Rolling US Economy Into The Shitbin Thread

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this is why i live in canada!

J0rdan S., Friday, 19 October 2007 06:13 (twelve years ago) link

oh wait.

J0rdan S., Friday, 19 October 2007 06:13 (twelve years ago) link

Guys, this is a good time stay in academia right?

Catsupppppppppppppp dude 茄蕃, Friday, 19 October 2007 11:51 (twelve years ago) link

It's a good time to learn a European language.

Nubbelverbrennung, Friday, 19 October 2007 13:33 (twelve years ago) link

Prime shit examples:

When Bush was elected in 2000, the federal budget was in surplus and the national debt was being paid down. Had this state of affairs continued, as projected, it would have led both to lower interest rates and a strong dollar, together. Instead, Bush submitted a series of enormous tax cuts to the Republican-controlled Congress and lobbied them through. Immediately, the CBO's projected budget surpluses turned to projected deficits for the next decade.

Bush also initiated a war of choice, not necessity, in Iraq. This war has already cost well over $700 billion. Yet, Bush insisted on making his tax cuts permanent. Overall, the national debt has increased under Bush by about $2 trillion in seven years. This represents a difference of about $3 trillion of debt from what was projected at the start of his first term.

Because, due to Bush's tax cuts and other policies, the Federal government was in a far weaker position to stimulate the economy when the recession started after 9/11, almost the entire stimulus was delivered via lower interest rates. Because these rate cuts were artificial, and not based on a stronger dollar, this stimulus not only inflated the current housing bubble, but it also undercut the dollar even more than the ballooning national debt did.

Now the dollar is at an all-time low against the euro and the canadian dollar. However, the incomes of the top 10% of American households have increased at a good clip, while the lower 50% of households have seen a decrease in income after inflation. This is largely thanks to Bush's shitty policies. I expect more of the same mismanagement until he is gone.

Aimless, Saturday, 20 October 2007 18:36 (twelve years ago) link

I agree with everything you've just said. You're predictions still seem a tad extreme on the downside though, if I may so.

aaaaaaaaaaaaaaaaaaaaaaaaaa, Saturday, 20 October 2007 18:50 (twelve years ago) link

i wonder if income inequality will ever arrive as a political issue in this country. americans tend to not begrudge the rich - so it'll have to be more of a "for everyone's good" type of angle. no?

jhøshea, Saturday, 20 October 2007 18:54 (twelve years ago) link

I remember the 1970s and early 80s quite well. Back then people couldn't belileve it, either. Bush has done a bangup job of recreating many of the same policy errors under Johnson and Nixon that led to raging stagflation back then, except the underlying economy is now weaker than it was in the 1970s and the oil shocks we are likely to get are not political, as when OPEC was formed, but structural.

Oil will exceed $100/barrel some time this winter. The ever-weakening dollar will lead to smaller profit margins and rising retail prices on all imported goods (which means almost everything we buy in the USA). Transport costs will rise with pil prices. Stock prices will erode along with profits. With so many savings tied up in stocks and home equity, consumer spending will be crunched, and personal debt and bancruptcies will rise like a tide. Businesses will retrench and unemployment will rise. No end in sight.

I hope I am wrong.

Aimless, Saturday, 20 October 2007 19:07 (twelve years ago) link

Anyone want to join my modern-day James Gang? We shall ride across the lower Midwest, robbing and pillaging.

milo z, Saturday, 20 October 2007 19:09 (twelve years ago) link

sounds fun

jhøshea, Saturday, 20 October 2007 19:13 (twelve years ago) link

Sorry, I don't want to relocate. But this scheme sounds ripe for franchising.

Aimless, Saturday, 20 October 2007 19:14 (twelve years ago) link

Oil will exceed $100/barrel some time this winter. The ever-weakening dollar will lead to smaller profit margins and rising retail prices on all imported goods (which means almost everything we buy in the USA). Transport costs will rise with pil prices. Stock prices will erode along with profits. With so many savings tied up in stocks and home equity, consumer spending will be crunched, and personal debt and bancruptcies will rise like a tide. Businesses will retrench and unemployment will rise. No end in sight.

I hope I am wrong.

-- Aimless, Saturday, 20 October 2007 19:07 (14 minutes ago) Link

The coming of $100/barrel oil is not Bush's fault. It's yours and mine and everyone else's for using too damned much energy. I agree Bush could and should have done a lot more with policy to encourage energy efficiency, but there's little he could have done to stop oil's eventual rise to that price level.

