Wallstreet Sky Rockets! 3/11/08

reply to post by Agit8dChop


Hmm.. interesting, I have never thought to look at it from that angel .. not saying I 100% agree with it.. but insightful none the less.

However, how do you explain the housing bubble and the vast economic expansion in smaller nations not associated with the war.. like Ireland, Spain, Romania, Hungary, Luxembourg ..

And the complete opposite in some countries like Mexico and Poland.

Or complete neutrality.. like Canada, France, Germany and Russia?

Some countries prospered, some countries got worse, some countries had no major flux's .. seems like if it was all based purely on the war, only America and Britain would be having these problems?

Just throwing around some hypothesis, I wouldn't doubt the war played some part in the problem though. Personally, corporations not living up to past pay increase percentages had the biggest impact on the credit issues.

reply to post by Agit8dChop


I love it. A 50 point drop from a 5 year historical leap, and suddenly the rally must now be over and its a turn for the worse.

reply to post by Rockpuck


As a fiscal conservative I am certainly against any sort of unnecessary spending, including on the war, but I doubt that it had absolutely any impact on the economy. In fact, if anything, it helps the economy. But of course since the economy is down right now its part of the DNC talking points to blame the war...if it goes up we'll all see the legions loyal to the DNC all claim that its only up due to the war too.

Its simply reality that war funding helps the economy. There is a reason why the world wars brought us out of a depression.

In reality, the vast spending wasted on social programs costs much, much more than the war. But no one complains about that, because being anti-war and blaming the economy on it is sexy. However, as anti-war as I am, I just can't blame it as the cause of economic woes when its the exact opposite.

[edit on 12-3-2008 by pacificwind]

reply to post by pacificwind


.... that historical leap was pruley from a 200billion dollar saviour scheme.
It was touted as the turn around.

if it was the 'turn-around' and the 'saviour' it should of lasted for weeks.

hell the interest rate cut lasted more than a week.

Being it dropped today, shows the consumer understands the reality..

Sure why not...

Let's just get deeper and deeper into debt, who cares?

We just print up money without anything to back it up...sure!!!

It's a quick fix for a long term problem. These idiots need to realize that by trying to stimulate the economy they are only making things worse in many ways.

reply to post by Rockpuck


Everyone is tied into the American economy one way or another.
Especially in Oil, being its traded in the US dollar.

What ever happens to American, will affect China, and that will inturn affect the asia pacific.

Also, oil prices and Russia, eastern russian states are being pressured because russia is now upping the price on oil, thus why they are building their military.

the US financial aid packages cannot continue at peak rate either.

countires whom deal in OIL will prosper, countries whom import, will suffer, but not specifically because of that.

Alot of banks are tied to America too, and the housing bubble is being forced around..

.... Country A whos economy is faltering, but isnt tied into the WAR, is faltering because his banking sector is tied to the USA, or his oil imports are pressuring the economy.

Country B whos economy is prospering, is becuase he exports alot of oil, or because his banking sector is independant.

There are many many other reasons, this isnt the be all and end all, but its two fo the most critical concepts in todays atmosphere.

reply to post by pacificwind


World war II is a completly different scenario.
The US Was coming out of the depression before the war started,the war didnt save the economy, infact I read the US almost became bankrupt fighting the Japanese.

World war II effectivley CREATED this problem for us.

See, world war II created the concept of mass production, of engines, mechanical engineering etc etc.
We flooded the world with cars, TVs, Radios, consumer products that came from world war technological advancements.

We created the idea of a superpower, we came to understand the reality behind oil...

we setup banking cartels, and financial markets to fund the war.

Trade pacts were made, alliances settled.. World war II bought us the tools of prosperity, we turned them into destruction.

Social programmes and such benefit the USA, yes its money not nessecarily seen as 'productive' but it creates wealth within the community, it balances out debt within the commuity, it brings about confidence and respect for the USA, this is the big thing.

The dollar was based on trust, confidence. Its not eroded to nothing.

reply to post by Agit8dChop


If it was a "saviour scheme" then it would have dropped 400 points today. But it didnt - why? Because while we are heading toward a down trend in the business cycle, its not severe enough to cause a financial disaster that I know many on this board hope for. In all reality if the fed wanted to stimulate the market all they'd need was another rate cut. The cash infusion canceled any chance at a rate cut. A cash infusion makes the market go up, and the knowledge that no rate cut is coming makes the market go down, so it was zero sum game.

Of course this assumes that all economics is scenario specific and that there are never any general economic principles. But there are. War spending always helps the economy, always will. Why? Because war spending plows money into business capital, and businesses use that money to make more money, thus the GDP goes up.

