| Back to Home > Bulletin Board > Current Events > Topic: Dow Jones hits 13,000 |
Topic: Dow Jones hits 13,000
| Author | Message |
| UGoGirl | Posted – 4/25/2007 9:50:43 AM | show profile I just love it, the insanity of it all.. *** What a delightful, degenerate economy! AP reports that three million manufacturing jobs have been lost in the United States since George W. Bush came into the White House. But who cares about making anything anymore? Who cares about actually creating the things that really make people wealthier? The money is not in making things?but in shuffling paper around. Everyone is getting rich - providing financial services to everyone else, like people on an island making their livings by taking in each other's laundry. Let's see, we'll lend you money to buy a house. Then, you refinance the house with our friendly rivals down the street?and then you place the money with a private equity firm?that uses it to take a company private?paying off the shareholders?who take their loot and put it into a hedge fund that buys the shares of the same company when it comes back onto the public market! Whew! What does it take to keep this grand money machine spinning? More credit (or cash)?and an incredible amount of naïveté?not to say, dumbness. Not to mention more than a few twisted tales: Who's Not Telling You the Truth? Money supplies all over the world are increasing - 10% per annum in the United States, 10% in Europe, 14% in Asia. The hedge funds, mutual funds, private equity funds, investment banks - the green stuff is everywhere?and everywhere it is chasing more green stuff. The world has gone green. ...Practically unnoticed in the worldwide euphoria of rising prices was the falling dollar. In the two weeks we were in South America, the dollar lost about 2% of its value against the euro. Against gold, it lost 3%. Measured against gold or the euro, Americans - even if they had all their money in the Dow - got poorer while we were away. ... And all of this excessive spending, made possible by the excessive creation of money and credit by the Federal Reserve, means that prices will go up excessively. ...It's a good thing that they are excluding energy costs in reporting inflation, as "Energy prices jumped 3.6 percent last month after increasing 3.5 percent the prior month. The price of gasoline rose 8.7 percent, the most since November, and natural gas costs increased 3.3 percent"! Yikes and yikes again! And let's not forget food! Luscious, delicious food that is sometimes fried, often crunchy and/or chocolate covered, and then eaten a hell of a lot more often than I should (but a lot less than I want) which results in a big deficit in the Total Mogambo Food-Oriented Hedonism Quotient (TMFOHQ), for which I angrily blame a cruel, uncaring world, and thus proceed to make everyone's life a living hell with my righteous revenge. Now, unfortunately, things are getting worse, as the new report, "showed food prices rose 1.4 percent in March, after the previous month's 1.9 percent increase that was the most since October 2003." Well, judging by the lack of frightened wailing and screams of outrage, apparently I am the only guy in town who can multiply the 0.6% rise in the CPI times twelve months to get a terrifying annual inflation rate of 7.2%, or who can add March's 0.6% inflation in prices to February's 0.4% inflation in prices to get an average of 0.5% inflation in prices, and then multiplying THAT by twelve months to get an annual price inflation of 6.0%, which is still horrifying enough to make you whimper and cringe in terror if you have any tiny little bit of a hint of comprehension of the enormity of what this means! Or maybe everyone else is so gullible, non-thinking, childishly trusting, ignorant, stupid and easily-led that they are falling for the Fed's trick of making you pay attention only to "core consumer price inflation", which EXCLUDES food and energy prices, but is still hedonically adjusted to make it look better than it is. When you do that, "core consumer prices" are, magically, up only 0.1%! Hahaha! What a scam! http://www.dailyreckoning.com/Issues/2007/DR042307.html |
| UGoGirl | Posted – 4/26/2007 6:28:41 PM | show profile Nice to see I'm not the only one who doesn't see the economy as being in great shape: http://news.blogs.nytimes.com/2007/04/26/run-on-wall-street-sends-dow-above-13000/#comments |
| mailbag | Posted – 4/26/2007 8:23:17 PM | show profile | email poster You are talking to yourself again. lol. :D Did someone say 13 is not a lucky number? It is funny -- back in 2005 after a flat growth year for the DOW all the pundits were saying how those marks that make up the DOW should be changed to reflect a true economy (which appeared to be growing.) Don't hear them now...and the economy's growth is flat. The dollar is trashed imo. Worthless in the UK - and what kind of economy do they have? Past the comfort zone for the EURO. We get 12-cents extra by going to Canada... just a few years ago it was 40-cents extra. |
