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Yeah. I think sky high gas prices played a key role in getting us into recession and making the recession a lot worse. Now that prices are cheap, it's basically the same as a huge stimulus package.
Yeah it was the gas prices, not the fact that Americans were extracting around 600 billion a year from the home ATM. The housing bubble started to collapse before oil prices got ridiculous. The spike in oil prices was caused essentially by hot money flows. It was a symptom of what was going on, not a cause.
And its not the same as a "huge stimulus" package. Oil prices aren't that much lower than they were in 2006~2007 and are no more than they were in 2005. If oil prices were 140+/barrel for years then it would create a modest sized stimulus, but that wasn't the case. Oil prices were ridiculous for around 6 months or so.
Really, out of all the things that are going on you peak a 6 month spike in oil as one of the major causes of the recession even though...ahem the recession started before prices started to spike dramatically?
The bottom line is that the market is still holding steady in the mid 8000's ... even with plenty of bad news. It looked like last Friday might have been a bad day but, then it wasn't.
So far .... all of the predictions of more huge drops into the 7000's and below just aren't happening.
The bottom line is that the market is still holding steady in the mid 8000's ... even with plenty of bad news. It looked like last Friday might have been a bad day but, then it wasn't.
So far .... all of the predictions of more huge drops into the 7000's and below just aren't happening.
Wow you really are a "believer" in the system. You really think we've hit bottom in the DOW?
After today, we'll probably have interest rates at 0.5% and before long at 0% and things keep getting worse. I still think people are in denial about just how early in this game we are. 10% unemployment and GDP reduction of 10% or more is in the bag for 2009, IMO.
I can't help but feel like somehow "they're" keeping the market steady to prevent panic...whether it's just until after the holidays, or just until Bush is out of office so he won't be associated with it?
I have no rational justification for feeling this way; it's just I guess because nothing is making sense with the market's movements.
Or it's just the simple fact that the DOW has already been heavily discounted ... much more than previous recessions ... and pretty much everybody who's going to sell has already sold.
Hence, the bottom.
The only way it's going to go down much more is with a full blown depression and that's just not gonna happen.
Or it's just the simple fact that the DOW has already been heavily discounted ... much more than previous recessions ... and pretty much everybody who's going to sell has already sold.
And you know that everybody who's going to sell has already sold because?
Your comments are sorta funny, you seem to really believe you have the ability to know whats going on in the markets.
Sheri, it's nice that you're so optimistic, but blind optimism isn't always a good thing...caution is a good thing in times like these.
We're in unprecedented times; while it's sometimes hard to think the future might not be rosy, it's much better to prepare for the worst and hope for the best. It seems like you might have a lot riding on the hope that the economy is on an upswing, as do many people. I just hope you're willing to open your eyes to the possibility that things might not swing up for a long time--and make plans for what you'd do if that's the case.
A lot of retail investors have been shaken out, but these are small fish. The big fish are the funds, who're trying to optimize exit strategies. Many hedge funds will go out of business, because their business model has become obsolete. The easy money's gone, and foreigners and fiscally lax pension funds are no longer buying unquantifiable bundled assets. As hedge funds choose, or are forced, to liquidate, they will put downward pressure on the markets.
We will reach the bottom when all the Big Boys who want out are out. There are about a thousand hedge funds whose business model no longer works. When I do the math, I don't see a risk-return ratio that I consider attractive. Yet. Others might, but not me.
I'm certainly not going to borrow money or sell something else to buy stocks. But I am maxing out the 401K (75% stocks) and dollar-cost averaging. I feel fairly confident in doing this (only about 20% of my net worth is in stocks).
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