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See what some of the more seasoned economists had to say on the coming depression.....
Merrill Lynch economist David Rosenberg said evidence of a recession is piling up with dismal figures from the Institute of Supply Management services sector report, "the collapse in auto sales" in January and "unprecedented tightening in credit conditions."
This "adds to our concern that we are facing a much deeper downturn than we saw in 2001," and means the Fed may be forced to make an emergency rate cut before its next meeting March 18.
Nouriel Roubini, a New York University economist, who has been bearish on the economy for over a year, said most indicators "are heading south and suggesting a deep and severe recession that has already started."
Roubini said the Fed is moving aggressively because it "is seriously worried about this vicious circle and about the risks of a systemic financial meltdown."
Joseph Quinlan, economist at Bank of America, said that regardless of whether a recession develops, the so-called "misery index" -- the sum of unemployment and inflation -- has reached a three-year high of 9.1 percent, a sign of growing trouble.
"With the US economy already on thin ice ... the higher the misery index in the coming months, the greater the odds of a consumer-led US recession," Quinlan said.
"The latter, in turn, could trigger a vicious circle of more job cuts, rising unemployment and an even greater level of retrenchment on the part of US consumers."
RBC's Zyblock said the Fed rate cuts and economic stimulus efforts will help ease the downturn.
"We believe it to be highly premature to characterize current policy efforts as impotent," he said.
"Policy makers have learned from the script of post-1989 Japan and the US experience of the 1930s that today's collapse in real estate should be treated as an ominous deflationary threat. We believe policymakers have begun, and will continue, to attack the problem with the seriousness it deserves."
Why the US could be entering the worst ever depression in history soon...... just look at the bubble in housing (housing data from past 130 years)..... more crunch times ahead..... could last for years before it gets better.
A Surprising Look at 100+ Years of Home Prices
By Dr. Steve Sjuggerud
March 19, 2007
We really have experienced the greatest real estate boom in U.S. history, if the figures are to be believed. Take a look...
The only other housing boom of any real magnitude was the World War II boom. But it doesn't come close to what we've just gone through...
The figures should be believable... They are from Yale professor Robert Shiller, who is both a well-known financial historian and the creator of the Case-Shiller Weiss real estate price indexes. Shiller's real estate indexes are thought to be the best available (speculators note: You can even trade futures and options on these indexes on the CME).
Wall Street's worst day in 3 months
Stocks tank after an economic report and comments from a Fed official amplify recession panic. Dow loses 370 points.
NEW YORK (CNNMoney.com) -- Stocks tanked Tuesday, after a report showing a big slowdown in the services sector of the economy and cautionary comments from a Fed official amplified fears that a recession is underway or imminent.
The Dow Jones industrial average (
INDU) lost about 370 points, seeing its worst one-day point loss since mid-October. The decline equaled a drop of 2.9%.
The broader Standard & Poor's 500 (
SPX) index lost 44 points, its worst single-day point loss in almost 6 months. The decline equaled a drop of 3.2%.
The Nasdaq composite (
COMP) fell 73 points and saw its worst single-day point loss since mid-October. The decline equaled a drop of 2.6%.
"The pebble in the pond this morning was the ISM report and then the comments from [Fed President] Lacker came out and that kind of pushed people over the edge," said Kim Caughey, senior equity analyst at Fort Pitt Capital Partners.
"This is a very volatile time, everyone is nervous and the volatility shows the degree of nervousness," Caughey added.
Stocks tumbled in January, with the Nasdaq seeing its worst start to the year ever, on fears that the credit and housing market crises will send the economy into recession, if it isn't there already.
After such a steep decline, stocks managed to bounce back for a few days last week as investors scooped up battered shares. But the rally was short-lived, with stocks erasing last week's gains in a matter of two sessions.
The speed of the retreat added to investor jitters, said Peter Dunay, investment strategist at Leeb Capital Management. "If we lost that much over three weeks, investors would have seen it as a period of consolidation, but to drop 370 points in a day is really rattling."
Hi, Hulumas.
Any idea on roughly which month will it start to come in ?
sounds interesting....very interesting...where's the news from?
Dear Readers,
Good news... Good news... Good news...
Interestingly, It is said that QDII fund will surprise all global fund managers by accumulating overseas Penny, 3rd liner before jumping into 2nd liner and blue-chip of all Sgx. China related counters. Their reason is simple and popular now i.e. encouraging and promoting its economic policy " Ben Shiou Kang"!!!
Get ready for a Construction Rally!!!!!!!!!!!!! These Chinese companies believe in good head start for the New Year. Ang Pow Commmmmmmmmmminggggggggggggggggggggggggggggggg!!!!!!!!!
Some companies out there will continue to do well despite all these "interesting scenarios"
All of us already knew that US economy is in a mess state due to the sub-prime issues.
And now china is also in a mess state due to the effects of drastic weather condition, which results in USD7.5b loss.
And we also have India who is battling hard against bird flu.
it will be an interesting 2008, 2009 and 2010.
Depends on where division you are looking at. The Call centre/customer service department in banks is always recruiting cos when economy is good, many left. No one want to work night shift or weekends. But u notice the recruitment section, almost 50% is from gahment.
I hear some rumours that job cuts have already started in some banks in Singapore.
But strange.... the Recruit section on Saturday is still quite thick. Hope the rumours are false.
RATS MEANS - LOU SHU
LOU MEANS FLOW OUT
SHU MEANS LOOSE
HOWEVER I DON;T BELIEVE IN ALL THESE
Feb-1 non-farm job report showed massive job losses, contrary to market expectation of some gains. Another indication of looming troubles ahead.
Another bad sign from heaven is the biggest snowstorm hitting most parts of China this few days before the Lunar New Year Holiday which caused massive havoc and destroyed great amount of farm crops. In ancient days, the Emperors would pray during this time for good harvests and blessings from the Heaven. Any calamities were signs of displeasure from Above. Recall, the current snowstorm is the biggest ever to hit China in more than 50 years.
Rats! It's the year of the rats! Not so sanguine.
To all out there reading this: Gong Xi Fa Cai, Nian Nian You Yu.
right! tanglinboy. if there's another contraction in 1st qtr 2008, technically in recession. a full blown recession could kick-in once the US growth hit negative after that which looked increasingly possible.
but not to fret. in a recession or even a depression, fortunes can be made or lost. based on past histories, 6 of the 13 recessions in the US showed the S&P500 were up.
interestingly, someone said you could see a recession already in play when other people started to lose their jobs, while it's a depression when it happened to you. how true! must be depressing indeed to get the dreaded pink slip.
Fact : Subprime issues do not cause the US to lose any money.
Basically the money is transferred from Peter to Paul to Buffet to Soros to ET.....etc. but still within the US. In actual fact, they are positive from those who bought the CDOs in Asia. When someone loses, someone wins, it is a zero sum game. Everyday the talk of the day is BIG Losses by so and so, but who wins ? This is an illusion created by the US Economists. There is no US Recession, it is just illusions.
Hasn't recession already arrived.. technically speaking?
It's my opinion that a US recession is likely to occur anytime in the 3rd quarter of 2008. So try to lighten your portfolios especially those heavily reliant on exports, commodities (basic materials exclude food), and major shippings with large exposure to/from East Pacific routes. Markets worldwide likely to price in a US recession by 2nd quarter or earlier.
Keep more cash and ready your war chest by later 2nd half of 2008 to bottom-fish. Just my thoughts, not instructions for you to sell or buy.
