Fed Cuts Rate, Dollar Falls, Stocks Fall

reply to post by RogerT


Sorry, man! I was a little hasty, I've only skimmed a little through the thread. I should have been more thorough. Thanks for pointing it out.

And infinite, thank you too. Now I can say I understand at least basics of this whole mess. I never thought it is actually THAT serious. I knew it isn't looking good, but to think it is actually that bad... I had no idea.

Originally posted by Duby78
I never thought it is actually THAT serious.

It's been THAT serious for a few months.

The media is only starting to notice it.

Throbber

Good points, but if the american establishment destroys itself trying to maintain ithe U.S economy for a lengthy period of time, it will no longer be able to provide support for those suffering because of the economic failure.

As such, people will be forced to survive - and we know what people are capable of when they are forced to survive.

True, though I wouldn't call it "self destruction" .. we are long over due for a recession or at the very least a significant adjustment in value to the markets.

RogerT

The driving cause is the credit derivative fiasco, which is only just getting started.

Aigh, over the long haul the over all driving problem with the market is Credit.. what I was implying was the fresh ROUND of selling was initiated by the earnings report of Exxon, Chrysler situation and the financial problems of Citi.

The Fed could seemingly care less about the dollar's demise, but are busy pumping out liquidity to keep the equity markets alive and bail out the big banks - basically to help out their banking buddies from going belly up.

Yes.. except, imagine if the banks DID collapse, and their "banker buddies" went bankrupt, and there was a run for the money in the banks..... some how I think their banker buddies would still be rich, and I would stand 24 hours in line to get my meager cash (which won't be there when I get to the teller) if the banks went under.

You may be over-estimating the importance of the American economy on the current global stage.

Perhaps not.

When the European market falls, America can pull off a winning day in the markets (we do that often) .. or if the Asian markets fall, Europe always seem to follow, but America may be up..

But if America falls, Asia falls, then Europe opens down, regardless of what American markets will do the same day..

I can bet that Asian markets when they open in a few hours will be down.

Thanks to China, an American recession need not cause the whole world to crash

China is a PRODUCER not a CONSUMER. China can produce all it wants, but its largest trading partner won't be buying, so China will stop producing, and they sure as hell wont start consuming..

Although it's anyone's guess what is really going on in the markets at the moment eh?

I have not seen a prediction come true yet.. the general agreement is sometimes in the near future we are due for a big drop.

I wonder though if the fed really will stop bailing the market like they say.. essentially saying they did all they could now its up to the market to ride it out...

Originally posted by Rockpuck

Thanks to China, an American recession need not cause the whole world to crash

China is a PRODUCER not a CONSUMER. China can produce all it wants, but its largest trading partner won't be buying, so China will stop producing, and they sure as hell wont start consuming..

OK, so you disagree with the economist article, that's your prerogative, though a challenge on the actual content would have been more interesting

I'm no way an expert on China, though I do hear that there are now more middle class Chinese than middle class Americans, so I guess there's at least a little bit of consuming going on there right now.

Wasn't that what the article was pointing at?

I hear what you're saying bro', but I'll back the corner that says after a (rough) period of readjustment, the world will cope just fine without the American debt funded consumer, and probably be a better place for it. After all, it's the rest of the world that's been lending the US the couple billion a day for all the plasma TV's and SUV's Now the dollar is being burnt to a crisp, looks like they aren't going to get much of a return on the loans either.

I also personally feel that the American people will bounce back after some 'finding feet' time. OK, it may take a few decades!

I agree for sure that there's a difficult time ahead, but maybe a really scary global crash will be the catalyst that's needed for humanity to step up to the plate and take back our world from the fat controllers.

It scares me silly, but in a way I'm looking forward to it



[edit on 1-11-2007 by RogerT]

Originally posted by Rockpuck

I can bet that Asian markets when they open in a few hours will be down.

Spot on.

JNIc1 (Nikkei 225 FUT Cont.) opened 300 points down

reply to post by Duby78



No worries

Yep, it's nearly about the time to buy a few gold coins and bury them under the roses.

I think the most important thing to remember is that the world follows America's lead economically, for better or for worse. So, no matter how bad things are in America, they're going to be worse in the other markets. Do I see the world getting away from an Amero-centric economy anytime soon? No. Furthermore, I really question the reliability of the economists who predict good Chinese and Russian economic growth next year. No, buddy, I think it's going to be a worldwide recession or something close to that.

The days of lending to anyone with a pulse should end!

reply to post by uberarcanist


The world only follows America when we are able to export our inflation and financial woes via the dollar as a reserve currency, oil traded in USD and currencies pegged to the USD.

Interestingly enough, all of these things have been crumbling lately.

reply to post by aava


Alright...when you consider the fact that the European Union, China and probably most of the developing countries are net exporters, who do you think is doing the importing necessary to support these economies? I'll give you one guess...

reply to post by uberarcanist


I'm not going to deny a global slump will occur, it will just be a lot nastier for us on the stateside. When those things I listed are no longer applicable, look for our economic woes worsen on a much more "local" level.

