The Global Economy

[Fogelhund]

I'm wondering what the GTXf world thinks about the Economy at the moment.

My background is as a Business Degree, major in Finance, minors in Political Science and Economics.

I've been working in the Stock Market as an Investment Advisor since 1993.

------------------------------------------

I regularly run models, as to where I think things can go in the economy... and I'm now stumped. I cannot come up with a happy scenario at the moment. The most positive outcome I can come up with, is a GDP growing at 1-2%, interest rates flat, and stock market returns of 5%...if things are perfect.

Otherwise... I just come up with scary scenarios.

http://www.marketwatch.com/story/meet-the-affable-bear-who-expects-the-sp-to-tumble-to-20-year-lows-2016-09-19?link=sfmw_tw

http://fortune.com/author/ryan-derousseau/

http://www.barrons.com/articles/jim-rogers-on-oil-gold-and-why-china-is-a-buy-1473211563?mod=bol-social-fb

We lowered interest rates, to stimulate the economy. We issued more debt, we made money easy to get.... and it didn't work. So now we have the DJIA at 26x earnings, the S&P at around 23x earnings, and Companies are issuing debt with negative yields. We have asset inflation in many parts of the world still... and really, housing prices are high again, because of interest rates... it's a bigger problem in Canada now.

Is the 2000 to xxxx Bear Market over... I don't think so... we fell to a PE of 18 (2009), from 42.... all other Bear Markets ended with PE's of 6, 8, 8, 10, 12... when people hated equities... most Bull markets end at a PE of 18.... Bear markets typically are 15-30 year events...

Typically, the way to fix economies, is the take out the excess, and feel the pain... Everything else to fix things haven't worked, and we keep kicking the bucket down the road, with low interest rates... so what next?

So.....

[Cam]

I know nothing of the economy. :(

[Crazed_Insanity]

I think it's safe to say that the global Econ is heavily dependent on US Econ... All we know is that Trump will speed up our destruction, so let's just maintain status quo and hope for things becoming perfect by kicking the bucket down the road.

Sarcasm aside, I think for those who care about these things. They all know that we're doomed with status quo, but nobody wants to rock the boat because nobody has any popular solutions... We only have loud mouth Trump coming up with stupid solutions... And Bernie just needs to be hushed.

[Fogelhund]

To put it into simplistic terms... Capitalism and Capital Markets require growth.

Growth is Inflation (Higher Prices) + Productivity Gains + More Sales

At the current time we have almost no inflation, our productivity gains are meager, and more sales come at either further indebtedness, increased salaries, or more people to sell too...

Further indebtedness only works for so long,

Salary growth has been benign, with the one aberration being the latest data point, that is so out of the norm, it looks to be a mistake, or a number cocked up for political gain.

More people to sell to - You can accomplish this with birth rates greater than 2.0, or immigration, or expanding global trade. The Western World has birth rates less than 2.0, and at this point, the populist politics of Brexit and Trump are anti immigration and protectionist, to reduce global trade... this isn't the place for the political debate, but reducing immigration and global trade will cause contraction. A fall in the birth rate, without replacing those bodies, will also eventually cause contraction... just look at Japan for example... they need either immigration, or a baby boom.

Productivity Gains... well, it's been piss poor for the most part. We have some technology coming down the pipe, but I'm wondering how overall it will benefit us. Self-driving vehicles. Will they be more expensive, have a greater profit margin for the automakers? If they take over, will performance cars be a thing of the past, and ultra luxury cars... as we will be driving fleets of cars at a normalized acceleration rate, and following maximum computer set speeds... so what's the point of a 500hp car now? I'm wondering, do prices on cars go down? And what of jobs? Taxi drivers, bus drivers, truck drivers... jobs no more. Maybe Taxi companies, Bus companies and trucking companies are more profitable... So we end up with a situation where more of the profits end up in fewer of the hands, and continued trend and spread between the wealthy and the not so wealthy... and we should recognize that we are in early stages of global revolution on this already... We are the 99%, Occupy Wallstreet, Black Lives Matter, Brexit, Trump popularity, even ISIL are signs of an increasingly tired population of people who are tired of being oppressed, or abused by those elite politically and elite wealth...

