Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Bush-The Mastermind behind 9/11? -- Ignore unavailable to you. Want to Upgrade?

To: Hope Praytochange who wrote (2173)	8/26/2003 12:24:29 AM
From: Don Earl	Read Replies (6) \| Respond to of 20039

I've yet to see a Reuters article that wasn't either mindless hype or mindless FUD. The one you posted would fall into the category of both. GDP has been strong almost exclusively because of sky rocketing energy prices. The spike in housing is due to interest rates. Manufacturing is still basically flat after nearly 3 years of contraction. And unemployment is still nearly double what it was before the Bush Cartel took charge. If interest rates continue to rise, we won't be looking at a recession, we'll be looking at a full blown depression. Bankruptcies are already at record highs. The combination of absurd energy prices, and the vulnerability to variable rate debt of the average American household, could very well be enough to push the economy over the edge of a cliff. In addition, housing prices tend to move in the opposite direction of rates, similar to bonds. What that means is anyone who purchased homes at the top of the market, with something close to zero down, could very well be buried in even a slight pull back in housing prices. In selling a home, you can automatically take 10% off the top for closing costs, commissions, taxes, etc.. The current American debt bubble dwarfs what we saw leading up to 1929, and the economy has become so fragile just about anything could end up being the trigger that causes it to burst. The bond market was over due for a correction, but if it over corrects, we could be in heap big trouble. My guess, if Reuters is running true to form, is we're probably looking at a shake out on bonds in anticipation of the usual fall bloodbath in stocks. Since Bush put an investment banker in charge of the SEC, maybe some of the old rules no longer apply. Hard saying. One thing I do know is anyone talking about an economic recovery before unemployment gets below 4% and a gallon of gas gets below $1.20 is full of cow patties. Inflation driven GDP is NOT a sign of recovery.