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162 Comments
- MikeFallopian, on 05/02/2008, -8/+32Like it or not, the economic well-being of average people is closely tied to the financial health of large corporations. They provide the jobs, they pump the money into the economy and they are publicly traded. The Fed's moves in the last quarter were designed to keep investments strong, and guess what? It worked. The US economy posted positive growth against all expectations, and instead of seeing a market crash we are watching stocks rally. The housing market is a ways off from recovering and inflation is high. But I'll take temporary inflation over temporary joblessness.
- Cryptocracy, on 08/17/2008, -12/+32"its a big club, and you ain't in it"
- George Carlin - enjo13, on 05/02/2008, -8/+26I really don't understand the American fascination with loathing the American economy. The fact is that most people can afford to eat, they can even afford to drive (as evidenced by an actual increase in driving over the last quarter). Outside of housing and finance, our economy is actually going along quite well,buoyed by unexpected strength in foreign markets. True economic experts have been saying more or less this all along.. but I guess that doesn't sell newspapers. Declaring that we are on the brink of the next great depression does.
Hell, even the great majority of homeowners haven't had their houses foreclosed on. The vast majority of Americans aren't selling heirlooms 'just to get by'. Christ, for a group of people that loves to lambast the media for being a bunch of puppets you sure are responding to their manufactured crisis of confidence quite predictably. - inactive, on 05/02/2008, -7/+22I bought a house I had no business affording, I lost the kids' college money day-trading on eTrade, I live my life based on my credit card limits so I can buy iPhones for the whole family, 50in. flat-screens for every room the house, and matching Hummers for me and my wife.
DAMN YOU WALL STREET.
/sarcasm - Number23, on 05/02/2008, -9/+23Doom-n-Gloomers always, always, always wrong. Whether it’s overpopulation or SARS or housing or global warming or whatever else, the worst scenarios never become reality.
While these are not fat times, unemployment is very low and the economy still growing. Given the headwinds of terrorist attacks, multiple oil shocks, stock market crash, two wars, devastating hurricanes and a housing crash, the economy looks pretty ok.
Let me offer you an important life truth. Rarely will you experience your worst fears or your fondest hopes. Life mostly lies in the somewhere in the middle. - StingingNettle, on 05/02/2008, -5/+16I would take this as a signal to sell. PE ratios are historically high.
- MikeFallopian, on 05/02/2008, -0/+8So does unemployment.
- inactive, on 05/02/2008, -6/+13It is pretty funny to watch the same people in one thread, saying "the MSM just lies to us" if it is positive, saying "did you see what the MSMS said? I told you so!" when it is negative.
You can see them here. There is a segment that is so unhappy with their lives, they are only soothed by believing everyone else is *****. Yeah, the economy is pretty ***** right now, but none of these gloom and doomers lived in the 70's, obviously...
I personally made more money already this year than I made all last year, and I did pretty damn good last year. You just have to be smart enough to follow the trends. These lazy whiners are more interested in sitting on their asses and complaining. - phogasmic, on 05/02/2008, -0/+6wow, i cna't believe it took this long to scroll down to a reasonably sensible comment.
- whorunbartertwn, on 05/02/2008, -0/+6The 70s... what was the average square footage of a house then compared to now? Computers? Cell phones? Video game consoles? Budget range cars with side airbags that need their first tuneup at 100k? 150 channels on your flat screen TV?
You can have your fond memories of the easy life in the 70s for all the workers, I'll stay right here in the miserable times we're supposed to be suffering in. - NCSUspoon, on 05/02/2008, -6/+12You're starving?!?! I don't know anyone who is starving. I appreciate your point but we can do without the hyperbole.
- jmpeagle, on 05/02/2008, -3/+9how are you alive?
Food has fallen as a percentage of the rich world's average household spending for decades. It was 30% as recently as the 1970s. Now it's only 10-12% even with the run up in prices. I think we'll be OK. - inactive, on 05/02/2008, -1/+6Do you shop at ad homs RUs? Because you sure can't argue worth a *****. What you said had absolutely nothing to do with my comment. It was just simpleton self flagellation.
Tell me, oh great genius. What percentage of wages went towards food in the 70's, vs. now? Come on, you can do it! You can move past broad generalities, can't you? - aedes, on 05/02/2008, -4/+9this is hilarious. the fact that the tone of the comments section suggests that the majority of digg users reading this article believe that the worst is over. I'm going to wager that this is b/c the average digg user is under 25, and since most of us have grown up in times of relative economic prosperity, have no idea how ***** things can get. We are all still fools, believing the the good times will come indefinitely, and have no end.
