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Old 10-23-2008, 01:51 PM   #21
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We need a De - fense emote like the plastic dohicky the fans at football games have.

One more time:

Agile, mobile, and hostile (now that Alabama is way up in the rankings)

'God Looks After Drunkards, Fools and The United States of America.'

'Stay the course, press on regardless, hurry up just stand there.'

Pssst - Wellesley.

Pick one you like.

heh heh heh - looks like next year for this cat is gonna be closer to 3% SEC yield than 4% SWR or 5% variable. 16th year of ER may bring out the cheap bastard in me one more time. .
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Old 10-23-2008, 02:03 PM   #22
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actually, i would like to take a towel, dampen it, twirl it between my hands and THWACK the derrieres of those panicking...i'm in for the long haul!
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I'm right there with ya girl! Let's get to thwackin'!
Hey, who let these women in the men's changing room

What, I am in the women's room:confused:

No? It's co-ed?

Seriously, I never care for the permabears. In hindsight, I would pay more attention to the bulls who turned bearish last year, not those who do now. It's no prescience to be bearish now. Even so, I don't think the ones who turned bearish last year know for sure what comes ahead.

On the other hand, history has been on the side of the permabulls, who have been right, IN THE LONG RUN.

I just wonder if this long run extends to the end of my life. Oh well, not the end of my life, because I will collect SS in little more than 10 years.
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Old 10-23-2008, 02:03 PM   #23
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I am not sure he was referring to the market or the Presidential election..........

BTW, Dow 8000?? That's pretty funny.........
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Old 10-23-2008, 04:21 PM   #24
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Gloom & doom? Perhaps I just don't understand the situation, but I'm gonna buy a brand new motorcycle in a couple of months. Yes, in the dead of winter, because that's when I'll have the money that is not allocated for other things, and I think the dealer will be happy to see someone with cash when there's snow on the ground. Because I think spring will come.

Applies to economics too.
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Old 10-23-2008, 11:49 PM   #25
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There is a significant difference between a "Permabear" or a "doom and gloomer" and someone who had been reading about the economy and concluded that the housing bubble could not continue inflating forever, that MANY people had overleveraged themselves with creative mortgages and credit cards. In addition, that mortgages had been sliced and diced and sold off to the far corners of the planet.

Some looked at those unpleasant facts and realized also that the stock market had a run up coincident to the housing and credit bubble.

That is why many in 2005-2008 became very uncomfortable about future prospects for the economy.
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Old 10-24-2008, 12:28 AM   #26
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Oldbabe, I am of the same opinion. And following is an excerpt from a BusinessWeek article with some numbers.

The bursting of the credit bubble suggests that the U.S. and global economies have a growth problem as well as a debt problem. According to the official numbers, economic growth in the U.S. has averaged 2.7% over the past 10 years. But by BusinessWeek's calculation, U.S. consumers have run up about $3 trillion in excess borrowing and spending over the same period—consumption that was not justified by income growth. Without that boost, which translated into new homes, cars, furniture, clothing, and the like, U.S. economic growth would have come in considerably lower. The global boom, too, was artificially fueled by out-of-control borrowing by consumers and businesses.


So, we will have to work off the excess. It may take longer to recover than past recessions. It means gloom, but not necessarily doom. So, I am prepared for a lean year or two, but not running for the hills.

One way debt loads can be alleviated is with a bit of inflation. Dirty word indeed, but imagine how mortgages currently "under water" can become afloat with a little bit of the "I" thrown into the economy?

PS. I am slowly buying back the shares that I got stopped out off. I believe in equities, but in the long run, and will keep reminding myself to be patient. Still, I will keep many yearly expenses of cash (I only have I-bonds, and just a bit of corporate bonds). I was never more than 70% in stocks, and it seemed to work for me. Down to 30% in stocks now. Deliberate selling earlier in the year brought it down to 50%. Then stop loss orders and price dropping did the rest.
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Old 10-24-2008, 01:32 AM   #27
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I don't consider myself to be a "permabear" either. However, the root of this crisis seems to be housing, and until houses come back to earth, the economy is going to experience pain. The problem as I see it is that houses are still overpriced. As I understand it, the median household income in the United States is about $50K. Crank that income into any of the popular "how much house can I afford" calculators and you come up with a house in the range of $150-175K. This tells me that many areas of the country still have quite a ways to fall.

