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Broadly speaking the US economy is quite healthy and people were expecting a correction in the stock market for some time. Within tech, it will have some negati

Broadly speaking the US economy is quite healthy and people were expecting a correction in the stock market for some time. Within tech, it will have some negative impact on the plans of some companies as it will be harder to get lofty valuations based on 'fluff'... during such times investors want to see hard facts and real results to back-up value--but that's a broader trend thats been slowly developing for some time. Internationally, China is clearly having a hard time dealing with the realities of 'the market.' People have long since suspected a lot of the figures coming out of China were not accurate and everyone knows the place is rampant with corruption and such. Things are going to get a lot uglier there before it gets better.

roymurdock 11y ago
Interested to know which statistics you based this opinion of the US economy being "quite healthy" on. Anything deeper than top level unemployment rate?
- cryoshon 11y ago
  I am also interested in seeing the data which claims that the US economy is quite healthy right now. The unemployment rate is a juked stat; check out the labor force participation rates if you want the full story. A primer: labor force participation got smashed in the Great Financial Crisis, and still hasn't recovered.
  - wiremine 11y ago
    The participation rate is down 3.3% from 2005 [1]. Given the huge shift in demographics over the last 10 years [2], I don't think that's a data point that screams "smashed." [1] http://data.bls.gov/timeseries/LNS11300000 http://data.bls.gov/timeseries/LNS11300000 [2] Lost of baby boomers retiring and Gen X being such a small demo compared to the boomers and the millennials.
    - cryoshon 11y ago
      The demographic shift angle doesn't make sense. The boomers are slowly exiting the workforce, sure-- on an individual basis, as they can choose to retire at different times. Many are having to defer retirement or not retire. This isn't an orderly mass exit, it's a trickle. Millenials are a far larger generation than the boomers, and are rapidly leaving college and attempting to enter the workforce-- 100% of them are trying to enter the workforce at the same time, immediately after graduation day. The fact that labor participation rates haven't stabilized or even increased in response to their population level attempts to enter the workforce shows that there really are not enough jobs to go around. Jobs lost in the early depression haven't returned, and there are many more people out and about looking for them now than there were before. Boomers are retiring, but their children are desperate to take their place, which isn't actually possible.
      - achompas 11y ago
        The fact that labor participation rates haven't stabilized or even increased in response to their population level attempts to enter the workforce shows that there really are not enough jobs to go around. I'm not sure the data bears this out. If they're looking they're in the labor force, and we'd see a commensurate rise in unemployment for age groups 20-24. That's clearly not the case, as unemployment is down ~1.5% for that demo since mid-2014: http://www.bls.gov/web/empsit/cpseea10.htm http://www.bls.gov/web/empsit/cpseea10.htm I don't have demo-level participation data available but that would clarify whether rates are lower bc of millenial LF dropout or millenial employment success.
      - wiremine 11y ago
        > Millenials are a far larger generation than the boomers Depends on your definition of "far larger". - The Millennial cohort is 83.1 million - The Boomer cohort is 75.4 million, 90% the size of the Millennials. Source: https://www.census.gov/newsroom/press-releases/2015/cb15-113.html https://www.census.gov/newsroom/press-releases/2015/cb15-113...
      - wiremine 11y ago
        > Jobs lost in the early depression haven't returned There are actually more jobs now then there were in 2005: - January 2005: 132,752,000 - January 2015: 140,793,000 Source: http://data.bls.gov/pdq/SurveyOutputServlet?request_action=wh&graph_name=CE_cesbref1 http://data.bls.gov/pdq/SurveyOutputServlet?request_action=w... Obviously the _type_ of jobs have changed, and this doesn't factor in population growth directly, but I don't think the statement "jobs lost in the early depression haven't returned" isn't grounded in the data.
- code4tee 11y ago
  Debt to income ratios, capitalization of companies, worker productivity, oil prices, savings rates, more healthy housing prices (in most areas), foreclosure rates, industrial orders, housing starts, .... This isn't 2007-08.
  - cryoshon 11y ago
    Wages are shit for workers and thus consumption/demand are weak... this undermines the Chinese economy, which in turn undermines the US economy. Labor force participation is also garbage. Savings rates are a bit moot when tons of people are living paycheck to paycheck, also. It's not 2007-2008, but it's not quite 1998 either.
    - rorykoehler 11y ago
      Capitalism at it's finest. The race to the bottom will eventually force someones (possibly everyones) hand. The mechanism that will drive change (either violent/non-violent) is just a matter of who blinks first.
      - maratd 11y ago
        > Capitalism at it's finest. The race to the bottom will eventually What are you going on about? If capitalism is a race to the bottom, we would have reached it a long time ago. Capitalism isn't new. It's been around for a while.
        TheOtherHobbes 11y ago
        I'm amazed anyone can try to defend a system that has manic-depressive episodes built in as a feature.
        merpnderp 11y ago
        Because it's the system that's pulled several billion people out of abject poverty in the last 30 years? I believe the system that was tried before that was called socialism, and didn't work as well as capitalism.
- deleted 11y ago
  [deleted]
- code4tee 11y ago