The problem on this politically, is we really needed to find a way to bridge the gaps between the lower end population, and higher end... Bernie style economics actually might have been the right way to go on that, but it's been preached for so long that the American Dream and way is anti-socialism....

[Tom Servo]

Bernie style economics actually might have been the right way to go on that, but it's been preached for so long that the American Dream and way is anti-socialism....

Like Cam, I'm definitely no economist. I wonder, though, if that's why Scandinavian nations are still rating so high on happiness/quality of life indexes. I do think that as we automate more and more, we'll have to find some way to support people whose jobs will most likely be eliminated.

[MR2 Fan]

Like Cam, I'm definitely no economist. I wonder, though, if that's why Scandinavian nations are still rating so high on happiness/quality of life indexes. I do think that as we automate more and more, we'll have to find some way to support people whose jobs will most likely be eliminated.

Hmm, I have a new term...I hope it hasn't been used before...."Technological Socialism"....giving everyone equal access to basic living amenities that technology provides for us.

[drew]

I'm employed and getting checks again, so, yay (me??). Beyond that, I know 3 5ths of sweet fuck all.

[Rare White Ape]

I too know fuckall, but I do know this maxim:

There are two types of Republican voters. Millionaires and suckers. Open your wallet to see which one you are.

[Sad, little man]

The problem on this politically, is we really needed to find a way to bridge the gaps between the lower end population, and higher end... Bernie style economics actually might have been the right way to go on that, but it's been preached for so long that the American Dream and way is anti-socialism....
Right... We have gutted the middle class to line the pockets of the super wealthy. But ultimately this is going to torpedo the economy as we end up with a small number of people with massive cash hordes, while most of the population does not have the money to go out, buy things, and keep the economy going. How do people expect the economy to thrive when more and more people are finding it harder and harder to make ends meet? We are living under a sociopathic bourgeoisie who are going to drive the economy into the ground in pursuit of getting as much as stratospherically possible for themselves. This is why we need to, essentially, burn the motherfucker down.

[Crazed_Insanity]

I too know fuckall, but I do know this maxim:

There are two types of Republican voters. Millionaires and suckers. Open your wallet to see which one you are.

This thread really isn't about any party. Status quo has bi-partisan support. Trump is an oddity in the Republican Party. Nobody really wants to deal with the bucket now and most would rather kick it down the road.

You can actually delete republican in that maxim. Open your wallet and you'll know which kind of voter are you... I'm never going to vote for any candidate who takes money from the rich. Not gonna be a sucker no more.

[Jason]

Cash hoarding at the top is a real killer imo, that's money that isn't being circulated. Trickle down doesn't work, if the money is effectively doing nothing.

Also, agreed on something giving when it comes to 'socialism' and the US. Blue collar and many entry level jobs can be replaced with technology, is it morally acceptable to let those people suffer? Hell, as the younger class of workers work their way up the chain at my job, I'll be pretty unnecessary pretty soon. Yes, graphic design is increasingly less needed, as the tools become easier to use, and premade templates cover for bad taste.

[FaultyMario]

FWIW, from my social studies training, we know that current production models are flawed. As in unsustainable growth. Currently doing laundry so i can't be as eloquent as I'd like, but the business of food production, for example, has relied too much on taking from the poor to give to the rich (by abusing their leverage over small producers or by receiving large government subsidies) while screwing consumers. At the same time there hasnt been a significant technological advancement for better efficiency or much higher productivity in big agribusiness (the small producers is another game altogether).

[Rare White Ape]

This thread really isn't about any party. Status quo has bi-partisan support. Trump is an oddity in the Republican Party. Nobody really wants to deal with the bucket now and most would rather kick it down the road.

You can actually delete republican in that maxim. Open your wallet and you'll know which kind of voter are you... I'm never going to vote for any candidate who takes money from the rich. Not gonna be a sucker no more.

I know what you mean. Yep, there are mechanisms built into the bureaucracy as a whole which largely protect us from that way of thinking.