On the bright side (from a U.S.-centric point of view), however, it appears that there has been a fairly substantial transfer of wealth from the rest of the world to the U.S. I say this because when IOU's from the sale of overpriced houses were "sliced and diced" and sold overseas, most of the money from the sales of inflated assets stayed at home -- but the IOU's (held by foreigners) have been drastically written down. Perhaps this will leave the U.S. with a smaller hangover relative to the rest of the world when all the dust settles. Note: American's had better learn to LWYM (Live Within Your Means) -- I suspect our friends overseas will be a bit more savvy next time around.
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Old 10-24-2008, 05:36 AM   #28
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More important than any acknowledgement to the doom and gloomers is the question -
what does the largest decline in the first year of a bear market in the history of the United States mean for the future of the economy? This decline of 40+ percent is larger than the 1929 1st year bear market, the previous worst and more than double the 1973 decline. We are now in uncharted territory with new data that is worse than anything Firecalc has included.


I am and have been very concerned since the BDI index has completely collapsed in the last 30 days. For two weeks straight from the depths of an 80 percent decline it has had 10 straight days of 7 percent or great decline each and every day, the BDI is now down almost 95 percent from it's peak in May. This indicates there is absolutely no realtime demand to move actual live goods as this is a spot rate for boats.

Logic to me is bringing concern that the largest one year fall in the history of bear markets must mean the markets forsee a decline in economic activity unmatched in history and a resulting rapid dropoff in tax revenues and will I fear create untenable budgets throughout the world. Watching the US government leverage itself into this mess will reduce it's ability to react to it as it could of before it's 2 trillion dollar guarantees to the financial industries. The largest decline in the stock markets in the first year in history is the biggest canary in the cage of future economic activity and the markets seem to be saying the canary is going to have trouble staying alive.
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Old 10-24-2008, 06:24 AM   #29
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I wonder what is going to happen today. See the "Blood Bath" Thread.
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Old 10-24-2008, 09:22 AM   #30
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a decline in economic activity unmatched in history
RunningMan, I believe you are right and have for many months. I don't know where a "safe haven" is. The wealth extraction/destruction has already taken place and people are merely starting to realize it now.

I haven't bothered posting here recently because I have already said my piece and got little but abuse. Plus, what more is there to say?? I believe most of us will be facing very very tough times and it's quite sad. Obviously if I had been a "perma-bull" (how long is "perma-", anyway, in the life of this board??) I would not have retired early and I would have a cellar full of food and gold. Two years ago I was happy to be in ER; now I see that ER was as symptomatic of a bubble as anything else.

What it might need to come down to is the evaporation of most of the 'growth' we have seen in this century. People are going to -voluntarily or involuntarily- cut back on non-essentials.. anything that's not necessary for bottom-line subsistence. I am already making the sauce for the pasta last 3 meals instead of 2.. asking the butcher for thinner pork chops.. having meatless suppers where we never had before. It is kind of "crazy" to be saving pennies after having "lost" hundreds of thousands of dollars on paper.

It was great while it lasted.. I had fun with new toys just like anyone else.. but people don't NEED iPods and cable TV and A/C and 4000 s.f. houses. We are going to learn what it is that we really need. Other countries may be equally badly off, but will have less far to fall.
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Old 10-24-2008, 09:28 AM   #31
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Well, I'm still buying a new iPod if mine dies (which it is threatening). And joining Walt, I just bought a charming old Mercedes that we intend to convert to a grease car eventually.

And BTW--where are these doom and gloom forums--NOW that sounds like a fun place to sign up as a moderator!
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I've watched both ER forums and Doom and gloom forums, for the last 5 years. I have to say, the doomers seem to have pegged this one. I listen more to the doomers now. This forum seems to think way tooooo optimistic. Happy investing!
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Old 10-24-2008, 09:40 AM   #32
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but people don't NEED iPods and cable TV and A/C
Hey, speak for yourself. I live in Texas.
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Old 10-24-2008, 10:07 AM   #33
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Strange, I seem to remember Texas as being inhabited before a/c was invented.. maybe it ain't WORTH inhabiting sans a/c.. but that is another kettle of fireants.

People lived in Maine before central heating with oil/gas, too. Imagine!

