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Yes, everything has SOME level of impact on the econmy, how significant though, who really knows. And how does one measure the long term vs. the short term of any of those impacts?
If it can be done, it is certainly beyond my pay grade. I do think Trump is breaking a perfectly good economy, but I realize that is my opinion and I do not have a background on economics. Though a lot of economists DID predict we would see problems with Trump's policies.
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I've said it before and it's obvious, but it always can use a repeat.
When you and I and others feel "flush" due to a basically good stock market, we may treat ourselves to a new iphone...maybe even a more expensive one than we need. We may buy a boat if that is our thing, because - after all - we made tens of thousands of dollars "extra" this year. We might even buy a 2nd home.
We might give money to our adult children - MUCH more than any tax cut.
But we don't in times like these. The reverberation comes quickly and it's hard to measure until many months later. I suspect corporations are seeing it internally as their systems update (and compare) sales on an hourly or daily basis. So they don't get surprised at the end of a quarter...they see trends.
This downturn is happening at exactly the wrong time. A large percentage of consumer profits for the year are made in the next 6-8 weeks. But people will tighten up their spending when they see the headlines or look at their statements.
You seem interested in this sort of thing, as am I, but I think your take on what drives consumer confidence is a little off the mark, in large part because so many consumers are not as tied to the stock market, good or bad. Here is a bit more of much you can look up about what more directly drives consumer demand...
"One of the main factors influencing demand for consumer goods is the level of employment. The more people there are receiving a steady income and expecting to continue receiving one, the more people there are to make discretionary spending purchases. Therefore, the monthly unemployment rate report is one economic leading indicator that gives clues to demand for consumer goods.
The level of wages also affects consumer spending. If wages are steadily rising, consumers generally have more discretionary income to spend. If wages are stagnant or falling, demand for optional consumer goods is likely to fall. Median income is one of the best indicators of the condition of wages for American workers. (For related reading, see:
Prices and Interest Rates
Prices, affected by the rate of inflation, naturally impact consumer spending on goods significantly..."
It makes one wonder where the market might be if we had a competent President.
Someone like Rand Paul, who is disciplined, and principled would make a big difference. It might take dew years to lay the foundation for it, but once laid, you can build on it for decades.
No, market cycles are more about trends and patterns over very long periods of times, like when a certain sectors such growth stocks fall out of favor in favor of value stocks. Its easy to shift your allocation to be over/under weight on one or more of these sectors.
Timing the market is trying to pick the top/bottom on a particular day.
Two totally different things.
You said: "market cycles are more about trends and patterns over very long periods of times"...
that's not true, when the game is "every three months" in a dire pursuit to break records.... (that's the fiction which is it, based on nothing more than speculative trading frenzy, which always leads to spike and crash, when people take profits as they realize the foundation in non existent - Speculation Drama can only last so long, before people learn how to see through it "even dense smoke dissipates when the wind blows" then, one can see the ruins visibly!!!)...
You said: "market cycles are more about trends and patterns over very long periods of times"...
that's not true, when the game is "every three months" in a dire pursuit to break records.... (that's the fiction which is it, based on nothing more than speculative trading frenzy, which always leads to spike and crash, when people take profits as they realize the foundation in non existent - Speculation Drama can only last so long, before people learn how to see through it "even dense smoke dissipates when the wind blows" then, one can see the ruins visibly!!!)...
Thats one persons opinion. I'm actually in agreement with you on the constant drive for improvement every 3 months, however there are absolutely larger trends that one can shift to align with and do ok for themselves. Bottom line is that your money and your retirement savings are not some "set it and forget it" tool like many people want to believe they can get away with. It takes some level of research and engagement to ensure your financial security, nothing worthwhile in life is free and easy.
Someone like Rand Paul, who is disciplined, and principled would make a big difference. It might take dew years to lay the foundation for it, but once laid, you can build on it for decades.
His state is a wreck - dead last on most everything.
He knows zero about economics except for Idealogy that he has bought lock, stock and barrel. His motto will be "it sounded right to me".....
C'mon. Is he also a competent nuclear engineer like Rick Perry?
Precisely. On the one hand, Trump can brag about cheap gasoline prices. But on the other hand it'll cost jobs - and good-paying jobs to boot. It's a no-win situation for him.
Falling oil prices are usually greeted with cheers, especially at the gas pump. But for the economy, the equation has changed thanks to the transformation of the U.S. back into a major oil producer courtesy of the shale revolution.
“The key point to remember here is that the lower oil prices are now a net drag on the U.S. economy, because the [capital-expenditure] cutbacks triggered in the shale oil business outweigh the gains to consumers’ spending from cheaper gas prices,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics, in a Monday note.
You seem interested in this sort of thing, as am I, but I think your take on what drives consumer confidence is a little off the mark, in large part because so many consumers are not as tied to the stock market, good or bad. Here is a bit more of much you can look up about what more directly drives consumer demand...
I think both can be correct - we live in a complex world. For the basics - sure, an income big enough to pay off the credit cards is an important foundation (not for us, we pay cash for everything and always have)...
But with rising interest rates - that can temper it a bit.
The same way Buffet visits his retail stores (Nebraska Furniture Mart) every weekend, so do I observe and question people in various trades. I already know the answer when I talk twice yearly (launch and retrieve) to my boat dealer. If the market is up, more people buy boats. If it is not, NO ONE buys a boat.
Housing starts are down - big time - right now. That is not due to people having a job, but due to chaos and fear and loathing in the markets.
Trump not only doesn't have sound economic policy, but he is sinking the ship that is barely afloat. It's no different than the rest of his career. I lived near Atlantic City when he became the first person in modern times to lose BILLIONS on Casinos. It takes a special talent to lose money in a business where you automatically make it......
His ROI on his own inheritance is effectively zero - or perhaps 1-4% if we want to be generous. Even that money is largely ill gotten...taken from taxpayers, contractors, bondholder and now Russians. The Russians are the only ones who are getting their monies worth.
Once a loser always a loser.
Sadly, a large percentage of Americans think Realty TV is real. They would not take a moment to think "Why isn't Jeff Bezos or Warren Buffet or anyone else doing Reality TV?" - and, of course, the answer is clear. They don't need the money.
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