How bad is this economy going to get?

Discussion in 'West Mall' started by AustinHorn24, Apr 1, 2020.

  1. Monahorns

    Monahorns 5,000+ Posts

    The thing is that companies who let go their experienced employees hurt themselves. The companies who hire them as consultants are getting a great service and are making money as a result.

    US corporations make a grave mistake thinking that people are cost centers instead of profit centers. It will lead to market share loss and therefore reduced sales. Any companies who have the right viewpoint will make money based on their viewpoint.
    • Agree Agree x 2
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  2. AC

    AC 1,000+ Posts

    I would answer this with the following:
    Gen X and some Boomers laid off for the above reasons are starting businesses in large numbers. They are creating the jobs in this Covid 19 economy! I have taken 4-5 calls trying to get me to take a PPP loan. My answer is always no. Instead I started a second company based on passive income creation. My first company covers my overhead and I live well. If your over 50 and find yourself laid off. I would consider starting a business. There are 1 million choices out there. I’m now focused on passive income. That way I can retire when and where I want to, but still have income.
    • Like Like x 1
  3. Joe Fan

    Joe Fan 10,000+ Posts

    gold hit an all time high

  4. Dionysus

    Dionysus Cocky + Relaxed Admin

    Communist memes aren’t funny unless everyone gets them.

    • Funny Funny x 7
  5. bystander

    bystander 5,000+ Posts

  6. Musburger1

    Musburger1 2,500+ Posts

    There's a lot of issues when discussing the $600.
    1. Disincentive to work. Why work for less?
    2. Slow down evictions.
    3. Payments allow for consumption which keeps economy going.
    4. Fairness.
    5. Growing deficits by billions every week.

    #1 seems to be the most important issue from what I can tell as far as how the members in this community see things. And this is discussed daily in the media. Everybody seems to have an opinion. But lets take a look at #4 and #5 for just a minute.

    This morning, Zerohedge posted this article.

    In Unprecedented Move, Congress Proposes Taxpayer-Funded Bailout Of $550 Billion CMBS Industry

    Commercial mortgage backed securities are in deep doo doo. So Congress is gaining momentum to pass a bill that would transfer over half a trillion dollars from the taxpayer to the billionaires and mega-millionaires that are on the hook for this collapse. The banks would be guaranteed to be made whole. Yes, all the millions of people making near minimum wage previously are now getting $600 per week courteous of the US tax payer. But if and when this bill passes, a few hundred uber wealthy "crony capitalists" are going to bailed out of billions of losses by the US taxpayer. And there will be little outrage or little media coverage when it happens. And certainly no analysis. This is going to be a bipartisan bailout just like the one in 2008.
    • poop poop x 2
  7. Monahorns

    Monahorns 5,000+ Posts

    Q2 was a 34% drop worst since the Great Depression. Bad news and not getting much better. Government lockdowns are killing the economy which is killing people as the CDC says lockdown related deaths are high.
  8. Musburger1

    Musburger1 2,500+ Posts

    Question for Nashhorn. What exactly are you "pooping on." Can you intelligently respond or is that asking too much of you?
  9. Musburger1

    Musburger1 2,500+ Posts

    The GDP can be raised. However the cost of raising it would require even more dollars of debt than the corresponding increased dollars in GDP. In other words, to create another trillion of GDP, it would probably take two or three trillion of new debt.
    • Agree Agree x 1
  10. Monahorns

    Monahorns 5,000+ Posts

    The worst part of the lockdowns is that it harms the division of labor. When some people are deemed unessential the implicit agreement that undergirds it is broken. In the division of labor we all choose to do one thing and trade in order to get everything else. Shutting down business tells people in certain lines of work that their work is not important to the functioning of the nation. It is a tyrannical and dehumanizing thing to do, and a majority of our State and Federal leaders are guilty of it. We need to value the individual and at the same time encourage each person to find groups where they can feel connected and supported, not including government because we have already given them way too much power. Ideas about the better way to organize society

    Defining Cooperative Individualism - Part 1
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  11. nashhorn

    nashhorn 5,000+ Posts

    Probably asking too much but I simply agree, what you are describing is worthy of poop, not the describer.
    • Like Like x 1
  12. Dionysus

    Dionysus Cocky + Relaxed Admin

    Can this spending really even be called “taxpayer” money any more? I mean, it’s just being created and added to an existing debt that will never be paid off and I don’t know what that end game is supposed to be.
    • Agree Agree x 3
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  13. mchammer

    mchammer 10,000+ Posts

    Dion, it’s not being added to the debt. The money is being printed, not borrowed via the treasury bonds and bills.
    • Like Like x 1
  14. AC

    AC 1,000+ Posts

    I think America will either adopt Bitcoin as the new Global Reserve Currency or perhaps a digital currency version of the USD or Euro. There is no way the USD maintains Global Reserve Currency long term!

