Article says we might be getting close to the bottom (Passaic: real estate market, mortgage)
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A huge stock market rally would change everyone's psychology. If 401ks and IRAs received a positive jolt and restored themselves even by as little as 1/3, I think consumers would start to spend a little.
I really want to do my part. I need some new clothes, a haircut, and I'd like to upgrade my camera. But I'm going to wait for tangible evidence of a recovery.
A huge stock market rally would change everyone's psychology. If 401ks and IRAs received a positive jolt and restored themselves even by as little as 1/3, I think consumers would start to spend a little.
I really want to do my part. I need some new clothes, a haircut, and I'd like to upgrade my camera. But I'm going to wait for tangible evidence of a recovery.
-Marc
Contrary to what you may read, consumers spending too much was the problem. Americans overspent and need to pay off debt. That means much of job market that relied on consumer spending needs to lose their jobs and find new jobs in production. Any increase in consumer spending can only be funded by borrowing from foreigners or diverting capital from healthy productive jobs in America. There can be no consumption without production and the only reason America has been able to consume is because they've borrowed money from China only to buy products from China with it. A recession is necessary to rebalance the American economy so it can be self sufficient and not rely on borrowed money and production from overseas. Recession is actually the cure to our problems and the solution to the long term health of the economy. The Bush/Obama solutions have all been akin to supplying morphine to a drug addict to numb the pain. In the end, the withdrawal will be worse.
You can't borrow and spend your way to prosperity as an individual and you cannot do it collectively as a nation either.
Optimism doesn't always work better than pessimism. This entire financial crisis we face as a nation was built entirely on optimism. In fact, optimism is the only thing that has ever led to a major financial crisis.
Optimism is the psychological fuel of innovation. Without a basic positive mindset, nothing good would ever get done. And no adventures would be undertaken.
There's more to life than being careful and while you do want to be responsible, there is a such thing as being TOO responsible.
BUT, if things start looking up, the media will actually have to look for news again. I wonder if they forgot how?
Oh come on, stop blaming "the media". The gloomy outlook is based on gloomy economic reality, it's not some media creation. The media simply report on what's going on. They report on foolish exuberance just as much as on gloom and doom, depending on what's going on.
Or have you forgotten how the media was nothing but sunny days and blue skies when it came to the economy during the bubble?
Residential real estate offered "minimal and scattered" signs of stabilization in some regions, although Case-Shiller data show that prices nationwide are still falling. Single-family home prices tumbled 18.5 percent in December from the previous year, and real estate agents say that nonforeclosure sales are still stagnant.
"House prices continued to decline, reportedly at double-digit paces in some areas, with little or no signs of a deceleration evident," the beige book said. "Builders in various districts generally remain pessimistic regarding recovery prospects this year, and consequently the pace of new home construction declined further in most areas."
Real estate sales in Manhattan, where prices have remained high despite the economic tremors, fell 60 to 65 percent from last year.
Optimism is the psychological fuel of innovation. Without a basic positive mindset, nothing good would ever get done. And no adventures would be undertaken.
There's more to life than being careful and while you do want to be responsible, there is a such thing as being TOO responsible.
Everything in moderation, including caution.
-Marc
It will take awhile for the doom & gloom'ers to go away. There exists too much downward momentum. Just stay focused on the daily advance / decline ratios to determine the shift in momentum to the upside. Investors are basicly optimistic, albeit cautious, at this point... evidence the $6.5 Trillion in money market funds.
Optimism is the psychological fuel of innovation. Without a basic positive mindset, nothing good would ever get done. And no adventures would be undertaken.
There's more to life than being careful and while you do want to be responsible, there is a such thing as being TOO responsible.
Everything in moderation, including caution.
-Marc
that's why I said "doesn't always". There's a time for optimism. And there's a time for skepticism. While Washington and Wall St. pillage your money and livelihood to try to instill optimism in that your home value might stop falling, you'd be much better suited with skepticism.
In fact, skepticism is a huge part of the scientific process that gets overlooked. It prevents people from making mistakes or building upon past mistakes.
Trust me, the America isn't in any danger of being too responsible. They just passed 2 of the most irresponsible bills through congress the past couple of months with more to come.
Oh come on, stop blaming "the media". The gloomy outlook is based on gloomy economic reality, it's not some media creation. The media simply report on what's going on. They report on foolish exuberance just as much as on gloom and doom, depending on what's going on.
Or have you forgotten how the media was nothing but sunny days and blue skies when it came to the economy during the bubble?
If media is responsible for the gloomy bearish news NOW, then media was responsible for creating the bull days of 2001-2006. Did anyone blame media that time?
the employment component of the ISM non-manufacturing index for February came in today: only two industries reported increased employment this month, surprisingly one of those was the real estate "rental and leasing" sector, said Omair Sharif, an analyst with RBS Research.
the Chicago Board Options Exchange "volatility index", sometimes called the "fear gauge" because it reflects the price of protection against swings on the S&P 500, fell 6.6% to 47.56, a far cry from its highs above 80 during the last market nadir in November. Traders are divided on whether the relatively tame fear gauge indicates the market is in the eye of the latest storm, or out the other side. "Our stance is we have moved more to what we call the 'grind stage' of the bear market," said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research. "Here, new lows in the market don't show spikes in fear from investors. Instead, we see more feelings of resignation, even boredom."
As always when the optimists declare we will never recover, and nobody is calling bottom. The we have bottom.
We are a long way from that yet.
Despondency isn't here yet.
It always follows:
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