  PS... I don't deny that a subset of the US economy/workforce got hit really hard in 2008 and never recovered. But when you look at the US economy as a whole things are doing quite well.
  - sillygeese 11y ago
    > when you look at the US economy as a whole things are doing quite well To be more accurate, when you look at the propaganda spewed by the mainstream media, everything seems to be fine, because they keep spinning everything in a positive light. In the US, for starters, there's a huge bubble in stocks, and an echo bubble in housing. There's a massive property bubble in Canada and Australia, and so on. With interest rates already at roughly zero, they don't have room for lowering them to "stimulate" the economy (to avoid the inevitable crash that's coming). Of course, getting people to spend money they don't have and businesses to start projects they shouldn't, isn't exactly good for the economy but hey.. whatever keeps the show going for a while longer. (Downvoters? It's at the very least possible that you just don't know that I'm right.. :) Do your homework, but not from mainstream media sources)
    - MCRed 11y ago
      We have a democrat who is president, and who took over after a crisis during the term of a republican. (never mind that he was part of the cause of the crisis with his 1990s era "not lending to people who can't repay is racist" lawsuit against banks)... so the liberals of HN are highly motivated to believe that democrats are "responsible" and that they have "fixed the economy" after republicans "wrecked it". So when you point out that the king has no clothes, naturally you get downvoted. The current mess of the US economy is due to the choices of many politicians, in congress and the presidency, from both parties. Neither party should get a passing grade in this regard. This is why we need the government out of the economy, and let it work. Hell if it weren't for government the bad banks would have failed in 2008-- and we would have had a real recovery afterwards.
      - deleted 11y ago
        [deleted]
- topkai22 11y ago
  Corporate profits have been good, GDP has been rising at a decent rate, consumer confidence has been looking OK. Statistically, the economy has been looking alright, although the distribution of benefits continues to be unequal.
  - cryoshon 11y ago
    Staggeringly unequal benefits distribution makes for an unhealthy economy. We don't describe the economy of Mexico or Brazil to be healthy even when they are at high employment and growing GDP mostly because the burgeoning economy doesn't produce a similar ripple in their societies.
    - cynicalkane 11y ago
      There's no real reason a 'staggeringly unequal benefits distribution' should lead to an economic crisis, unless you believe in proletarian revolution or something.
      - deciplex 11y ago
        Let's say all the wealth in the world, minus a few percent, belonged to 400 people. Can you think of some ways that would wreak havoc on the economy, even without triggering a "proletarian revolution?"
        cynicalkane 11y ago
        No, because an economic crisis is a fall in economic output. The point is that "undesirable wealth distribution" is not what an economic crisis is. If 400 people controlled everything, the world wouldn't be a great place to live, but the economy would probably be more stable.
        vezzy-fnord 11y ago
        I don't recall high Gini coefficients being associated with economic stability. The massive reduction in marginal utility from most people focusing only on immediate consumption, coupled with the massive oligopolism and centralization leading to price distortions -- those alone don't imply economic stability to me. An extreme oligopoly would likely imply civil unrest, so all else would suffer.
sillygeese 11y ago
> Broadly speaking the US economy is quite healthy In reality, it's the exact opposite of "quite healthy". Here's a good overview of what's up: http://www.oftwominds.com/blogaug15/bear8-15.html http://www.oftwominds.com/blogaug15/bear8-15.html
- rogerthis 11y ago
  You cannot offer a different view. Go home. Sorry. (And they won't even perceive the sarcasm).
- dragontamer 11y ago
  If a 2008-style credit crunch takes out the likes of AGI in the next few weeks, causing rippling effects to spread throughout the economy in ways that no one understands... then we've reached a 2008 level crisis. We don't have record numbers of people flocking to mobile homes as their subprime mortages jack up the rest of the economy. Your article is crap because it ignores everything that was bad about 2008. Record layoffs, hundreds of thousands of people losing their homes and jobs. Major manufacturers (the _entirety_ of the "big three" car companies) almost went bankrupt. Financial controls are arguably in a worse state than they were in 2008. But beyond that, the core economy is doing much better than back then. Furthermore, financial controls in 2007 prevented us from seeing any issues. The subprime mortgages getting wrapped up in CDOs and all that stuff was occurring in a non-regulated "shadow economy" manner. Is there a shadow economy that is about to crash today? I don't think so. But that was the conditions of 2007/2008 financial crisis.
kevando 11y ago
Bubble? http://i.imgur.com/lQt3Ylr.jpg http://i.imgur.com/lQt3Ylr.jpg
- 7Figures2Commas 11y ago
  Central bank bubble.
  - joeyspn 11y ago
    You mean... something like this... http://blog.milesfranklin.com/wp-content/upLoads/2014/12/US-National-Debt-Chart.png http://blog.milesfranklin.com/wp-content/upLoads/2014/12/US-... But at a global scale?
- savanaly 11y ago
  Now extend the timeline 100 years into the past, it will look a lot more encouraging. Or a 1000 years, it will look positively sunny.
- forgetsusername 11y ago
  Utterly useless to show a growth graph spanning decades without a log scale.
deleted 11y ago
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forgetsusername 11y ago
