Originally Posted By Spirit of 74 Let's see: oil is $143 (btw, Osama said in a '99 interview that he'd have revenge on the west when it hit $144, so pretty soon he wins!) ... American Airlines is looking to fire 900 flight attendants ... Starbucks is closing 600 units ... GM just had one of the worst months in its history and some folks are using the word bankruptcy ... what am I missing? I'm waiting for someone to pop in and talk about how things are being exaggerated and things really aren't bad because Wall Street is still doing relatively well.
Originally Posted By X-san It isn't doing relatively well though. It's just on the cusp of a Bear Market or already there. There's no "relatively well" about that, unless you're expecting 1929 or something. Even after the crash of 1929 though, there were people out there saying things were going "relatively well". lol.
Originally Posted By hopemax <a href="http://money.cnn.com/2008/07/01/markets/markets_newyork/" target="_blank">http://money.cnn.com/2008/07/0...newyork/</a> > Worst June since the 1930s: Wall Street struggled Monday at the end of the worst June for the Dow and S&P 500 since the Great Depression, ending a tough first half of the year on a dour note. In the first half, the Dow lost 14.4%, the S&P 500 fell 12.8% and the Nasdaq fell 13.5%. The Dow's plunge of 10.2% in June was the worst monthly performance since September 2002 when it fell 12.4%, and the worst June since 1930, when it sank 17.7%. The S&P 500's 8.6% decline was the worst month since September 2002, when it fell 11% and the worst June since 1930, when it fell 16.5%.
Originally Posted By RoadTrip <<I would recommend caution, and dollar cost averaging personally.>> Absolutely. I've been investing in the same selection of mutual funds for about 20 years now. My monthly investment has gone up over time, but that has been determined by my personal financial situation and not by the market. I have never increased or decreased my contributions based on market conditions. There have been the normal ups and downs, but overall I have done very well. I could have gotten scared after 9/11 and sold everything. Frankly, things looked a lot worse then than they do now. But if I had done so I would have lost a lot of value. You have to remember, that although the market is down considerably right now, it is down from an ALL-TIME-HIGH reached on October 9, 2007 -- less than a year ago. I'm going to hold what I have. Partly because my Financial Planner has done a good job. I have a couple of funds that usually aren't big performers but usually go up when everything else goes down. So on balance I usually do OK. But the main reason I will hold is that I am convinced that: 1) Congress will do SOMETHING about oil futures speculation and that the end result will be a reduction in prices. 2) Just like every other year for the past zillion years, the price of gas will drop like a rock after Labor Day. 3) Once America knows we have a new president, whether it is Obama or McCain, consumer confidence will increase like you would not believe. It is like when Reagan took over after Carter. Reagan didn't have to do a damned thing, yet everyone felt better just because there was a new guy in the White House. So sorry, I just can’t do gloom and doom. I probably would have more reason than anyone to worry, because I plan to retire next year and will be needing to start drawing on my mutual funds a few years after that. I could be a chicken-shit and pull it all out and put into a money market account. But in the end I don’t think that would be very damned smart. Time will tell.
Originally Posted By fkurucz <<1) Congress will do SOMETHING about oil futures speculation and that the end result will be a reduction in prices.>> What can they do? Tell traders in London, Hong Kong and elsewhere to lower prices or we will ... wag our finger at them? << 2) Just like every other year for the past zillion years, the price of gas will drop like a rock after Labor Day.>> It didn't last year. It did drop, but much less than years before, and I recall that prices started climbing long before the traditional summer price rise. It will stay comfortably above $3, maybe even above $4 in places like California.
Originally Posted By fkurucz <<So sorry, I just can’t do gloom and doom.>> You can call it that, or you can call it being realistic, and maybe preparing for it, as opposed to assuming that gas will always be cheap and building a national fleet that consists of trucks and SUVs. Slightly OT, but something that I see here a lot in Colorado are guys driving pickups that have a pair of "testicles" dangling behing the rear axle. I guess I am supposed to be impressed.
Originally Posted By fkurucz <<what am I missing?>> That the Fed will continue printing money like it was toilet paper so that businesses that are "too big to fail" will have access to liquidity to keep themselves afloat. Of course this means that the greater public will be reamed by high inflation. Some consider this policy to be a "hidden tax".
Originally Posted By RoadTrip <<What can they do? Tell traders in London, Hong Kong and elsewhere to lower prices or we will ... wag our finger at them?>> <<WASHINGTON (AP) — Federal regulators said on Tuesday that they would place stricter limits on foreign exchanges that trade American oil as concerns continue to grow about the role of speculation in rising fuel prices. Some lawmakers said the move was long overdue. At a Senate hearing to assess its performance, the Commodity Futures Trading Commission said it would require the London-based ICE Futures Europe exchange to adopt position limits used in the United States for the trading of the West Texas Intermediate crude oil contract, which is linked to a similar contract on the New York Mercantile Exchange.>> Source: <a href="http://www.nytimes.com/2008/06/18/business/worldbusiness/18oil.html" target="_blank">http://www.nytimes.com/2008/06...oil.html</a>
Originally Posted By fkurucz "Federal regulators said on Tuesday that they would place stricter limits on foreign exchanges that trade American oil as concerns continue to grow about the role of speculation in rising fuel prices. Some lawmakers said the move was long overdue." So how will this affect prices in the global market? Even if we could halt speculation of domestically produced crude, what about the rest of global production, most of which will never see US shores? If global prices rise, our prices will follow the market.
