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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: deeno who wrote (28191)	9/28/2007 1:21:44 AM
From: 8bits	Respond to of 78526

guess that depends on your definition of "mild". In most things I read here on SI, people consider US the consumption engine of the world. thats why the trade imbalance, weak dollar, etc. Our market seems to panic if GDP only raises 1% Imagine how we would react if it fell 5%. Seems mild, is it? A recession with a 5% decline in GDP would exceed all of the worst US recessions of 73-74 and 81-82 by at least 66% and those were considered severe recessions. Possible I suppose but I envision something milder.. more like a 2001 redux. As standard of living increases people will buy food and better food. Yes... Just because your laid off or downsized or get less hours, the last cutback is likely food. For Americans ad Europeans, I agree... for many Asian countries (China, India..) prosperity is very recent. Cutting back on meat during a severe downturn would not be too hard for them to do. Metal consumption is more predicated by governmental entities.... infrastructure build out is done generally by spending other people's money. (And most importantly in China, it creates jobs..) Remember the original statement bill made was hiding places. With the historically high oil inventories (especially the US) Oil will plummet as should most raw materials. Oil discoveries and greenfield mines for most metals are decidedly behind the curve.. the articles I have read about high oil inventories do not take the dramatic rise in total global consumption. Oil inventories in relation to daily consumption are actually fairly low historically. Going INTL? I was not referring to international stocks but international economies. Stock markets can drop severely in the face of growth recessions / mild recessions (let alone severe recessions or depressions) China, India, and to a lesser extent Latin America are behind the curve in terms of infrastructure and are now (and have been) allocating funds to rectify this. Government policy for the first two countries (esp. China) dictates that they continuing building infrastructure in the face of a recession.