Hurting 2, Saturday, 20 October 2007 19:26 (twelve years ago) link

Part of the pricing of oil represents the weakness of the dollar. This hurts the USA more than it does other countries. US citizens are paid in dollars and the US government collects revenue in dollars, so they are stuck. EU countries can use euros to buy increasingly cheap dollars, so they don't see the same rise in prices as we do. The weakness of the dollar is mainly Bush's fault.

Aimless, Saturday, 20 October 2007 19:31 (twelve years ago) link

The US also uses way more oil than other countries.

Hurting 2, Saturday, 20 October 2007 19:33 (twelve years ago) link

he could have done to stop oil's eventual rise to that price level.
Not starting a war in Iraq would definitely have helped here.

stet, Saturday, 20 October 2007 19:57 (twelve years ago) link

arrgh, if that won't work then
http://calculatedrisk.blogspot.com/2007/10/imf-mortgage-reset-chart.html

El Tomboto, Monday, 22 October 2007 17:47 (twelve years ago) link

tombot u r freakin me out

gff, Monday, 22 October 2007 17:50 (twelve years ago) link

i hope my small apartment + modest savings plan + job in "information services" is enough to weather the shitstorm, if it comes. i got myself out of credit card debt a few months ago, at least

gff, Monday, 22 October 2007 17:53 (twelve years ago) link

well if you can hold down a job and don't have to worry about an ARM reset you should be okay, it's the homeowner with kids and a subprime loan and two cars who ought to be shitting themselves

El Tomboto, Monday, 22 October 2007 17:58 (twelve years ago) link

apart from some student loans and binging on credit cards over a few years, i'm kind of debt phobic.

which has actually made me lose out over the past several years, i realize, since i pay for EVERYTHING with a debit/check card... i could have just paid that balance on a credit card with some rewards scheme and has some air miles or something

gff, Monday, 22 October 2007 18:00 (twelve years ago) link

rolling gff personal finances into the shitbin thread, ha

gff, Monday, 22 October 2007 18:01 (twelve years ago) link

This will give you a boner Tombot

http://nymag.com/guides/money/2007/39952/

Dandy Don Weiner, Wednesday, 31 October 2007 11:30 (twelve years ago) link

the economy increased by 3.9% this quarter! bull market forever, baby. economy's better than ever. golden age.

yet me and so many people I know are getting laid off next month. granted we're all in the writing/design field, but urhhhhh. gggg.

burt_stanton, Wednesday, 31 October 2007 14:58 (twelve years ago) link

http://nymag.com/guides/money/2007/catastrophist071105_560.jpg
http://nymag.com/guides/money/2007/catastrophist071105_2_560.jpg

^^^ lol

most of that guy's scenario is not really news to regular bigpicture/CR readers I don't think. But #5, the "we don't pay attention" thing, yeah, well, evidently the awareness campaign is underway, but hell if the big players are paying attention.

He also leaves out the approaching demographic catastrophe as millions of inexperienced thirtysomethings and even some late-twenties kids are forced to move into arguably tougher jobs that the boomers have been holding for two decades. Beyond the social security and healthcare costs associated with mass retirement, I don't really know if this generation has the work ethic and definitely not the rolodex to just start filling in and not fuck up royally. too busy updating their linkedin pages.

El Tomboto, Wednesday, 31 October 2007 15:11 (twelve years ago) link

can someone explain what "being upside down on your mortgage" means, in plain English?

Tracer Hand, Wednesday, 31 October 2007 16:14 (twelve years ago) link

essentially, owing more than your home is worth.

Dandy Don Weiner, Wednesday, 31 October 2007 17:10 (twelve years ago) link

also Tombot I'm not going to blame this generation as much as I blame their parents.

Dandy Don Weiner, Wednesday, 31 October 2007 17:11 (twelve years ago) link

isn't that the way people buy homes? by paying for the privilege of a loan?

Tracer Hand, Wednesday, 31 October 2007 17:12 (twelve years ago) link

When you enter into a contract with a bank for a mortgage, both you and the bank assume that the property value will not plummet. The bank doesn't want you to default any more than you want to default. But if for whatever reason you need to sell your home, and you can't get what you owe on it, then you will owe the difference to the bank. And the bank knows that when that happens, you probably will not have enough assets to cover the difference.

Predatory-type loans (which seems like a nebulous description to me) typically compound the problem because they have higher transaction rates (points, etc.)

