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Greenspan: Economy in 'once-in-a-century' crisis

Discussion in 'Political Discussion' started by PatriotsReign, Sep 15, 2008.

  1. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    In an interview Sunday, the former Federal Reserve chairman said that more financial firms will fail and that housing won't stabilize until 2009.

    WASHINGTON (CNN) -- The U.S. credit squeeze has brought on a "once-in-a-century" financial crisis that is likely to claim more big firms before it eases, former Federal Reserve chief Alan Greenspan said Sunday.

    Greenspan told ABC's "This Week" that the situation "is in the process of outstripping anything I've seen, and it still is not resolved and it still has a way to go."


    http://money.cnn.com/2008/09/14/news/economy/greenspan/index.htm?postversion=2008091413

    Anyone still think we're not in a recession?
     
  2. Real World

    Real World Moderator Staff Member

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    For someone who claims to be an economist, you really don't sound like one. I guess if you say we're in one long enough, at some point you may eventually be right.
     
  3. mcgraw_wv

    mcgraw_wv In the Starting Line-Up

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    Just get rid of the Central Bank, and these bubbles won't happen... common sense will take over as the investment strategy of the future and not based on if the Fed wants to add or drop a point to some magic meter to spur or withdraw growth...

    The Fed has created every major bubble with it practices of flooding the market with cheap cash, and then withdrawing and causing a crash...

    The conspiracy theorist in me believes this is a plan to rob property from the people... In the past few years you have seen JP Morgan acquire assets for pennies on the dollar from the likes of Bear Sterns, and other takes overs, this crash, IMO, is nothing more than a way to consolidate the assets of our country...
     
  4. Real World

    Real World Moderator Staff Member

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    :wha: I bet it was coordinated with those same people who planned 9/11. Afterall, it wouldn't be that hard to get the millions of people who purchased homes in the last 15 years to play along.
     
  5. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    Greenspan just told you we're in a "once in a century" economic crisis and you claim I don't know what I'm talking about?

    No offense RW, but if you actually believe we aren't in a recession, you don't know squat about economics. Every respected economists you can find will tell you we are in a recession.

    Why do you have such a difficult time accepting reality? Look around you and ask yourself "are these good times economically?" If you say "YES" with a failing banking system, skyrocketing unemployment and a real estate depression your eyes are closed brother.

    I have predicted much of what has happened over the past 3 months in posts I made 6 months ago...and you're still telling me I don't know what I'm talking about. Well, I will tell you it's going to get worse RW...so when will you open yours eyes and admit I've been right?
     
  6. mcgraw_wv

    mcgraw_wv In the Starting Line-Up

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    Well just to throw this out there... Ron Paul predicted Fannie May and Freddie Macs collapse over 5 years ago...

    But god forbid we listen to and let someone lead us that has the foresight to see the path we are headed down. If only he was cuter!
     
  7. mcgraw_wv

    mcgraw_wv In the Starting Line-Up

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    You don't have to "play along" to fall for the trap...

    It doesn't take a world wide coordination, it just takes a trap set for the average dumb American to fall into... 401ks to me is the next trap...


    This is what I forsee... for the last 15 - 20 years, America has been locking away money in 401ks, this has become fuel in the Market to make money, lend at interest, and all kinds of financial tools to make money, but to the 401k holder, it's locked up money that can't be touched for quite some time...

    No you have the largest generation of Amercan's heading into retirement, The Baby Boomers...

    How much do you think your money will buy when everyone around you has 500,000 at their disposal to spend via their 401k?

    That is when inflation will hit the roof... When all that money comes flooding back into people's hands...
     
  8. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    The truth is mcgraw, many people have predicted what would happen. I'll be the first to admit my own predictions were just based upon others in-depth analysis and some common sense.

    The fact that Ron Paul predicted the falls of Fanny and Freddie is pretty amazing to me. He must have some good econmists on his staff! All I predicted was another 12-18 months of recession with increased unemployment and continued real estate declines. I don't think we'll see any real turn around until early 2010
     
  9. Real World

    Real World Moderator Staff Member

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    Greenspan is the same clown who said we were in one 3 years ago, only to say we weren't, and who is now saying we are. Also, how much of this is his doing?


