So i see the economy is doing good.

[Martin]

Originally posted by: nick1985
how come no threads about the increasingly good economy?

Why, I could have sworn there was a thread about it somewhere...let me look. Ah, here it is.

 

[catnap1972]

Originally posted by: theblackbox
how come every xbox and ps2 around the nation has been bought up, i guess a lot of people at least have tv and electricity, so while they starve and lack employment, at least they'll be able to play ncaa 2005

Wait until January when they actually have to PAY for them.

Easy to stick $10,000 worth of stuff on the credit card...the kicker is when the BILL comes.

 

[arsbanned]

Originally posted by: Keyur
Christmas. How could businesses possibly fold during Christmas?

Because most Americans are spending the bulk of their money at mega-stores such as Wal-Mart and Sam's Club, thereby taking away from the locally owned businesses and adding further to Sam Walton's fortune. That's how.

 

[IronMentality]

Originally posted by: ScottFern
You forget 5.5% unemployment rate is only considered "good" when Clinton was president.

The unemployment rate only fell further when Clinton signed Reagan's welfare reform bill as well.

 

[IronMentality]

No one also ever likes to point out the cost of every single basic service from phones, to internet, to affording groceries has fallen dramatically as technology has progressed. Americans have the most purchasing power out of all countries as a whole on top of this. For example, to pay an average phone bill in the 1920s would take 9 hours of work for most Americans while it's now around 3.

Same goes for just about every single service we use monthly or yearly.

 

[arsbanned]

"IronMentality -- 100% American Made. Proud Moderate Republican. " And does not know how to use the EDIT function. 😛

 

[Stunt]

I'm not an expert on this sort of thing but your 4% growth you talk about is usually based on GDP or stock prices.

Stock prices are a very poor indicator and it rallys all the time, very cyclical.

On the GDP front, the US dollar is doing horrible and inflation is out of control. I can see the GDP of the US rising just because of those two factors. US companies are raising prices on goods exported (US is still the biggest exporter in the world) and therefore will seem to collect more income. But in reality the economy didnt grow, the greenback is just sucking huge, so it seems bigger.

 

[Engineer]

Stocks boosted by durable goods data

Seems factories are producing up.

Morning news:

University of Michigan Consumer Sentament higher than expected 97.1 vs 95.8 expectation. Up from 92.8 in November

November home sales much sharper decline than expected. Down 12.1% vs expectation of 7.1% down.

November sales up .2% as consumers saving (expectations) for December holiday. October had a rise of .8%

Oil down $0.43 to the $43.xx range

Dollar at an all time new low vs the Euro

(All seen on CNBC this morning - no links yet)

Home Sales fall sharply.

Oil falls: US stocks build

 

[outriding]

Originally posted by: nick1985
how come no threads about the increasingly good economy?


Text


Text

There are roughly 9 indicators to determine if the econ is doing well.

I cant remember them all but building permits and vendor performance are just 2 more.

If you like I will look them up later tonight

 

[PatboyX]

good.
lets hope it keeps past the holidays.

 

[piasabird]

The Stock market is not the Economy.

 

[ReiAyanami]

if we could convince the foriegners to bring their dollars back into the market we'd be looking at Dow 13,000

 

[dullard]

I'll be the first to say the economy isn't bad. There is nothing that shows we are in a recession or depression. And I'll say a lot of the numbers look good and many people are doing quite well. So if anyone posts later saying I think the economy is horrible, that poster is warned that he/she will be an idiot for not reading this first paragraph.

However, there are many areas of concern. Because of these areas of concern, I cannot say the economy is great. The following are some troubling areas. Each of these spots may be ironed out without any problems, or they may be lingering bad news that prevents the economy from booming. In the worst case senerio, any of these could continue to get worse and in a relatively short time make the economy bad. In no particular order:

1) Record budget deficits. If, hypothetically, during 2004 the government had cut spending and was at a balanced budget, then the 2004 GDP growth would be virtually non-existant. Thus the growth was based largely on borrowed money. The federal government can easily borrow/spend our way out of a mild recession, but it can't borrow forever. Our debt isn't anywhere where it is unbearable, but the proposed spending cuts by both political parties will be a big hamper on the economy as this excess money is removed in the upcoming years.

2) The good GDP growth came at a time of record low interest rates. What would have happened if interest rates weren't so low? They are at a point that they pretty much can only go up. Will this be a big drag as they go up?

