I'm glad I have 20+ years to retirement...this market is just god-awful frightening. If my 401k was a movie, it'd be "Gigli"
I'm glad I have 20+ years to retirement...this market is just god-awful frightening. If my 401k was a movie, it'd be "Gigli"
Don't listen to Deogol or Melonie. We are just tin foil hat wearing wackos!




Asian markets down 10% in early morning trading......and its gonna get worse as the insurance for Lehman's bonds are annouced Friday.....
any bets on tomorrow DJI close?





just the opinion of a 'dumb blonde with big tits', but I wouldn't even start thinking that a bottom is in until the DOW crosses below 8000.










off topic but ... if California continues on their current path of political priorities in regard to public spending, gov't borrowing and tax rates (as New York already did many years back to the point of bankruptcy), you may find that your sensitivities will be less offended than they once were !




I'm betting on another 10 percent day.....like I said, AIG is reporting what they are going to be paying for bonds, etc......and it sound like it may be insuring at 10-20 perfect of the bonds value....
If thats the case there will be a big write-off. Also Chrysler Financial and Ford Cred (if it still exists?) has to report their "earnings"; thats my reasoning for another hit today...
Where do you think Melonie and I and the few other conservatives on here get our views ? History. Economic and political HISTORY.
High spending and high taxes inevitably leads to financial ruin for EVERYBODY.
Lending money to people without an income check and a poor credit history means most of them won't be able to pay it back.
"A stupid man's report of what a clever man says is never accurate because he unconsciously translates what he hears into something he can understand." - Bertrand Russell
"It's just a matter of people having low self esteem and being way too easily offended." -Random Guy on a Internet Forum
In other words: Boo-motherfucking-hoo





because you would have to start with Franklin Raines and Jim Johnson ... both of whom are Obama advisors !Why aren't we going after them (lying buyers and bankers alike) with criminal charges?





So why was there such an economic boom after Clinton raised taxes and why is the economy in such bad shape after Bush's tax cuts?
If you get your views from history, how can you possibly say, "high spending and high taxes inevitably leads to financial ruin for EVERYBODY". It was high spending and high taxes to pay for our military buildup during World War II, that brought us out of the Great Depression. Even before World War II, government spending on public works projects made things better.





well, to be technically correct, it was the 'permanent removal' of some 350,000 American males from the US labor force / unemployment rolls (i.e. soldiers and later casualties of WW2) that ended the Great Depression. Following that historical record, the most effective remedy for the current economic disaster would probably be a 'Bird Flu' epidemic. After all, it was a virulent flu epidemic in 1918 that made the 'roaring 20's possible ! I know that this is a sensitive subject, but for a fact every US military conflict since Korea has failed to 'permanently remove' enough unskilled American males to have any significant positive impact on the American economy.It was high spending and high taxes to pay for our military buildup during World War II, that brought us out of the Great Depression
a graphical representation of the difference courtesy of my 'friend' Elaine at ...
there are a whole slew of economists who point out that FDR's public spending programs and other economic measures turned a recession into a depression, and sustained that depression for may additional years. See for a rather concise summary. Also note that many of the economic and tax policy proposals being floated by the Obama campaign bear an uncanny resemblance to those of FDR ... leading to the conclusion that, if implemented, the results are likely to be similar !!!Even before World War II, government spending on public works projects made things better
~
Last edited by Melonie; 10-11-2008 at 05:12 AM.




Actually, the economic boom in the nineties was driven by the rapid growth of technology. It had nothing to do with any political/tax programs (well, except for Al Gore...you know....the inventor of the internet).
The existing recession is a natural economic cycle that is now being "hightened" by a serious credit problem. A problem that was caused by programs pushed by politicians. Now, a "solution" has been put in play by politicians that will probably ease the credit situation very soon, but will lead to long term depreciation of currency. This is a much worse problem than a cyclical recession.
The sins of all those that support the governments "right" to legislate virtually anything are now coming to roost. Thank you all. I have had the best month ever in my portfolio. Now, please try and not devalue my gains too much. Aaahhh...don't worry about it...I can speculate just fine on currencies....