>people were expecting a correction in the stock market for some time "People" are expecting a correction 100% of the time, so the forecast is pretty much useless. If it was truly anticipated, it wouldn't happen. Action, like that which occurred at opening this morning, is sheer panic.
- gmarx 11y ago
  That isn't true. People expect a correction when there has been a long run up in prices and when those prices are high relative to, for example, earnings. This has been the case for quite some time. On the other hand when the S&P hit the 600s in 2008 (or was it 2007?) I doubt anyone was anticipating a correction
  - forgetsusername 11y ago
    >high relative to, for example, earnings. This has been the case for quite some time. Well, the Shiller CAPE has been "relatively high" (above the mean) since about 1998. So, I guess we agree that people have been calling for corrections the whole time. And it's useless.
- alyx 11y ago
  I'm interested to hear other people's experiences. I have a 100k trading portfolio and I have sold/bought nothing in the last week. Thoughts on who's doing all this downward trading?
  - harmegido 11y ago
    Individual investors really don't impact prices. It's big funds that are able to do very large trades that have an impact on supply/demand. And I'd also point out that nothing has to be bought/sold for prices to move, although volume does spike when prices move downwards. I'm curious about your terminology. 100k is quite a bit for most people. Is that your 'trading' portfolio or your 'investing' portfolio? If it's the latter, I suggest you keep doing what you are doing (i.e. nothing).
kachnuv_ocasek 11y ago
Can't wait till we link to this comment 5 years from now, laughing at how gullible we were – again.
- forgetsusername 11y ago
  >laughing at how gullible we were – again. What exactly are we "falling for"? The economy ebbs and flows, as it has for centuries. The real gullibility is thinking that these cycles somehow represent the end of the world.
dataker 11y ago
Regardless of your ideological background, you cannot possibly assert the U.S economy is healthy. 0% interest rate for several years is not healthy. QE is not healthy. 100+ % debt:GDP ration is not healthy. Inflating assets is not healthy. A vanishing middle-class is not healthy.
- forgetsusername 11y ago
  >QE is not healthy QE is over (though, I wouldn't be shocked to see more). >0% interest rate for several years is not healthy. Why not? >100+ % debt:GDP ration is not healthy. Why not? I mean, I wouldn't call the US economy "flourishing" or anything. But it's not sick, and relative to the rest of the world it's looking pretty good (as the strong dollar and low rates imply).
  - cm2187 11y ago
    QE is not over. The balance sheet of the Fed hasn't gone down. What is over is QE expending.
    - AnimalMuppet 11y ago
      Well... what maturity bonds did the Fed buy? How long ago did they start buying them? The Fed's current plan is to let them expire. If I recall correctly, a big part of what the Fed bought was 2-3 year duration (but I could be mistaken). Some of that should have already expired; more should do so soon.
  - dataker 11y ago
    QE is 'over'(for now), but it has shaped today's economy. There may have QE4. Artificially low interest rates is the main cause of most malinvestment and inflating assets. Usually ends with a pretty rough recession. For debt, I could just say 'Greece/Argentina/Brazil/Japan/...', but(yes) these aren't the world's reserve currency. U.S could just pay its debt to China by 'printing money' Still, it also severely hurt Americans and is probably the main problem for the middle class. Wages don't keep up with inflation and assets are inflated, so their purchasing power is smaller and citizens usually get indebted themselves.
deleted 11y ago
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jes 11y ago
Unfunded liabilities (money that is owed, but not currently on-hand) in the United States are said to be greater than $127T: http://www.forbes.com/sites/realspin/2014/01/17/you-think-the-deficit-is-bad-federal-unfunded-liabilities-exceed-127-trillion/ http://www.forbes.com/sites/realspin/2014/01/17/you-think-th... This does not account for unfunded liabilities owed by the states. The situation there is very difficult as well. You also mention that China is rampant with corruption. In my view, with respect to politics and cronyism, I think the United States government is also highly corrupt. I would like to share your optimistic outlook, but unfortunately, I'm not able to do so given all that I see going on around me.
- PublicEnemy111 11y ago
  The US government does not lie about growth, nor does it threaten money managers with prison time for selling stocks.
- cromwellian 11y ago
  This is all pretty obvious and a long time coming. There are a lot of forces at play: aging of the population, greater returns to capital vs labor due to increasing productivity. As an absurd conclusion, birthrates drop to ~1 per couple, 2/3rds of the population retired, and robots put most people out of work. Is it really so surprising that taxes would have to go up massively on the owners of the robots and other capital to provide all of the retirees a basic income? Hans Moravec, who ran the CMU robotics department, pointed out these trends in his 1988 book _Mind Children_ and what the end game would be. My fear about the unfunded liabilities argument is that it appears to be the new talking point of Trump and Fox News, and rather than see the writing on the wall with respect to the long term trends in the labor market and demographics, it'll just be more arguments about slashing federal social programs, pensions, and the liabilities themselves, which will make us all the less prepared when the real devil comes knocking.
- forgetsusername 11y ago
  >Unfunded liabilities (money that is owed, but not currently on-hand) in the United States are said to be greater than $127T: This is classic one-sided accounting. That money is not vaporized, never to be seen again when it's paid out. It is paid to US citizens as income. Out one pocket, into another.