3) Unemployment is low. But there are two lingering problems. Since Sept 2001, many people have left high paying jobs and took low paying jobs. In the long run, that isn't a good thing. Yes it is better that these people are working, but they aren't putting the money into the economy that they used to be doing. Secondly, unemployment is also low because people who lost their jobs are not being counted any more as they haven't found jobs. This has always been a problem with our unemployment numbers, but I think it is much worse recently than it has been in the past.

4) Housing is strong. But housing has been growing for decades, the record housing levels are not a surprize. We'd be at record housing levels even in a recession. Housing levels will continue to increase as the government has major tax breaks for house owners. But it can't increase forever. Extreme example: when 100% of people live in houses, it can't go higher. But of course there are some people who will never have houses for various reasons, so the true cutoff is lower than 100%. Where is the cutoff? No one knows and it probably isn't in the next couple of years. But it's coming eventually. New housing starts took their biggest tumble in 11 years in November, new home sales plummeted by the sharpest rate in a decade in November. Interest rates are going up, and likely will go up dramatically in 2005/2006. What will happen here?

5) Tax cuts certainly helped out the economy. This is just the inverse of #1 above. Additional tax cuts are going to be scarce. Thus this stimulus has played out. Are we strong enough to continue without more tax cut stimulus?

6) Oil has plummeted, and the stock market has soared almost perfectly in step. But, oil is still 33% higher that it was last year and is at historically quite high levels. Peak oil concerns, while quite overblown, are coming. Will oil stay high and be a drag?

7) Jobs are being created, but the new job growth is currently much less than it was earlier in the year. It is barely enough to keep up with population growth. Will things go back to what they were, or is the white house correct that job growth in 2005 will be meager?

8) Christmas revenues are about in line with forcasts. But that came with a record number of price cuts. Sales used to be after Christmas and are now being done before Christmas. Corporate profits have been the biggest drag on the economy in the past 3 years. Pre-Christmas price cuts certainly aren't going to help that sector.

I could go on. Yes things are good now. But that occured with many positive stimulii. Now that the stimulii are ending, can we keep the good economy going? Possibly. But we are in a fragile state where if anything goes seriously wrong, I don't know if we can prevent another recession. Maybe we'll luck out and those problems will go away. But maybe not.

 

[Engineer]

Originally posted by: dullard
I'll be the first to say the economy isn't bad. There is nothing that shows we are in a recession or depression. And I'll say a lot of the numbers look good and many people are doing quite well. So if anyone posts later saying I think the economy is horrible, that poster is warned that he/she will be an idiot for not reading this first paragraph.

However, there are many areas of concern. Because of these areas of concern, I cannot say the economy is great. The following are some troubling areas. Each of these spots may be ironed out without any problems, or they may be lingering bad news that prevents the economy from booming. In the worst case senerio, any of these could continue to get worse and in a relatively short time make the economy bad. In no particular order:

1) Record budget deficits. If, hypothetically, during 2004 the government had cut spending and was at a balanced budget, then the 2004 GDP growth would be virtually non-existant. Thus the growth was based largely on borrowed money. The federal government can easily borrow/spend our way out of a mild recession, but it can't borrow forever. Our debt isn't anywhere where it is unbearable, but the proposed spending cuts by both political parties will be a big hamper on the economy as this excess money is removed in the upcoming years.

2) The good GDP growth came at a time of record low interest rates. What would have happened if interest rates weren't so low? They are at a point that they pretty much can only go up. Will this be a big drag as they go up?

3) Unemployment is low. But there are two lingering problems. Since Sept 2001, many people have left high paying jobs and took low paying jobs. In the long run, that isn't a good thing. Yes it is better that these people are working, but they aren't putting the money into the economy that they used to be doing. Secondly, unemployment is also low because people who lost their jobs are not being counted any more as they haven't found jobs. This has always been a problem with our unemployment numbers, but I think it is much worse recently than it has been in the past.

4) Housing is strong. But housing has been growing for decades, the record housing levels are not a surprize. We'd be at record housing levels even in a recession. Housing levels will continue to increase as the government has major tax breaks for house owners. But it can't increase forever. Extreme example: when 100% of people live in houses, it can't go higher. But of course there are some people who will never have houses for various reasons, so the true cutoff is lower than 100%. Where is the cutoff? No one knows and it probably isn't in the next couple of years. But it's coming eventually. New housing starts took their biggest tumble in 11 years in November, new home sales plummeted by the sharpest rate in a decade in November. Interest rates are going up, and likely will go up dramatically in 2005/2006. What will happen here?