We are still living in the good times. Wait 5 years or so, and see how things are going. The US has already sold out it's soul, and the principles it was founded on, in a vain attempt to buy every American a dream house and an SUV. Take that, and add on a completely destroyed health-care system, aging and retiring baby-booomers, declining oil supplies, a prolonged period of a lack of executive leadership in government, an economic slowdown, massive (both monetary and physical) involvement in wars around the world... Add on top of this that fact that the US is basically running on the fumes of massive international debt... and you have a situation which, if not handled PERFECTLY, will end up going very very badly in the long run. - jmpeagle, on 05/02/2008, -3/+8he's wrong, they've been falling for 8 years. Also, people tend to trade on the forward P/E and not the existing P/E.
http://seekingalpha.com/article/67598-market-not-b ... - ColonelJessup, on 05/02/2008, -10/+15Here we go again with the Digg.com economic professors......................
- manifest020, on 05/02/2008, -0/+5"banks have tended to borrow less from the Fed in recent weeks than they did in March and early April."
Oh good, banks are borrowing less now so the economy is fine. Key word "tended"
"Foreclosures are climbing at a strong clip and the decline in home prices has picked up speed in recent months."
Wait, I thought you just said everything is just fine. I'm confused.
I'm no expert, but isn't this just saying that banks borrowed enough money, so things are looking good for the banks? What happens when the money finally distributes?
How you feel about your wallet either increases revenue or decreases revenue in the general market period. Which is why I honestly don't know who to trust on this. All I see is foreclosure signs, high gas prices, and a low dollar. The economy is looking bad, the economy is looking good. Writing an article about how banks are borrowing less money from the Fed is not going to make me feel better. Neither is a bunch of unsupported opinions of CEO's, big time investors, and chairman. Sorry. I still feel like we're floating on a cloud that's going to pop, and we have a long way to fall. - kemp34, on 05/02/2008, -0/+5Yes, take a look at the Dow/Gold chart of the past years, not so pretty and it has gotten worse since this chart was published:
http://goldprice.org/news/2006/01/dow-jones-indust ... - bc289, on 05/02/2008, -0/+4Your case is that the figures are accurate. The figures are not. That to me seems like your case is being hurt. Also, the wording really has little to do with what I said. Either way, you are measuring inflation incorrectly.
- tuxidomasx, on 05/02/2008, -2/+6"Let me offer you an important life truth. Rarely will you experience your worst fears or your fondest hopes. Life mostly lies in the somewhere in the middle."
What if my worst fear is to not experience my fondest hopes?
ah ha! - Daedalus81, on 05/02/2008, -0/+4Hop on the clue train. The fact of the matter is that investors are less worried about the risk of investments they make, because they see the fed will bail them out.
- kemp34, on 05/02/2008, -1/+5Forward earnings are headed DOWN, bet on it.
- spikehay271, on 05/02/2008, -0/+4I think you missed the latest Ron Paul newsletter about how everything bad is caused by the mysterious 50% annual inflation we've been having because of evil fiat currency.
- Dumbledorito, on 05/02/2008, -1/+5It's quite possible to be malnourished and still be overweight.
Ironic, ain't it? - CiXeL, on 05/02/2008, -0/+4we're not far from the 10 year anniversary of 9/11
so why are we still suffering from it?
oh yeah its because the ***** who let it happen is still in power - inactive, on 05/02/2008, -0/+4Decline in the S&P index and the decline of the dollar against foreign currencies != "inflation." So sorry.
- inactive, on 05/02/2008, -2/+6Education on hyperinflation for Diggers.
http://en.wikipedia.org/wiki/Hyperinflation - inactive, on 05/02/2008, -3/+7A 25lb sack of rice is still only ~$19. A few hours of minimum wage labor will allow you eat as well as the average Chinamen for weeks.
- dreicher, on 05/02/2008, -4/+8In a 75% consumer-driven economy, it doesn't take much for a contraction. Our economy has been, by in large, propped up by phantom equity extraction from over-inflated housing prices. To assert that a contraction there or that it would take a great majority of people in foreclosure to cause some serious hardship is simply foolish. I don't know that it will raise to the level of financial ruin and depression; however, to think that we can section off housing and finance from the broader economy doesn't hold water. Sure, multinationals will probably squeak by (some may even flourish); however, companies dependent on the almighty U.S. buck are in for tough times and poor and middle-class Americans are going to feel the pinch if they aren't already.
- jaymzdean, on 05/02/2008, -0/+3It's called the Corporate Welfare State, and you're witnessing it at it's worst.
- inactive, on 05/02/2008, -2/+5WTF inflation numbers are you reading?
- jaymzdean, on 05/02/2008, -0/+3Attention everyone at Digg:
ColonelJessup has decided you should not pretend to know enough to even discuss the economy. Shut down Windows, get a beer on your way to the couch, watch some Paula Abdul TV, and forget about it. - tak84, on 05/02/2008, -4/+7You can't?
