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Pastimes : Ask Mohan about the Market -- Ignore unavailable to you. Want to Upgrade?

To: Zeev Hed who wrote (10513)	12/8/1997 9:40:00 PM
From: Mike M2	Read Replies (3) \| Respond to of 18056

Zeev, I do not have stats to back it up but i would guess the majority of downsized workers live on downsized income even after finding a new carreer. Of course I am aware that some highly skilled workers can write their own ticket. My reference to indebtedness was consumer debt in 4Q96 household debt was 89% of disposable income,up from 83% in 90 and 67% in 80. I disagree that the debt levels both consumer and gov't are manageable. When the next recession comes the deficit will explode as revenues(tax receipts) fall off.I don't have a great forecasting record but I feel a recession in 98 is assured.No way do we run budget surpluses.About the budget surpluses and economic calamities -correlation does not establish causation. About the consumer problems at the margin-that is where big changes begin at the margin. Look at SE Asia first it was Thailand now it is all of SE Asia. With regards to the level of debt being well matched by increase in asets-that is what Japanese bankers thought when they made loans based on inflated asset values with little regard about one ability to service the loan(income).On a political note lets not forget that a democratic congress(empowered by the Constitution) appropriated all the money that Reagan and Bush spent. The trouble with government economic policy is they like Keynesianism when comes to spending money but they forget that he advocated surpluses during the boom times to pay down the debt incurred during recession. Also consider the off budget deficit -social security and others. We are in a lot of trouble. See tekgks note 10534. Mike