5) Tax cuts certainly helped out the economy. This is just the inverse of #1 above. Additional tax cuts are going to be scarce. Thus this stimulus has played out. Are we strong enough to continue without more tax cut stimulus?

6) Oil has plummeted, and the stock market has soared almost perfectly in step. But, oil is still 33% higher that it was last year and is at historically quite high levels. Peak oil concerns, while quite overblown, are coming. Will oil stay high and be a drag?

7) Jobs are being created, but the new job growth is currently much less than it was earlier in the year. It is barely enough to keep up with population growth. Will things go back to what they were, or is the white house correct that job growth in 2005 will be meager?

8) Christmas revenues are about in line with forcasts. But that came with a record number of price cuts. Sales used to be after Christmas and are now being done before Christmas. Corporate profits have been the biggest drag on the economy in the past 3 years. Pre-Christmas price cuts certainly aren't going to help that sector.

I could go on. Yes things are good now. But that occured with many positive stimulii. Now that the stimulii are ending, can we keep the good economy going? Possibly. But we are in a fragile state where if anything goes seriously wrong, I don't know if we can prevent another recession. Maybe we'll luck out and those problems will go away. But maybe not.

Very good post. :thumbsup:

 

[Centinel]

I concur Engineer:

Very good post Dullard. You pointed intelligent and valid criticisms of the current economy without resulting to the usual BS i've seen so much of.

Several people here should take lessons how to PROPERLY critique an issue.

 

[charrison]

Originally posted by: dullard
I'll be the first to say the economy isn't bad. There is nothing that shows we are in a recession or depression. And I'll say a lot of the numbers look good and many people are doing quite well. So if anyone posts later saying I think the economy is horrible, that poster is warned that he/she will be an idiot for not reading this first paragraph.

However, there are many areas of concern. Because of these areas of concern, I cannot say the economy is great. The following are some troubling areas. Each of these spots may be ironed out without any problems, or they may be lingering bad news that prevents the economy from booming. In the worst case senerio, any of these could continue to get worse and in a relatively short time make the economy bad. In no particular order:

1) Record budget deficits. If, hypothetically, during 2004 the government had cut spending and was at a balanced budget, then the 2004 GDP growth would be virtually non-existant. Thus the growth was based largely on borrowed money. The federal government can easily borrow/spend our way out of a mild recession, but it can't borrow forever. Our debt isn't anywhere where it is unbearable, but the proposed spending cuts by both political parties will be a big hamper on the economy as this excess money is removed in the upcoming years.


First let me say, the current deficits are too large. However, they are not record breaking in relation to gdp or adjusted for inflation. We have had far worse budget deficits in the past




2) The good GDP growth came at a time of record low interest rates. What would have happened if interest rates weren't so low? They are at a point that they pretty much can only go up. Will this be a big drag as they go up?


This happens in every recession cycle. Economy get bad, interest rates gets lower. Economy gets better, interest rates go up. Nothing new is happening here.





3) Unemployment is low. But there are two lingering problems. Since Sept 2001, many people have left high paying jobs and took low paying jobs. In the long run, that isn't a good thing. Yes it is better that these people are working, but they aren't putting the money into the economy that they used to be doing. Secondly, unemployment is also low because people who lost their jobs are not being counted any more as they haven't found jobs. This has always been a problem with our unemployment numbers, but I think it is much worse recently than it has been in the past.

1. It has not bee proven that low wages jobs have replaced high wage jobs before thre recession.
Meanwhile disposable income is up.

2. Unemployment is determined by survery, not by counting who is on unemployment.. This is a myth set out by the liberals that just wont die.





4) Housing is strong. But housing has been growing for decades, the record housing levels are not a surprize. We'd be at record housing levels even in a recession. Housing levels will continue to increase as the government has major tax breaks for house owners. But it can't increase forever. Extreme example: when 100% of people live in houses, it can't go higher. But of course there are some people who will never have houses for various reasons, so the true cutoff is lower than 100%. Where is the cutoff? No one knows and it probably isn't in the next couple of years. But it's coming eventually. New housing starts took their biggest tumble in 11 years in November, new home sales plummeted by the sharpest rate in a decade in November. Interest rates are going up, and likely will go up dramatically in 2005/2006. What will happen here?



Meanwhile homeownership is at all time high, around 60%. I agree the housing boom cannot go on forever.

FYI, with interest rates so low, the tax break on mortgage interest is not that big of a deal.



5) Tax cuts certainly helped out the economy. This is just the inverse of #1 above. Additional tax cuts are going to be scarce. Thus this stimulus has played out. Are we strong enough to continue without more tax cut stimulus?