    BTW, the DXY dropped below 93 today.
  15. Dionysus

    Dionysus Cocky + Relaxed Admin

    I learned something. Can it be considered taxpayer money though? I feel like the taxpaying citizens are completely disconnected from the nation’s money supply and related policies.
    I’ve been seeing articles suggesting that reserve status may be in jeopardy. I don’t know but I think the global financial system(s) will seriously explore alternatives and we are beginning to see tech platforms for that take shape.
  16. Mr. Deez

    Mr. Deez 10,000+ Posts

    That has been becoming true for many years even when the federal government isn't engaging in legalized counterfeiting as they are now. The lower and middle class pay so little (and often "pay" negative) in taxes that they don't care if federal spending goes through the roof. So little of the money will be taken from their pockets that they aren't concerned. They have no stake in keeping the federal government fiscally responsible.

    Federal spending is now financed by a very small group of taxpayers. They have a lot of money but not enough to cover what the broader majority wants to spend money on. Accordingly we borrow the rest. And when we really need to spend huge money, we just print it.
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  17. theiioftx

    theiioftx Sponsor Deputy

    Yesterday, I got a notice that an employee filed for unemployment. The problem is that the employee is none other than me! Since I am fully employed and did not even contact the labor department, I can only assume that unemployment claims are false just like Covid numbers.
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    • WTF? WTF? x 2
  18. Musburger1

    Musburger1 2,500+ Posts

    U.S. National Debt Clock : Real Time

    Which is where we are now. That is, the government is using more borrowed money than revenue for expenditures. So the biggest tax burden isn't on the wealthy (they aren't paying for most of this now), the biggest burden is on the future generations. But of course the system will implode before that because its unpayable.

    Using figures from the link above, the current total US federal tax revenue is approximately $2.35 trillion. whereas total US federal spending is approximately $6.14 trillion. And the interest on the debt is $337 billion and growing. And that's with record low interest rates.
  19. AC

    AC 1,000+ Posts

    :arrow-up: Then why aren’t most Americans looking hard for a way out? More people need to join me and opt out of our corrupt banking system.
    Invest in Bitcoin, Gold, Silver.
    Bitcoin will pass $500K per coin someday several years from now. It’s not going to stop appreciating.:fire::fire::fire:
  20. Austin_Bill

    Austin_Bill 2,500+ Posts

    Guys, I'm of the opinion that SHTF is going to happen in the next 12 months. Solar and wind might not be as good as fossil fuel, but with those two things it allows for self sufficiency. If you can make your own electricity you can keep your home running, you have refrigeration, you have communication, you have a bit more security. I'd like to think we will get through all of this, but the truth is I don't see it. The left has declared war on the right and it can't be undone without complete surrender.

    Do your remember all those dooms day shows about people who were preparing for the end of the world, I now believe them. I think we are in for a world of pain, I'm seriously looking to build a bunker where I can take my family and even then I think I might be too late.

    I hope I am wrong, if I am, well I can get help for an obvious mental condition, but if I'm right well we are all in for a terrible time.
  21. Austin_Bill

    Austin_Bill 2,500+ Posts

    It's interesting that there is no way out unless you leave the country. Even then, the implosion is going to take down the whole world economy. I wouldn't be surprised if we have a world war which will give us a complete reset. I like your optimism about bitcoin, but all that will really matter is what you can touch, food, tools, weapons etc. Land food and water will be the most valuable with precious metals as the base level of exchange.

