The price of oil continues to fall as fears of a "considerable recession" in both the US and Europe rise. Light, sweet crude fell to US$77.91 on the New York Mercantile Exchange during morning trading in Singapore.
One analyst said: "The bailout may save the banks, but companies are still laying off workers and demand is going to suffer." Another noted that while the bailouts are helping the banks, the rest of the economy "needs help as well".
If this isnt recession I sure as hell dont want to see what recession is...
Its pretty plain that this is a recession and has been for some time. I personally think this is a lot worse than just a plain recession. Wall Street cant even pay their own debt. Job loss is at 750,000 for the year. The federal reserve printing $250,000,000,000 and pumping this make-believe money into the market just yesterday.
I have never seen anything like this in my life. I have only read about things like this and that was in history class and it usually revolved around the year 1929...
This is not a slowdown. 2001 was a slowdown compared to our current situation. We are in a recession, doomed for depression. My question is will this depression be more catastrophic than the "Great" one?
You can agree all you like, it doesn't make it a recession :)
To quote the BBC: "What is the definition of a recession?
Technically speaking, the ... economy would slide into recession when it experiences two successive quarters of what is known as "negative growth".
For this to happen, the total amount of goods and services produced ... - known as gross domestic product (GDP) - would have to contract on a quarter by quarter basis for a total period of six months."
MOst likely than not, since our borrowing habits were not checked. All of a sudden anyone who had a simple job was able to get a mortgage of half a mill with no down payment.
After all numbers were crunched, that Joshmo, was asked to make a monthly payment of $2500 for 35 years.
That Joshmo started squeezing all his nuts to get the oil out (Savings) and still could hardly make eds meet, while mortgage was not the only payment he had to make.
Some of these Joshmo's went belly up and asked for chapter 11 within a year with no savings of any kinds whatsoever.
Depression and other financial crisis were looming and all of a sudden that Joshmo and his family is HOMELESS.
What did the Government do? Bail out the Banks, instead of a spender (Joshmo) and now they are saying, abnk should lend again since they have been bailed out.
My Question: LEND WHOM???..
How about Government lends the Joshmo, who gives his house to the Government as a collateral, pays absolutely nothing for as long as he is living in that house.
Upon death or better selling prospect, he sells the house, give the money back to the Gov, plus a small interest, upon death Gov takes the house, since they have paid for it and seeks a new buyer with profit... Am I shooting stars from my rear end?? http://www.cmhc-schl.gc.ca/...
I really dont think Recession is something you can quantify in terms of GDP alone. You have to look at the whole picture. I know what the classic definition of it is but I disagree that it is an accurate definition.
One must take into account all variables to get an accurate reading.
Ex: Take the value of gold. In 2005 an ounce would cost 513.00. Gold is currently around 845.00 or so.
That is a 65% increase in price in just 3 years.
Gold for the last 20 years has been pretty stable usually hanging around $300-$600. Now it is pretty stable around $850 and has been at this level for quite some time. Meaning even if we gave a conservative estimate of the base value being 650 and the current price of 830, this would still mean inflation has risen by 28%!
My point is, GDP cant give you an accurate view of how the economy is going when there are so many other factors to consider.
Unemployment is yet another factor. All these things combined should give a good picture of how a nations health is.
If the US were a person and it were to visit the doctor for a checkup. The doctor would probably explain to that person that unless they serious change their lifestyle quickly, they will not be around much longer.
The same is true of the US system. That is why I believe we have been in a state of recession for at least a year or more.
recession: "An extended decline in general business activity, typically two consecutive quarters of falling real gross national product. "
its been falling for a few years now.
call it a slowdown all you want the economic label for a "slowdown" that last more than 2 quarter is recession.
"a period during which business, employment, and stock-market values decline severely or remain at a very low level of activity."
IE, if america's growth falls below 0% you have depression. in 2001 it was at 5%, now its at about 2%. 2002 almost was a depression with just over 0% (probably having alot to do with missing 2.4 trillion that hasn't been mentioned much since just before 9/11)
...but then the war machine started roaring up, and war is a business in america (its best, most successful business) the housing market was expanding like gas ever since 9/11 and the economy slow made it way back up to half the growth it had in 2001 and lower than the clinton era.
it can also be called more accurate "stagflation", but for all intensive and practical purposes its a 7 year long recession thats only getting worse as it only being carried by an ever increasing debt which is like building a tower (the debt) with no way down eventually you got jump/fall off but either way your falling (depression) and going to hit the ground (the real value of the US economy).
A recession isn't based upon thoughts or believes, it's based on simple numbers. For there to be a recession a country's GDP must shrink for 2 quarters in a row. Note that it's not that the GDP must grow slower, or stagnate, but actually shrink which the numbers for the US do not show.
You may be using the word recession to mean something else, but in relation to the original question posed by SunDown, the analysts are denying we're in a recession because by the definition of a recession, we're not there yet.
