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View Poll Results: The stock market IS the economy
Yes 2 6.90%
No 16 55.17%
Sort of, it's complicated 11 37.93%
Voters: 29. You may not vote on this poll

 
 
Old Yesterday, 10:32 PM
 
Location: Oregon, formerly Texas
6,437 posts, read 4,351,078 times
Reputation: 11157

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My arguments for yes:

We are not in a depression nor recession unless the stock market is low. Is what we are in now even a recession? I hear few calling it that. Supposedly we are only in a pause of the best economy ever according to many. Whether this is denial or not I don't know.

Bailouts have been heavily weighed toward interests with lots of market exposure. Therefore those in power fear a market drop more than any conceivable level of unemployment, business closures etc, etc. Again, if the markets are fine, everything is fine.

The markets, and thus the economy, does not care about the "little people" who have little to no exposure to the makrkets. We could have 30-40% unemployment or those people could cease to exist and it wouldn't matter. Perhaps the markets would even go up.

A real depression happens only when or if the market crashes. That would actually affect the people who matter. All the airport workers, musicians, waiters, etc... that are laid off don't matter. Facebook's engineers can work from home. They matter, as well as those like them. Everyone else doesn't.

This pandemic economy has been a master class of who is economically important and who is not. Hint: most of us and our little pissant jobs are not.

*I am speaking in extreme and inflammatory terms on purpose.

Last edited by redguard57; Yesterday at 10:45 PM..
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Old Today, 03:53 AM
 
Location: The Triad (NC)
30,293 posts, read 66,879,688 times
Reputation: 35844
Quote:
Originally Posted by redguard57 View Post
We are not in a depression nor recession unless the stock market is low.
Before the Fed would finagle with things... it might have once been just that simple.
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Old Today, 03:55 AM
 
80,427 posts, read 78,727,210 times
Reputation: 56929
right now the market is selling tickets for the 2021 and beyond show .........

markets are already pre selling seats at what many investors call sale prices based on future 2021 earnings .

this year is no longer for sale . they sold out in march for the 2020 show , unless they find a few empty seats available from covid holders who won't be attending .

Last edited by mathjak107; Today at 04:30 AM..
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Old Today, 05:28 AM
 
Location: Guadalajara, MX
7,555 posts, read 3,674,972 times
Reputation: 14365
Quote:
Originally Posted by redguard57 View Post
The markets, and thus the economy, does not care about the "little people" who have little to no exposure to the makrkets. We could have 30-40% unemployment or those people could cease to exist and it wouldn't matter. Perhaps the markets would even go up.
30-40% unemployment affects consumer spending, which (eventually) effects the financial outlook of companies, which affects the stock market.

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Old Today, 07:15 AM
 
9,668 posts, read 10,274,781 times
Reputation: 8487
Quote:
Originally Posted by mathjak107 View Post
right now the market is selling tickets for the 2021 and beyond show .........

markets are already pre selling seats at what many investors call sale prices based on future 2021 earnings .

this year is no longer for sale . they sold out in march for the 2020 show , unless they find a few empty seats available from covid holders who won't be attending .
For the win. Currently the stock markets are very, very forward looking in the main. Further, on balance earnings and other other relevant metrics have been far less horrible than most would have expected. The rub is enough horrible CV-19 news and market focus will be on today and tomorrow.
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Old Today, 07:26 AM
 
9,668 posts, read 10,274,781 times
Reputation: 8487
Quote:
Originally Posted by lieqiang View Post
30-40% unemployment affects consumer spending, which (eventually) effects the financial outlook of companies, which affects the stock market.
Good point. However, and contrary to a key tenet of redguard57's thesis huge money and other subsidy has been directed at the traditional working classes in efforts to backfill consumer spending to a degree. PCE was down Feb. 0%, March -6.6%, April -12.8%, May +8.2% (current dollars). That's a bad run but it's not....The End of Days as so many predicted.


I know the crybabies don't want to hear this but so far governmental and Federal Reserve actions in response to CV-19 seem to have worked quite well.
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Old Today, 08:50 AM
 
10,598 posts, read 4,608,653 times
Reputation: 2191
Quote:
Originally Posted by MrRational View Post
Before the Fed would finagle with things... it might have once been just that simple.
When did that start?
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Old Today, 08:54 AM
 
10,598 posts, read 4,608,653 times
Reputation: 2191
Quote:
Originally Posted by redguard57 View Post
My arguments for yes:

We are not in a depression nor recession unless the stock market is low. Is what we are in now even a recession? I hear few calling it that. Supposedly we are only in a pause of the best economy ever according to many. Whether this is denial or not I don't know.

Bailouts have been heavily weighed toward interests with lots of market exposure. Therefore those in power fear a market drop more than any conceivable level of unemployment, business closures etc, etc. Again, if the markets are fine, everything is fine.

The markets, and thus the economy, does not care about the "little people" who have little to no exposure to the makrkets. We could have 30-40% unemployment or those people could cease to exist and it wouldn't matter. Perhaps the markets would even go up.

A real depression happens only when or if the market crashes. That would actually affect the people who matter. All the airport workers, musicians, waiters, etc... that are laid off don't matter. Facebook's engineers can work from home. They matter, as well as those like them. Everyone else doesn't.

This pandemic economy has been a master class of who is economically important and who is not. Hint: most of us and our little pissant jobs are not.

*I am speaking in extreme and inflammatory terms on purpose.
The stock markets are part of an economy. The economy is now, the markets can look forward. So the economy might be in the shtters right now, but the markets are looking forward with optimism. And the Fed is a large part of that optimism.
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Old Today, 08:57 AM
 
80,427 posts, read 78,727,210 times
Reputation: 56929
Quote:
Originally Posted by Hoonose View Post
The stock markets are part of an economy. The economy is now, the markets can look forward. So the economy might be in the shtters right now, but the markets are looking forward with optimism. And the Fed is a large part of that optimism.
In my opinion you can not equate main st and Wall Street ...we see different things being different ways at two different points in time .....

Markets have their best gains while Main Street still looks bleak as can be—ALWAYS

All the biggest drops come when markets are making new highs and the economy is humming
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Old Today, 09:37 AM
 
Location: Oregon, formerly Texas
6,437 posts, read 4,351,078 times
Reputation: 11157
Quote:
Originally Posted by Hoonose View Post
The stock markets are part of an economy. The economy is now, the markets can look forward. So the economy might be in the shtters right now, but the markets are looking forward with optimism. And the Fed is a large part of that optimism.
What indications are there that things will be better in 2021? Destroyed industries that have to re-build from scratch will be YEARS out from profitability.
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