-
We’re currently investigating an issue related to the forum theme and styling that is impacting page layout and visual formatting. The problem has been identified, and we are actively working on a resolution. There is no impact to user data or functionality, this is strictly a front-end display issue. We’ll post an update once the fix has been deployed. Thanks for your patience while we get this sorted.
US Economy not doing so well
Page 2 - Seeking answers? Join the AnandTech community: where nearly half-a-million members share solutions and discuss the latest tech.
LegendKiller
Lifer
Buyout euphoria, nothing more, nothing less. The economy ain't doin that great. GDP growth blows.
imported_Shivetya
Platinum Member
if this isn't a great economy I could probably retire in a few years with my 401ks growth adjusted for what it takes to be a good one.
this economy is very good, considering that the price of oil hasn't sucked the life out of it I am more impressed.
StageLeft
No Lifer
OP makes a good point. For all the doom and gloom, people still are chomping at the bit to come to this country and it's still providing for its people better than most other countries and debateably better than any other country. Nobody can tell the future, but the older I get the more I ignore the chicken littles because for every time they're right about a fear they're wrong 10 times as often. I have Canadian and EU citizenship and have absolutely no desire at all to take advantage of either one of them.
Concerning treasuries:
Source
"Most of the securities are bought by primary dealers which are large securities dealers; a small amount is purchased by individual investors"
If normal people like me and you stop buying it, it isn't a big deal.
Source
"The Fed requires primary dealers to participate meaningfully in both the Fed's open market operations and Treasury auctions and to provide the Fed's trading desk with market information and analysis that are helpful in the formulation and implementation of monetary policy."
Primary dealers must purchase a certain amount at each treasury auction. The US govt will always be able to sell debt...
... unless a significant number of primary dealers collapse at the same time. Possible? Yes. Probable? Considering how banking has become an integral part of most people's lives, no. Everyone would have to lose faith in the system at the same time. I would sooner bet that everyone decides it is okay to shoot their neighbors and society collapses that way.
LegendKiller
Lifer
lol, typical mentality, DJIA/NASDAQ/S&P500 = Economy.
Lets take a look at the situation.
1. GDP Growth Q1 07 was ~1.2%, half what it was in Q4-06. Savings rate was -1%, which is alarming considering Q1 is bonus time. If people can't even save then, it's a big problem. Lets see what happens shortly when the Q2 numbers are released.
2. Inflation is at least 4.5-5%. The bogus numbers released and parroted are half what real americans are facing. Energy costs, food costs, housing costs, all have increased dramatically in the last few years.
3. Housing is falling. millions of dollars of equity is being erased every day, more than offsetting the equity markets.
4. The dollar is in freefall. Just think, 10 years ago you used to be able to buy more than 1 euro for every 1 dollar. Now you have to spend more than 1 dollar to buy 1 euro. This is telling, especially today when Iran is asking people to pay for oil through Yen or other currencies.
All in, the average consumer is being squeezed from every angle. You have less disposable income. When it's really going to hit the fan is this winter, as heating costs skyrocket, ARMs reset at breakneck paces, and people are stuck.
You have buyouts taking place left and right. Look at Hilton, 26bn being paid out to investors. The gains garnered from that are pushed right back into the equities markets. More money chasing less stocks = higher price.
Vic
Elite Member
I won't agree that it's part of some partisan conspiracy. I think of it like going to Vancouver, BC. A beautiful city with most of its utilities above ground on rotting plywood platforms in stinking alleyways, even downtown, in an amazingly free and equal country with more homeless junkies on its "skid row" (Hastings Street) than you've probably ever seen in your whole life (and every once in a while, or when some high-profile event takes place, the police sweep them all up to keep them in their place). Meanwhile, a few blocks over on Robson Street, the affluent shop safely in high-end luxury boutiques.
This is the new world order. It's not about equality, it's about status quo. When certain posters say we need to be more like Europe or Canada, that's what they're really talking about. America is too chaotic for them. When they say the economy is not good enough or that the poor aren't doing well enough, they're saying that the government isn't bribing the potentially dangerous masses lower classes enough to make them feel safe in their own relative affluence.
Vic
Elite Member
Record consumer spending over the past decade or so says you're wrong.
It's so humorous in a way for me to read these pessimistic posts. Times have been so much better over the past 15 years than they were in the 70s and 80s that it's not even funny. Admittedly, so much prosperity is disconcerting because it makes one think that a decline must be imminent, but OTOH all you guys here missed the big boom and you don't even realize it! It makes me wonder, what're you gonna do when things really do slow down?
LegendKiller
Lifer
Yeah, record consumer spending equating to a negative savings rate. Ever look at Fas140 public reports for Credit Card master trusts (such as Capital One's COMET)? Take a look at them, find out how fast credit card debt has grown, then get back to me.
Additionally, take a look at the nearly record lows of equity in homes.
Finally, find figures about Mean Equity cashout for homes. We'd have been in a recession if it hadn't been for additional debt spending.