| UGoGirl | Posted – 4/27/2007 11:44:54 AM | show profile Mailbag, yes I'm talking to myself again. Believe me I'm used to it. I truly wasn't like this a few years ago. A few years ago I was as blissfully ignorant as the average American. My motto was usually (and still is in some respects today) that things usually turn out for the best, blah blah blah. I had this assumption, a few years ago, that the future would pretty much play out like the past has. But then I got curious, spent a good long time looking at the data, and took the red pill. And once I understood that no, the future was not going to proceed as the past has, it changed everything. I can now see how so much of what America (in particular) is doing is unsustainable. Our energy consumption and dependence on oil and (increasingly) natural gas from countries of the world that don't have our best interests at heart. Our unsustainable debts and deficits. The 10,000 mile salad, the fact that we don't really know how to do much here these days other than push papers around. And what surprises might the future have in store for us from climate change? One thing is clear, the future is going to be a lot more expensive (energy, food, etc.) and we will either have to change and adapt or engage in an all out resource war at the global and local levels. We know the strategies the Bushies are taking. But as I said I'm used to talking to myself about this. This isn't stuff that a lot of people want to talk about, and believe me when I say that my social life has not benefited from this awareness. It's a real downer. I did go through a short period when I found this all quite depressing, but I don't really feel depressed now. I can joke about our bleak future while at the same time I try to do what little I can to improve our future both for my family and others. |
| catlondon | Posted – 4/27/2007 12:29:13 PM | show profile So, I had a lovely thoughtful reply to this and it seems to be lost, so here it goes again. A year or so ago, I read an article in the Economist about the stock market that detailed the outdated information often used in representing our economy. For instance, manufacturing figures are often used, even though the U.S. is no longer an industrial nation, but, let's call it intellectual manufacturing is rarely represented. So even though China is making our computers, the ideas that cause that hardware to come into being are still largely generated in the U.S. (for a silly example, think the iPod). The gist being that we shouldn't expect our economy to look like 1917 anymore, but should be giving more weight to the Genentech's of the world--which contribute as strongly but with a different product. Anyway, that's a poor recounting of the article but it definitely made me feel better about the stock market. As for food, well there's two sides to that issue as well. One, that Americans have a right to artifically cheap food subsized by their government or 2) that heavily subsidized U.S. food contributes to the impoverishement of the rest of the world, which can't compete against our low prices, and that if you factor the tax-payer funded subsidies in to the cost of food it hurts Americans more than paying the true cost of the food does. According to the Washington Post in 2006, since 2000 the U.S. paid $1.3 billion to people who don't farm, simply because they live on subsidized land. In the heartland, that's called "farming the mailbox." So I would have to know why food prices are rising before getting upset about it. |
| UGoGirl | Posted – 4/27/2007 12:53:32 PM | show profile Food subsidies are a problem, and we all know that Americans can also afford to eat less (most of us anyway). But the recent price increases have nothing to do with changes to food subsidies. They have everything to do with oil/gasoline. What do you need to transport food? Gasoline. What do you need to grow food? Gasoline. Rather than feeding people, what are food crops increasingly being used for: alternative fuels. This situation is only going to get worse in coming years. |
| catlondon | Posted – 4/27/2007 1:22:04 PM | show profile Some of the price increase is due to the global shift away from oil and gas to farm-based fuels like ethanol and biodiesel. I'm not a huge supporter of ethanol, but it the increased demand has driven up the price of corn and soybeans. It's a conundrum--we want to wean ourselves off gas and oil, but we don't want it to hurt us somewhere else and I don't know if that's possible. Just ask those rich Cape Codders, who will be mortally wounded if a windfarm goes up and spoils their view! (I'm being sarcastic.) |
| UGoGirl | Posted – 4/27/2007 1:54:20 PM | show profile Cat, yes those windfarm fighting rich cape codders. Absurd. One of the most obscene fights by Robert Kennedy at NRDC I've seen. Hopefully he's changed his tune on that one. |
| TruthOut | Posted – 4/28/2007 2:31:21 PM | show profile Most people's eyes glaze over at financial news they don't understand what it means or how it impacts them. And sad to say but until your job is outsourced, 99.9% of the world doesn't care until it happens to them. And how many people do you think really understand how the hedge fund market works? |
| mailbag | Posted – 4/28/2007 3:00:59 PM | show profile | email poster Too true truthout "TruthOut ... And sad to say but until your job is outsourced, 99.9% of the world doesn't care until it happens to them. And how many people do you think really understand how the hedge fund market works?" I agree - both science and financial news is over the average bear's head. Can't say why. Maybe too much attention to football in high school, which lead to lack of understanding and comprehension in college and adulthood? Maybe fear? Fear of some personal financial failure and or watching one's job go overseas? (Fear = avoid topic all together.) Personally I've not understood the food subsidy program. I am against payouts, but not against some break a farmer could get if he grew "x need" and didn't make a "y" percent of profit. The hedge fund business. jeez. Just go to Vegas. :) In my mind it is the same. |
