PLEASE DONATE
SO THIS SHIVERING PATHETIC SNIVELING
SHADOW OF A DOG CAN GET OUT OF OUR SIGHT!
Posted on 01/17/2009 7:00:43 PM PST by SeekAndFind
Amazingly, equities will end the year up. Most shareholders will experience something they've forgotten existed: capital gains. True, the economy is now in a bad slump, and the Obama initiatives (see below) will do little, if any, long-term good. But the forces of recovery will break through. As they always do, stocks will rise before the economy does. There will be volatility aplenty, but imperturbable bulls will be smiling a year from now.
Big Bar to Robust Recovery: Bad Ideas
The U.S. is enacting a "stimulus" program of gargantuan peacetime proportions to rejuvenate our recessed economy. We are not alone in this. Japan, China, Europe and numerous other nations are doing the same--not yet as big as our program but based on the idea that governments can rekindle growth.
It's all mostly wasted effort.
Governments are indeed critical to economic growth--but not in the manner we see unfolding here. While times and circumstances change, principles of economic growth do not. The basic ones have stood the test of time:
--The rule of law, especially property rights.
--Money that is stable in value, which the dollar manifestly has not been.
--Low tax rates.
--Ease of starting a new business.
--Minimal barriers to doing business, whether overseas (low or no trade barriers) or domestic (no internal cartels or onerous licensing procedures).
Despite its sheer size, the impact of the new President's fiscal program, after the initial euphoria, will be painfully limited. Instead of a jolt like from downing a six-pack of Red Bull, we'll get the economic equivalent of a tepid cup of decaffeinated tea. In fact, the waste and misuse of much of the money--inevitable in any quick, massive government-managed or -directed program--will negate much of the good in parts of this infrastructure-spending package.
(Excerpt) Read more at forbes.com ...
This is a recession that has hit the rich disproportionately. And now Obama is going to hand them the bill for bailing it out and feeding the poor. So while I think the market will increase, I think the improvement will be anemic for the next several years while Obama is beating up the rich.
Reminds me of why I was a Forbes booster.
Economically, he’s one of the only guys who gets it.
Steve, good for thee, as for me, cash is king.
“This is a recession that has hit the rich disproportionately.”
If the “rich” are hit disproportionately in this matter. It is their own dang fault for misreading economic conditions that set this play up. After all isn’t the “art” of getting rich and remaining rich the same as being smart and staying ahead of the game ?
At the same time, being poor and remaining poor is “one’s” own choice. Hence the reason for providing a vehicle to promote ones ambitions to rise above and learn from past mistakes.
The markets and their relative influence on society is that vehicle.
I would have to doubt that a little. The only challenge to those with money is knowing when to start snapping up cheap real estate. And, in general, it's very much a "buyer's market" for anyone with money.
I don’t even think that cash is king. The huge budget deficits mean an increase in the money supply which will drive inflation. People will eventually go into stocks again (thinking to kept up with the inflation), but 0’s new, higher capital gains taxes will take their capital through taxing imaginary gains which are only the result of inflation. In this way capital, the engine of prosperity, with be dissipated and destroyed. That means that real economic growth will be crippled.
There is no escape when the whole system is crippled, or even collapses. I am preparing by diversifying into gold, and buying a few guns while it is still possible, just in case there is an attempt further to restrict ownership. However, no one survives a depression in the clear. Even essential occupations are hurt.
Although I am in NJ myself, I would recommend that families with children move to safer, lower crime areas off the coasts. Rural areas where you can grow a home garden may turn out to be very nice in the future.
Yes. However, the majority of people "with money" are those with allot of equity based assets. The choice is to wait it out, or to liquidate the devalued assets and buy undervalued real estate. For most people there is no short cut here. It simply requires waiting to recover what has been lost.
For somebody who is very knowledgeable whenever it comes to economic issues, why does he not also improve his facial appearance? I like the guy, but he’s still too “nerdy looking” and continues to have the perfect face for radio. Steve Forbes face is truly what’s keeping him from actually winning any political office, IMHO.