But, it's the elected representatives, the ones we put there to create and debate on the very legislation that protects us, that think that way, and that freaks the fuck out of me.

[neanderthal]

We know trickle down doesn't work (hello Kansas, Wisconsin, etc) but we do have a model that has worked; California.

Raise taxes and limit spending. This raises government income, which, properly targeted, can then spur/ induce growth. Federal spending (and WWII) got us out of the depression. (But lets not get into that. I believe the baby boom had more to do with it than we realise but that's getting us sidetracked.) That's not going to happen much here in CA because everybody wants any extra income for their own pet projects so the bucket gets kicked along, even in this case.

[Rare White Ape]

I'm a firm believer in high taxes, high welfare/spending, but I don't know whether this is good or bad. For now, I'm happy to state that I'd gladly give over another 5-10% of my income in exchange for better civil services and better quality of governance. I think that if you spend money on propping up the bottom end of society (i.e. those with no work, or poor health, you know, greasing the squeaky wheel) then it follows that that 'burden' then suddenly becomes more productive and helps lift the economy as a whole and everyone wins.

I could be wrong tho. I've been wrong about stuff before.

[neanderthal]

I'm a firm believer in high taxes, high welfare/spending, but I don't know whether this is good or bad. For now, I'm happy to state that I'd gladly give over another 5-10% of my income in exchange for better civil services and better quality of governance. I think that if you spend money on propping up the bottom end of society (i.e. those with no work, or poor health, you know, greasing the squeaky wheel) then it follows that that 'burden' then suddenly becomes more productive and helps lift the economy as a whole and everyone wins.

I could be wrong tho. I've been wrong about stuff before.

I believe this too.

I believe that there is set amount of "resources" a human needs to survive comfortably. Rich people have that covered easily. Their consumption (spending, therefore economic growth) doesn't go up proportionately as their income grows. Whereas poor people are barely able to make that resource minimum. Middle class barely do. Well, depending on where exactly you are in the middle class. So, it follows that the greatest economic growth would come from (the very many) poor people having disposable income to spend, even on basics. That spending would create jobs, creating even more income, which could be made available for more spending, now on less necessary items, and more pleasure goods.

But i'm no economist.

[overpowered]

http://i.imgur.com/CjKCNvn.png

[drew]

Papa John's pizza is shit too. Fuck that place.

[Jason]

Bingo, it only works if that money at the top is going towards creating or expanding businesses, all too often it just sits in accounts, being traded back and forth, effectively.

[Crazed_Insanity]

Problem with socialism is that it'll create a sense of entitlement.

Bible does teach that the haves should help feed the poor, but bible is also teaching that if you don't work, then you don't get to eat!

The rich don't owe us anything.

We need the JFK style socialism... For the workers, we should not be asking what the govt or big companies can do for us, but instead think about what we can do for our society. Govt's role is help making that possible rather than just take from the rich and distribute them to the poor.

For the rich, Rather than forcibly increase taxes and force companies to keep outdated jobs, govt should simply encourage them to spend their money in more meaningful ways that actually invests in the future, rather then allowing the money to sit in offshore accounts or just forcibly take them and give to welfare recipients...

If I were president, I'd divert as much govt funds as possible for a Mars mission and have Elon Musk take over NASA.

He will create shit load of cool jobs in America all the while making profit for everybody in the long run.

[FaultyMario]

I Just heard our finance minister tell our Congress pretty much the same thing you posted, fogs; we're expecting negative growth, i.e. we're fucked.

[Fogelhund]

Problem with socialism is that it'll create a sense of entitlement.


People talk about socialism, and socialistic policies like it is a black and white situation, instead of a spectrum of grey.

[Tom Servo]

Also, a sense of entitlement in certain things I don't consider bad. We already consider ourselves entitled to a safe work environment, food that won't make us sick (unless we mishandle it ourselves), cheap gas...the list goes on. For instance, I don't see a problem with feeling entitled, as a citizen of a first world country, to healthcare that won't bankrupt me if I trip on a sidewalk.

There are a lot of nations with socialist policies where the citizens do feel entitled to certain things, and as far as I can tell, it's not a problem.