Social programs are, economically, a losing proposition. Why? Because social programming redistributes wealth, and the simple reality is that it just gets redistributes to those who take it, spend it, and that's it. The multiplier impact of business spending is huge, where as there is none with consumer spending when that spending is just wealth redistribution. Social programs do not create wealth, war does. At most, social program spending is wealth redistribution - at worst, it suppresses overall wealth. It only brings "confidence and respect" for those of the liberal and socialist perspective, and frankly, I don't care what other people "respect" about our economy as long as its going up.

So if you want to blame something on the fall of the US economy, blame the fact that spending on social programs isn't being cut. Blaming on the war is just incorrect - if anything, the war would help the economy. In reality the percentage of spending on the war is such a laughably small percentage of GDP that the positive impacts it can have is minimal - but they are certainly not negative.

[edit on 12-3-2008 by pacificwind]

reply to post by pacificwind


I agree with you on social spending, absolutely.. I think they would have a bigger effect then the war..

But the underlying cause is Credit.. and I just cant say that the war caused a Credit crisis.. bubbles have formed before and we where not at war.

As for WWII -- the difference is, we actually used our industry for that war.. this war is not a real war. We are sitting like ducks, as our equipment rusts and our men become worn out.. we are not supplying them with anything except food, water and oil.. and repair parts.

We are not loosing tank batallions and 100's of jet fighters and replacing thousands of men every month, and buying thousands of coffins to fly back bodies every month..

There is no industry involved in this war except big contractors, weapons dealers and oil companies.

reply to post by Agit8dChop


Another point of interest is the fact that America had no taste for foreign wars prior to the creation of the Federal Reserve. We simply couldn't afford them. Once the marriage of government and their own debt institution was consumated in 1913 it wasn't long before WW1 took the stage and the military-industrial complex was born.

reply to post by pacificwind

posted by pacific winds
In all reality if the fed wanted to stimulate the market all they'd need was another rate cut. The cash infusion canceled any chance at a rate cut. A cash infusion makes the market go up, and the knowledge that no rate cut is coming makes the market go down, so it was zero sum game.

This is the second time I've heard you say this and for the life of me I can't guess where you're pulling it out of.

That contrasts with the U.S. market, where investors now see a roughly 70 percent chance of the Federal Reserve lowering interest rates by 75 basis points from 3.0 percent at a policy meeting next Tuesday, and around a 30 percent chance of a 50 basis-point reduction.

www.cnbc.com...

Thursday Morning and we are down 200 since Tuesdays 400 point spike. There will be some posters eating their words and we know who that will be. (-229 now on Thurs, -280 since the spike. Will we get 3 o'clock rally? Will we find support on the way down?)

Dollar at it's lowest point EVER. Asian Markets crashing, Congress fumbling around knowing that they are supposed to do SOMETHING but only duscussing doing the wrong things ie, buying mortgages only to have home values decrease more and than we are stuck with the deficit or more regulation in the credit and mortgage industries which is like putting on a condom in the 2nd trimester.

I do not think anybody really wants the economy to fail but it truly is inevitable. To many factors against it. Those managing are Managed Economy have created the perfect storm, whether intentionally or unintentionally, to blow the whole thing up.

The only real solution is to raise rates, keep inflation low temporarily, and let the bottom drop out now before it gets worse. IMO.

[edit on 13-3-2008 by Tinhatman]

[edit on 13-3-2008 by Tinhatman]

reply to post by pacificwind




War does not create wealth! Ask Napolean or check the deficit after WW2 or Vietnam or WW1. War creates wealth solely for those who are directly benfitting from war contracts. In past wars it was those who made rifles and tanks, in this war it is the security contractors and other private contractors. The rest of the economy suffers from displacement of goods and commodities.

Currently we have the displacment from war, a credit melt down, morgtage meltdown, housing and construstion melt down, foreign currency shifts (Kuwait depegged last May, Qatar this year), the dollar is tanking, even mainstream economists who are notoriously payed off or just incomptent are starting recognize that we are already in a Recession (since last September) and that it is only going to get worse. they can't even lie about it or fudge the numbers anymore.

I am listening to Bloomberg now and they are talking about Paulson floundering around.

reply to post by HimWhoHathAnEar


I'm just pulling it out of reality, and not the liberal controlled media that is telling you the end is nigh 24/7. Or would you like to deny that (1) cash infusions pump up the market AND that (2) when any promise of rate cuts are lost, it causes a sell off.

Oh and to tinhatman:

War does create wealth. Its a fact, because war spending plows money into economic sectors that have a large multiplier.

