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> In a perfect world, the stock market would decline another 70 or 80 percent "The economy" is a measure of the value being created and enjoyed. Anyone who sa

by tjic 18y ago

> In a perfect world, the stock market would decline another 70 or 80 percent "The economy" is a measure of the value being created and enjoyed. Anyone who says that they want "the economy" to decline 80% is saying that they want EVERYONE'S standards of living to decline 80%. You, your brother's, your retired parents - they should lose 80% of their housing, 80% of their nights out, 80% of the books they'd like to buy, 80% of the movies they'd like to watch, 80% of the vacations they hope to go on. Except for the dead bodies piled on the sidewalks, he's basically hoping for a genocide. "I feel alienated and I feel like a failure and I hate everyone and therefore I want it all to burn" is a fine sentiment for a high school heavy metal band or an idiot 14 year old goth, but it's an absolutely shameful thing for an adult to say.

kiba 18y ago
When a stock market declines, it just mean that the investors think the companies are doing unprofitable activities and that they need to change their activities to more profitable one. Hopefully they will switch to production of goods that people actually want and the stock market will rise up again.
mechanical_fish 18y ago
Without getting into the rest of Rushkoff's argument, he said the stock market, not the economy. Though the media tend to confuse these things, they are not the same. At all. The S&P 500 is down nearly 50% since last year. Obviously, this has not produced a 50% drop in the standard of living. Here's a calculation of the historical total-market P/E ratio from 1871 to 2003: http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B23663E61%2DC865%2D46F2%2DB83E%2D4EEC2DDEC0C0%7D&dist=morenews&param=archive&siteid=mktw&garden=&minisite= http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B236... The historical average is 11 to 14, depending on how it is calculated. The same source reports that the S&P 500 P/E ratio on February 12 was 29.1: http://www.marketwatch.com/news/story/how-current-pe-ratios-stand/story.aspx?guid=%7B13BD1A19-0A04-4FEE-97A6-0A1C410D6881%7D http://www.marketwatch.com/news/story/how-current-pe-ratios-... That implies that, in mid-February, the market needed to drop another 52% to 62% to get back to the average P/E ratio of the market over the last century. Obviously, an average P/E of 11 implies that the market has historically spent quite a bit of time at an even lower P/E. Obviously, this is a facile analysis. The Marketwatch guy himself hedges it quite a bit (e.g. he points out that during a big recession P/E can surge temporarily due to the relative timing of economic events). But it does go to show that, when Rushkoff suggests that the market might drop another 70% or 80%, he's not talking about something unprecedented -- he's merely talking about a market-average P/E of 6. Nor is he suggesting a drop of 80% in a real economic measure, like employment, or GDP.

by tjic 18y ago

kiba 18y ago

When a stock market declines, it just mean that the investors think the companies are doing unprofitable activities and that they need to change their activities to more profitable one. Hopefully they will switch to production of goods that people actually want and the stock market will rise up again.

mechanical_fish 18y ago

Without getting into the rest of Rushkoff's argument, he said the stock market, not the economy. Though the media tend to confuse these things, they are not the same. At all. The S&P 500 is down nearly 50% since last year. Obviously, this has not produced a 50% drop in the standard of living. Here's a calculation of the historical total-market P/E ratio from 1871 to 2003: http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B23663E61%2DC865%2D46F2%2DB83E%2D4EEC2DDEC0C0%7D&dist=morenews&param=archive&siteid=mktw&garden=&minisite= http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B236... The historical average is 11 to 14, depending on how it is calculated. The same source reports that the S&P 500 P/E ratio on February 12 was 29.1: http://www.marketwatch.com/news/story/how-current-pe-ratios-stand/story.aspx?guid=%7B13BD1A19-0A04-4FEE-97A6-0A1C410D6881%7D http://www.marketwatch.com/news/story/how-current-pe-ratios-... That implies that, in mid-February, the market needed to drop another 52% to 62% to get back to the average P/E ratio of the market over the last century. Obviously, an average P/E of 11 implies that the market has historically spent quite a bit of time at an even lower P/E. Obviously, this is a facile analysis. The Marketwatch guy himself hedges it quite a bit (e.g. he points out that during a big recession P/E can surge temporarily due to the relative timing of economic events). But it does go to show that, when Rushkoff suggests that the market might drop another 70% or 80%, he's not talking about something unprecedented -- he's merely talking about a market-average P/E of 6. Nor is he suggesting a drop of 80% in a real economic measure, like employment, or GDP.