The US Economy

I'm happy for your frineds scrat but if you check my previous post, people are not booking my competition either. Work is way down period.

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Scrat, Yes, there are some positive indicators. We'd be deaf and dumb if we didn't read or hear about them; it's a regular mantra today, and it's been that way before summer - if you recall. Well, I'm patiently waiting for more definitive reports from the job market other than that our economy is growing by six percent. You see, I just don't get it; when three million jobs were lost during the past three years, how does the economy keep growing? It's an honest question. The financial pundits were saying that our economy would be picking up for several quarters now, and I'm patiently waiting for that to happen; job growth, the strongest economies of the world showing some positive growth, and people not in debt up to their eyeballs - while our feds keep spending like there's no bottom to the trough. A few billions here, and a few billions there, and before we know it, it turns out to be real money!

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I live in a place where many people are very well off, from darn well off (cattle market is up, local economy is flourishing) to stinkin' rich (retired tech millionaires). It's Republican territory, too. But all this doesn't seem to be helping Bush because it's also a place where people are squinting at the Patriot Act, glowering at the deficit, greatly discomfited by Iraq.

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Meant to add that there are lots of ads for buying gold and (this surprises me) international funds. What does that say?

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Scrat, Here's another view of our economic and stock forecasters. They were saying that our economy will show improvement in 2002. I didn't believe them, and kept most of our retirement funds in bonds. You know what happened don't you? The S&P lost over 21 percent, and many lost 30 percent of their investment. We gained over four percent last year. Do you know how long it'll take to remake that 30 percent loss? I've come to trust my economic forecast more than all those pundits that make a living selling their stories.

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Tartar, We have pockets of wealthy people in Silicon Valley too. Homes selling at million and over are very active every week. They publish at least five or six of those sales every week. The wealthy will always have money to spend, but they don't make up our country's economy. After a few billion dollars, they already have everything they want or need. Money gets spent by the middle class and poor. We make up 98 percent of the economy.

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Bi-Polar Bear wrote:

I'm happy for your frineds scrat but if you check my previous post, people are not booking my competition either. Work is way down period.

I'm sure you don't mean it that way, but it seems to me that you all but deny the existence of positive news while--again--seeming to suggest that the only information we should consider is your personal experience (and that of those in your field) or whatever information you think matters.

But again, my core point to you was that your statement that "nobody" is engaging in discretionary spending is nonsense. Of course spending is down while employment is down, but that only tells us our history, not our future. This thread is supposed to discuss where we think we're going, not where we've been.

As an aside, I sincerely hope that your business improves and that your personal piece of the puzzle will be a positive one. For that matter, I hope mine does as well. Cool

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c.i. , I just thought I'd mention my portfolio is up significantly from Oct 2000 to date, even backing out the bargains I picked up during the period (like IBM at $54-$55 Smile

). It all depends on which indicators you watch, and what you do with the info, I guess. Dollar-Cost Averaging sure works for me.

Tart, I'd imagine the folks advertising all that gold and those Foreign Funds for sale figure they're too deep in 'em, and are lookin' to off-load 'em to folks who are still nervous. If you're looking for a good, safely conservative, growth investment, go for real estate. Commodities, especially precious metals, are too volatile for the risk-averse, and most funds and bonds, foreign or domestic, when calculated against inflation and their overhead pay about the same as passbook savings. The reason they're safe is precisely that they aren't going anywhere :wink:

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If I add back my spending, because I'm retired, our funds are up approximately 27 percent since 12/31/2000. The net after my withdrawals still represents a 10.8 percent increase. Since that's the period most people lost on their investments, we're not complaining. Wink

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cicerone imposter wrote:

If I add back my spending, because I'm retired, our funds are up approximately 27 percent since 12/31/2000. The net after my withdrawals still represents a 10.8 percent increase. Since that's the period most people lost on their investments, we're not complaining.

Ah, but you are in fact complaining, and at every turn, that the economy can't possibly be improving. Or had you forgotten?

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my best guest (keeping in mind that I know nothing) is that currently the economy is flat-lining with both some positive and some negative indicators.