Also, weird thing for someone who so adamantly supported Bernie to say...

[21Kid]

:lol: at Tom's sidewalk comment.

In some cities, the sidewalk is public property,
Unless work needs to be done on it. Then it comes out of the homeowners taxes.
Or if someone gets hurt, then they can make a claim against your homeowners insurance.
And if you don't shovel snow, the city can fine you for not keeping a safe walkway. (We had a letter on our door, when we got back from vacation)

This is why some people are annoyed with government.


But yes, I agree with your overall comment. And most of those places that get basic services are much happier than we are.
And Trickle down has proved itself to be wrong. They say that lower taxes will create more jobs because the corporations will have more money to spend. :? Who has ever created a job just because they had money? Supply and demand. Demand will create the need for more jobs. And who buys stuff? The billionaire who already has all the toys? Or the lower/middle class family that wants a new TV? Corporations are making record profits and still cutting jobs. They are not in the business of creating jobs, but of maximizing quarterly profits. If we tax the higher classes more, it will ease the burden of the rest of us and make it easier to buy stuff. Creating more profits and jobs. win-win

edit: as far as the Global Economy, I don't know enough about the world to comment on it. It seems that the same rules would apply, but I'm not sure.

[Fogelhund]

The only benefit trickle down economics has provided, is more profitable corporations. This of course favours those who have stocks, IRA's, 401K's, or company pensions invested in these stocks. Given the ownership of such things is highly skewed towards the elite wealthy, it would appear that this is a policy that benefits the rich, far more than the average.

I do believe it's time to start to examine the taxation system, and fairness to it's citizens... as much as that is going to upset the apple cart.

I think we also need to examine how stock options are handed out to executives, their taxation, and create stricter legislation around these. While in theory they are ensuring that executive compensation is aligned with shareholder interests, it seems as though that is often not the case, especially shareholder's long-term interests.

We also need to look, long and hard at lobby and special interest groups influence on politics... but that probably isn't something to be addressed in an economics discussion, despite that quasi relation.

[Crazed_Insanity]

Also, a sense of entitlement in certain things I don't consider bad. We already consider ourselves entitled to a safe work environment, food that won't make us sick (unless we mishandle it ourselves), cheap gas...the list goes on. For instance, I don't see a problem with feeling entitled, as a citizen of a first world country, to healthcare that won't bankrupt me if I trip on a sidewalk.

There are a lot of nations with socialist policies where the citizens do feel entitled to certain things, and as far as I can tell, it's not a problem.

Also, weird thing for someone who so adamantly supported Bernie to say...

Jesus gave away free healthcare and early Christians do willingly share the possessions with one another, but people didn't feel 'entitled' to Jesus' healings nor do early Christians think that they are entitled to other people's possessions. You see what I mean by a sense of entitlement might be bad?

Further, due to human nature, this sense of entitlement will eventually creep in, which was probably why later day Christians are no longer sharing everything. If you don't work, you don't eat. If you really need help, it's up to those who really feel like helping you to help you... not as a 'commandment' that thou shall feed all hungry people!

Time changes, conditions change... people of previous generations also felt entitled to pension pay chk or social security paycheck after retirement..., but if funds are rapidly depleting... your sense of entitlement won't magically make money appear out of thin air.

So I'd recommend that we feel grateful for a safe work environment, food that won't make us sick, cheap gas..., etc., but we shouldn't feel like these things are basic rights others absolutely need to provide for us...

As we all get richer, we all can have more to be grateful for... and we get poorer, we all should also be okay with giving up certain luxuries...

This balance will be difficult to achieve, this is why socialism/communism isn't beating capitalism.

Capitalism simply capitalizes on human's greedy nature and uses that to help advance the society as a whole. However, capitalism will eventually reach the end of life as the rich suck the poor dry...

[neanderthal]

I think "socialism" is one of those words you heard and you love to throw out, like "political correctness" and "wikileaks" regarding Hillary Clinton. It's a buzzword "corrected" to scare the mouth breathers.

There is nothing inherently wrong with socialism. We have lots of socialism via socialist entities around us everyday; Roads. Schools. Police. Parks. Fire Dept. County Hospitals. Public utilities. Public transportation. Trash collection. Etc, etc, etc.