The current tax cuts will keep giving until they are repealed. We need tax reform instead of more tax cuts(tax simplication at the very least.




6) Oil has plummeted, and the stock market has soared almost perfectly in step. But, oil is still 33% higher that it was last year and is at historically quite high levels. Peak oil concerns, while quite overblown, are coming. Will oil stay high and be a drag?

7) Jobs are being created, but the new job growth is currently much less than it was earlier in the year. It is barely enough to keep up with population growth. Will things go back to what they were, or is the white house correct that job growth in 2005 will be meager?



Meanwhile unemployement rates are below 20-30 years averages. Would you rather have solid employment or employment fueled by a bubble that will evenutually burst?



8) Christmas revenues are about in line with forcasts. But that came with a record number of price cuts. Sales used to be after Christmas and are now being done before Christmas. Corporate profits have been the biggest drag on the economy in the past 3 years. Pre-Christmas price cuts certainly aren't going to help that sector.



Corporate profits have been quite healthy the past couple of years and this is a trend that appears like it is going to continue



I could go on. Yes things are good now. But that occured with many positive stimulii. Now that the stimulii are ending, can we keep the good economy going? Possibly. But we are in a fragile state where if anything goes seriously wrong, I don't know if we can prevent another recession. Maybe we'll luck out and those problems will go away. But maybe not.

The economy is doing quite well now. And yes there will be another recession(probably 5-8 years judging by previous business cycles)

 

[Engineer]

First let me say, the current deficits are too large. However, they are not record breaking in relation to gdp or adjusted for inflation. We have had far worse budget deficits in the past

I agree that deficits are too large...any deficit is too large in my eyes. I don't mind the occasional borrowing when needed and I understand that it's low (relatively) compared to GDP, but the problem is that it is a stacking debt and is renewed year after year after year.

I'm really starting to wonder, though, if debt really matters. It's been going on so long (50 years?). Does the deficit matter?

 

[Centinel]

Engineer:

That's a slippery slope that unfortunately some people prescribe to.

 

[charrison]

Originally posted by: Engineer

First let me say, the current deficits are too large. However, they are not record breaking in relation to gdp or adjusted for inflation. We have had far worse budget deficits in the past

I agree that deficits are too large...any deficit is too large in my eyes. I don't mind the occasional borrowing when needed and I understand that it's low (relatively) compared to GDP, but the problem is that it is a stacking debt and is renewed year after year after year.

I'm really starting to wonder, though, if debt really matters. It's been going on so long (50 years?). Does the deficit matter?

As long as as the economy keep growings, it appears it is not a problem. But one day it could be a problem. And we are not the only country that carries this large of debt load either....

 

[Centinel]

Exactly charrison:

I hear veeeery little about the EU's current economic problems.....only criticisms of the US's.

 

[Engineer]

Originally posted by: charrison

Originally posted by: Engineer

First let me say, the current deficits are too large. However, they are not record breaking in relation to gdp or adjusted for inflation. We have had far worse budget deficits in the past

I agree that deficits are too large...any deficit is too large in my eyes. I don't mind the occasional borrowing when needed and I understand that it's low (relatively) compared to GDP, but the problem is that it is a stacking debt and is renewed year after year after year.

I'm really starting to wonder, though, if debt really matters. It's been going on so long (50 years?). Does the deficit matter?

As long as as the economy keep growings, it appears it is not a problem. But one day it could be a problem. And we are not the only country that carries this large of debt load either....

So we need the lines to be more like the "BLUE" lines! 😉

(i.e. Debt growing much faster than GDP in the "RED" areas)

 

[charrison]

Originally posted by: Engineer

Originally posted by: charrison

Originally posted by: Engineer

First let me say, the current deficits are too large. However, they are not record breaking in relation to gdp or adjusted for inflation. We have had far worse budget deficits in the past

I agree that deficits are too large...any deficit is too large in my eyes. I don't mind the occasional borrowing when needed and I understand that it's low (relatively) compared to GDP, but the problem is that it is a stacking debt and is renewed year after year after year.

I'm really starting to wonder, though, if debt really matters. It's been going on so long (50 years?). Does the deficit matter?

As long as as the economy keep growings, it appears it is not a problem. But one day it could be a problem. And we are not the only country that carries this large of debt load either....

So we need the lines to be more like the "BLUE" lines! 😉

(i.e. Debt growing much faster than GDP in the "RED" areas)

Well this is a misleading graph at the very least.

