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Downturn

3 (6%)

Recession

20 (40%)

Depression

11 (22%)

Paradigm Shift

6 (12%)

Apocalypse

10 (20%)

Total Members Voted: 50

[PTTG??]

If one looks at the events of the past six months, it becomes apparent that the current situation may not be exactly as the policy makers may claim. Look at the Dow Jones Industrial Average, for instance; for the first time in history, it has had a loss of %50 percent from it's high. Even the crash of 1929 was not as severe.

And it's still going.

[Tormy]

Recession, that is my opinion at least.

[mainiac]

If one looks at the events of the past six months, it becomes apparent that the current situation may not be exactly as the policy makers may claim.

Is it different from what the current policy makers claim?  The new administration said that there was nothing they could do to prevent further decline of housing prices and is saying they are keeping all options on the table because the banking crises is so bad.

Even the crash of 1929 was not as severe.

Yes it was...
Dow high, Sept 3, 1929: 381.17
Dow low, July 8, 1932: 41.22

That Dow still needs to lose about 75% of it's remaining value to match 1929.

And it's still going.

Yeah.  But keep in mind that there's not much more damage that can be done by the decline of finance and home prices.  Other macro-economic factors are stagnating, but not plummeting.

I say it's gonna be the worst recession since the Great Depression but it's not gonna be a depression.

[Granite26]

I think it depends on what the current administration does or doesn't do to fix things.

IMHO if they keep throwing money around, 1: We'll be burdening ourselves with future debt, slowing the comeback (but maybe stopping the descent), and 2: Speeding the descent when people realize 'oh crap, if I buy now, I might not be eligible for the next stimulus.' 

Basically, the bailouts are rewarding failure (helping companies in trouble, but not those not in trouble).

[Aqizzar]

Which is exactly why Chris Dodd has been talking about a temporary nationalization of the major banking system, to forcibly relieve them of these unsaleable assets that keep anybody else from putting money back in them.  The plan has worked before during banking crises in Europe, and there's no reason why it can't work here.

We Americans really need to abandon this mythological cowboy-freedom crap, and realize that governments exist for a reason.  Yes, nationalizing the banking system will save us from a fifty year Depression.  No, it is not one small step away from turning into communist Russia.  Laissez-fare Reaganomics got us into this mess and it's not going to get us out.

[PTTG??]

Sorry, Mainiac, I must have been looking at the wrong data.

Yeah, the decline is still continuing- and what's really going to hurt is the inflation shock of all the money being poured in.

Then we got the evaporation of AIG which could start a whole new candyland of sunshine.

[mainiac]

Yeah, the decline is still continuing- and what's really going to hurt is the inflation shock of all the money being poured in.

We had deflation in the last quarter of '08.  The government is actively trying to promote inflation to get it back up to normal levels despite the low interest rates.

[PTTG??]

Well, then there's the fact that when things do start recovering in 8-16 months (or whenever), oil demand will rise, kicking prices back up and shocking the system again. You'll recall the prices of just this last summer before the demand imploded. Factor in the decrease in global supply (Canada and Mexico aren't making new oil), and there's a recipe for disaster.

Of course, I'm really just looking for an excuse to go found a commune in Canada.

[Granite26]

Which is exactly why Chris Dodd has been talking about a temporary nationalization of the major banking system, to forcibly relieve them of these unsaleable assets that keep anybody else from putting money back in them.  The plan has worked before during banking crises in Europe, and there's no reason why it can't work here.

We Americans really need to abandon this mythological cowboy-freedom crap, and realize that governments exist for a reason.  Yes, nationalizing the banking system will save us from a fifty year Depression.  No, it is not one small step away from turning into communist Russia.  Laissez-fare Reaganomics got us into this mess and it's not going to get us out.

I disagree with every single sentance there...

[PTTG??]

I doubt that you feel that the temporary nationalizing a small group of banks is one bill short of making the United States into a copy of Stalinist Russia.

That said, I'm against the protection of banks. Frankly I hope they collapse. All of them. It'll be tough on the economy- in fact after the dust has settled it may never be the same- but our life-styles will be the better for it.

[inaluct]

That said, I'm against the protection of banks. Frankly I hope they collapse. All of them. It'll be tough on the economy- in fact after the dust has settled it may never be the same- but our life-styles will be the better for it.

I agree wholeheartedly.

[Aqizzar]

That said, I'm against the protection of banks. Frankly I hope they collapse. All of them. It'll be tough on the economy- in fact after the dust has settled it may never be the same- but our life-styles will be the better for it.

Better how exactly?  Because you won't have to pay ATM fees to see how much money you don't have?  Seriously, explain to me how your life will improve because of the collapse of the financial infrastructure of all Western civilization.

[inaluct]

We'll get to hunt things. With bows and arrows.

[PTTG??]

I'll admit I went overboard with that statement. It will be fun to laugh as the economic world comes down- I myself am too poor to really care one way or the other.
Even if I loose my job, I could probably find more work. And if nobody's hiring, well, there's always the Canadian Outback. Go up north with six buddies and a carfull of booze and start a new mountainhome... I mean commune.

[Granite26]

Maybe people will start thinking of wealth as a long term thing rather than hot-potatoing it along?

The housing crisis is the perfect example.  House prices are going up because more people want houses.  People invest in houses, making the price go further up.  Rather than being smart enough to realize that it's the next bubble and that house prices will come back down when the builders catch up, the investers start selling to each other.  People decide that owning a house is the best possible investment, because the prices are going up, and so they buy a house they can't afford now to sell later for a huge net gain.  Houses keep going up.  Eventually people get priced out of the game, the economy cools, and the bubble bursts, and there are a ton of people too dumb to do more than follow the local trends left holding the bag.

Same with the banks.  Those loans were a BAD IDEA^tm, but they made the decision themselves.  There are banks out there that AREN'T in trouble because they didn't make the dumb mistakes.  They weren't worth as much, because they made a slow steady profit, rather than growing huge and supernova'ing.  IF the US government bales out the dumb mistakes, it's like flipping the bird to companies that were responsible.  There's no reason not to be corrupt, in the future.

Should the government do something to help the economy?  Sure, of course it should, that's what we pay taxes for (well, I pay taxes cause the cops will arrest me if I don't, but hey) The thing to remember is that the government should help the economy without helping the poor choices at the expense of the good ones.

The same goes for bailing out the big three.

Anyway, good economics say that the right answer is to preload your solutions, not post load them.  It's the philosophical difference between auctioning off polution rights and a cap-n-trade system.

Edit:

Also, follow the money... the "These economic times" crowd are all selling something, be it newspapers, bomb shelters, or big government fixes.  (for the record, I'm not a Republican.  Those asshats are worse than the Dems... Wargs in sheeps clothing compared to normal wolves...)