    PR, you've been saying we're in one since you joined, and guess what? You've been wrong EVERYTIME! I'll say what I've been saying, and that is that one is certainly possible, but it hasn't happened yet. You are clearly cheering for one. It's funny that my nonacceptance of something that hasn't happened, is me "not living in reality". LOL!
     
  10. Real World

    Real World Moderator Staff Member

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    Right, cuz all those people are going to retire at once, and when they do, they're all going to collect their $500k on the first day, and spend it in unison. 401k's were created with the idea that SS wasn't going to cut it, and cuz it was a means for a nonsaving society to nest egg retirement. It wasn't some Reyonlds Wrap ploy to create a massive asset aquisitional scheme headed by some masked man behind a curtain.
     
  11. mcgraw_wv

    mcgraw_wv In the Starting Line-Up

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    Can you look at the net affect of an entire ( VERY LARGE ) generation make the change from adding to their 401ks ( most of which are the higher salary earners at their jobs ) to now withdrawing that money?
     
  12. Real World

    Real World Moderator Staff Member

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    Are you talking about people paying in, versus people taking out? What's the point? that's not a concern. If they, as in account holders, close out their 401k then there'd be a problem. A run-off on capital like that is what causes banks to fail, and is certainly why an institution like IndyMac went under. Everyone rushed to withdraw their cash, and the bank failed as a result, as no bank has the liquid assets to satisfy their overall holdings. That's very unlikely to happen though. People who retire draw on their accounts in a structured manner. They draw as they use it. Remember, any and all pretax retirement investements are taxable income when drawn.
     
  13. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    The only thing you're having trouble with is an "official" recession being declared RW. But if you look around you at the chaos that is happening in every economic sector, then it's clear to anyone our economy is in big trouble.

    I'm not cheering for anything RW. But only a fool would think it's bad luck or karma to say we're in a recession. Please tell me you're not one of those who believes if people didn't talk so negatively, we wouldn't be so bad off! Pah-leeze tell me that RW!

    Answer me this;

    How can we have the biggest real estate decline since the depression and not be in a recession?

    How can we have the worst financial market conditions since the depresssion and not be in a recession?

    Now that every major economist has stated that we ARE in recession, how is it you believe we are not?
     
  14. STFarmy

    STFarmy In the Starting Line-Up

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    Not being a prick, but I am curious if you have links to many of the major economists saying we're in a recession. I mean, I know Buffet did, but Warren Buffet IS rooting for a recession. And obviously Greenspan has. I'm really curious to see what the consensus in the economic intellectual community is.
     
  15. Real World

    Real World Moderator Staff Member

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    Look, you're a nice guy and all, and I genuinely enjoy your posts in here. You're one of the few dudes in this place that doesn't take any of this gibberish personally. ;) That being said, you've been cheering, praying, preeching, hoping, etc. for there to be a recession, since you joined up. Every post you make is about how we're in a recession, and that "every ecnomist is saying we're in one", yet, to date, one hasn't happened. Does that mean that one won't at some point? Who knows. I know it hasn't to date, despite the constant clamoring by you. I've explained before why RE declines aren't enough to cause a recession, or depression. It's the context of that which causes the losses that's important. If people lose property because they lost their jobs, then I'd be mortified about the current situation. However, that's is not the case. People lost their homes because they made moronic investments. Their loss did not affect their employment situation. Someone who's employed, and loses a home, still continues to supply a consumer driven economy with the cash it needs to remain stable. I'd say the cost of fuel will be more of burden than the real estate market losses will be. The fed all but insured, via the infusion of capital, that the financial sector would remain afloat. I said before that I didn't think a recession was likely so long as people were working, and I maintain that. What's made one more possible in my view is the spike in fuel costs to record levels. Those costs are not only felt at the pump, they're felt in every aspect of consumption. Be it through the products that are made via petroleum, delivered with it, or manufactured with it as a fuel. I personally hope a recession is avoided, and think that one is certainly possible, but as of today, one hasn't happened.
     