roymurdock 11y ago

Interested to know which statistics you based this opinion of the US economy being "quite healthy" on. Anything deeper than top level unemployment rate?

cryoshon 11y ago
I am also interested in seeing the data which claims that the US economy is quite healthy right now. The unemployment rate is a juked stat; check out the labor force participation rates if you want the full story. A primer: labor force participation got smashed in the Great Financial Crisis, and still hasn't recovered.
- wiremine 11y ago
  The participation rate is down 3.3% from 2005 [1]. Given the huge shift in demographics over the last 10 years [2], I don't think that's a data point that screams "smashed." [1] http://data.bls.gov/timeseries/LNS11300000 http://data.bls.gov/timeseries/LNS11300000 [2] Lost of baby boomers retiring and Gen X being such a small demo compared to the boomers and the millennials.
  - cryoshon 11y ago
    The demographic shift angle doesn't make sense. The boomers are slowly exiting the workforce, sure-- on an individual basis, as they can choose to retire at different times. Many are having to defer retirement or not retire. This isn't an orderly mass exit, it's a trickle. Millenials are a far larger generation than the boomers, and are rapidly leaving college and attempting to enter the workforce-- 100% of them are trying to enter the workforce at the same time, immediately after graduation day. The fact that labor participation rates haven't stabilized or even increased in response to their population level attempts to enter the workforce shows that there really are not enough jobs to go around. Jobs lost in the early depression haven't returned, and there are many more people out and about looking for them now than there were before. Boomers are retiring, but their children are desperate to take their place, which isn't actually possible.
    - achompas 11y ago
      The fact that labor participation rates haven't stabilized or even increased in response to their population level attempts to enter the workforce shows that there really are not enough jobs to go around. I'm not sure the data bears this out. If they're looking they're in the labor force, and we'd see a commensurate rise in unemployment for age groups 20-24. That's clearly not the case, as unemployment is down ~1.5% for that demo since mid-2014: http://www.bls.gov/web/empsit/cpseea10.htm http://www.bls.gov/web/empsit/cpseea10.htm I don't have demo-level participation data available but that would clarify whether rates are lower bc of millenial LF dropout or millenial employment success.
    - wiremine 11y ago
      > Millenials are a far larger generation than the boomers Depends on your definition of "far larger". - The Millennial cohort is 83.1 million - The Boomer cohort is 75.4 million, 90% the size of the Millennials. Source: https://www.census.gov/newsroom/press-releases/2015/cb15-113.html https://www.census.gov/newsroom/press-releases/2015/cb15-113...
    - wiremine 11y ago
      > Jobs lost in the early depression haven't returned There are actually more jobs now then there were in 2005: - January 2005: 132,752,000 - January 2015: 140,793,000 Source: http://data.bls.gov/pdq/SurveyOutputServlet?request_action=wh&graph_name=CE_cesbref1 http://data.bls.gov/pdq/SurveyOutputServlet?request_action=w... Obviously the _type_ of jobs have changed, and this doesn't factor in population growth directly, but I don't think the statement "jobs lost in the early depression haven't returned" isn't grounded in the data.
code4tee 11y ago
Debt to income ratios, capitalization of companies, worker productivity, oil prices, savings rates, more healthy housing prices (in most areas), foreclosure rates, industrial orders, housing starts, .... This isn't 2007-08.
- cryoshon 11y ago
  Wages are shit for workers and thus consumption/demand are weak... this undermines the Chinese economy, which in turn undermines the US economy. Labor force participation is also garbage. Savings rates are a bit moot when tons of people are living paycheck to paycheck, also. It's not 2007-2008, but it's not quite 1998 either.
  - rorykoehler 11y ago
    Capitalism at it's finest. The race to the bottom will eventually force someones (possibly everyones) hand. The mechanism that will drive change (either violent/non-violent) is just a matter of who blinks first.
    - maratd 11y ago
