Do you live in the U.S.? I ask because my friends in Canada seem to get spoon fed info on their media-stating a much better economic situation than is truly now happening in the US.
Yes, I live in the US...
So tell me what exactly horrible things are happening here ?
Well, I guess if you live here-you may have noticed "a bit" of inflation, or possibly "a small drop" in the value of peoples home equity. Maybe you noticed that the nations largest employer is now Walmart (low pay and NO health insurance provided). Maybe you noticed that credit card companies are raising rates for almost all borrowers(icluding ones with 780 FICA scores and virtually no debt), not just subprime. Maybe you noticed that 35% of homes were being bought by subprime buyers that are no longer in the market, or that homebuilders are getting absolutely crushed here. You could have noticed that retailers are having " a bit" of trouble. Did you notice corporate profits rose less last quarter than they have in a number of years? I guess outside of all that-everything is "just peachy" LOL. I'll pass on the kool-aid, thanks.
Small drop in home equity ? since when ? 5 days ago or 5 years ago or 20 years ago ? Its all relative.
Homebuilders are getting crushed because they overbuilt. Supply and demand. But more importantly they bought too much land that is choking their books, thats the biggest problem there.
Did corporate profits shrink ?
Inflation ? When there was no inflation ? Once again, compare prices 100 years ago 30 years ago and now... Inflation is a fact of life.
How about personal incomes up 6% year over year as measured by tax receipts. Or that doesn't count ?
Yes, economy is cyclical... surprize.... Sometimes its stronger, sometimes its weaker... no big deal.
But we're talking about mass hysteria here... I think the cause of it is information overload. And people just more inclined to concentrate on the bad news..... Isn't that why the regular media is flooded with the stream of bad news ? Because they figured out that its what people watch ? Not just stock market news but bad news about everything. The shocking stories of "TRUTH" ! The more shocking the better.
And there is a whole industry of doom and gloom end of the world market forecasters. People love it, they read this stuff, they pay subrtscriptions. They all want to know the shocking "TRUTH". In the meanwhile they have nice jobs, get decent paycheck and hoping to ask their boss for another raise soon. And most of them live in the house that has doubled in price since they bought it 10-15 years ago with 12% mortgage, which they refinanced 2 years ago at 5-6%.
Edited by ogm, 19 August 2007 - 02:48 PM.