I might splurge on a tiny wood stove for here.. winter never gets much below 0 but is long and chilly and rainy. We have a small amount of free firewood from trimmings and such and it seems a shame to waste it in the ridiculously inefficient fireplace. Or am I just making excuses for a new purchase?? Hmm!
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Old 10-24-2008, 10:10 AM   #34
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And BTW--where are these doom and gloom forums--NOW that sounds like a fun place to sign up as a moderator!
ROFL!! You crack me up, Sarah!
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Old 10-24-2008, 10:12 AM   #35
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Sarah, I think the gloom forums are more fun than the doom forums--maybe try those first?
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Old 10-24-2008, 10:22 AM   #36
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I'll admit we are doing our bit to keep the economy stimulated, we are still buying the things we want to buy and taking the vacations we want to take. So what if it means we may end up only semi-FIRING (I have already but DH is still out in the trenches) instead of going the full banana?

The market is down, but life is still good. We are happy and healthy, something no amount of money can buy us.
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Old 10-24-2008, 10:23 AM   #37
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Running_Man, you might appreciate this post that I just came across:

The Oil Drum: Australia/New Zealand | The Failure of Networked Systems: The Repercussions of Systematic Risk
about Systematic Risk; long comment talks about shipping index, various lag times for playout of different "fail" aspects
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Old 10-24-2008, 12:34 PM   #38
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May I repeat this? "Gloom, but not necessarily Doom".

Well, I have to include the qualifier because one can never say never. I am younger than many in this forum, but still have a bit of story to tell.

In 1980, when I just got out of graduate college, got married, and started my first job, we bought our first home. The FHA mortgage was for $64K, with a few $K down. The interest rate was 14%. The oil crisis was in full bloom, along with inflation. There were long lines at the gas pump. One time driving back from LA, I thought we had to pull off the highway to sleep overnight, failing to find a opened gas station.

There was a boom in solar water panel installation, and precoolers for improving AC efficiency. People were talking about burning newspaper in their stoves, and buying arts and collectibles as a hedge against inflation. My parents retired their Chevrolet station wagon and bought a VW Rabbit. My company credit union was paying near 10% (or was it even higher?) interest on deposits. The wages were falling behind the inflation so much that I was given a semi-annual raise of 6% (or 7%?).

When the FHA interest later climbed to 16%, and gold climbed past $900/ounce, I told my wife I felt sorry for my two younger brothers, who were still toiling in school. They would never be able to afford the house I had. The media talked about how we would never see single-digit interest rates again, ever.

Fast forward 10-20 years. My brothers are now living in their 4000-sqft McMansions. New subdivisions have banned roof-mounted swamp coolers, along with water solar panels, and PV arrays. People all use cable; no external TV antennas are allowed. Last I talked to my brothers last week, they have not expressed any fear of lay-offs (knock on wood). I hope they know to build up a cash reserve, but being all adults, who am I to be giving sermons?

The pendulum has swung too far one way, and has to come back and overshoots to the other side. One subdivision near my 2nd home in the mountain had a ban on "For Sale" signs (it scared off buyers). Recently the media started to tout frugality as a virtue. There are plenty of articles on dumpster diving for "perfectly edible food" (search for "freegan" on the Web), and living in 64sqft homes. On the latter, there's an entertaining thread right here in this forum.

So, what's a guy like me to do? Being reasonably frugal, I can cut back on the self-indulgence (read travel, and lots of travel) I allowed myself the last 5 years. I will survive, same as other people in this forum. I have been checking out books and DVDs from the library more. I will get back to being an armchair traveler, and cherish the memory of trips my wife and I have taken. Life has been good to us, and I am grateful.

So, me worry? Just a bit concerned. I am sticking to my story: Gloom but no Doom.
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Old 10-24-2008, 01:40 PM   #39
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And BTW--where are these doom and gloom forums--NOW that sounds like a fun place to sign up as a moderator!

Here ya go. Be prepared for 80% BS, but 20 % value added stuff about the economy.

Life After the Oil Crash Forum - Index

I read the LATOC *financial * Doom Breaking news. Everything else is crap.

I've learned more about CDS, MBS, CDO on this website that I never knew existed. One thing I like about this website is, it posts links to articles about the economy. Granted everything is slanted towards "End of the world"

You may laugh at this forum, but there is some very smart people on it. Try to keep an open mind and weed through the BS.
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Old 10-24-2008, 01:58 PM   #40
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Everything else is crap.
Try to keep an open mind and weed through the BS.
Is there any inconsistency between these two statements?
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