7 replies
  • OFF TOPIC
  • |
Gee feels like we are not out of this one yet and already some are predicting another:

J
im Rogers, the market sage, has warned the global economy is just two years away from another recession, but remains ill-prepared to cope with the after-effects.
Mr Rogers, the respected currency trader and hedge fund pioneer, cautioned that when the downturn takes hold "the world is going to be in worse shape because the world has shot all its bullets."
Speaking in an interview with business television channel CNBC, the septuagenarian investor said that "since the beginning of time" there has been a recession every four-to-six years, and that's mean another one is due around 2012.
However, he said that due to the extraordinary measures already adopted by central banks and governments around the world, the arsenal of available tools to combat the next recession is somewhat lacking.
With reference to Ben Bernanke, chairman of the US Federal Reserve, he said: "Is Mr. Bernanke going to print more money than he already has? No, the world would run out of trees."
Meanwhile, Robert Shiller, co-creator of the Standard & Poor's/Case-Shiller house price index, warned that the next downturn may come even sooner.
"For me a double-dip is another recession before we've healed from this recession. The probability of that kind of double-dip is more than 50pc. I actually expect it," he said. His prediction came despite the S&P/Case-Shiller index for May showing a 4.6pc year-on-year increase in house prices in 20 major US conurbations.
  • Profile picture of the author seasoned
    he said "For me a double-dip is another recession before we've healed from this recession. ".

    Well, in the stock market, there is something called a dead cat bounce. Peopple see things getting bad, try to pull out, etc... The market crashes! It often crashes TOO quick! People often see bargains, automatic orders may be tripped. The market can SKYROCKET! THAT is the dead cat bounce. OFTEN, at some point, after that, there may be a rally! Some call it a sucker's rally. People join in, etc... They run out of cash, and the market drops AGAIN!

    The ECONOMY does the SAME, but may react slower.

    As far as I am concerned, we are STILL in the sucker's rally! WAIT until the us isn't pumping more money in, housing prices start climbing, the market goes up, and the fed funds rate starts climbing with no real negative effect, and THAT is the recovery. As far as I am concerned, we have had a recession for the past 11 years, it just got worse. It WAS starting to look like it was recovering until 2001, it went back down, and stayed there. 2008 was just worse.

    HECK, SOME will quote like:

    Julius Shiskin suggested several rules of thumb for defining a recession, one of which was "two down quarters of GDP".[3] In time, the other rules of thumb were forgotten,[4] and a recession is now often defined simply as a period when GDP falls (negative real economic growth) for at least two quarters.[5][6] Some economists prefer a definition of a 1.5% rise in unemployment within 12 months.[7]
    YEAH RIGHT! And HOW do we determine that? With agencies determining rules on GDP and unemployment, inflation, and pumping money into the economy, those numbers aren't really reliable. Even so:

    U.S.'s $13 Trillion Debt Poised to Overtake GDP: Chart of Day - Bloomberg

    Look at the chart! Since late 2008, the GDP is moving at the same rate even as the debt is accelerating. SO, clearly, the REAL GDP is DROPPING! It is like a family that has $60000 more in the bank than they ever had before, but also has $80000 more in debt. Their REAL change is a LOSS of $20,000, but they may feel like they GAINED $60,000!

    Steve
    {{ DiscussionBoard.errors[2396052].message }}
    • Profile picture of the author Bill Farnham
      His prediction came despite the S&P/Case-Shiller index for May showing a 4.6pc year-on-year increase in house prices in 20 major US conurbations.
      That's another good example of how statistics can be used or misused with ease.

      A 4.6% increase in price on a commodity that has fallen 20%-60% in some markets is irrelevent to any meaningful comeback.

      And houses are inexplicitly tied to jobs. Those jobs are nowhere on the horizon, and the jobs that are growing by catagory are service jobs that create zero wealth and only drain the cash availible to afford the services.

      Not a pretty picture.

      ~Bill
      Signature
      {{ DiscussionBoard.errors[2396156].message }}
      • Profile picture of the author seasoned
        Originally Posted by Bill Farnham View Post

        That's another good example of how statics can be used or misused with ease.

