21 ms·

2022 economy, financial markets like the year 2000 all over again

2 points by elsewhen 4y ago

incomingpain 4y ago
I disagree. The crash so far is actually worse than the financial crisis and dotcom combined. So it's not like dotcom all over again... it's much worse. It's also not done. >An exceptionally robust job market. The Federal Reserve raising interest rates at a rapid clip. Overheated financial markets starting to correct themselves, with the frothiest sectors bearing the brunt. This is low inflation thinking. It's easy to get caught up in low inflation thinking because it's been quite steady for quite some time. So not a key consideration for so long. High inflation is whole new ball game. >The layoffs started as a trickle and became a gush. IPOs were shelved, and the companies that had gone public saw their share prices dwindle. Yet I see signs in doors suggesting the opposite. People are hiring. This is next level issues, this isn't what we should expect. >Inflation reached its highest level in a decade of 3.8% that March, and the Fed raised interest rates a half-percent in May to try to rein in inflation. Yes indeed. If only the fed raised rates when it was 3.8% and not 8.3%. > The attacks sent an already shaky economy into a temporary tailspin — a reminder that geopolitical events can cause more economic pain when the situation is already precarious. Geopolitics is certainly a factor. A top democrat literally said the USA is at war. Which implies the democrats believe they are at war with Russia. In the not-geopolitics pov, some democrats also believe the second us civil war has already started. >The bottom line: The U.S. may well escape a recession this time around. But when the market sentiment reverses, like it did 22 years ago and is doing now, it becomes more vulnerable to whatever bad news may arrive. No, it's far more problematic. This is bigger than a 'the fed mismanaged and we're going to have a bad time for a year' We don't really know yet what the story is. Perhaps it's major military mobilizations; energy, food, wood, metals are suddenly quite high. Another possibility is that we are heading into 2nd great depression.

2 points by elsewhen 4y ago

I disagree. The crash so far is actually worse than the financial crisis and dotcom combined. So it's not like dotcom all over again... it's much worse. It's also not done. >An exceptionally robust job market. The Federal Reserve raising interest rates at a rapid clip. Overheated financial markets starting to correct themselves, with the frothiest sectors bearing the brunt. This is low inflation thinking. It's easy to get caught up in low inflation thinking because it's been quite steady for quite some time. So not a key consideration for so long. High inflation is whole new ball game. >The layoffs started as a trickle and became a gush. IPOs were shelved, and the companies that had gone public saw their share prices dwindle. Yet I see signs in doors suggesting the opposite. People are hiring. This is next level issues, this isn't what we should expect. >Inflation reached its highest level in a decade of 3.8% that March, and the Fed raised interest rates a half-percent in May to try to rein in inflation. Yes indeed. If only the fed raised rates when it was 3.8% and not 8.3%. > The attacks sent an already shaky economy into a temporary tailspin — a reminder that geopolitical events can cause more economic pain when the situation is already precarious. Geopolitics is certainly a factor. A top democrat literally said the USA is at war. Which implies the democrats believe they are at war with Russia. In the not-geopolitics pov, some democrats also believe the second us civil war has already started. >The bottom line: The U.S. may well escape a recession this time around. But when the market sentiment reverses, like it did 22 years ago and is doing now, it becomes more vulnerable to whatever bad news may arrive. No, it's far more problematic. This is bigger than a 'the fed mismanaged and we're going to have a bad time for a year' We don't really know yet what the story is. Perhaps it's major military mobilizations; energy, food, wood, metals are suddenly quite high. Another possibility is that we are heading into 2nd great depression.