Recession Fears Blanket Wall Street; Dow Plunges 300 Points

This is an interesting take on the effects of the proposed stimulus package the President is going to talk about in today's presser, a lot of points made but while this person agrees that this will not solve the problem i didn't find any potential solutions to the current crisis. He does take some jabs at Greenspan's role in the current situation.

Fiscal "Stimulus" Doomed To Fail

Lost in the Congressional debate over how to provide stimulus is a more fundamental question: Does anyone remember how we got to where we're at?

The answer is Greenspan put the pedal to the metal by irresponsibly slashing interest rates to 1%. Banks thought this was free money and responded by borrowing short and lending long to finance all kinds of risky endeavors but typically centered around residential and commercial real estate.

reply to post by JacKatMtn


That's why it cannot work. Business breaks will take too long to implement. It's election year, so whatever happens expect political fighting over it...which isn't good for the economy.

Long term, the US cannot afford it.

Interesting note;

the rally has basically finished. FTSE was up over a 100 points, it's not been slashed to 10 and more markets (German DAX, French CAC 40) are in the red.

S&P now down.

BREAKING:

The package does not involve government spending, just tax cuts

[edit on 18-1-2008 by infinite]

reply to post by infinite


What this president is doing is to give a boost to the republican party when people that had no clue how to manage their budgets and how the economy work because they have never deal with the markets (never have money to invest either) goes out there with their miserable tax return and buy that expensive piece of equipment that they could not afford before.

That will create a false sense of consumer spending, while the rest with more brains will put it toward their creditcard bills that will give a false sense of credit confidence while their credit cards get full the next month.

But gets what they did it!!!!!!!!!!!!!! they will make the numbers looks good at least for a quarter.

We have been reap off and screw everywhere.

Can somebody tell the morons in Washington that we know they are nothing but lying and deceiving the people.

I am going to E-mail my congressmen.

The rally is officially over in London.

We've lost the 100 points we gained, the 2% +

...now, we are back in the red. Don't know what is going on, markets are not holding any gains.

Sterling lost 1% against the Dollar today

FTSE 1000 is looking bearish, not sure about the Dow, S&P, etc but London is facing more lower targets soon.

*sighs*

reply to post by infinite


All 3 major indexes are now down.

It might spike again after the Bush presser but can't see it holding then either.

Look at the German stock market 5 day chart

reply to post by JacKatMtn


Is not going to hold because this stimulus is fake, to get fake numbers in the markets and a sense of stability, it will not hold it will crumble, because the real issues has not be addressed.

This may work for the gullible, but not for the market savvy and investors with brains.

Bush to talk right now, I will post more for comments.

Started with lies, about employment, but what else can you expect.

As he is talking the Dow keeps falling.

More bail out for businesses, but then what do you expect from a corporate government.

Nothing about bringing wealth builders like industries so people can start making real money and the economy grow.

Morons is what we have for politician

The markets are going to love the promise of bail out, what a crook



[edit on 18-1-2008 by marg6043]

I could have swore that I heard Bush say..

This is what we need to keep our company strong

instead of country


Am I hearing things?

Originally posted by JacKatMtn
I could have swore that I heard Bush say..

This is what we need to keep our company strong

instead of country


Am I hearing things?

Yes he is running our nation like a corporation but remember he bankrupt his own company once.

Now he is doing it to us.

reply to post by JacKatMtn


Freudian slip.

... the error might appear to be trivial or bizarre, but may show some deeper meaning on analysis. ... A Freudian slip is not limited to a slip of the tongue, or to sexual desires. It can extend to our word perception where we might read a word incorrectly because of our fixations. It is important to note that these slips are semi-conscious. This is to say that these thoughts are consciously repressed and then unconsciously released.

Bush is full of them.
.

Dow has dropped 50 points so whatever he said (I missed it) couldn't of been that strong enough or even a surprise for the markets.

Make that 100 points

[edit on 18-1-2008 by infinite]

reply to post by Gools


A massive slip, just who was he conferring with prior to this presser?

Some personal interests maybe?

I wonder if the transcript will show the slip?

This is so funny one of financial advisors for CNN, just got irritated and ask, in what is this money to be spended after the refund checks?

On more imports so the trade deficit keeps increasing?

Then it was answered with the American and non American way to help the economy, spending is American but saving is UnAmerican right now.

I tell you this is getting hilarious.

Lets spend on chinese goods, it sure will fix the economy, the national deficit and the trade deficit.

We have morons for leaders in this nation.

S&P 500 is the best index to use for rating the US economy (this is what my US freinds tell me)

S&P Chart

It's declining very rapid now, not bearish but something to be worried about.

980 - 950 is probably the bottom for the market.