Interestingly enough, the EU is increasing its share in the Chinese export market, even dethroning the U.S as the largest trading partner. Our greatest export is inflation . Point I'm trying to make is, we will be making a much smaller splash on the world's markets compared to what we used to.

reply to post by aava


That's interesting what you post about the European Union and China. Can you source that, please?

reply to post by uberarcanist


I had a good academic type source awhile ago, tell me if this will do:
www.chinadaily.com.cn... --dated
www.china-embassy.org... --newish
ec.europa.eu... --newish

Keep in mind the difference between "trading partner" and "net exporter". You can argue the merits of the two for ages. We are still China's largest net export market, because their exports to us far exceeds what they import from us. You have to consider that the EU does a fair amount of exporting to China, so the trade is more balanced, but the volume of trade is larger. Some will tell you only net exports matter, as it is factored into GDP. I think trading volume as a whole tells a story too.

edit to fix dated website

[edit on 11/1/07 by aava]

[edit on 11/1/07 by aava]

reply to post by aava


I'm not attaching a lot of importance to either link. There's nothing that states that the EU is IMPORTING more Chinese goods than America is, and I think that imports from China is really what makes China's world go round. Furthermore, $5.7 billion is not a lot in the world of international trade.

I would *like* to see an end to Amero-centric global trade, I just don't see it happening soon.

"China is a PRODUCER not a CONSUMER. China can produce all it wants, but its largest trading partner won't be buying, so China will stop producing, and they sure as hell wont start consuming.."

Thank you Mr. Rockpuck. You are absolutely correct.

This whole thing is a very complicated matter. Much of China is still a third world nation. India, and china combined, are not big enough to take up the immense slack that it would take, to make up for massive void left by the US. America is chinas largest trading partner. America, is Europes largest trading partner. The world economy is interdependent (look that word up if you do not know what it means). If the worlds largest economy were to fall, everyone loses. If one domino falls...what happens to all the other dominos?

Also, do not forget nominal Purchase Power Parity (PPP).
en.wikipedia.org...


[edit on 1-11-2007 by West Coast]

reply to post by RogerT

OK, so you disagree with the economist article, that's your prerogative, though a challenge on the actual content would have been more interesting

I have no desire to pinpoint every failed point of a mediocre economic theorist.

I'm no way an expert on China, though I do hear that there are now more middle class Chinese than middle class Americans, so I guess there's at least a little bit of consuming going on there right now.

Middle class that is compared to the actual gross income per Chinese citizen. If you knew anything of China, or the Chinese market, the middle class per capita is far less then America, it is also far less percentage of the population, along with the fact that most are supported employees of American based corporation and or based by companies that base revenue off of American consumerism.

Wasn't that what the article was pointing at?

No.

I hear what you're saying bro', but I'll back the corner that says after a (rough) period of readjustment, the world will cope just fine without the American debt funded consumer, and probably be a better place for it.

The major consumer or producer of the technology that fuels the rest of the manufacturing world will be, essentially, the economic power..... can you live with America being replaced by China?

After all, it's the rest of the world that's been lending the US the couple billion a day for all the plasma TV's and SUV's

American debt can be .. confusing.. the dynamics of American Debt are anything but simple, but it is a cycle and partnership that when one side tips the entire thing falls.

Now the dollar is being burnt to a crisp, looks like they aren't going to get much of a return on the loans either.

The dollars devaluation will, in the long term, have more adverse effects on the PRODUCERS of the world, we buy less, less income, more debt for industrial nations ... this includes a large section of Europe.

The Dollar is devaluing, no one can deny, but unless our top trading partners do the same for their own currencies they will see a big problem of their own --- over valuation ..

I also personally feel that the American people will bounce back after some 'finding feet' time. OK, it may take a few decades!

Or a simple "readjustment" where the biggest loosers may be those who had significant portions of wealth in markets.. but the buying oprotunities for folks like me will be extreme .. the coming adjustment will be something like the 1980's, I doubt anywhere near the 1920's. Aside, no economic hardship of a major industrial / economic / military super power last a few decades -- war solves many economic issues.

I agree for sure that there's a difficult time ahead, but maybe a really scary global crash will be the catalyst that's needed for humanity to step up to the plate and take back our world from the fat controllers.

Not only do I agree, but I hope so .. power in Western societies is displaced.

Spot on.

JNIc1 (Nikkei 225 FUT Cont.) opened 300 points down

Europe, if you follow the graphs, when American markets opened collapsed in on its self - - some say tomorrow will be another big hit on Wall Street but if things follow the current trend some good news will come out and the market will go up slightly .... seems to have trouble getting above 14k.

Furthermore, I really question the reliability of the economists who predict good Chinese and Russian economic growth next year. No, buddy, I think it's going to be a worldwide recession or something close to that.

The days of lending to anyone with a pulse should end!

Right on Uber.

aava is right though, Europe is becoming an increasing economic holder of Chinese goods..... however the money to feul the importing comes from exporting goods to America......

No America, no exporting (mostly technology) annd no importing anything from China.

reply to post by West Coast


The United States is not China's largest trading partner. See above post for information.

reply to post by aava


But who's importing the most Chinese goods? THAT'S the figure we should be focusing on.