  16. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    A year or so from now, it will officially be declared that we have been in recession since Jan. 2008. I'll guarantee you that RW.

    The one thing that will help our economy the most is a recession. You just don't understand that recessions are good for the economy...and they are necessary. It will be the only means of restoring balance and confidence.

    Is a rainy day a good thing? It is if you're a farmer experiencing a drought!;)
     
  17. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    Recession is here - economists

    "We're definitely seeing conditions spread to more parts of the economy. The big drop in business activity, that's a huge red flag," said Gus Faucher, director of macroeconomics for Moody's Economy.com.

    The recession watch can now end. It's already here. - Feb. 5, 2008

    USA TODAY survey: We're in recession, economists say

    Two-thirds of the 52 economists polled said the U.S. economy is in recession. Add those who believe the economy will be in recession soon, and 79% believe that the economy will contract at some point in 2008

    USA TODAY survey: We're in recession, economists say - USATODAY.com

    Growing Number Of Economists Say Recession Is Here


    A growing number of top economists believe that the U.S. economy has now toppled into recession…

    Some economists argued that the normally low-profile ISM services reading, coupled with the government’s report Friday showing the first monthly net loss in jobs in more than four years, is proof that recession is now a reality.

    Keith Hembre, chief economist of First American Funds, told CNN Money that:

    My forecast had been that the recession would begin this quarter, but the hard data wasn’t there yet. But now we’re seeing that. The service sector is a much larger component of the economy [than manufacturing] and this is very much a recession reading.

    CNN Money’s senior writer said that economists took the latest report as a sign problems are no longer restricted to just housing and manufacturing. Gus Faucher, director of macroeconomics for Moody’s Economy.com, told CNN Money his firm now believes the economy is in a recession. Faucher said:

    We’re definitely seeing conditions spread to more parts of the economy. The big drop in business activity, that’s a huge red flag.

    Economist Bob Brusca of FAO Economics said he doubted that the U.S. was in recession a week ago, but now believes there is about a 75% chance that a recession began last month. Brusca explained:

    That’s what recessions do. They come upon you all of a sudden. When you look back at history, you’re struck by how even-keel it is until the bottom just falls out.


    Growing Number Of Economists Say Recession Is Here | Boom2Bust.com

    Most importantly!!!!! This is what we need to accept...all of us!

    17 reasons America needs a recession
    Think positive, this 'slow motion train wreck' is good for the U.S.

    ARROYO GRANDE, Calif. (MarketWatch) -- Yes, America needs a recession. Bernanke and Paulson won't admit it. And investors hate them. We're all trapped in outdated 1990s wishful thinking about a "new economy" and "perpetual growth."

    Seventeen reasons America actually needs a recession - MarketWatch
     
  18. STFarmy

    STFarmy In the Starting Line-Up

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    Thanks for the links PR.
     
  19. Real World

    Real World Moderator Staff Member

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    Did you smoke a lot of grass in the past or something? [​IMG] Cuz you don't seem to remember anything people say in here. First of all, when have I ever said a recession isn't going to happen? I think I've said time, and time again, that one is certainly possible, but to this point, one hasn't happened. Second, when have I ever said a recession doesn't have positives? A recession is a correction, among other things. However, a RE correction, without an economic recession, is what will help our economy most. A recession means the loss of jobs on a massive scale, bankruptcies, both commercial and private, along with a significant decrease of capital in all markets. Avoiding a recession while accomplishing a corrective set of market conditions is the most ideal situation, and not a recession in and of itself.
     
  20. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    What I am saying is that we are without an ounce of doubt already in a recession RW...not that we "may" go into one. I am saying a year from now, it will officially be declared that a recession started in Jan. 2008.

    As you know, our government officials typically don't declare anything a recession until it's over...you did you know that, right?

    A recession doesn't have to mean a loss of jobs on a "massive" scale. Did you know that we were "officially" in a recession in 2001/2002? Do you recall mass bankruptcies? I think you're confusing a recession with a depression.
     
    Last edited: Sep 15, 2008

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