Dandy Don Weiner, Wednesday, 31 October 2007 17:17 (twelve years ago) link

oh certainly! well played baby boom letting healthcare slide for the 20 years you've owned the electorate

El Tomboto, Wednesday, 31 October 2007 17:18 (twelve years ago) link

yeah Tracer it's also called "negative equity"

El Tomboto, Wednesday, 31 October 2007 17:19 (twelve years ago) link

Not to mention saddling us with ridiculous expectations. Why do I have to be the one to tell my PARENTS "No, I can't make a living doing whatever I want."

Hurting 2, Wednesday, 31 October 2007 17:20 (twelve years ago) link

I know several people who live in homes that cost more than $500K that signed unbelievably stupid loans.

Dandy Don Weiner, Wednesday, 31 October 2007 17:27 (twelve years ago) link

Today the news is telling me the economy is going great - no need to worry. about anything. I'm glad all this mess is finally, somehow, over.

burt_stanton, Wednesday, 31 October 2007 17:28 (twelve years ago) link

I love how the financial press keeps reporting that the subprime crisis is *not turning out to be as bad as we thought* when it hasn't even come near its peak. No one could have predicted the levees wouldn't hold, etc.

Hurting 2, Wednesday, 31 October 2007 17:36 (twelve years ago) link

No one could have predicted that Bin Laden was determined to strike inside the United States!

Tracer Hand, Wednesday, 31 October 2007 18:04 (twelve years ago) link

No one could have predicted that he would use planes as missiles!

Tracer Hand, Wednesday, 31 October 2007 18:04 (twelve years ago) link

Dear US economy,

I love you. Send money. Thanks loads. Ta!

Aimless, Wednesday, 31 October 2007 18:07 (twelve years ago) link

oh certainly! well played baby boom letting healthcare slide for the 20 years you've owned the electorate

Yeah, that's something, among numerous other socio-political phenomena that baffles me. Does that mean that all that "hippies done sold out and became heartless, vacuous yuppies" stuff is true?

dell, Wednesday, 31 October 2007 22:03 (twelve years ago) link

sure, whatever that means.

El Tomboto, Wednesday, 31 October 2007 22:05 (twelve years ago) link

side note: the word "yuppie" did once have a specific meaning. I'm a little tired of it just signifying everyone upper-middle class and below retirement age.

Hurting 2, Wednesday, 31 October 2007 22:06 (twelve years ago) link

how funny will it be when affluent boomers need their money to pay for their own lifestyle instead of being able to just throw it away on their kids' rent and shit?

El Tomboto, Wednesday, 31 October 2007 22:08 (twelve years ago) link

It once meant a specific kind of douchebag, now the term encompasses too many douchebag subcategories.

xp

Abbott, Wednesday, 31 October 2007 22:10 (twelve years ago) link

I agree, Hurting, Abbott...I think that "yuppie" is about as useful a word as "hipster" (or arguably, "hippie"). But, I'm thinking of all the press about baby boomers -> "yuppies" that was the subject of Time and Newsweek, etc., cover stories when I was growing up in the eighties.

dell, Wednesday, 31 October 2007 22:11 (twelve years ago) link

Not all that funny, if it also means my already-rent-paying ass has to start supporting my parents, which is already a situation I have a small reason to worry about (xpost)

Hurting 2, Wednesday, 31 October 2007 22:14 (twelve years ago) link

Yeah but overall pretty funny, right?

El Tomboto, Wednesday, 31 October 2007 22:14 (twelve years ago) link

even that's pretty funny - the last 50 years of not giving a shit about our elders are something of an aberration, no?

milo z, Wednesday, 31 October 2007 22:16 (twelve years ago) link

also funny because my brother is way more successful than me and any duties are going to fall on him. haha

milo z, Wednesday, 31 October 2007 22:16 (twelve years ago) link

gotta get back to my law school applications...

Hurting 2, Wednesday, 31 October 2007 22:17 (twelve years ago) link

to what extent is the massive fed preemptive action currently underway reducing/not reducing the risk from that?