I'm glad to hear that you're now declaring were in a recession. Of course, the last quarter (which included last year) didn't have negative GDP growth. Since two consecutive periods of negative GDP growth are needed in order to have a recession, we'd have to have one for the first quarter to even begin to predict one. But why think about data when we can just change the definition and declare it to be a recession because we desperately want to confirm our worldview?

[edit on 13-3-2008 by pacificwind]

reply to post by pacificwind

posted by pacificwinds
I'm just pulling it out of reality, and not the liberal controlled media

Yeah, I know where you pulled it outta! So everybody here is uninformed by the Doom and Gloom media and only pacificwinds knows the Real Deal.
Good Luck with that, I'm heading back to watching my PM's rise.

reply to post by HimWhoHathAnEar


What's that, you can't deny those two points which demonstrate why the markets upswing wasn't due to a cash infusion only? Of course you can't, you'd just prefer to be arrogant.

(1) cash infusions pump up the market AND that (2) when any promise of rate cuts are lost, it causes a sell off.

Facts can hurt whenever your only seeking to confirm your worldview.

[edit on 13-3-2008 by pacificwind]

reply to post by pacificwind


Speaking of world view's and basing my assumption on your own comments I would think that you are implying that I have a liberal outlook when in fact I am wildly conservative when it comes economic standpoints and social spending.

The problem is that you are basing your numbers on the statistics that the government releases to determe growth or shrinkage in the economy. These numbers are notoriously manipulated and when taken at face value do indeed tend to not show much negative impact at all.

According to a study done by Duke University most American CFO's already believe we are in a depression.

I suggest to check out this site,
Ticker forum.

While not an end all be all site it will give you some fantastic insite from insiders and economists in the field.

There is a lot more going on right now than just what's on the surface and what is being openly discussed.

As far as war being GOOD for an economy, it is true in the very short term and generally in very specific industries. As far as war being good for the overall health of an economy in the long term we would have o ignore 1000 yrs of historical evidence to come to that conclusion.
This "theory" that war is good for economic health has been largely disproven and typically is only used by those who want to start a war.

Also, it may help to turn off Sean Hannity once in awhile and flip over to Bloomberg. Great info there!
[edit on 13-3-2008 by Tinhatman]

[edit on 13-3-2008 by Tinhatman]

Originally posted by pacificwind
reply to post by HimWhoHathAnEar

 

What's that, you can't deny those two points which demonstrate why the markets upswing wasn't due to a cash infusion only? Of course you can't, you'd just prefer to be arrogant.

(1) cash infusions pump up the market AND that (2) when any promise of rate cuts are lost, it causes a sell off.

Facts can hurt whenever your only seeking to confirm your worldview.

[edit on 13-3-2008 by pacificwind]

posted by pacificwinds
In all reality if the fed wanted to stimulate the market all they'd need was another rate cut. The cash infusion canceled any chance at a rate cut. A cash infusion makes the market go up, and the knowledge that no rate cut is coming makes the market go down, so it was zero sum game.

You said that a cash infusion canceled out a rate cut. I posted a cnbc article that proved that to be false. I don't know where you got off track. The cash infusion in no way canceled out a chance at a rate cut! Just that simple.

[edit on 13-3-2008 by HimWhoHathAnEar]

reply to post by Tinhatman


I'm not sure what to say. When you claim that numbers which don't agree with you are just wrong because there must be some conspiracy at the source, then you will always find validity for your own view. I may be paranoid about some things, but I am just not paranoid enough to think that simply because statistics - which having spent some knowledge about methodology I find to be very verifiable - don't agree with my view that they must be wrong.

I'm happy you sited a survey that says what people think, as in a past life I was a social science methodologist. Just because people believe we are in a recession, depression, whatever does not mean its happening. People are conditioned to respond based on what others say and what the media tells them, its called the social desirability response effect. Did you know a large amount of Americans think that Canada is part of the United States? Just because people think something does not mean its true. All it shows is that public sentiment is heavily programmed by the media.

I tend to base my views based on the data, and not make the data fit my views.

Its been verified over and over again war is good for the economy. Its only disputed by people who are vehemently anti-war. I'm anti-war but not radical about it, because I base my views on reality and not what people would like me to think.

Your assumptions about my political ideology are laughable. My ideology is so different than Hannity its amusing. I think you should probably turn away from the liberal news media and look at the data! But wait, because I think the news media is liberal it must mean I'm conservative, right?

[edit on 13-3-2008 by pacificwind]

reply to post by HimWhoHathAnEar


Are you resorting to lying now? It appears so. The article you posted today cited that investors we're expecting a rate cut. They know they are not likely to get one after a cash infusion, so stocks drop. This completely confirms what I said.

If and when they get a rate cut, the stocks will go up. Again...confirming what I said already.




[edit on 13-3-2008 by pacificwind]