Your miracle economy is built on debt. Great job, you think that mortgaging our entire future is a good thing.
LegendKiller
Lifer
That's why most statistics are stated in %. Absolute $$ mean next to nothing.
PingSpike
Lifer
I was actually going to make a thread on this question. WTF does the fed use a metric with food and energy stripped out of it to measure inflation...calling it 'core' inflation I believe? I don't really give a shit if the price of flat screen TVs or boats or a lot of other crap remains stable...I HAVE to heat my house, drive to work and eat, so I'd tend to think food and energy are kind of a bigger deal then well...pretty much everything else.
LegendKiller
Lifer
Adding energy costs creates massive volatility. They strip it out to be more predictable.
Vic
Elite Member
Please stick to actual argument instead of personal attacks, thank you.
So are you arguing that the increase in credit availability of the past couple of decades was a bad thing? Would you prefer that those who need these funds not have access to them? Do you want to go back to the days when most working people were forced to be "cash and carry" because the only alternative was to (literally) beg at their local bank when they needed even a small loan? Is that your argument?
edit: and BTW, home equity is currently at an all-time record high due to the housing boom. You argue elsewhere that home values are going to bust all the way to dust, sure, but that's irrelevant at this time in the context of the factual error in your post here.
LegendKiller
Lifer
I certainly agree.
dmcowen674
No Lifer
Because obviously you are rich.
Speaking of Canada, there is a lot of people asking what does it take to become Canucks.
I was going to ask Stunt but maybe you know.
LegendKiller
Lifer
Please stop trying to be melodramatic. It wasn't a personal attack, it was an observation, if you want to refute that you think the proliferation of credit is good, then try, otherwise, my stance stands.
The availability of credit over the past couple decades has been a great thing for the average consumer. It has allowed them access to goods and services at an accelerated pace. However, it has also introduced more volatility into the economy and has also resulted in rampant abuse in the last 5 years. Some credit is a great thing, but not to the extent. I know you like polarizing my arguments, despite repeated protestations contrary to your posts.
You are, once again, wrong about home equity. I am sure that you seek to measure it on an absolute aggregage scale, which is wholly inaccurate and very misleading. On a % basis is the correct way to do so.
http://calculatedrisk.blogspot...d-equity-falls-to.html
Take that for example. Does it look like we are reversing trends? If anything our downturn is getting faster and shows no sign of recovery. All this credit bonanza of the last 5 years has done was create a plethora of loans with 0% down and no skin in the game. Add to this the thousands of homeowners who are going underwater, you will see this pace quicken.
As far as my position on housing, you continually say I am waiting for it to fall to 0%, or to 1995 levels. That has never been my position. I expect rationality to return to the market with prices falling to an annually adjusted basis. If an index was 100 in 1995 and increases 2% per year, then I expect that index to be about 124 (not taking the time to just compounding returns). HOwever, as it stands, that index is, grossly speaking, at about 170. So I expect it to go down to 124.
It's like the stock market. If one were to project the market from 1995 - now, you'd come up to about where we are. However, if you look at where we were in 2000, jsut under where we are now, you'd see that the growth was just way too quick, it outstripped the fundamentals.
blackangst1
Lifer
+ Income up from 7 years ago? Yep
me too
blackangst1
Lifer
I travel out of country once a year and NEVER use credit *shrug* Never had a problem
Vic
Elite Member
There's something kind of comical about the way Dave exposes his own selfishness and greed while railing against what he perceives as the selfishness and greed of others. Basically what he's telling Skoorb here is that the only reason why Skoob wouldn't want to steal from others for his own livelihood is because he must have already stolen it.
:laugh:
No, but on a serious note, I think Dave would do well to learn that perception of reality is not reality itself. A number of comments he has made recently has caused me to worry about his mental state and to be genuinely concerned for his personal safety (from himself). Because of this, it is my desire to be nicer and more helpful to him here, but that I feel will be difficult because of his pride.
I think, Dave, that you need to understand that when you hate something outside yourself, you're not really hating that something. What you're doing is hating that part of your own self that that external something represents to you. Bear with me here. Think of your mind as kind of like the words printed here on your computer monitor. They flash from my keyboard to your screen much like reality passes through your senses to your brain. In the end, what you see and feel it not actually reality, but the activities of your brain cells. And that's all "reality" can ever be to any one of us and no more. So you need to understand the nature of your own perception, emotions, and self-image in the way you view the world around you. Because what you really see when you see reality is just yourself. And what you're really telling us when express all this bitterness about the world is how bitter you are about yourself. In all fairness, I recognize my own self-anger issues if that helps.
I'm trying to be nice here. Really. If it helps, pretend that Moonbeam posted this. 🙂
TRENDING THREADS
-
Discussion Zen 5 Speculation (EPYC Turin and Strix Point/Granite Ridge - Ryzen 9000)- Started by DisEnchantment
- Replies: 25K
-
Discussion Intel Meteor, Arrow, Lunar & Panther Lakes + WCL Discussion Threads
- Started by Tigerick
- Replies: 25K
-
-
-
