30 minutes ago, Larry said:

"Market Crashes Length & Severity"

 

So, it took the Great Depression twice as long to get to this % of decline.  (And  that one used to be the fastest onset of the bunch.)  

 

That's probably not a useful comparison in an age of high-speed trading, computer algorithms, and 24/7 news cycles

 

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Larry

Larry

Posted
Posted (edited)
9 minutes ago, techboy said:

That's probably not a useful comparison in an age of high-speed trading, computer algorithms, and 24/7 news cycles

 

So, your point is that the lower tech of the 1920s might have slowed down the speed of the Great Depression?  I can kinda agree with that.  But I'll point out that this one is also vastly faster than all the others, too.  

 

Is our current system that much more "crash-prone" than it was for the housing market collapse?  That one took almost 200 days to get to the same % of collapse that we're at, now, on day (looks like around 20, on that graph)?  

 

And if it is the case that our current system makes crashes happen 10x faster, then maybe it's a sign that we need to change the system?  

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techboy

techboy

Posted
Posted
4 minutes ago, Larry said:

 

And if it is the case that our current system makes crashes happen 10x faster, then maybe it's a sign that we need to change the system?  

 

I don't know if that's necessary (or feasible). There are circuit breakers in place to prevent things from dropping too far REALLY fast (like in minutes), and no one complains when things go up this fast.

 

For every seller, there is a buyer, and both think they're getting a good deal. I'm not sure I want to tell people they can't buy or sell at an agreed upon price (and ultimately, that's what moves prices).

 

Also, "crash" is a pretty loaded word... We're barely in a Bear Market. Give it time... We can go WAY further down.

 

 

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TheGoodBits

TheGoodBits

Posted
Posted
1 hour ago, TheGreatBuzz said:

Is there any other tools besides taxing the **** out of the rich?


UBI effective until we get through this. Can also slash programs left and right to help pay for it, I’d imagine a ton of military exercises and such should be on hold anyway. 

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PleaseBlitz

PleaseBlitz

Posted
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1 hour ago, TheGreatBuzz said:

Is there any other tools besides taxing the **** out of the rich?


Thats the last thing you'd want to do. Ideally, you cut taxes, including for the rich, but we fired that bullet 2 years ago when we didn’t need to. So instead of a big jolt into a stagnant economy, that $ was used by companies and the ultarich to buy back their own stock.

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PeterMP

PeterMP

Posted
Posted
2 hours ago, TheGreatBuzz said:

Is there any other tools besides taxing the **** out of the rich?

 

More deficit spending (though as I documented a not so many days ago the larger the debt/deficit, the less the value in deficit spending).

 

I don't think giving people cash is going to do too much good.  People aren't going to look to spend it.

 

The issue here is keeping small businesses going (your local restaurants, stores, etc. even if they are chains there is a good chance they are franchises).  If they can't pay rent and/or local taxes, they go out of business and there's a whole new wave of low skilled workers looking for jobs, we're going to have big problems, and it isn't like the retail market is going to come back.  You could set local municipalities back big time in terms of how they make most of their money (property taxes).

 

I'd think about looking to give cash to local governments in hope that would tie them over and they can at least defer or reduce property taxes.

 

The only issue I have is how many of your local strip malls etc are actually owned by big companies?  and they can afford to take loss themselves by reducing or deferring rents.  And if the local government reduces or defers property taxes and the big companies put the local businesses out of business because they can't afford rents, you've done nothing but give money to big businesses (which generally means wealthy people).

 

I'm not sure and don't know.

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EmirOfShmo

EmirOfShmo

Posted
Posted (edited)

The interest rate cut last week actually caused mortgage rates to increase. Rates I was looking at for 10 year mortgage went from 3.125% to 3.375%. So, yeah, this is about helping businesses not the consumers. 

I'm a retired and do some sole-propiertor work part-time. I have 0.00 jobs on my schedule for the next 6 days. Tentative job on Friday & no firm scheduled work the week of 3/23. I usually have 12-15 hours of work per week. How is the White House Occupant going to help me? I'm looking at least 2 weeks of lost income and possibly more. 

I'm getting crankier by the hour...

Edited by EmirOfShmo
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CousinsCowgirl84

CousinsCowgirl84

Posted
Posted
1 minute ago, EmirOfShmo said:

 

1 minute ago, EmirOfShmo said:

I'm a retired sole-propiertor who has 0.00 jobs on my schedule for the next 6 days. Tentative job on Friday & no firm scheduled work the week of 3/23. How is the White House Occupant going to help me? I'm looking at least 2 weeks of lost income and possibly more....


well, I mean, dems would have shut everything down as well. I have one job on the schedule for next week. So everything is shutting down. It’s going to be a deep recession...

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PeterMP

PeterMP

Posted
Posted
21 minutes ago, CousinsCowgirl84 said:


well, I mean, dems would have shut everything down as well. I have one job on the schedule for next week. So everything is shutting down. It’s going to be a deep recession...

 

It is funny how it has worked out that essentially every high ranking, expert, and person with advanced degrees in public health and infectious diseases has turned out to be a Democrat.

 

It is a very odd phenomenon.

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No Excuses

No Excuses

Posted
Posted (edited)

Trump has officially destroyed the Obama economic boom. 
 

 

Congratulations Republicans on handing over the economy to the only moron in the world who had a casino go bankrupt.

 

———-

 

In a USA not governed by thumb sucking Neanderthals, things wouldn’t be so bleak.

 

 

Edited by No Excuses
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