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We're in a depression now (one that has been covered up by gargantuan central bank and government "stimulus.") What we're heading into is not merely a depression, but a collapse of everything.
In terms of interest rate, you put a trend line to it over a period of time (5 years), it was upwards. They are constantly tweaking the interest rates up and down, look at that link you sent me you will see it from period to period. Who really knows what the future would be, maybe the fed would have raised it again. But I suspect they were reacting to political pressure to drop rates, as well as some external issues such as brexit, China trade, and other countries that weren't doing so well. I think in January they indicated that rates would remain unchanged.
But, of course you know, raising rates can be a bad sign as well - inflation, overheating economy, etc.
Anyways look after COVID and you can see the bottom dropped out, again your link shows that. 1.5 is no comparison to today. That's all COVID.
true, we don't know with certainty what their next move was going to be but the trend was clearly negative.
trump pressuring powell to lower rates may have been a factor, but if you followed the events as they happened in 2019, powell was extremely and openly defaint to trumps twitter attacks.
but you have ignored all the other factors that were huge indicators of a fractured economy.
We're in a depression now (one that has been covered up by gargantuan central bank and government "stimulus.") What we're heading into is not merely a depression, but a collapse of everything.
agreed. this was coming our way regardless, but the fed policy response to covid is a doubling down of the same policies from the last decade. 0% rates and QE infinity.
The big difference between the great recession of 2008 and now, is that in 2008 it affected just about everyone. With the pandemic many of us are not only not affected, able to work from home, but saving money by not commuting or going out as much, plus getting stimulus money. It's basically the lower income jobs such as retail and hospitality that are unemployed or laid off temporarily. Now some public agencies (state, county and city) are cutting personnel costs due to less tax revenue, but a small percentage of layoffs compared to 2008. At 11.1% unemployment rate today, 88.9% are working. At worst in 2009 it was less, at 10%, but that included people in all salary ranges.
Very true. This is disproportionately affecting lower skill, lower income professions.
The labor participation rate did tick down a bit. People are being incentivized to retire and not all parents can leave the kids. I expect it go down more when schools close again.
I find it interesting that we now have a de facto guaranteed minimum income. The Senate may waffle, but people have to pay rent, and property owners depend on that rent to meet their bills. I have cousins who depend on rental income for their retirement. Fortunately, they have been in that game for decades and their properties are generally not mortgaged, but Covid-19 has made a wreck out of their cash flow.
I have seen a lot of things come and go, but if you look me in the eye and ask what America will look like a year from now, I don't have a clue. Stock prices are not tied to productivity any more. Money is essentially free. We haven't seen that since the Medieval era. Some of the social problems we are dealing with are 50 or 60 years old. Our entire education system is crumbling. By the time the epidemic is over, I don't think there will be a normal to get back to.
The economy wasn't strong. Businesses and millions of workers couldn't afford rent in April, not even a month into stay at home orders. There were just a bunch of people working low wage jobs, living paycheck to paycheck. And businesses surviving on credit.
Quote:
Originally Posted by Larry Caldwell
I find it interesting that we now have a de facto guaranteed minimum income. The Senate may waffle, but people have to pay rent, and property owners depend on that rent to meet their bills. I have cousins who depend on rental income for their retirement. Fortunately, they have been in that game for decades and their properties are generally not mortgaged, but Covid-19 has made a wreck out of their cash flow.
I have seen a lot of things come and go, but if you look me in the eye and ask what America will look like a year from now, I don't have a clue. Stock prices are not tied to productivity any more. Money is essentially free. We haven't seen that since the Medieval era. Some of the social problems we are dealing with are 50 or 60 years old. Our entire education system is crumbling. By the time the epidemic is over, I don't think there will be a normal to get back to.
I have to agree with you. There are many problematic factors here, many of which have been in play for a while. Covid brought light to many issues here so we’ll see what happens next. I think the next 4 months will be very telling especially if a vaccine comes out.
I find it interesting that we now have a de facto guaranteed minimum income. The Senate may waffle, but people have to pay rent, and property owners depend on that rent to meet their bills. I have cousins who depend on rental income for their retirement. Fortunately, they have been in that game for decades and their properties are generally not mortgaged, but Covid-19 has made a wreck out of their cash flow.
I have seen a lot of things come and go, but if you look me in the eye and ask what America will look like a year from now, I don't have a clue. Stock prices are not tied to productivity any more. Money is essentially free. We haven't seen that since the Medieval era. Some of the social problems we are dealing with are 50 or 60 years old. Our entire education system is crumbling. By the time the epidemic is over, I don't think there will be a normal to get back to.
Call me crazy, but considering the stuff I see around me and comparing it to what I'm being told by the news, I am starting to think it is by design. I dunno.
We're in a depression now (one that has been covered up by gargantuan central bank and government "stimulus.") What we're heading into is not merely a depression, but a collapse of everything.
Isn't that how you can control mankind? Break them down and strip them of what they were, then build them back up the way you want.
It can be kicked indefinitely. With the new Fed paradigm, there is no such thing as consequence anymore.
As long as the dollar is the safe haven. If that changes welcome to the real world. And there are warning signs.
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