Who owns the internet? Nobody. Who uses it, everybody. Guess what, socialist. You pay for access. Just as you pay "fees" that result in your trash being picked up. Errbody pays a little bit and errbody gets to use it.
Sounds like public parks and schools and beaches and, well, you get the idea.

[Jason]

The fact is, there's enough wealth, technology and resources in developed countries to take care of everyone's basic needs in said countries and *still* have economic classes, and different pay for different work. It's just pure greed in the US keeping things from balancing out a bit.

[Crazed_Insanity]

Neanderthal, I do agree there's nothing inherently wrong with most -isms. The problem is with humanity's misapplication!

Socialism has a negative connotation in the US, but I'm sure even you can tell that I'm not trying to scare anyone away from socialism. I'm actually for it, but it can only work when everyone has the right mindset.

Even with your examples, my point still applies. Nobody owes you access to the internet. Nobody owes you a smooth road for you to drive on. Nobody owes you free medical treatments in emergencies... We should just be grateful of these services being available rather than expecting them as some sort of basic human rights or something like that.

[neanderthal]

So, if you get home and you find you've been burgled, do you feel entitled to Police, and a thorough investigation? Yes?
How about a fire? Do you feel entitled to a timely and sufficient response from the Fire Dept? Yes?
Ever had your trash NOT collected? Did you immediately complain, maybe even call them them to do so? Yes?

Because you've fucking paid for it.

I rest my case.

We are entitled to the services and goods we've paid for. When I pay for access to the internet I EXPECT unfettered access to it. We all do. Why do you think there's such a huge outcry when a carriers service goes down? When I drive down a massively potholed road, I complain and moan and bitch. Why, because part of the innumerable taxes I pay as a motorist and citizen, is supposed to go to maintaining the roads.
*I don't complain too much however, because I have excellent choice in vehicles, whose suspension designs ameliorate the effects of most potholes very well. Both my 95 E320 and BMW 2002 have very compliant suspensions. Firm but nearly cossetting, though that may sound like an oxymoron. As does my motorcycle, a long travel adventure bike, the Honda Africa Twin. But we're getting sidetracked.

That's not a knock on socialism. That's the basic fundamental service when you exchange goods for other goods or money. It cuts across ALL political schemes.

Don't confuse capitalism, an economic endevour, and socialism, a political endevour, though one much maligned by the Republicans, (who, paradoxically, love the Police, the Armed Forces, their social security, their Medicare, etc,) to scare their mouth breathing, cousin- fucking followers.

This cousin- fucking and mouth breathing doesn't apply to all followers of republican ideology. Just the cousin fucking and mouth breathing ones.

And there are probably cousin- fucking, mouth breathing democrats, so there.

[neanderthal]

The fact is, there's enough wealth, technology and resources in developed countries to take care of everyone's basic needs in said countries and *still* have economic classes, and different pay for different work. It's just pure greed in the US keeping things from balancing out a bit.

Preach!

Can we get an "Amen?" A "hallelujah" maybe?

[JoshInKC]

The fact is, there's enough wealth, technology and resources in developed countries to take care of everyone's basic needs in said countries and *still* have economic classes, and different pay for different work. It's just pure greed in the US keeping things from balancing out a bit.

PREACH!

[Crazed_Insanity]

Preach!

Can we get an "Amen?" A "hallelujah" maybe?

Amen brother!

Anyway, whenever we pay for something, of course we expect something in return. However, if my house burnt down and fire fighter didn't come fast enough, it's not really their fault. Likewise if I had a home invasion/robbery and cops failed to come in time to save me. Bitch and moan, sure, but sometimes there will be times our expectations are not met, then what? Sue the hell out of the city? Expect taxes to be refunded? Anyway, it's your mind, you can set it however you want, but I choose to not see these services as entitlements.

Further problems with social programs is that the government may not be utilizing the tax money effectively. Diverting more resources for wars than for internal infrastructures or investing in future generations with better education...