a lot of economists would argue that the capital gains tax cuts which were forced upon Bill Clinton by a republican congress played a major role in that economic boom !Actually, the economic boom in the nineties was driven by the rapid growth of technology. It had nothing to do with any political/tax programs
and this point is of EXTREME future significance. Unfortunately for most Americans, they still think in US-centric economic terms i.e. the US dollar being a valid 'yardstick' for measuring value. However, in today's global economy, nothing could be further from the truth. The obvious example are recent declines in US gasoline, food and stock prices. While some of the decline has been due to a reduction in demand, a LARGE piece of the decline is directly related to the strengthening of the US dollar's international exchange rate.but will lead to long term depreciation of currency. This is a much worse problem than a cyclical recession
As you point out, the recent 10-12% strengthening of the US dollar is most likely a short-lived result of US dollar payoffs on derivatives contracts by foreign 'bagholders'. In the longer term, unless the US gov't stops printing up new money and the US gov't stops spending like a drunken sailor, the US dollar index is headed south of 72 again (arguably WAY south). And as the US dollar index drops, the US dollar denominated prices of any international commodity - of imported products of all kinds - automatically rise !
This is arguably the cruelest tax of all, since it affects the American poor and middle class as much as the rich. And some economists point out that a devalued dollar actually creates a greater negative impact on the poor, since the share of their US dollar denominated incomes that must be devoted to purchasing 'world market' priced commodities like food and energy is greater than the middle class and FAR greater than the rich ! Similar logic applies to the purchase of low end imported goods by the poor versus the purchase of high end domestic goods by the rich !
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Last edited by Melonie; 10-11-2008 at 05:33 AM.




Aaaahhh....yes...I stand somewhat corrected. The capital gains tax cuts definitely steer money toward investments that produce economic growth, but that extra money would have had far less effect if the underlying industry was not in a position for major growth. Then again, the industry would not have grown as rapidly if it were not for this captial infusion. It is kind of funny...the "cause" and "effect"...something to think about everyone....





^^^ that concept of 'positive reinforcement' was indeed fundamental to the bright economy of the 90's.
However, the same principles now apply in reverse ... i.e. 'negative reinforcement' causing the recent economic turmoil to build upon itself. Falling stock markets causes a few stockholders to sell their holdings (to minimize losses) ... which in turn causes stock prices to fall even further, prompting even more stockholders to sell their holdings, causing even larger drops in stock prices, prompting even more stockholders to sell. The concept of 'negative reinforcement' also applies over a wider scope as well ... i.e. people who have lost money in the stock market spend less money on consumer items, which reduces profits of companies that produce consumer items, which reduces the future stock prices of these companies ! And falling corporate profits plus capital gains losses of stockholders causes gov't tax revenues to fall, which prompts gov'ts to raise tax rates to try and recoup these losses, which in turn causes corporate profits, consumer spending, and stock prices to drop even further, resulting in even lower gov't tax revenues ...
The 'tin foil hat' crowd is of the opinion that the extremely complex financial system of today's world is far more vulnerable to 'positive reinforcement' and 'negative reinforcement' effects. As such, the well-intentioned actions of politicians and governments intervening in today's world economy are much more likely to fail at achieving their intended result. Perhaps more important, these gov't interventions are also capable of triggering an unintended consequence as the result of setting a new 'negative reinforcement' cycle in motion !!!
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Last edited by Melonie; 10-11-2008 at 07:03 AM.




As a different mode of thought, I wonder what the 90's would have been like without a capital gains tax? Cutting of the cap gains tax did help fuel growth, but the fact that there was a cap gains tax kept growth from its full potential.
As for the falling market...eventually, the value investors with a buy and hold mentality will go into buying mode and start propping it up to some point. We may face a bear market for a while yet, but the free fall will eventually stop. When this occurs depends a great deal on the psychology of the average invester (and the institutions also).





I'll agree with the institutions, but not with the average investor. For a fact, sovereign wealth funds, hedge funds, banks and investment houses (managing the investments of the very rich) own FAR more shares than all of the average investors put together.but the free fall will eventually stop. When this occurs depends a great deal on the psychology of the average invester (and the institutions also).




You are correct...I should have said the institutions and also the average investor. I was looking at it from the point of view that much of the average investor money is handled by institutions (via mutual funds, etc.). You got me....I have observed people around me making runs on their mutual funds and going to cash based investments....to protect their principal.
Promote yourself and earn more money! This is a business that is owned by strippers for strippers. Let's make that money!





I dare say I have read as much HISTORY as anyone on this forum, and I disagree emphatically with the 'conservative' view of the causes of this disastrous panic attack in the NYC stock exchange, and concomitant worldwide economic crisis.
The notion that HISTORY will invariably backup the conservative viewpoint is absurd.
You must have chaos within you to give birth to a dancing star.
Friedrich Nietzsche
Free your mind, and your ass will follow.
George Clinton
______________________________________





That's a conservative myth. The economic boom started long before the capital gains tax cuts were passed in late 1997. Conservatives like to ignore everything that happened before the capital gains tax cuts were passed and pretend everything started happening right after the capital gains tax cut. The fact is, the economic expansion started years before the capital gains tax cut. Government tax revenues began to significantly increase long before the capital gains tax cut. If you look at the below chart, you will see there was no significant increase in GDP growth after the capital gains tax cuts were passed in the 3rd quarter 1997:
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The fact is, there was consistent economic growth after Roosevelt took office and began spending on a number of government programs. It was only in 1937, when Roosevelt reduced government spending, that economic growth slowed down.
In Japan, increased government spending was able to get Japan out of the depression by 1933:
http://en.wikipedia.org/wiki/Great_Depression#East_Asia
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