Thread: The strongest economy in the world

Originally Posted by Jet Gorgon

I'm awarding you the tin can hat

Cheers Never had one before.

Originally Posted by Jet Gorgon

What industry is going to drive the economy?

Industry doesnt drive the US economy does it? Consumers spending money they dont have drives 70% the US economy They will be given more money to spend and the whole illusion will continue. Sounds mental doesnt it, but thats just how it is.

I'm seeing enough factory utilisation data in the chip sector to know that the world is awakening. Corning (GLW) for example, make the glass that is used in all manner of tv's and electronic gadgets are reporting ramp up in orders and they seemingly cant supply substrate fast enough.

Originally Posted by Jet Gorgon

Even Ford is complaining

Ford cars aint good enough, end of story. Most Americans I chat with on a daily basis have Japanese or German cars. I hear the Subaru brand more than I hear Ford. That tells me plenty.

^ If folks don't have jobs, they ain't gonna support diddly except the food banks, Spin. Corning? Yup, Ford is lagging but surviving and ain't getting help coz they didn't ask for a bailout. Feked from both ends.

Originally Posted by sabang

White House expects better GDP figures

OK, I'm gonna start laughing again.

Please watch this again.

Originally Posted by Jet Gorgon

Please watch this again.

I cant it hurts too much laughing at his antics.

Originally Posted by Jet Gorgon

Who is going to drive the uptick, Spin?

The amswer is still tech, 4g is booming. Apple cant sell enough of those short penis compensators, whats it called? ah yeah, the iphone. 4g 4g 4g. tech tech tech!

^ You gave us that vid, so you watch it again. (I e-mailed that to several right-wingies; believe it or not, the GI Joe vets among them were upset with the profanity.)

OK, I agree the tech sector cos will do well (Apple, Google, RIM -- oh, but Blackberry is Canadian -- fek, can you believe that?), but there aren't enough of them. There are many in Sil Valley and they cannot even save California. The startups are having probs getting VC, too. I think many of those phone apps are Asian designs. By the by, have you seen this commercial? 555

Nice, comprehensive post. I hope I have been wrong about my adherence to the gloom and doomers. Still some problematic issues with the US however.

Originally Posted by Norton

There was a time when I too bought into the idea if left alone unfettered capitalism would take care of itself.

Likewise.

Originally Posted by Norton

It is now obvious greed vis a vis profits at any cost within the business sector requires government regulation and intervention.

Indeed.

Great post Norton.

It seems to me the 'challenge' to the Obama administration is selling it's considerable progress to the people.
It would be a political risk to sell the 'this recession is over' spiel too aggressively- it might backfire on them. We may yet have a bit more recession to go, or even a 'double dip'.
Also, you've got a "Gain on the Street, pain on the street" scenario. Investment bankers are minting it- soon after having been saved from extinction with government money. Wall Street is rebounding vigorously.
On the other hand, Joe Sixpack is feeling considerable pain, and will be for a while yet. So overt Triumphalism is hardly likely to be well received in Main Street.

Originally Posted by Norton

The financial sector is generally in good health due to government's quick response in applying TARP to prevent what surely would have been a total collapse. As a result credit is and will continue to be available to both the private and business sectors...

You are joking, Norts...

Entrepreneurship and new small businesses are supposed to lead us out of the recession, just as they have in prior downturns, right?
Sure. Your neighbor's grand idea will persuade a bank to lend her start-up money; she'll open for business in six weeks; and money will immediately flow from customers to her to her employees. Taxes will be paid, and the national economic engine will hum effortlessly in no time.
If only.
Today shows a different reality: Commercial bankruptcies are surging.

...a National Federation of Independent Business trend report states that in May the percentage of business owners reporting that loans are harder to get rose to 16%, the highest reading since the 1980-82 recession.
Businesses can't easily rely on credit cards these days, either.
"What's happening now is that a lot of banks are retrenching and cutting back on lines of credit and credit card limits," McCracken says.
Small businesses vital to economic recovery go bankrupt - USATODAY.com

Originally Posted by sabang

Investment bankers are minting it- soon after having been saved from extinction with government money. Wall Street is rebounding vigorously.