      > Capitalism at it's finest. The race to the bottom will eventually What are you going on about? If capitalism is a race to the bottom, we would have reached it a long time ago. Capitalism isn't new. It's been around for a while.
      - TheOtherHobbes 11y ago
        I'm amazed anyone can try to defend a system that has manic-depressive episodes built in as a feature.
        merpnderp 11y ago
        Because it's the system that's pulled several billion people out of abject poverty in the last 30 years? I believe the system that was tried before that was called socialism, and didn't work as well as capitalism.
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code4tee 11y ago
PS... I don't deny that a subset of the US economy/workforce got hit really hard in 2008 and never recovered. But when you look at the US economy as a whole things are doing quite well.
- sillygeese 11y ago
  > when you look at the US economy as a whole things are doing quite well To be more accurate, when you look at the propaganda spewed by the mainstream media, everything seems to be fine, because they keep spinning everything in a positive light. In the US, for starters, there's a huge bubble in stocks, and an echo bubble in housing. There's a massive property bubble in Canada and Australia, and so on. With interest rates already at roughly zero, they don't have room for lowering them to "stimulate" the economy (to avoid the inevitable crash that's coming). Of course, getting people to spend money they don't have and businesses to start projects they shouldn't, isn't exactly good for the economy but hey.. whatever keeps the show going for a while longer. (Downvoters? It's at the very least possible that you just don't know that I'm right.. :) Do your homework, but not from mainstream media sources)
  - MCRed 11y ago
    We have a democrat who is president, and who took over after a crisis during the term of a republican. (never mind that he was part of the cause of the crisis with his 1990s era "not lending to people who can't repay is racist" lawsuit against banks)... so the liberals of HN are highly motivated to believe that democrats are "responsible" and that they have "fixed the economy" after republicans "wrecked it". So when you point out that the king has no clothes, naturally you get downvoted. The current mess of the US economy is due to the choices of many politicians, in congress and the presidency, from both parties. Neither party should get a passing grade in this regard. This is why we need the government out of the economy, and let it work. Hell if it weren't for government the bad banks would have failed in 2008-- and we would have had a real recovery afterwards.
    - deleted 11y ago
      [deleted]
topkai22 11y ago
Corporate profits have been good, GDP has been rising at a decent rate, consumer confidence has been looking OK. Statistically, the economy has been looking alright, although the distribution of benefits continues to be unequal.
- cryoshon 11y ago
  Staggeringly unequal benefits distribution makes for an unhealthy economy. We don't describe the economy of Mexico or Brazil to be healthy even when they are at high employment and growing GDP mostly because the burgeoning economy doesn't produce a similar ripple in their societies.
  - cynicalkane 11y ago
    There's no real reason a 'staggeringly unequal benefits distribution' should lead to an economic crisis, unless you believe in proletarian revolution or something.
    - deciplex 11y ago
      Let's say all the wealth in the world, minus a few percent, belonged to 400 people. Can you think of some ways that would wreak havoc on the economy, even without triggering a "proletarian revolution?"
      - cynicalkane 11y ago
        No, because an economic crisis is a fall in economic output. The point is that "undesirable wealth distribution" is not what an economic crisis is. If 400 people controlled everything, the world wouldn't be a great place to live, but the economy would probably be more stable.
        vezzy-fnord 11y ago
        I don't recall high Gini coefficients being associated with economic stability. The massive reduction in marginal utility from most people focusing only on immediate consumption, coupled with the massive oligopolism and centralization leading to price distortions -- those alone don't imply economic stability to me. An extreme oligopoly would likely imply civil unrest, so all else would suffer.