S&P is currently trading down 1.5%

[edit on 18-1-2008 by infinite]

It must have been my hearing, the transcript is up and I viewed the presser again at their site.

This is what was said:

www.whitehouse.gov

I'm optimistic about our economic future, because Americans have shown time and again that they are the most industrious, creative, and enterprising people in the world. That is what has made our economy strong. That is what will make it stronger in the challenging times ahead.

I must have had a mental freudian slip thinking Bush was doing this to help his corporate buddies out.

reply to post by JacKatMtn


Actually no, not at all. This sort of cyclical sell off happens every recession, and the only people hurting are the stupid investors who buy into the media hype. If they actually bought and sold based on data and fundamentals, they wouldn't be "hurting." I have no sympathy for the emotional investors who do nothing but buy/sell based on the mood of MSNBC.


Oh and, my big unit, I wish you would stop lying about me. As I have said...over and over again..but I'll say it one more time, yet again for you: we are headed toward a recession, have been headed toward a recession, and will be in a recession. There is no avoiding it. I - and everyone else who has any elementary knowledge of the markets - has known this is coming for years. Cyclical recessions must come. And every single time, emotional investors freak out and sell And they'll buy everything back at high prices when we hit a growth period in a few years.

However, unlike the mass media who wish and hope and pray for economic disaster, I know its not coming. While the media's collective mouth waters over the possibility of any sort of national or (even better!) global economic disaster, unfortunately it isn't going to happen unless some major external event happens. But that won't stop the media and the doomsday prophets from wishing for it. They'll be sure to maximize the drama of the recession though.

[edit on 18-1-2008 by LightinDarkness]

Originally posted by JacKatMtn
reply to post by infinite

 

Thanks for the link infinite

, As you and many others here have been saying for quite a long time this was pretty much imminent, I worry that it could be much worse than predicted because didn't much of these same people say that nothing was wrong only a few short months ago?

Now they are saying correction? Trust them?

I don't.

Because the Economy depends on consumer spending to a large amount, and consumer spending factors in their expecations of the future (short term) it is imperative to "POLITICIZE" the forecasts.

Do you want to spook the public by saying it's gonna be a mess? That would cause consumer spending to tank! of course you CANT trust them

with every forecast be it housing, or stocks, or the economy it is in There and the country's best interest to be optomists while privately they may know it will be much worse, but they want the decline to be delayed and now they want it to be orderly. as always do your own homework and listen to as many "pro's" as you can.

It appears to me that Bush went to Saudi's yesterday so they could remind each other they that have a "deal" and that as long as oil prices are kept high, than Saudi will get more and more surplus (petro dollars) which get's their Shieks richer and they nod and reinvest in American treasury's and now in American Banks which are on the edge of a cliff, as well as other corporations. Although these Gulf buyers are not "providing captial" they are buying ownership and helping these companies stay solvent.

The standard of living is going down in america, there are no questions about it.

The question i have is how big of an impact the downgrading (soon to be) of mortgage insurers (AMBAC) and (MBIA) will have and wether it will trigger the dominoes to start falling (defaulting) in the credit derivatives market. This may require many more cash infusions from our Arab buddies.

the other 3 question are

1.will their be a "war" launched in the middle east, now would this line the pockets of Big oil, and thru more petro $ to recycle even help our financial economy?
2.and will emerging economy's in the world continue to grow despite our slowdown since the west's banking models are becoming entrenched in their soil as asset bubble blowing should take off as well as consumer debt there.

3. deflation or hyperinflation of the dollar will be a political decision, not monetary or economic (according to Michael hudson economist in the Kunich campagin) which path will be taken?

Also light n' darkness baring any major technological break through by some innovative american based company which effects global change in some way i don't see this being an ordinary "cyclical" recession. Money is flowing out of America and following the bankers debt blowing scheme to emerging country's.

We avoided the true fate of the last recesion by blowing the housing bubble , their are no more bubble's left and all the growth we have seen in the last few years was based on the extension of financial shananigans (structured finance) and lax lending. Their is no manufacturing base to fall back on, at the least this is a long and deep recession and we will emege from it (more likely adapt to it IMO) and be lucky if we do so with our currency intact.


[edit on 18-1-2008 by cpdaman]

reply to post by LightinDarkness


Ack we are halfway to an agreement the media does want doomsday for ratings I understand your point but my point is even though we may not be in a depression ( or doomsday as you like to put it ) we are in a recession that is only going to get worse until A the government can even admit we are in a recession and B fix all the underlying problems that I posted in my thread. Light we agree on more than you think but I dont think I have called you a liar or lied about you at all.

Today's market was very volatile with constant sharp swings up and down, at the end of the day the DOW lost nearly 60 pts on the day.

Though it started up 150pts early it couldn't maintain and the President's speech on stimulus, had if anything a negative effect on this day.