Did you dig into where those profits came from? On-off items (like selling chunks of the biz), prop trading and, for the commerical banks, higher fees for keeping an account, ATM use, overdrafts...NOT from loans. Sh*t, with interest rates so low, might as well hoard the cash under the bed.
Sure, the sector needs regulation, but that is the responsibility of the SEC and the Fed, which mucked up big time, not the federal govt.

Originally Posted by sabang

Originally Posted by Norton

There was a time when I too bought into the idea if left alone unfettered capitalism would take care of itself.

Likewise.

Originally Posted by Norton

It is now obvious greed vis a vis profits at any cost within the business sector requires government regulation and intervention.

Indeed.

Great post Norton.

I dunno - seems to me he is 'flip-flopping'. This is typical cowardly bleeding-heart liberal tactics, changing your mind when faced with information that contradicts his original assumption. I bet you he even looks French!

^ I've seen pics of him in a striped tee and red beret.

I certainly hope its turned the corner, but I have some serious doubts. So long as the structure of the world economy is built on sand (aka $US debt), its bound to crumble sooner or later. Propping it all up with more paper money might get us a reprieve in the short term. But its all got to come tumbling down in a big heap eventually. Productivity of things useful to society is real, paper money is not when it gets out of balance with its true worth. There is going to be a big adjustment in the world distribution of real wealth based on productivity coming in the next decade. China, India, Brazil and Russia can see that coming and are making plans right now. Meanwhile USA just continues to print, borrow and spend while the going is still good. Pumping up the bubble with paper money might be seen as some as an end to all our problems, but in fact its just a strategy designed to ease us into the inevitable redistribution of world wealth base on productivity.

Originally Posted by Whiteshiva

I bet you he even looks French!

Originally Posted by Jet Gorgon

I've seen pics of him in a striped tee and red beret.

Crap, I been outed.

Originally Posted by Jet Gorgon

You are joking, Norts...

Not at all. Your ability to step back and look at the big picture will always be impeded by your Limbaugh like obsession for accenting the negative while refusing to look at the positive indications that the recession is easing, total collapse of the US economy is no longer a distinct probability and confidence in the economy is reflected in Wall Street investment.

Expectations that all the measures the government has taken to prevent the collapse will happen over night is unrealistic. Unemployment will continue for some time, home foreclosures for unemployed will naturally follow. Banks are and will lend money to small businesses when they can show ability to repay. Once this happens businesses will start to hire again and employment figures will be on the increase.

It took 10 to 15 years of money for nothing and chicks for free for the bubble to burst. Why would anyone assume it will recover in a year. If one looks at the economic growth in the 1920s there is nearly an exact comparison to what occurred in the run up to the current crisis. It took 12 years to recover from the 1929 collapse and would have been much longer if the economy had not been stimulated by the growth of industry in response to US entry into WW2.

Is the US economy still in bad shape? You bet. Is the worst over and are mechanisms in place to recover? I along with many much smarter than me say it is.

For those who would rather see the total collapse of the US economy fail for political reasons, I am sure many instances of doom and gloom can be found.

BTW, GWB should be given credit for pushing through the TARP bill so don't for a minute think my post is somehow swayed by partisanship.

Originally Posted by Panda

Meanwhile USA just continues to print, borrow and spend while the going is still good.

Deficit spending and its continued increase is indeed a major problem. The US government has for the last 10 years and continues at an increasing rate to increase the deficit.

Without a workable fiscal plan to decrease the deficit to a more sustainable level, disaster is assured. Living on borrowed money with no regard for the consequences is a mistake governments, businesses and individuals alike seem unable to comprehend even though the results should be obvious given the recent economic melt down.