― longtime caller, first time listener (man alive), Thursday, June 11, 2020 10:14 AM (eighteen minutes ago)

idk, but if you read the regulations/descriptions of the PPP program, it says that the loans can be resold on the secondary market ... so, if I was a cartoonish pessimist, I would suggest that the next "sub-prime" crisis will be risky PPP loans ... they have now reduced the portion of the loan that has to be used for payroll from 75% to 60% and given people/businesses 24 weeks to qualify for forgiveness as opposed to the original 8 weeks.

sarahell, Thursday, 11 June 2020 17:38 (three weeks ago) link

(2) getting into the morass of accounting details is how they getcha

ooooooooh!!!! do tell!

sarahell, Thursday, 11 June 2020 17:39 (three weeks ago) link

use of "stonks" really peaking this past month.

Yerac, Thursday, 11 June 2020 17:40 (three weeks ago) link

xp -- wait really? Why the fuck would anyone buy a loan that is meant to be forgiven?

longtime caller, first time listener (man alive), Thursday, 11 June 2020 17:41 (three weeks ago) link

how much truth is there in the apocalyptic "soon people will have to pay all their back rent/mortgage payments and everything will crash and burn" articles that are coming out now?

sarahell, Thursday, 11 June 2020 17:42 (three weeks ago) link

xp -- wait really? Why the fuck would anyone buy a loan that is meant to be forgiven?

idk? it's there in the text of the law though. Maybe not all the loans are intended to be forgiven? I am guessing that at minimum, it is a way for banks to free up more capital in the short-term to do more lending?

sarahell, Thursday, 11 June 2020 17:44 (three weeks ago) link

perhaps they will be unforgiven?

voltmeter said i had potential (Sufjan Grafton), Thursday, 11 June 2020 18:13 (three weeks ago) link

i really hope these redditors/robinhood first time account people that I have read so much about the past month don't lose their shirt.

Yerac, Thursday, 11 June 2020 18:18 (three weeks ago) link

supposedly the huge gains of the last couple months were predicated on the fed taking strong action and giving investors confidence that the world would not explode

which always seemed like bullshit to me. i don't think it's a coordinated effort or anything, but the last few weeks have just seemed like willingly suspending disbelief to pump the market back in and squeeze the last juices out of it before manufacturing slowdowns and a collapsing real estate market become so obvious that even investors have to acknowledge it.

― our god is a might god (Karl Malone), Thursday, June 11, 2020 10:26 AM (forty-eight minutes ago) bookmarkflaglink

it's impossible to know if this pullback will start the end-of-february-esque retest of lows or will start the end-of-april-esque retest of some highs.

voltmeter said i had potential (Sufjan Grafton), Thursday, 11 June 2020 18:18 (three weeks ago) link

i really hope these redditors/robinhood first time account people that I have read so much about the past month don't lose their shirt.

― Yerac, Thursday, June 11, 2020 1:18 PM (nineteen minutes ago) bookmarkflaglink

I was just reflecting on what a terrible feature of our system it is that people feel like they need to wait around for others' pain in order to get on the american dream latter - specifically in response to a reddit post that was hoping for widespread foreclosures so he could buy a house, a horrible sentiment yet sort of understandable.

longtime caller, first time listener (man alive), Thursday, 11 June 2020 18:38 (three weeks ago) link

And then on top of that, the system throws a lot of headfakes at you

longtime caller, first time listener (man alive), Thursday, 11 June 2020 18:38 (three weeks ago) link

because in america someone has to lose in order for you to feel like you can gain.

Yerac, Thursday, 11 June 2020 18:39 (three weeks ago) link

*american dream ladder

longtime caller, first time listener (man alive), Thursday, 11 June 2020 18:41 (three weeks ago) link

go, shitbin, go

stocks rise 5% on covid optimism!!!
*5 days pass, in which absolutely nothing happens that was not already widely expected*
stocks fall 5% on glum covid outlook!!!

it's not even as compelling as mass psychosis

brooklyn suicide cult (Dr Morbius), Thursday, 11 June 2020 19:16 (three weeks ago) link

The state police said it will be an 8 hour wait from the back of the line to speak to a state employee about unemployment. pic.twitter.com/plGONcpS6n

— Daniel Desrochers (@drdesrochers) June 17, 2020

𝔠𝔞𝔢𝔨 (caek), Wednesday, 17 June 2020 17:16 (three weeks ago) link

Trump country.

Li'l Brexit (Tracer Hand), Wednesday, 17 June 2020 17:28 (three weeks ago) link

stocks up on reports that unemployment line is now less than 16 hours long

Karl Malone, Wednesday, 17 June 2020 18:03 (three weeks ago) link

jeez, what state is that?