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Scrat, People can make money in the market and retirement investments even if the S&P reflects a loss - or didn't you know that? Where do you find any complaint from me? I'm retired, and do not need to depend on employment to live out the rest of my life in comfort. I'm talking about the general trend of the economy - but more precisely the world economy - which by my estimation isn't doing too well. Maybe, you live in a different world, but I would like nothing more than to see a "real" improvement in the economy where jobs are added - rather than just productivity increases - and some p/e ratios that supports the market with some meat rather than fat. Too much fat isn't healthy, and I see a repeat of "irrational exuberance" in the market place.

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cicerone imposter wrote:

Scrat, People can make money in the market even if the S&P reflects a loss - or didn't you know that?

CI - I just pointed out your complaints. No need to get snippy, girlfriend. :wink:

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Scrat, You gotta learn how to read - that's number one, and number two, I'm a man. If you still can't identify the different sexes, I'm not sure how you can decern anything! LOL

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cicerone imposter wrote:

Scrat, You gotta learn how to read - that's number one, and number two, I'm a man. If you still can't identify the different sexes, I'm not sure how you can decern anything! LOL

I've got #1 knocked, skippy, and as to #2, you need to get up on the lingo and recognize a joke when you see one. Cool

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7.2% Incredible, if sustainable:

http://money.cnn.com/2003/10/30/news/economy/gdp/?cnn=yes

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Tartarin wrote:

7.2% Incredible, if sustainable:

http://money.cnn.com/2003/10/30/news/economy/gdp/?cnn=yes

I believe this is where CI tells us these numbers don't mean anything, that we've heard this before, etc. ... :wink:

Just kidding, CI. I suspect that even you are starting to see the forest for the trees. Dare I write "I told you so"? Cool

(This is the part where CI reminds me that it ain't over yet, leaving the option open to deny the recovery ever occurred if the economy ever dips again in the near or distant future.) Shocked

:wink:

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I have no problem with growth if it's reliable and steady and provides jobs. Before going out and buying that Lagonda, we'd do well to wait and see if jobs cease to be a lagging indicator or whether GDP becomes one.

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Tartarin wrote:

I have no problem with growth if it's reliable and steady and provides jobs. Before going out and buying that Lagonda, we'd do well to wait and see if jobs cease to be a lagging indicator or whether GDP becomes one.

Yeah, I know... you have a lot invested in the economy remaining bad. We got that a while back. Rolling Eyes

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What Tart's CNN article fails to mention is that GDP growth is outpacing productivity gains ... those pinning their hopes on continued labor woes are in for continuing disappointment. The last couple paragraphs, in particular, speak volumes about the efficacy of the fiscal policy of The Current Administration:

Quote:

Nonresidential fixed investment rose at a 11.1-percent annual rate, following the second quarter's 7.3-percent pace, a sign of continuing strength in business spending. Investment in equipment and software rose at a 15.4-percent pace, compared with 8.3 percent in the second quarter.

Weakness in imports -- which subtract from GDP, since they represent goods and services bought from other nations -- also helped total GDP growth. Imports grew at just a 0.1 percent pace in the quarter, while exports surged at a 9.3-percent growth rate.

The tax incentives are encouraging capital investments, while the deficit's effect on the relative value of the dollar, wisely being allowed to float freely, strengthens both production and consumption of domestic goods and services.
The following chart, from the French Organisation for Economic Co-operation and Development, clearly indicates not just US, but global recovery is gaining momentum.

http://www.able2know.com/gallery/albums/userpics/10156/OECD%20Comp%20LI%20Aug%2003.jpg

Even the BBC reluctantly and cautiously acknowledges the trend:

Quote:

Job hopes lift US confidence

Will higher confidence boost spending?
Consumer confidence in the US has risen thanks to an improvement in job market conditions, a survey has said.The latest study from the Conference Board, a private research group, found its consumer confidence index rising to 81.1 in October, up from a revised 77 in September.

"A more favourable job market was a major factor in the turnaround," said Lynn Franco, director of the board's consumer research centre.

In a related article, the BBC is uncharacteristically enthusiastic (though the article's further commentary is consistent with their scepticism ... they are, after all, by their own admission, "Confounded):

Quote:

Economy confounds the sceptics
US economic growth soars
The US economy rocketed ahead in the three months to September, fuelled by a consumer spending spree and the long-awaited return of business investment.

A bunch of folks are having trouble coming to grips with this. They're just gonna have to get used to it. Its here.

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