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it wasn't so good for most during the great depression either. oh it was great that consumer prices fell almost 20% but incomes fell 60% . all things being equal i will take rising incomes and rising prices to a deflation of any sort. most economists including bernacke agree .
any deflation can be an endless spiral to get out of, that was japans problem. inflation is much easier to whip.
it wasn't so good for most during the great depression either. oh it was great that consumer prices fell almost 20% but incomes fell 60% . all things being equal i will take rising incomes and rising prices to a deflation of any sort. most economists including bernacke agree .
Deflation, once it bottoms out, sets things up for new purchasing, and eventually you have inflation.
Everytime the stock market crashes, its a form of deflation as far as equities are concerned. Yet once prices bottom out, new people enter the market and it goes up.
Even in the 2008 crash, though many lost their homes or properties, others got good deals on homes. If you were a younger person, who still had a decent job, it was the perfect time in many places to buy a house.
you have alot to learn about deflationary spirals my friend. do some research instead of running on whats in your head , then come back here and see if you still feel that way.
because the fed knows how to react to market crashes now market crashes lead to recessions and not deflationary depressions. there is a huge difference.
the damage is worlds apart when true deflation hits. real deflation can take a lifetime to get out of.
Deflation, once it bottoms out, sets things up for new purchasing, and eventually you have inflation.
Everytime the stock market crashes, its a form of deflation as far as equities are concerned. Yet once prices bottom out, new people enter the market and it goes up.
Even in the 2008 crash, though many lost their homes or properties, others got good deals on homes. If you were a younger person, who still had a decent job, it was the perfect time in many places to buy a house.
the big if is to have a job, have decent pay, most mportant be able to get a mortgauge to take advantage when these drops happen ,.
the problem is as you just saw not being able to buy and the plunge in price go hand in hand for most.
Yes, it would be terrible. And good at the same time. For those still working, rents would be cheaper. A lot of people would move out of the city, but for those determined to stay, it would be a lot more livable.
i guess you were not one of the ones that had to take a pay cut or had your hours cut in the downturn.
for most they were still behind even if they got some roll backs in rent.
Back to the original story. What will be that external event that this analyst believes will drive the financial institutions to downsize 15% in 18 months? I would assume she has reason to believes that certain large players will be failing like Lehman, etc..., because most banking analyst should know exactly how many jobs will be coming to an end within this timeframe because they are on all of the management conference calls asking questions on short term plans. So the next 18 months should be fully transparent unless their is something that this particular analyst knows that no other analyst knows, and from this quickly written article, it seems more of a marketing campaign on her part. Since Wall st is very global, it could simply be a location strategy readjustment with banks moving out of complete countries and going to a more hub-and-spoke model, but without any details coming from this analyst, nobody knows. When an analyst provides a negative outlook, they should really provide very concrete example so that the covered industry can try its best to avoid it. The best analysts actually help the companies and investors that are heading towards murky waters, not trying to get media attention off of a few words. There are many analysts out their, but the greater public only tends to hear from the attention whores.
companies can offer guidance but it is rare that exact details are spilled to analysts.
most analysts work by extracting geneneral info from the companies they follow, their suppliers and their competitors. usually they are just projections of where sales are headed.
i doubt any company was ever saved from advice from their analysts.
it is hard to even imagine what the job cuts will mean . the job cuts made since the peak of the downturn have made most companies lean and mean with record profits and up to now record revenues.
in my own industry we always get excited about new projects breaking ground. we figure they will grow our businesses but somehow all these huge projects end up being a flash in the pan for local business and we see very little come in from them.
they end up buying out of state and utilizing out of state labor. job losses can act the same way.
2008-2009 saw the real estate market in manhattan slow down but foreigners ran with the ball taking advantage of things and bring prices right back up. manhattan prices on the decent stuff is higher than ever even in the mess we are still in.
at our 200 central park south building we sold two apartments at the low. both went only about 8-10% below the record high. it took longer as both parties ran into the same thing.
they were pre-approved for mortgages and as the time grew closer to closing both were told their banks had no money to loan.
it took one person 3 banks before they actually handed them the money and we closed . prices held up well only the time to close grew and that was in one of the greatest financial collapses since the great depression. .
Last edited by mathjak107; 08-11-2013 at 04:29 AM..
Back to the original story. What will be that external event that this analyst believes will drive the financial institutions to downsize 15% in 18 months? I would assume she has reason to believes that certain large players will be failing like Lehman, etc..., because most banking analyst should know exactly how many jobs will be coming to an end within this timeframe because they are on all of the management conference calls asking questions on short term plans. So the next 18 months should be fully transparent unless their is something that this particular analyst knows that no other analyst knows, and from this quickly written article, it seems more of a marketing campaign on her part. Since Wall st is very global, it could simply be a location strategy readjustment with banks moving out of complete countries and going to a more hub-and-spoke model, but without any details coming from this analyst, nobody knows. When an analyst provides a negative outlook, they should really provide very concrete example so that the covered industry can try its best to avoid it. The best analysts actually help the companies and investors that are heading towards murky waters, not trying to get media attention off of a few words. There are many analysts out their, but the greater public only tends to hear from the attention whores.
If you read the article, they cited many of the banks have publically announced tens of thousands of layoffs. So this is no secret knowledge. Also, they've used technology to make some people redundant. No secret knowledge.
There are troubles at banks like JP Morgan Chase and Bank of America, and this stuff is no secret knowledge either.
Banks have moved operations and other divisions out of NYC, to other areas, and again this is no secret knowledge.
You're upset because you're afraid this woman's prediction might damage the markets, and you're upset that she isn't giving you advice on how to deal with these matters. So you have to call her an attention ***** because she pointed out an industry trend in employment which is happening already. I don't know if 100k will be laid off, but I do know a lot of Wall Street layoffs are already happening. And they've all been announced in the news. Even Bloomberg businessweek says Harvard MBAs are not streaming to NYC, because there are far fewer jobs on Wall Street.
And no, an analyst doesn't necessarily have to tell you how to respond towards something you perceive as negative. She's not a financial advisor.
She accurately predicted the poor health of banks before the 2008 meltdown. She was wrong about the timing of the municipal defaults, but some of them are happening now and perhaps there will be even more. She's at least partially right about the current layoffs on Wall Street, we'll see if they become as big as she says.
companies can offer guidance but it is rare that exact details are spilled to analysts.
most analysts work by extracting geneneral info from the companies they follow, their suppliers and their competitors. usually they are just projections of where sales are headed.
i doubt any company was ever saved from advice from their analysts.
it is hard to even imagine what the job cuts will mean . the job cuts made since the peak of the downturn have made most companies lean and mean with record profits and up to now record revenues.
And the article was saying the banking layoffs were making the banks a lot more profitable. So if the Wall Street banks have found a way to do the same work with far fewer people, there is no advice from an analyst that would stop them.
Over the years, divisions from big NY banks have been moved to cheaper locals, and yes, technology as reduced the need for a lot of people, including traders. The biggest effects this would have is in NYC real estate and taxes, oh and since bankers spend money like crazy, hospitality would be hit hard (restaurants, bars, etc.) As well as services like dry cleaning, etc.
yep , just my point , less can mean more as those left can see even more money .. we are living that right now as layoffs continue and real estate here gets even more expensive.
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