The big blue line from 1950 to 1980 keeps both republican and democratic presidents as blue.
The reason for the descrease in debt ratio, is simply it was that high after WWII. It could only go down at that point. WWII required massived amounts of borrowing.

Reagan did increase borrowing, but he also brought the cold war to end.

Clinton and the republican congress did decrease spending

Current deficits are related the war and decreased tax receipts.

 

[Engineer]

Originally posted by: charrison

Originally posted by: Engineer

Originally posted by: charrison

Originally posted by: Engineer

First let me say, the current deficits are too large. However, they are not record breaking in relation to gdp or adjusted for inflation. We have had far worse budget deficits in the past

I agree that deficits are too large...any deficit is too large in my eyes. I don't mind the occasional borrowing when needed and I understand that it's low (relatively) compared to GDP, but the problem is that it is a stacking debt and is renewed year after year after year.

I'm really starting to wonder, though, if debt really matters. It's been going on so long (50 years?). Does the deficit matter?

As long as as the economy keep growings, it appears it is not a problem. But one day it could be a problem. And we are not the only country that carries this large of debt load either....

So we need the lines to be more like the "BLUE" lines! 😉

(i.e. Debt growing much faster than GDP in the "RED" areas)

Well this is a misleading graph at the very least.

The big blue line from 1950 to 1980 keeps both republican and democratic presidents as blue.
The reason for the descrease in debt ratio, is simply it was that high after WWII. It could only go down at that point. WWII required massived amounts of borrowing.

Reagan did increase borrowing, but he also brought the cold war to end.

Clinton and the republican congress did decrease spending

Current deficits are related the war and decreased tax receipts.

But...while you say misleading, it does show that DEBT WAS GROWING FASTER than GDP during the RED areas. I, for the first time, can actually see the relationship and the argument given that debt doesn't matter as long as GDP outgrows it (i.e. So what if you borrow as long you grow your economy faster because eventually, your economy growth will elminate the deficit).

Regardless, deficits are too high (currently) and need to be lowered. Also, if it doesn't reverse itself, the national debt (overall) could work itself to the same level as GDP (in total dollars) and that would be a negative (IMO).

Edit: Oh, I know both Rep and Dem Presidents were kept blue.....I don't think the color had anything to do with the party in power, rather to show blue as declining and red as rising. Colors are fun, don't you think! 😉

😛

 

[charrison]

Originally posted by: Engineer

Originally posted by: charrison

Originally posted by: Engineer

Originally posted by: charrison

Originally posted by: Engineer

First let me say, the current deficits are too large. However, they are not record breaking in relation to gdp or adjusted for inflation. We have had far worse budget deficits in the past

I agree that deficits are too large...any deficit is too large in my eyes. I don't mind the occasional borrowing when needed and I understand that it's low (relatively) compared to GDP, but the problem is that it is a stacking debt and is renewed year after year after year.

I'm really starting to wonder, though, if debt really matters. It's been going on so long (50 years?). Does the deficit matter?

As long as as the economy keep growings, it appears it is not a problem. But one day it could be a problem. And we are not the only country that carries this large of debt load either....

So we need the lines to be more like the "BLUE" lines! 😉

(i.e. Debt growing much faster than GDP in the "RED" areas)

Well this is a misleading graph at the very least.

The big blue line from 1950 to 1980 keeps both republican and democratic presidents as blue.
The reason for the descrease in debt ratio, is simply it was that high after WWII. It could only go down at that point. WWII required massived amounts of borrowing.

Reagan did increase borrowing, but he also brought the cold war to end.

Clinton and the republican congress did decrease spending

Current deficits are related the war and decreased tax receipts.

But...while you say misleading, it does show that DEBT WAS GROWING FASTER than GDP during the RED areas. I, for the first time, can actually see the relationship and the argument given that debt doesn't matter as long as GDP outgrows it (i.e. So what if you borrow as long you grow your economy faster because eventually, your economy growth will elminate the deficit).

Regardless, deficits are too high (currently) and need to be lowered. Also, if it doesn't reverse itself, the national debt (overall) could work itself to the same level as GDP (in total dollars) and that would be a negative (IMO).

Edit: Oh, I know both Rep and Dem Presidents were kept blue.....I don't think the color had anything to do with the party in power, rather to show blue as declining and red as rising. Colors are fun, don't you think! 😉

😛

But at the same time, the economy was quite strong post WWII, even with huge debt loads. So it is all quite confusing😀

 

[Engineer]

So it is all quite confusing 😀

Sure the hell is! 😕

😉