sillygeese 11y ago

> Broadly speaking the US economy is quite healthy In reality, it's the exact opposite of "quite healthy". Here's a good overview of what's up: http://www.oftwominds.com/blogaug15/bear8-15.html http://www.oftwominds.com/blogaug15/bear8-15.html

rogerthis 11y ago
You cannot offer a different view. Go home. Sorry. (And they won't even perceive the sarcasm).
dragontamer 11y ago
If a 2008-style credit crunch takes out the likes of AGI in the next few weeks, causing rippling effects to spread throughout the economy in ways that no one understands... then we've reached a 2008 level crisis. We don't have record numbers of people flocking to mobile homes as their subprime mortages jack up the rest of the economy. Your article is crap because it ignores everything that was bad about 2008. Record layoffs, hundreds of thousands of people losing their homes and jobs. Major manufacturers (the _entirety_ of the "big three" car companies) almost went bankrupt. Financial controls are arguably in a worse state than they were in 2008. But beyond that, the core economy is doing much better than back then. Furthermore, financial controls in 2007 prevented us from seeing any issues. The subprime mortgages getting wrapped up in CDOs and all that stuff was occurring in a non-regulated "shadow economy" manner. Is there a shadow economy that is about to crash today? I don't think so. But that was the conditions of 2007/2008 financial crisis.

kevando 11y ago

Bubble? http://i.imgur.com/lQt3Ylr.jpg http://i.imgur.com/lQt3Ylr.jpg

7Figures2Commas 11y ago
Central bank bubble.
- joeyspn 11y ago
  You mean... something like this... http://blog.milesfranklin.com/wp-content/upLoads/2014/12/US-National-Debt-Chart.png http://blog.milesfranklin.com/wp-content/upLoads/2014/12/US-... But at a global scale?
savanaly 11y ago
Now extend the timeline 100 years into the past, it will look a lot more encouraging. Or a 1000 years, it will look positively sunny.
forgetsusername 11y ago
Utterly useless to show a growth graph spanning decades without a log scale.

deleted 11y ago

[deleted]

forgetsusername 11y ago

>people were expecting a correction in the stock market for some time "People" are expecting a correction 100% of the time, so the forecast is pretty much useless. If it was truly anticipated, it wouldn't happen. Action, like that which occurred at opening this morning, is sheer panic.

gmarx 11y ago
That isn't true. People expect a correction when there has been a long run up in prices and when those prices are high relative to, for example, earnings. This has been the case for quite some time. On the other hand when the S&P hit the 600s in 2008 (or was it 2007?) I doubt anyone was anticipating a correction
- forgetsusername 11y ago
  >high relative to, for example, earnings. This has been the case for quite some time. Well, the Shiller CAPE has been "relatively high" (above the mean) since about 1998. So, I guess we agree that people have been calling for corrections the whole time. And it's useless.
alyx 11y ago
I'm interested to hear other people's experiences. I have a 100k trading portfolio and I have sold/bought nothing in the last week. Thoughts on who's doing all this downward trading?
- harmegido 11y ago
  Individual investors really don't impact prices. It's big funds that are able to do very large trades that have an impact on supply/demand. And I'd also point out that nothing has to be bought/sold for prices to move, although volume does spike when prices move downwards. I'm curious about your terminology. 100k is quite a bit for most people. Is that your 'trading' portfolio or your 'investing' portfolio? If it's the latter, I suggest you keep doing what you are doing (i.e. nothing).