Bernie is the guy with sufficient foresight and integrity to do the job effectively. Same cannot be said for trump or Hillary.

[FaultyMario]

there's socialism because not every good can be privately owned. Also, socialism is form of governance, not of government.

[Tom Servo]

Back to trickle down, I wonder if that's one of those things that worked in theory when manufacturing was the main industry. It seems to me like manufacturing scales well along with demand, whereas a lot of the newer service/information jobs don't. For example, it doesn't matter if I have 500 or 10,000 people hitting the website I built, it still only needs me there. And even at 10,000, that was still barely even making a dent, and if I needed more, I'd just get AWS to spin up a couple more EC2 instances.

A lot of jobs like mine don't necessarily benefit from more employees. In my specific example, I'm pretty sure at the level of work that needs to be done and how well the current work is handling load, another employee would only slow things down. So, no trickle down. I can earn more for the company but that doesn't necessarily translate to hiring more people.

[IMOA]

personally I think it's grossly misleading to describe healthcare and the police as socialism but that does seem to be the thing in the last 10 years in the US

Anyway, I'll make a couple of comments while I'm between flights

Japan for the last 25 years is probably the best analogy for what the developed western world is looking at in the future, basically a long period of malaise with no view as to how to get out of it.

However. The thread is titled the global economy which is a lot more than the developed western world and in that context I'll say that the global economy is just fine. The problem is that our perspective is from the developed western world and the developed western world, in particular Europe but the others as well, is inefficient, lazy and getting its lunch chopped by Asia. Now, there's still enormous chunks of capital resting in the developed western world but this is slowly being redistributed and that process isn't going to stop any time soon.

The more I work in different countries around the world the more the contrast becomes clearer. Rampant entitlement culture, inability to have a reasoned debate, blaming the boogie man, basically anything except taking responsibility and getting on a sorting things out. I used to think we'd figure it out but now I'm convinced we won't.

So there's no problem with the global economy, just some problems with the bit of it that most of us are in and unless you're doing something about that the most likely future is a long, slow decline.

[shakes]

As long as the developed world is focused on acquiring as much stuff for as little money as possible and as quickly as possible, we're screwed. Capitalism requires growth and growth requires resources. We're going to eventually run out of the inputs required (human population growth or materials or both). I don't think we're going to wake up tomorrow and be facing the apocalypse but I wouldn't put it out of the question in say 100 or 200 years from now.

[MR2 Fan]

As long as the developed world is focused on acquiring as much stuff for as little money as possible and as quickly as possible, we're screwed. Capitalism requires growth and growth requires resources. We're going to eventually run out of the inputs required (human population growth or materials or both). I don't think we're going to wake up tomorrow and be facing the apocalypse but I wouldn't put it out of the question in say 100 or 200 years from now.

I agree with this, and I'm going to use the U.S. as an example.

We're in a viscious cycle right now. The cycle is that we want to buy things...lots of things...that's capitalism. BUT, due to a few reasons, we (meaning Americans) seem to be less worried about quality than price...more than ever before, price is the driving factor in our buying for most people...the ones who are middle or lower class.

So the big businesses realize this trend, and because they're focused on quarterly profits above all else, and competing with all of the other big businesses who are thinking the same thing....PRICE OVER QUALITY, the only way they can compete is to move things offshore for cheaper goods and labor.

That satisfies the Wal-Mart crowd where 90% of the stuff is now made in China, etc. and things keep getting outsourced.

People have less money overall because they can't get the manufacturing and call center jobs, so they buy cheaper stuff that is made overseas more, and the cycle continues.

The only way to stop this is if the government steps in and actually does some type of tariff or tax program for those companies who are sending jobs overseas...aka it will never happen.


On a separate topic....I feel like there is a slow build-up happening. The increasing mistrust of big businesses and big goverments (who are apparently becoming much closer aligned than we've previously understood) is possibly going to lead to a radical shift...maybe in 20-30 years.

I think we will start to see things, if they are allowed to, become much more localized and smaller.

