2008 will be the year subrime mortages reset and adustable rates will go up. This will mean many more foreclosures will hit the real estate market. There is also talk of an interest rate pause. Question is how will this affect the economy.. Yet there are other factors that also mold the economic markets. Oil nearly reaching 100 dollars a barrel puts a shadow over economies that import it like the United States. The US dollar which is an international peg for oil is reaching historical lows. If oil doesn't come down substantially it will put a big crimp on the consumers and the cost of doing business. Then there is the global economy led by the Chinese. What affect does the global economy have with the US economy? How well will the Bernanke fed handle inflation? How will all these factors affect the 2008 economy?
Impression of US Economy in 2008
- Thread starter nealvan
- Start date
I was talking to a flea market vendor that has been selling there for a living for the past 15 yrs. She said the past few weekends were way down compared to last year, and she had looked at the numbers, and sales were down almost 50% from the same weeks last year. She was saying it seemed like people don't have the money to buy. I think part of the problem is its a cash only business, and just selling inexpensive stuff.
I'm not saying I think everything will be down to that degree, but I think the reason why sales were up at all on black friday was because we have a lot of people coming to the US to shop for the big sales. I think by the first weeks of January there will be a blizzard of pink slips that throw us into a recession, for sure, and the sales declines here will have a domino effect in the nations that depend on us to sell to, since such a high percentage of what is on the shelves is imported anymore.
Jobless claims were up 10% last week, BEFORE Christmas, when you'd think companies would be HIRING extra help for the holiday selling season. That's not a good sign, and this is the time of year companies are budgeting for next year. I think companies will drastically cut expansion and cap-ex plans for 2008, and many will go into "cutback" mode, closing unprofitable stores and operations after the holidays. If you can't make it at this time of year, there is NO WAY you are going to make it the other 3 seasons.
I'm not saying I think everything will be down to that degree, but I think the reason why sales were up at all on black friday was because we have a lot of people coming to the US to shop for the big sales. I think by the first weeks of January there will be a blizzard of pink slips that throw us into a recession, for sure, and the sales declines here will have a domino effect in the nations that depend on us to sell to, since such a high percentage of what is on the shelves is imported anymore.
Jobless claims were up 10% last week, BEFORE Christmas, when you'd think companies would be HIRING extra help for the holiday selling season. That's not a good sign, and this is the time of year companies are budgeting for next year. I think companies will drastically cut expansion and cap-ex plans for 2008, and many will go into "cutback" mode, closing unprofitable stores and operations after the holidays. If you can't make it at this time of year, there is NO WAY you are going to make it the other 3 seasons.
fucked up
Hyperinflative Depression and WWIII.
I was looking at the votes here so far and the 2 popular choices seem to be of recessionary and the other a market of volitality.
33.33% (8 votes) There will be a global recession led by the US.
25.00% (6 votes) There will be no recession but the markets will see alot of volatility and sideways action.
That's pretty close really.
If you think about our bull market it seems like it is volatile in nature as well. Those that voted no recession here must believe that we are going to continue a similar trend that we have seen alot in our bull market. The global scenerio would mean that those that chose this would most likely believe that foreign countries rely on exporting to the US. This is true but also be aware that countries are growing and some of this balance may be shifted although the US still huge in magnitude. I know it used to be that Canada relied on 80% exports to the US but I don't know what the current figures are. Energy cost have got to weigh in on this as well. Oil reaching the psychological $100 level have got to make business think twice about expansion but if prices do come down sharply the picture will change fast.
Of those that voted could you please describe what your vote was based on? Such as facts and whether your choice has to do with primarly fundamentals or technicals and if there are any parallels to past markets.. thriftybob's post would be fundamental reasoning of his impression of the economy. There are those that believe that the bull run can't go on forever and it's just a matter of time before there's a recessionary period which would be a technical impression. Let's remember that a correction is not the same as a recession. Even big fall offs aren't necessarily bear trends but emotional markets. The market has corrected several times but the bull run has continued. Last week we also seen 2 huge up days in a row which will definatly make an impression to investors..
http://www.bloomberg.com/apps/news?pid=20601087&refer=home&sid=attYMJBK.KAw
http://bigpicture.typepad.com/comments/2007/11/citibank-reciev.html
http://www.bloggingstocks.com/2007/11/28/weekly-inventory-report-pushes-oil-prices-even-lower/
http://www.nytimes.com/2007/11/28/business/28cnd-econ.html?hp
http://articles.moneycentral.msn.com/Investing/JubaksJournal/ChinasEconomicPlanBlameUS.aspx
http://www.theaustralian.news.com.au/story/0,25197,22819452-36375,00.html
33.33% (8 votes) There will be a global recession led by the US.
25.00% (6 votes) There will be no recession but the markets will see alot of volatility and sideways action.
That's pretty close really.
If you think about our bull market it seems like it is volatile in nature as well. Those that voted no recession here must believe that we are going to continue a similar trend that we have seen alot in our bull market. The global scenerio would mean that those that chose this would most likely believe that foreign countries rely on exporting to the US. This is true but also be aware that countries are growing and some of this balance may be shifted although the US still huge in magnitude. I know it used to be that Canada relied on 80% exports to the US but I don't know what the current figures are. Energy cost have got to weigh in on this as well. Oil reaching the psychological $100 level have got to make business think twice about expansion but if prices do come down sharply the picture will change fast.
Of those that voted could you please describe what your vote was based on? Such as facts and whether your choice has to do with primarly fundamentals or technicals and if there are any parallels to past markets.. thriftybob's post would be fundamental reasoning of his impression of the economy. There are those that believe that the bull run can't go on forever and it's just a matter of time before there's a recessionary period which would be a technical impression. Let's remember that a correction is not the same as a recession. Even big fall offs aren't necessarily bear trends but emotional markets. The market has corrected several times but the bull run has continued. Last week we also seen 2 huge up days in a row which will definatly make an impression to investors..
http://www.bloomberg.com/apps/news?pid=20601087&refer=home&sid=attYMJBK.KAw
http://bigpicture.typepad.com/comments/2007/11/citibank-reciev.html
http://www.bloggingstocks.com/2007/11/28/weekly-inventory-report-pushes-oil-prices-even-lower/
http://www.nytimes.com/2007/11/28/business/28cnd-econ.html?hp
http://articles.moneycentral.msn.com/Investing/JubaksJournal/ChinasEconomicPlanBlameUS.aspx
http://www.theaustralian.news.com.au/story/0,25197,22819452-36375,00.html
I believe that the market will shift to bear in advance of the recession or growth recession being recognized and will bottom in real terms after profits evaporate and turn to losses, but sometime before the recession or growth recession ends.
Isn't that the normal sequence of events?
Isn't that the normal sequence of events?
It could be.. Hard to say what happens. So you think recession in 2008.. The subrime crisis seems to be a slow unwind and will go on through 2008 but right now the internet and tech are showing strength. I think it would depend on how much of a lead these markets can take and other factors such as oil prices and policies especially that of the fed will make. Could you expand on what scope you think this recession will be and if it will be a long lasting?
Thanks..