UPDATE 2-Seagate ups forecasts on industry sales, margins | Industries | Technology, Media & Telecommunications | Reuters

http://www.nytimes.com/2009/07/22/business/22coke.html (Cokes profit up).

Merck CEO says earnings suggest return to growth | Special Coverage | Reuters

Starbucks Swings to Profit, Aided by Cost Cuts - WSJ.com


Oh, and for Jettie-

AMD's earnings were disappointing, Yahoo reported weak Ad revenue.

We all want to see things go back to "normal" so now there seems to be a tendency to grab every straw and use it to claim "the turnaround is here" and we want desperately to believe it but-

Traders on wall street have an enormous interest in making people feel upbeat about the economy because they only make money if they can make people start buying and selling at a much bigger rate again, so we all know they will say almost anything to get a costumer on-board and their assessments will invariably be overly optimistic next-

The Governments know that only consumer spending in the end is the thing that can turn the table, for now people are wisely very cautious with their money but the Governments wants us to spend spend spend, so they to will downplay the negatives and push every little positive event as far as possible to try to raise consumer confidence.

Sabangs example with Starbuck is one, now the company have started to make a bit of money, so today in the news it is pushed as a major indicator that things are maybe changing, but the reality of it is more like your good friend that was run over by a car, and lost an arm a leg a lung and a kidney has come outside for the first time in his wheelchair, is it progress?, yes absolutely, but is it anything like he is returning to normal?, no way Jose.

So we have a relative few doomsday sayers being well overshadowed by someone trying to sell us a pink trip, the reality is I think somewhere in the middle, so being very careful with your hard earned money unless you can afford to loose some is still the best course of action.

This is so funny. I never heard so many feking lies and twisted answers in my life.
In Full: Couric, Obama Interview - CBS News Video

Originally Posted by Jet Gorgon

The markets are going up thanks in part to commodity price hikes.

Oh I see. Commodities are fueling the increase in the NYSE Composite Index? Interesting analysis.

Originally Posted by Jet Gorgon

Who is causing that meltdown? The state congress which is bladdy liberal.

Thank you for another in depth opinion. Why is it the "libbies" who caused the meltdown? Oh, forgot. They were in the majority when the good ship "USS Economy" hit the rocks as preset on auto pilot when the "other" party was in the majority.

^ They've been in power for many a year in CA. Please tell me why the state has to issue IOUs.
^^Did I say NYSE?

Originally Posted by Jet Gorgon

Did I say NYSE?

You said markets! The NYSE is a composite of all of em innit?

Originally Posted by Jet Gorgon

They've been in power for many a year in CA. Please tell me why the state has to issue IOUs.

Indeed they have. Seems there was no complaints when all was well with the economy!

CA was running on the same credit driven economy as was the Fed economy. The bubble burst with a loud bang due to the huge size of the CA economy. If you want to place blame then take a hard look at the "free" market. Therein lies the problem. Has little or nothing to do with government except the government closed its eyes to what was obviously a systemic problem which could have been prevented by enforcing a bit of restraint on the free market.

But no, can't have any of that nasty government interference in our perfect system of capitalism.

Originally Posted by Jet Gorgon

Tetchy! Getting angry because BO is flailing?

I don't get angry. Just tired of the same ole partisan craziness where it is en vogue to blame all the woes in the country on "libbies".

Originally Posted by Norton

The DJ is now hovering around 8800 with steady increase.

Originally Posted by Jet Gorgon

The markets are going up thanks in part to commodity price hikes.

Originally Posted by Jet Gorgon

Sorry, I was also referring to the Euro bourses

Oh them! Silly me.

Here Jet, more bad news for ya Atheros Communications (ATHR) reported great earnings. Six of their chips go into every Verizon FOIS (fibre optic tv) box. That means Verizon most likely report strong next Monday.

The market trades higher from here! Come on Jet, admit it. Bears are dead!