Everything was moving toward these massive monopolies....6 corporations owning 95% of media, a few carmakers making 90% of the worlds automobiles, etc.....but we're seeing the changes, smaller companies are taking hold...Youtube news sources, and...I have to say it, 3D printed things are going to revolutionize a lot of things...if the big corporations and goverments don't find a way to squash them first.

[Crazed_Insanity]

I get the feeling that we will get screwed in the end by federal reserves and the big banks due to some weird convoluted derivative things that most don't even understand.

Just as nobody outside of Wall Street really saw the 2008 financial earthquake coming until it was too late.

And 8 years later, we have a better understanding of what happened, but the banks bought all of our politicians to not waste money doing retrofitting because it just won't ever happen again! Or perhaps we are so fucked that no amount of retrofitting can help with the next big one so let's just forget about it. Just status quo everything and everything will be all right! :)

[Fogelhund]

Just as nobody outside of Wall Street really saw the 2008 financial earthquake coming until it was too late.



That would be false.

[Crazed_Insanity]

You saw it coming?

Who else here predicted it happening in 2008?

[JoshInKC]

I certainly didn't foresee the specifics*, but it was pretty clear that the level of growth was unsustainable and likely headed for a major downswing if not full crash. When you see a lot of people making a lot of money for what seems to be no reason, its a good idea to be cautious.

*In retrospect, I probably should have spotted it. I was rehabbing and selling houses back then and I remember being completely shocked at some of the people who were able to qualify for really big loans. Combine that with my inherent suspicion (about everything) and cynicism (about the markets), and its amazing that I didn't pick mortgages to go down in flames. Oh well, hindsight is always 20/20.

[neanderthal]

You saw it coming?

Who else here predicted it happening in 2008?


People were buying houses to put them right back on the market unchanged, and making $20k, if not more on that subsequent sale.

I definitely remember thinking "this is unsustainable, there's a crash coming."

[Crazed_Insanity]

We Californians all know a big earthquake's gonna come, we just don't know exactly when and how. Likewise, I believe 2008 financial meltdown couldn't be predicted precisely and most of us didn't even know how it began. That's what I meant. Anything else you guys wish to nitpick?

[IMOA]

I think the point is it was actually pretty well known that it was coming and that was why it was so bad. I know I was discussing it a fair bit when I was at Rabobank and that was back in 2004 and when I was in the US (Q4 2006/Q1 2007) I was reading a lot about it in mainstream papers etc and there was some discussion about it. Certainly by the time Bear Stearns failed in 2007 everyone knew it was a matter of when and not if and that when was going to be pretty soon.

[Kchrpm]

People have less money overall because they can't get the manufacturing and call center jobs, so they buy cheaper stuff that is made overseas more, and the cycle continues.

The only way to stop this is if the government steps in and actually does some type of tariff or tax program for those companies who are sending jobs overseas...aka it will never happen.

I disagree. The best way to stop this is by buying expensive, US produced luxury goods. Like Corvettes. BUY A CORVETTE TO SAVE THE WORLD!

[MR2 Fan]

I disagree. The best way to stop this is by buying expensive, US produced luxury goods. Like Corvettes. BUY A CORVETTE TO SAVE THE WORLD!

Aren't they built in Canada or is that just Camaros?

[Kchrpm]

Corvettes are built in Bowling Green, KY, and have always been built in America. Camaros are now made in Lansing, MI as of the 2016 model.

[Crazed_Insanity]

If iphones were made in the USA and if Apple maintains the same profit margin, they'll probably cost as much as Corvettes. Then nobody will buy iphones and Apple goes bankrupt and USA becomes less great again.

[Kchrpm]

I didn't say anything about building iPhones here. I said people should buy Corvettes :)

[Crazed_Insanity]

If GM makes Corvettes in China, then maybe we both may be able to afford to own one! It'd be a win for GM, America, China, global economy, you and me! A Win-win-win-win-win-win situation!

GM should just focus on designing a better Corvette and make sure they don't store all of their profits off shore somewhere and not paying their fair share of taxes.

[Kchrpm]

I'm...but...*sigh* nevermind.

[FaultyMario]

It's gonna have to be boobies, mate.


Or you could take up drinking. Drugs no, because they are mexican and mexicans pay no taxis, homes.