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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (7)	2/15/2004 2:28:42 PM
From: Jim Willie CB	Respond to of 116555

all the Fed does now, pushes USEcon into Liquidity Trap they have brought about higher commodity and energy prices which leads to crushed profit margins from higher production costs thus less profits, less hiring jobs they have brought about higher energy and food prices which leads to hindered household budgets thus less spending the continued presence of China and Asia serves as a bootheel on US firms and their pricing power this is a policy disaster for the Fed their reflation initiative has brought only COST INFLATION and so far that inflation cannot be passed along as higher prices instead, the effect has been corporate liquidation and outsourcing i.e. ABANDONMENT OF THE UNITED STATES the S&P index and Naz100 index seem to me to represent more than the global economy, not the US Economy !!! but as long as economists and equity analysts continue to accept the notion that the business cycle is either intact or only slightly altered, they will appeal to the obsolete playbook that says jobs are lagging everything the Fed does now will hasten the journey on the LiqTrap path the next actions are to monetize the longbond, which keeps us on track into the LiqTrap to coerce foreign CB's to lower rates, which keeps them on track into the LiqTrap to encourage a new round of housing refinance activity, only to keep the debt levels too high, and gaurantee an eventual mortgage finance crisis down the road, which ensures an acceleration into the LiqTrap down the road I GUESS THAT IS WHY THEY CALL IT A LIQUIDITY TRAP the business cycle is broken these articles expound on the underlying breakdown and ongoing forces "Paradigm Shift" gold-eagle.com "Permanent Intervention" gold-eagle.com "Spinning Credit Gears" gold-eagle.com the US Economic business cycle has been altered by globalization, debt burdens, foreign dependence, and technology itself... this is not your father's business cycle anymore / jim

To: mishedlo who wrote (7)	2/15/2004 2:40:37 PM
From: loantech	Read Replies (5) \| Respond to of 116555

mish in the great stock run from the early 80's to the late 90's or early 2000 did stocks always come back to their 200 DMA? Also in your first post about falling US wages is that taking the decrease in the value of the dollar this past year into account or just comparing average wages the past 2-3 years? Thanks, tom

To: mishedlo who wrote (7)	2/15/2004 2:48:52 PM
From: mishedlo	Respond to of 116555

Here is a different version of that gold chart. Nice pattern bounces off the 100MA stockcharts.com[h,a]dacaynay[dd][pc50!c100][iLa12,26,9!Lp14,3,3]&pref=G

To: mishedlo who wrote (7)	2/15/2004 2:49:39 PM
From: mishedlo	Respond to of 116555

Post from BruceBrown on the Motley Fool on demographics there is no shortage of predictions when it comes to financial markets and the effect of retiring baby boomers and what will happen to Social Security, Medicare, real estate, health care, financial markets, grandkids and just about anything you want to predict. They range from 25 years of the poor market performance, to 20 year of demographics going in the wrong direction for the market, to 30 years of market returns being .5 percent below historical averages to complete armageddon. Predictions are predictions and you can read tons of articles like this one: redding.com Rat, there are currently 13 Million American baby boomers that are age 55 - 58. The oldest will be eligible for full SS benefits come 2010 (retirement age for that age group is 66). Full retirement benefits will require baby boomers born after 1959 (23 Million of the 76 Million baby boomers) to work to age 67 if they want to receive the full Social Security benefits. All baby boomers have to work more than 65 years to receive full benefits (66 - 67 based on one's birth year). And who knows if the program will or will not receive additional ammendments to it such as the 1983 ammendment that Reagan signed. The first group that is going to hit the retirement stage of life that are currently 55 - 58 have 6 to 11 more years of employment to go. No doubt the really big number that is coming when that final 83% of the boomers hits retirement is going to be a big number that will be hard to digest. That will mean that the boomers in retirement in the year 2030 will constitute 20% of the population (or so says one prediction in terms of population). Currently, 35,000 people retire every week in the United States (1.8 Million per year). That number will grow to 62,500 per week when we hit that first group of baby boomers who are currently 55 - 58 (and that is the smallest group of the baby boomers). It's hard to get exact data, but the 76.1 living baby boomers have produced replacements (echo boomers) by way of children. Since the last group of baby boomers were born in 1964, the US has had 144.x Million births - or twice the number of baby boomers that were born. Birth rates are averaging an additional 3.8 to 3.9 Million per year, so if that rate continues (75,000 births per day) - between 2004 and 2030 we will have an additional 98 to 101 Million to add to the 144 Million already born between 1965 and 2003. On top of that, currently baby boomers are financially positioned better than their parents were. Various projections have been made, but many focus in and around a figure that claims boomers will accumulate twice the wealth their parents accumulated. And some studies suggest that boomers are somewhat frugal with their money because they are preparing to live long after retirement, and because they want to leave an inheritance for their children. Is it any wonder that the demographics of having 76.1 Million voting baby boomers in the work force with interests of wealth accumulation sway policies and political direction? The first group of boomers results suggest that the older baby boomers - those born between 1945 and 1954 - did particularly well when compared with their parents. And of course, that is one of the arguments and premises here on the Mish board. The reason that boomers have done so well is that stocks, bonds and real estate have benefitted from a tremendous boom over the past couple of decades. Is real estate going to zero? Are stocks and bonds going to simply roll over and die? Will all of these accumulated wealth simply vanish? In the meantime, the average income of boomers is well over the median income and contains a discretionary amount of income after taxes and expenses to the tune of: Looking at the largest segment of boomers (83%) Income Ages 39-44-----Ages 45-54 Before Taxes $56,500-----$58,889 After Taxes $52,626-----54,149 Annual Spending $45,149-----$46,160 Surplus of $7,477-----$7,989 Probably one of the things to look at is how current retirees handle their financial situation. Do they retire at the benefit age, sell all of their assets and ration out their money until the days are over? However we look at it, it will be interesting to see how everything plays out as the decades unfold. My wife and I started saving and investing over a decade ago and have continued doing that month in and month out ever since. One cannot predict the future - no matter how much we like to stew about it and predict things. However, we did figure and continue to figure in our plans of saving and building a nest egg for retirement that does not include Social Security. That at least removes one element of surprise that may or may not come depending on the demographics and future ammendments or changes to the SS system. BB