| UGoGirl | Posted – 4/28/2007 4:31:23 PM | show profile Well that's true, we really do want to be able to produce our own food and if a subsidy helps keep Farmer Joe farming, then that's good. Of course, these days there aren't many family-owned farms, all big business. I hope that changes. I wonder when civilizations have collapsed in the past how people handled it (psychologically). For example, when a society collapsed due to deforestation (and the impacts on agriculture), were there some old curmudgeons saying, "This isn't right. This doesn't look good. We've got to change." While others were saying, "Don't be such a downer, we'll figure something out. Something will come up. You need to enjoy life more." |
| questoo1 | Posted – 4/28/2007 4:32:53 PM | show profile true.. then again 99% don't know the mutal fund market either. We live in a sausage society. Most people don't know or want to know what goes into sausage, they just know it tastes pretty good. While there are many who constantly seek knowledge, I think its human nature to not really concern ourselves with something until it effects us in a negative way |
| catlondon | Posted – 4/30/2007 11:07:54 AM | show profile Just to weigh in on the farm subsidy program again, just so you know, people are being paid not to grow anything at all. The land sits fallow and the government sends people money not to do anything. If you're a woman with children who doesn't work, it's called welfare and you're a parasite on the State. If you represent ConAgra and take money not to work the fields, it's called a necessary subsidy. Approximately 60% of American farmers and ranchers don't receive a subsidy--the lion's share of the money goes to major producers. Farm subsidies haven't changed dramatically since they were enacted during the New Deal to assist farmers. Now it assists the multinationals and are more harmful to small farmers than helpful. A lot of money flows to both parties from major-producer lobbying groups to keep it alive and profitable. Anyway, just today's rant. |
| mailbag | Posted – 4/30/2007 2:24:11 PM | show profile | email poster So, you and I are paying some 40% of the rest not to grow crops? (I didn't know it was that high.) This is so we can import that same food cheaper from Chile and Mexico and anywhere else? |
| catlondon | Posted – 4/30/2007 2:36:58 PM | show profile Mailbag: Not all subsidies go for NOT farming, but a portion does. Here's a few paragraphs from a recent WAPost article on the farm bill, which is up for renewal this year. "In 1981, the Texas rice belt extended over about 600,000 acres. By last year, USDA records show, the amount of planted rice had shrunk to 202,000 acres, partly because landowners were able to get farm payments even if no rice was grown on their land. In fact, so many landowners and farmers are collecting money on their former ricelands -- $37 million last year alone -- that the acres no longer used for rice outnumber the planted ones." |
| mailbag | Posted – 4/30/2007 4:25:55 PM | show profile | email poster I must be dense today catlondon. I re-read that para and simply do not understand it. :-( |
| catlondon | Posted – 4/30/2007 5:01:20 PM | show profile Mailbag: No worries--in a nutshell, in this example in Texas, the taxpayers are paying out to subsidize 200,000 acres of rice, but actual rice is only being grown on a little more than 20,000 of those 200,000 acres. But the subsidy money comes no matter what to the owners of all 200,000 acres. Or, another example, if you were to buy an acre of land in Iowa that is subsized by the government to the tune of $1,500 for growing corn and what you do instead is plant a field of pink plastic flamingos and garden gnomes, the government will still send you $1,500 a year, no matter what because the land carries a subsidy. In fact, corn may not have grown on that land for thirty years, but the landowner will have received his/her/its corn subsidy all of those 30 years. |
| j.hodl | Posted – 5/27/2007 4:13:26 PM | show profile What's more, most of what little subsidized rice is grown in Texas is not for human consumption. Its to attract ducks for the hunters. Your tax dollas at work! |
| UGoGirl | Posted – 6/4/2007 1:09:53 PM | show profile Here's What's Going On... corporate corruption again... Companies buying back their own stock (plenty from the oil/gas industries)... what's that all about? *** So what's going on? The first round of analysis compared the growing tendency of companies to buy back their stock with their weak investment levels. The implication was that it might be business, not housing-stressed consumers, who were becoming the first to lose confidence in the economy. Net withdrawal of equity by non- financial businesses, in other words stock buybacks, grew from $42 billion in 2002 to a record $602 billion last year. As Bloomberg News columnist Caroline Baum wrote in April, buybacks may be "a good way to boost the stock price. It's not a vote of confidence in the