Action Needed Now To Avoid Depression, Warns ITEM Economist
Peter Spencer, chief economic advisor to the Ernst & Young ITEM Club said that quantitative easing is needed immediately
By Angela Monaghan and Edmund Conway
Last Updated: 9:56PM GMT 17 Jan 2009
The Government and the Bank of England have got "days not weeks" to take action to revive the economy or face a prolonged depression, one of the UK's leading economists has warned.
Peter Spencer, chief economic advisor to the Ernst & Young ITEM Club said that quantitative easing, whereby the Bank of England would print money to buy assets such as corporate bonds and consumer loans, was needed now.
"My concern is that people don't fully understand the dangers lurking out there. The Bank of England needs to move towards quantitative easing immediately – you don't have to wait until you get to zero per cent interest rates. If someone is choking to death you don't think twice about giving them an emergency tracheotomy. There may be dangers, yes, but the alternative is that they die," he said.
[snip]
Y'mean if he got botoxed and a plug job Forbes could be like John Kerry and Joe Biden...???
I suspect that his elitest/globalist views might be part of his problem. (and with a pair of -12 diopter lenses hanging on his shnozz, its hard not to look nerdy)
I believe Steve is right, but 2009 for the most part is going to be a disaster that is going to hit everyone. Rich, Poor, everyone is going to be munching on the crap sandwich.
Stocks may come back a bit, but its not going to really be that significant of a move upward. It will be the definition of a bear market rally. There will be mostly sideways trading. Any significant moves will be met will fearce profit taking.
I do believe that the US will recover faster than Europe and Asia. I think Europe is looking at a multi-year recession and any type of recovery in its stock markets will lag the US by 6 months to a year or more.
China is a faux version of capitalism and eventually even its artificial currency pegs to the US and Euro won’t save it any longer.
Both China and Russia are looking at multi-year major recessions as they hitched their wagons to Mercantalism and many of the commodities they attempted to horde will trade lower than the value they paid.
My neighbor just bought 15 cases of canning jars and spent (he said) about $450.00 on pressure cookers and other assorted canning equipment. He is urging me to buy similar supplies before there are a 'stampede' and there is none left to buy.
I don't know.
We're already in a rural area and I have everything needed to grow my own food.
I happen to see similarities w/ what Obama is proposing to do w/ FDR (one of his heroes apparently) and if you read the Forgotten Man by Amity Shlaes you find out quite a bit and it isn’t all that great w/ FDR and his govt. intervention - FDR actually created a depression w/in a depression in 1937/38 (the lowest point even after the crash of 1929) due to his socialistic tendencies on an already unstable economy.
Smart money has the market at 5500 by mid summer, and the dollar having a rally against the euro, frank, and pound in the interim, due to the fact that they are deeper into bad 3rd world paper in europe.
Senator John Kerry and V.P.-elect Joe Biden are Democrats, and Steve Forbes is a Republican. Everybody knows that there are double standards whenever they are comparing Democrats to Republicans, as unfair as this double standard continues to be.
1930, the year after the great stock market crash of October, 1929, was actually rather calm, with the stock market showing signs of recovery three times.
It didn’t last. And while 2009 might be calm for a while, there are several truly enormous economic bubbles that are still going to burst, in no particular order, and with little warning.
—Pension funds nationally are hopelessly overextended, and are going to be a grassroots catastrophe for the millions of people dependent on them, when their bubble bursts.
—ARM and Alt-A mortgages are also going to go bust. The two together are 1.5 times as large as the sub-prime bubble. This will be joined with cities and states defaulting on their municipal bonds.
—US Treasury bills (T-bills) are one of the largest economic bubbles ever created, and when it pops, economists are describing the effect as “spectacular”.
—The Great Hedge Fund Collapse, along with the Banking Collapse, and several others. Just two days ago, it was announced that the Schumer-caused failure of IndyMac in California was going to need 1/3rd of the $35B the FDIC has to cover bank account losses.
—The general recession. Hundreds of retailers will be going bankrupt, defaulting on their loans of both money and goods. This is more a multiplier effect on the rest of the economy.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.