Fuck the NRA (ulysses), Wednesday, 17 June 2020 19:15 (three weeks ago) link

i think kentucky (the tweeter lists kentucky.com as his website and reports for the lexington herald leader)

Karl Malone, Wednesday, 17 June 2020 19:16 (three weeks ago) link

oh yeah. they've been dismantling their unemployment system for a decade iirc.

Fuck the NRA (ulysses), Wednesday, 17 June 2020 19:27 (three weeks ago) link

a sad coda to that unemployment line in Frankfort, KY yesterday:

Hundreds of Kentucky residents waited in line for as long as 10 hours outside a makeshift unemployment office at the State Capitol in Frankfort on Wednesday in hopes of getting paid for claims that, for some, dated back as far as March.

But in the end, a handful who had stood in line all day were turned away, prompting despair and anger, the Lexington Herald-Leader reports.

“Maybe, maybe 25 people left to be seen and they turn us away,” resident Deborah McLaughlin told the paper.

Hundreds more who arrived after the line was cut off were turned away, as well. The state’s computer system shuts down at 7 p.m. and cannot further process claims, officials told those in line.

sorry everyone, but you know computers. they don't work after 7 pm, gotta shut them down.

time is running out to pitch in $5 (Karl Malone), Thursday, 18 June 2020 23:38 (two weeks ago) link

Yes, I am concerned the longer this goes on, the more losses banks will face. Large banks have more capital than they had before the 08 crisis, but not enough. 1/2

— Neel Kashkari (@neelkashkari) June 19, 2020

Dirty Epic H. (Eric H.), Friday, 19 June 2020 20:20 (two weeks ago) link

They should stop paying dividends and raise capital to increase their resiliency. They can essentially inoculate themselves from COVID and should do so now. 2/2

— Neel Kashkari (@neelkashkari) June 19, 2020

Dirty Epic H. (Eric H.), Friday, 19 June 2020 20:20 (two weeks ago) link

i smell a moral hazard

if only these banks had some real skin in the game

mookieproof, Saturday, 20 June 2020 03:16 (two weeks ago) link

Senior Trump economic advisor Kevin Hassett is leaving. A second senior advisor, Tomas Philipson, is leaving, too:

https://www.washingtonpost.com/business/2020/06/24/white-house-economist-philipson-departure/

And the market is getting skittish again:

I hope everyone is watching this. There’s not much left they can do before the bottom falls out of the market.https://t.co/UkJXeUYUhq

— Angry Staffer (@AngrierWHStaff) June 25, 2020

I don't know, but I think the economy might be in pretty bad shape.

Josh in Chicago, Thursday, 25 June 2020 17:43 (one week ago) link

Has anyone else read this? Not any new information, really, but pulls together a fair amount of date, synthesizes it, and makes its case pretty well...

https://newleftreview.org/issues/II123/articles/robert-brenner-escalating-plunder?fbclid=IwAR2hj5SYEErcjs0rW6YHtMFpjX5laUuYQi5DMIknsoFY1qib1LweqyhzW3s

blue light or electric light (the table is the table), Thursday, 25 June 2020 19:00 (one week ago) link

Has anyone else read this? Not any new information, really, but pulls together a fair amount of date, synthesizes it, and makes its case pretty well...

https://newleftreview.org/issues/II123/articles/robert-brenner-escalating-plunder?fbclid=IwAR2hj5SYEErcjs0rW6YHtMFpjX5laUuYQi5DMIknsoFY1qib1LweqyhzW3s🕸


Yep. Very good read. Basically capitalism now cannot survive without an unlimited government back stop. This can’t be sustainable.

Boring, Maryland, Friday, 26 June 2020 02:54 (one week ago) link

i think from now on sic should post the little spiderweb after those, like he is spiderman trying to stop up the web channels from funneling our information out

j., Friday, 26 June 2020 03:34 (one week ago) link

xp it was ever thus. governments create and sustain markets etc etc

methinks dababy doth bop shit too much (m bison), Friday, 26 June 2020 04:00 (one week ago) link

Cirque du Soleil filing for bankruptcy, so there's your silver lining.

brooklyn suicide cult (Dr Morbius), Thursday, 2 July 2020 19:20 (six days ago) link

lol it's like the backbone of the economy of Quebec

Boring, Maryland, Thursday, 2 July 2020 22:50 (six days ago) link

but they infected us too

brooklyn suicide cult (Dr Morbius), Thursday, 2 July 2020 23:19 (six days ago) link


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