    I'm preparing for the worst and hoping I'm a crazy paranoid fool. I just don't see it happening any other way.
    • Agree Agree x 1
  22. Chop

    Chop 2,500+ Posts

    I think #2 is the most important. Not only does it prevent (or at least mitigate) a massive homeless explosion, but it also keeps another real estate and banking crash like 2008 from happening (or at least mitigates the severity of it).
  23. AC

    AC 1,000+ Posts

    God save the USA! Lord give us strength, power, tenacity. Keep our children safe. Amen. :fire:
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  24. Driver 8

    Driver 8 smoooove

    What is #4 about?
  25. Musburger1

    Musburger1 2,500+ Posts

    I’m referring to the point of view that many people are receiving more income from unemployment than when they were employed. And many who came back to work are earning less than their former colleagues who remain on unemployment.
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  26. I35

    I35 5,000+ Posts

    The bigger question is why is the economy struggling now when we have had only good solid economic news for 3 years? I’m sure it’s not all the chaos from one side so they could point at the other. Imagine how well we would be doing right now as a country if instead of playing tug-a-war that we took the great things that were working and we all pulled the rope the same direction.
  27. Monahorns

    Monahorns 5,000+ Posts

    I35, the economy wasn't all that great below the surface. The easy money policy which has continued at historic levels since 2008 has consumed capital. That stagnates an economy. Some things got better with Trump because he deregulated, cut taxes, and was trusted by business leaders. But many of the fundamentals were weak.

    But make no mistake the lockdowns have crippled what positive factors their were. The truth of the global economy is that we are literally all in it together. Shutting down business and restricting travel cuts the economy deep. Then dumping money on it is like dipping a wound in sewer water. It isn't the salt water that everyone thinks it is.

    The Keynesian idea of aggregate demand leads our leaders to make bad decisions. It is a form of economic collectivism. It follows the idea of the General Will. Those types of ideologies harm people even as they claim to be helping the common good. There is a better way to organize economy and society.

    Defining Cooperative Individualism - Part 1

    Defining Cooperative Individualism - Part 2
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  28. Phil Elliott

    Phil Elliott 2,500+ Posts

    My understanding is the 34% number reported by the media was an annualized number. It did not drop 34% in one quarter. More like 8.5%.
  29. Joe Fan

    Joe Fan 10,000+ Posts

    Light Truck sales, as a share of US Vehicle sales, reached a new high in 2020 of 72.2% (through June).
    Stated differently, 266 light trucks cold for every 100 passenger cars
    Back in 1984, it was the opposite -- 272 passenger cars sold for every 100 light trucks

  30. I35

    I35 5,000+ Posts

    I don’t think you are giving enough credit to where it’s due. Trump did a lot of things that really added up. He took the capital gains taxes that was 35% under Obama and made it 21%. Then the threat of raising taxes on American companies that moved away to other countries influenced many American Companies to come back home.

    Most Presidents have 0 or maybe one trade agree on their resume. Trump has completed 6 I believe and Is currently has phase 1 done of 3 with China. That would make 7 trade agreements. All those benefit America well.

    The tax cuts keep money in the working people pockets so they can spend. Money exchanging hands because of consumer spending helped all. Stock Market although is global the US leads the way on how everyone does. Funny how people every morning wake up to see what the futures are in the East to predict what our market will do. But most of the time the East reacts from the day before on how America did that tends to show what their Market will do. There are things that can happen over night that can make it negative after the final bell rings, but most of the time we dictate the market as we are by far the largest consumers in the world.

    The regulations Obama put on our businesses handcuffed them. Deregulating was instant and a big boost. But that can’t be down played. It was big.

    More than anything the American people’s confidence in our businessman/president leads the charge. Politics block a lot of good decision that should be made for the economy and there’s some Presidents that seem to not know even the basics of economic. I’ll let you determine who those are.

    As far as a recession goes. We are a capitalist country and that alone if a president and Congress gets out of the way will prevent almost all recessions. But government over spends with waste and the % of bigger government with socialist attitude can hurt. Lending to way too many people not qualified to buy homes was part of the last recession with the housing Market crash. That was preventable. Obama actually slowed down the speed of the recovery with his regulations. But what’s going on right now is inexcusable. We were thriving economically and there’s a war going on because of an election. They don’t care how many causalities because getting power is more important. We no longer reward a party for good results. The opposing party is more about trying to present a perception than truth.

    I got to see first hand as a business owner how great we did with Trumps economy vs Obama’s. Also I got to see my 401 with stocks do tremendous. It’s already back up. That’s my take.
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