        A 4.6% increase in price on a commodity that has fallen 20%-60% in some markets is irrelevent to any meaningful comeback.

        And houses are inexplicitly tied to jobs. Those jobs are nowhere on the horizon, and the jobs that are growing by catagory are service jobs that create zero wealth and only drain the cash availible to afford the services.

        Not a pretty picture.

        ~Bill
        As far as what many now call this recession goes, there has NEVER been a time in history when home sales could REALLY go up, or even that prices could really go up. REALLY, think about it! Let's say a home cost $100,000. Ok, you get the $8000 that was originally offered as a US tax credit, and now by some R/E brokers. THAT right there is an 8% price REDUCTION! SO, for the home to go up 4% The price would have to go up 12%. If that were the case, you would expect them to make it clear. Of course, if it were $200,000, the $8000 would be only 4%, so for the home to go up 4%, the price would have to go up 8%. On the other hand, the price could go up 4%, and the person would basically pay the OLD price. Interesting huh!?!? On a site updated earlier this month, http://www.realestateabc.com/outlook/overall.htm they gave average prices for 4 regions! The average of all those prices? 192800. The alleged 4% increase? 7712 Issn't it interesting how it is SO close to the $8000 offered? It could even be argued that they paid $288 LESS, since that IS reflected in their bank account!

        Of course, as you said, 4% is really insignificant. Unless we are dealing with the SAME home and have two clusters of bids, in the SAME season, that are close to all those in the cluster and the difference can be seen between both clusters, 4% just doesn't mean much. And MANY things have to be taken into account. I just showed how the credit can make such a difference.

        Steve
        {{ DiscussionBoard.errors[2397061].message }}
  • Profile picture of the author HeySal
    Another recession? The only ones not still experiencing the recession are the severely wealthy. This is not another recession - this is just further decline. Just like the jobs market was tooted to have been getting better when the only thing that was showing up was over 100,000 very temporary census jobs.
    Signature

    Sal
    When the Roads and Paths end, learn to guide yourself through the wilderness
    Beyond the Path

    {{ DiscussionBoard.errors[2396327].message }}
  • Profile picture of the author sloanjim
    Well actually I made over 60% in 2009 and 2010 it's been much more than a "Dead cat bounce" it has been a 15 month+ bull market. shame you miseed it trying to call it. See it all the time. What the future holds I have no idea. I am never into "predictions"

    Well, in the stock market, there is something called a dead cat bounce. Peopple see things getting bad, try to pull out, etc... The market crashes! It often crashes TOO quick! People often see bargains, automatic orders may be tripped. The market can SKYROCKET! THAT is the dead cat bounce. OFTEN, at some point, after that, there may be a rally! Some call it a sucker's rally. People join in, etc... They run out of cash, and the market drops AGAIN!
    Signature

    15 Minute Forex Bar Trading System Free at
    http://www.fxscalpingmethod.com

    {{ DiscussionBoard.errors[2398587].message }}
    • Profile picture of the author seasoned
      Originally Posted by sloanjim View Post

      Well actually I made over 60% in 2009 and 2010 it's been much more than a "Dead cat bounce" it has been a 15 month+ bull market. shame you miseed it trying to call it. See it all the time. What the future holds I have no idea. I am never into "predictions"
      I talked about rallies AFTER the dead cat bounce. It never rallied anywhere near 60%. Of course, even in a DOWN market, you could make MANY times what you start with. You just have to pick a REALLY good stock, or keep churning.

      steve
      {{ DiscussionBoard.errors[2398668].message }}
  • Profile picture of the author sloanjim
    Yeah i remember in 2007 when it all imploded everyne said "6 months and we'll be back" Then it ws 12 months, then 2010 etc.....but the world changed in the crash and I do not think it's ever going back to how it was.
    Signature

    15 Minute Forex Bar Trading System Free at
    http://www.fxscalpingmethod.com

    {{ DiscussionBoard.errors[2398590].message }}

Trending Topics