The Economy

Nutmeg · Post by **Nutmeg** » Fri Oct 10, 2008 2:44 am

So basically, everything is great right now financially. The Dow dropped below 8600 today. The Bailout Bill is going to take time to implement, and people are still rapidly losing trust in our market. I'm not even 18 yet, and it kind of worries me. I found this interesting article just now, it's a really good read.

-Stocks are on track for their worst year since 1937-
http://www.chron.com/disp/story.mpl/nation/6050283.html

Should the government be bailing the banks out in the first place? What's going to happen to our country as the market continues to drop? I'm curious to see everyone's viewpoint on the issue.

Midnight_Rider · Post by **Midnight_Rider** » Fri Oct 10, 2008 2:52 am

Not that I'm such an economic genius or anything but, you can ask anyone I know and they'll tell you that I have been predicting all of this for years. I'm hoping that we don't end up living in Grapes of Wrath-type conditions.

Paul56 · Post by **Paul56** » Fri Oct 10, 2008 7:53 am

The current situation with the stock market is bring driven by fear which has been caused by the events leading up to this.

The average person invested in the stock market is watching their portfolio dwindle and telling their broker/adviser to get it out of stocks. Their losses were all on paper before they issued that order... but they solidified those losses as real upon the sell.

The fear is being created partially by the media who love to issue what I can financial porn... simply for the purpose of increasing their readership.

Follow the pictures on the CNN main page and you will see what I mean by financial porn. They are showing pictures of traders with their hands over their mouths... as though they having an OMG reaction to something... presumably the stocks tumbling.

I don't believe we are in for another Great Depression. I am holding onto my stocks and not selling because when the rebound happens the stocks will quickly recoup the losses. No sense in trying to time the market as to when to sell and buy back. Those who sold and buy back in on the upswing will have losses.

It takes some guts to hang on but I think those who do will be rewarded on the upswing... and things WILL swing back up.

There are plenty of people living well beyond their means by means of credit. These are the folks in serious trouble if/when they lose their jobs during times like this because when the income stops so does the ability to make the monthly payments on the credit... so everything comes tumbling down. I am a firm believer in paying as I go rather than raiding my future to pay for present indulgences.

MyNeonSaysHi · Post by **MyNeonSaysHi** » Fri Oct 10, 2008 3:14 pm

Nicely said paul.

rOniN · Post by **rOniN** » Fri Oct 10, 2008 5:12 pm

Don't worry too much...you are young and most likely wont deal with the stock market for some time. On the other hand you will be in debt if you go to college but that is usually something that wont get you financially in a hard spot since loans are not that hard to pay off with a new job.

As Paul said it is just stupid people doing stupid things right now and the media is pushing the fear just so people will watch to see what is going to happen next.

The market goes up and down all the time and sometimes it goes REALLY high like in the late 90s and really low like in the 30s. It is a fluid market which means it will not always be stable so this should be expected. It will go back up in the future - how near would be complicated to predict.

Most of the stuff happening right now wont effect many of us because we don't have too much debt, don't mess with the stock market and have jobs that will be hard to lose just because of a fluctuation in the market.

jrumann59 · Post by **jrumann59** » Fri Oct 10, 2008 7:34 pm

Shit right now I am salivating at intel at 14-15 a share. Now is the time to get in and have a relatively low risk high reward turn around. People if they got in now with 5-10K can make some serious money in 2-3 years.

Post by **racer12306** » Fri Oct 10, 2008 8:45 pm

I'm firing up my 401k right now and I'm going heavy in stocks. Hopefully this bet will work. But the plus is, if it doesn't I have 40-45 years until I retire so plenty of time to recover. I know many others aren't so fortunate.

heyitsstock · Post by **heyitsstock** » Sat Oct 11, 2008 12:40 am

remember this

BIG MONEY CAN BE MADE IN DISPIRIT TIMES...

Nutmeg · Post by **Nutmeg** » Sat Oct 11, 2008 1:05 am

What's a dispirit time?

Paul56 · Post by **Paul56** » Sun Oct 12, 2008 8:13 am

Nutmeg wrote:What's a dispirit time?

Definition: To make less hopeful or enthusiastic.

Yes, it is a word.

Post by **Diablo0** » Sun Oct 12, 2008 2:12 pm

I'm not too worried. Yah I've got investments in stocks which aren't doing well like just about all of them. However I'm only 24 and years away from retirement so there is plenty of time for it to rebound, it'll just take time. However, being everything is low it's perfect time to buy for all of us in our 20s and room for it to grow. I still have money going into my retirement every month...

I'm no economist but those that are please explain or correct me on my thoughts here...

Yes, the economy has taken a dive but the way I'm looking at it here is that this is what we really should be at. Apparently all of this started for the most part due to debt with credit being given to more people than we as a country have money. So... the credit grew and grew, the economy grew and grew but it was only on paper with no monetary value. Customers were putting a lot of things on credit so products were moving, housing were moving, so various companies were seeing profits for selling products, boosting their stocks but but all of those purchases were just numbers on paper being stuck on credit by the consumer. Now as some put it the bubble has burst, we can't sustain this credit since we don't have anything to back it up and our economy is shrinking to our true monetary value without all the faux money which was just credit moving around. The nation is now getting a reality check and many are being forced to pay off their debt and while that takes places many are cutting back, profits aren't there and thus the market takes a dive.

Is that a basic assessment on part of whats going on? Like I said, I'm definitely not an economist so I could be completely misunderstanding whats going on...