- oldhick, on 05/02/2008, -5/+8Sell your ***** computer, buy some ramen noodle and go away.
- bc289, on 05/02/2008, -2/+5Oh ok, Look4Truth. Tell me where to find the real truth. Conspiracytheories.com?
- jmpeagle, on 05/02/2008, -3/+6so are Earning per Share
- inactive, on 05/02/2008, -1/+4Oh, I will give you one quick hint, being how idiots tend to like to remain idiots:
"Futures prices on the Chicago Board of Trade, the benchmark for commodity grain and soy markets, have risen to multi-year highs this year. Wheat hit an all-time high of $9.81-3/4 a bushel just on Friday. Soybeans on Friday reached over $11.60 a bushel, a price not seen since 1973." - bc289, on 05/02/2008, -0/+3Whorun, you hit on exactly what many people have criticized GDP (and GDP per capita in this case) for; the fact that it does not take many things, such as increases in the quality of products, into account. Take that into consideration and you see that our lives have improved pretty dramatically since the 1970s.
- superkendall, on 05/02/2008, -0/+2But you feel like that because so much media has been instructing you to - in an election year no less!
If you really think we may fall, console yourself that if we fell very far indeed we'd just end up looking like Europe where unemployment figures double ours are the norm. - charmaniac, on 05/02/2008, -1/+3I have been saying for awhile that this is not another Great Depression. However, the recession is not over yet - and yes, it has begun. China and India are not going to surpass our economic might anytime soon. Yes, some cities in China have experienced spectacular development, but most of their population still lives in abject poverty. Just go to any of these countries and you will see what I am talking about.
I will put most American corporations against anything the world has to offer. Our companies are less corrupt, more efficient, and execute more effectively than anyone else in the world. Yes, CEO and executive compensation is out of control. Still, you should see the favor trading and bribery in China, India, Russia, et al. Our companies simply cannot get away with that kind of behavior because we actually have a free flow of information. - superkendall, on 05/02/2008, -2/+4It's not an American preoccupation, it's a media/liberal thing. You can't win elections if the economy is in good shape with the other guy in charge. This story of a positive result is offset by other reports that put different spin on the news...
- Daedalus81, on 05/02/2008, -3/+5"The optimists believe it is different this time. The catalyst for the change, they say, was the Fed-arranged deal that sold a troubled investment bank, Bear Stearns, to JPMorgan Chase in mid-March. The central bank further restored order in the markets by lending directly to investment banks, assuring that big securities firms could not be undone by a crisis of confidence."
Now the market expects failures to be bailed out in the future. They're investing on false confidence. Great. - inactive, on 05/02/2008, -0/+2no they are not - right around 18 times forward expectations is right in line with historical measures - the market is fairly valued here. stocks are a discounting mechanism - they think Q4 will be ok and so do I - oh by the way - did you see the NAZ yesterday? up almost 3%
- kemp34, on 05/02/2008, -0/+2Here's the long run chart, ever heard of cycles buddy?
http://goldandoilstocks.com/wp2/wp-content/uploads ... - cnorris1, on 05/02/2008, -1/+3Its called a sucker rally
- charlesray, on 05/02/2008, -0/+2There was an article on either here or Reddit that said people in the shipping industry believed that the recession had already ended awhile ago. Apparently shipments had been falling for a long time and then started to recover, and the exact same thing happened last time we had a major recession. Both times the economy started to recover right when everyone noticed we were having a recession and starting yelling about another great depression.
- NCSUspoon, on 05/02/2008, -7/+9I love reading these posts about how the Fed is pumping money into evil corporations to help the economy. You all act like it is a horrible thing and we are all going to die because of it. The truth of the matter is that it is working. The Fed is an institution that helps the markets greatly. If you want to stop complaining, start investing and be the person who is getting their pockets lined. Other than that. I suggest you guys be congress men or at least suggest an alternative. I haven't heard one yet.
- bc289, on 05/02/2008, -1/+3nyxgenxer, you hurt your case with every post.
Inflation is an increase in the price levels, you do not measure inflation based off of moves in the S&P or in the dollar. Look at the CPI for inflation.
In addition, the great thing about the stock market is that it's a hedge against inflation, as you are buying shares in a company that owns assets. These assets act as an inflation hedge because their value moves with inflation. You should read Stocks for the Long Run by Jeremy Siegel. - inactive, on 05/02/2008, -0/+2I get ~2.5%.
- Trixrox, on 05/02/2008, -2/+4No one can expect consistent growth. People should just live more frugally and elect the proper leaders.
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