future of the business." Recent Surveys Recent releases of the Federal Reserve's Senior Loan Officer Survey and the Conference Board's CEO Confidence Survey echoed this point, showing waning confidence in the economy's appetite for goods, services and investment. The second wave of analysis also took note of the buyback boom, but suggested a more cynical explanation. In a recent piece, New York Times economics writer Floyd Norris cited Robert W. Parenteau, chief U.S. economist and investment strategist for money-management firm RCM, as suggesting that stock-option profits have been the engine of stock repurchases. Norris quotes Parenteau as saying that "companies are lifting their own share prices in a remarkable feat of manipulation." New York Times op-ed columnist Paul Krugman joined this chorus by pointing to Fed research that has found that company decisions over when to buy back stocks "are strongly influenced by `agency conflicts,' a genteel term for self-dealing corporate insiders." Bloomberg |
| foodlit | Posted – 6/4/2007 1:40:28 PM | show profile No gloom and doom here As a headhunter, I've been seeing signs of growth in the economy for months now. Companies are hiring like crazy and it's harder to find the people. Last time I saw this kind of activity was just before the internet boom....so I am very optimistic about this economy. This Businessweek article confirms what we're already seeing... A Merry May for Jobs The stronger-than-expected employment report for the month caps a run of data that leaves the economy poised for a second-quarter bounce by Michael Englund The first day of June brought a fresh round of data that point to stronger growth ahead for the U.S. economy. Reports on jobs, income, and factory-sector sentiment all signal that the inventory downdraft of the 2006 fourth quarter and 2007 first quarter has reached an end. We still aren't out of the woods with housing, as suggested by a weak pending home sales report for April, but the removal of the inventory downdraft should allow gross-domestic-product growth to bounce above 3% in the second quarter. The prospect of a second-quarter bounce in growth, along with persistent signs of inflation, will keep the Federal Reserve on its toes in the coming months. |
| UGoGirl | Posted – 6/4/2007 3:43:59 PM | show profile Yes, but things aren't always what they seem. Before the stock market crash of the depression era, there was concensus that the stock market was at a new permanent high. (Only took about 30 years to recoup losses from that crash). Not necessarily a stock market crash we have to look forward to, but more likely a dollar collapse. |
| UGoGirl | Posted – 6/6/2007 10:38:32 AM | show profile all is not well.... History, as they say, has a habit of repeating itself (not necessarily with the stock market, but in other predictions of neverending growth and prosperity). The link below has a bit about the "permanent high" prediction in the stock market pre-Great Depression, and the 90% decline from 9/3/29 to 7/8/32 ...which was then also the lowest level for the next 67 years http://www.buyandhold.com/bh/en/education/102299.html |
| foodlit | Posted – 6/6/2007 3:05:00 PM | show profile Is the glass half full or empty Depends on your outlook. If you are searching for doom and gloom news on the economy, you can find essays like that to support your claim, but they are not fact based they are opinion. Just because people were saying the economy was strong before the crash of 1929, doesn't mean it's about to happen again. Since that crash, safeguards have been put into place to ensure it doesn't happen to that extent. I prefer to take the glass half full approach. I agree that everything is cyclical and that history repeats itself....which to me means that we're on an upswing and better days are still ahead, and the economy will continue to improve. Depends on your outlook. From where I sit, the sun is shining! :) Pam |
| mailbag | Posted – 6/7/2007 7:30:00 AM | show profile | email poster Pam Difference today is -- there are better (much better in fact) outlooks for other countries than our own. If you haven't already - spend some time discussing economic progress with Chinese and Indians who work in those countries today (in professional capacities.) I do speak with them on a weekly basis as part of my job. Their stories don't make the headlines... and believe me the amount of growth and wealth found at the middle class level is more than anything the USA has experienced. Sure... what if the USA growth sits between 2 and 3 percent for the next 10 years.... China is double digits for the next 20 years, India for the next 10. China will outpace us eventually to become the world's No.1 economy... Since our t-shirts and undies are made in China, are you ready to pay $100 for a tshirt by 2020? Or is the master plan to have t-shirt factories moved back to the USA at $3 pr hour by that time? |
| foodlit | Posted – 6/7/2007 8:48:50 AM | show profile So the US is the only economy that should be strong? I don't buy that. Why is necessarily a bad thing if other countries are experiencing economic growth. It could be a win-win for all. I think it's important to be aware and concerned about the economy, but what I'm seeing here is so much doom and gloom, the sky is falling, etc. I just don't see it that way. But apparently I'm in the minority! :) Pam |