kachnuv_ocasek 11y ago

Can't wait till we link to this comment 5 years from now, laughing at how gullible we were – again.

forgetsusername 11y ago
>laughing at how gullible we were – again. What exactly are we "falling for"? The economy ebbs and flows, as it has for centuries. The real gullibility is thinking that these cycles somehow represent the end of the world.

dataker 11y ago

Regardless of your ideological background, you cannot possibly assert the U.S economy is healthy. 0% interest rate for several years is not healthy. QE is not healthy. 100+ % debt:GDP ration is not healthy. Inflating assets is not healthy. A vanishing middle-class is not healthy.

forgetsusername 11y ago
>QE is not healthy QE is over (though, I wouldn't be shocked to see more). >0% interest rate for several years is not healthy. Why not? >100+ % debt:GDP ration is not healthy. Why not? I mean, I wouldn't call the US economy "flourishing" or anything. But it's not sick, and relative to the rest of the world it's looking pretty good (as the strong dollar and low rates imply).
- cm2187 11y ago
  QE is not over. The balance sheet of the Fed hasn't gone down. What is over is QE expending.
  - AnimalMuppet 11y ago
    Well... what maturity bonds did the Fed buy? How long ago did they start buying them? The Fed's current plan is to let them expire. If I recall correctly, a big part of what the Fed bought was 2-3 year duration (but I could be mistaken). Some of that should have already expired; more should do so soon.
- dataker 11y ago
  QE is 'over'(for now), but it has shaped today's economy. There may have QE4. Artificially low interest rates is the main cause of most malinvestment and inflating assets. Usually ends with a pretty rough recession. For debt, I could just say 'Greece/Argentina/Brazil/Japan/...', but(yes) these aren't the world's reserve currency. U.S could just pay its debt to China by 'printing money' Still, it also severely hurt Americans and is probably the main problem for the middle class. Wages don't keep up with inflation and assets are inflated, so their purchasing power is smaller and citizens usually get indebted themselves.

deleted 11y ago

[deleted]

jes 11y ago

Unfunded liabilities (money that is owed, but not currently on-hand) in the United States are said to be greater than $127T: http://www.forbes.com/sites/realspin/2014/01/17/you-think-the-deficit-is-bad-federal-unfunded-liabilities-exceed-127-trillion/ http://www.forbes.com/sites/realspin/2014/01/17/you-think-th... This does not account for unfunded liabilities owed by the states. The situation there is very difficult as well. You also mention that China is rampant with corruption. In my view, with respect to politics and cronyism, I think the United States government is also highly corrupt. I would like to share your optimistic outlook, but unfortunately, I'm not able to do so given all that I see going on around me.

PublicEnemy111 11y ago
The US government does not lie about growth, nor does it threaten money managers with prison time for selling stocks.
cromwellian 11y ago
This is all pretty obvious and a long time coming. There are a lot of forces at play: aging of the population, greater returns to capital vs labor due to increasing productivity. As an absurd conclusion, birthrates drop to ~1 per couple, 2/3rds of the population retired, and robots put most people out of work. Is it really so surprising that taxes would have to go up massively on the owners of the robots and other capital to provide all of the retirees a basic income? Hans Moravec, who ran the CMU robotics department, pointed out these trends in his 1988 book _Mind Children_ and what the end game would be. My fear about the unfunded liabilities argument is that it appears to be the new talking point of Trump and Fox News, and rather than see the writing on the wall with respect to the long term trends in the labor market and demographics, it'll just be more arguments about slashing federal social programs, pensions, and the liabilities themselves, which will make us all the less prepared when the real devil comes knocking.
forgetsusername 11y ago
>Unfunded liabilities (money that is owed, but not currently on-hand) in the United States are said to be greater than $127T: This is classic one-sided accounting. That money is not vaporized, never to be seen again when it's paid out. It is paid to US citizens as income. Out one pocket, into another.