Originally Posted By fkurucz The only way for prices to fall is for production to exceed demand. In the near term this does not appear to be likely.
Originally Posted By vbdad55 <It isn't doing relatively well though. It's just on the cusp of a Bear Market or already there. There's no "relatively well" about that, unless you're expecting 1929 or something. < so right here -- theeconomy has been in the crapper for 5 + years now-- however the 'shield' was that Wall Street kept advancing so as long as everyone's 401K's were rising - people ignored all theother signs - including the 900 pound gorilla in the room - consumer debt. The market is not looking like the knight on the white horse any longer...
Originally Posted By vbdad55 <But the main reason I will hold is that I am convinced that: 1) Congress will do SOMETHING about oil futures speculation and that the end result will be a reduction in prices. " only a movement to cap local taxes will affect the gasoline prices at this point. Chicago will see $5 / gallon by Labor day " 2) Just like every other year for the past zillion years, the price of gas will drop like a rock after Labor Day. " Every other year the demand from countries like India and China were not rising faster than the odds against the Bears next year. " 3) Once America knows we have a new president, whether it is Obama or McCain, consumer confidence will increase like you would not believe. It is like when Reagan took over after Carter. Reagan didn't have to do a damned thing, yet everyone felt better just because there was a new guy in the White House. " I do believe consumer confidence will rise with either - the issue is will it be enough to offset inflation ? " So sorry, I just can’t do gloom and doom. I probably would have more reason than anyone to worry, because I plan to retire next year and will be needing to start drawing on my mutual funds a few years after that. I could be a chicken-shit and pull it all out and put into a money market account. But in the end I don’t think that would be very damned smart. Time will tell. "I moved all of mine in the 1Q - I will re invest as I said when I think inflation will not run rampant as it did about 25 years ago....and consumer debt starts to drop some. I am very happy with my return vs. what could have happened to me the last 2 quarters - I think most would rather have been in my position. I understand the cyclical nature of the markets - but getting the hell out instead of taking a beating short term is not exactly a bad strategy. "
Originally Posted By barboy ///Frankly, things looked a lot worse then(right after 911) than they do now./// --no, not even close. Dot com busting was still the battle cry back then which is nothing compared to what's going on now. We have no water--- we're seeing long term droughts in a good sized chunk of the US---this is dust bowl pt.2 only worse. We have no credit--- good luck getting a home loan unless one comes to the table with at least 10% down, liquid reserves to cover 1 year of obligation to the lender(s) and a 700 or higher credit score. By a show of hands.... how many of you out there can come to the table as a qualified buyer? We have no equity in homes--- foreclosures and short sales continue to rock the indusrty and they are giving homes away in several markets(almost). We have no oil--- people are now scared to drive existing cars and scared to buy new ones. Have you walked a Mercedes Bens car lot lately? They're ghostowns. We have no power against the euro/yen/pound etc. We have no jobs--- even the Mexicans are cutting out and going back home. ---goodnight Irene
Originally Posted By NikkiLOVESMickey This nation has suffered through harder times before and bounced back. Times are tough compared to the relative comfort we're used to living in, but they've been much tougher. I'm not saying that I'm not concerned, but full-blown panic will set in when millionaires are selling apples on street corners to make ends meet. For the time being, I'll watch my money as best I can and refrain from making any unnecessary purchases and hope that this all blows over before it gets a lot worse.
Originally Posted By NikkiLOVESMickey <<Have you walked a Mercedes Bens car lot lately?>> How many normal, middle class families have ever been able to buy a Mercedes?
Originally Posted By NikkiLOVESMickey <<We have no jobs--- even the Mexicans are cutting out and going back home.>> Do we really have no jobs, or do we have people who don't want to "lower themselves" to work in more common professions now that times are tough? Even nearly three years post-Katrina there are still many companies with "Now Hiring" signs posted here in New Orleans, and it burns my butt when people say that they can't find a job. God forbid, if I were to lose my job, you'd see my butt at Home Depot so fast your head would spin. I'll do what I have to do to pay the bills.
Originally Posted By bobbelee9 ^^^But so many people don't think like you do. They would rather moan and collect and get as much free stuff as they can. Our church has a food pantry, it's unbelievable the people who show up for free food every week. While some do need and deserve help, there are some who show up crying that they have no money for food, diapers etc, but they reek of tobacco while looking like they just left the hairdresser/manicuist. And wearing brand new shoes/clothes. I've lost a lot of my compassion.
Originally Posted By barboy ///How many normal, middle class families have ever been able to buy a Mercedes?/// Many, as it depends on which model. Without reserching I would guess MB might well have the biggest range in car prices of any manufacturer---- maybe $33k for a 'C' model to the very exclusive $500,000 Mclaren SLR. Anyway coastal California(Bay Area, Santa Barbara, LA area, San Diego area), where I live, is absolutely loaded with MB's and the equivalent(BMW, Audi, Porshe, Range Rover, Volvo) and every one of those lots I have been on lately have not been moving product. 'Red Tag' sales and no foot traffic is the story. You'll see the EXACT same car on those lots that you saw 2 months earlier. Even worse for those in the swimming pool construction business---game over!
