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Some financial writers and economists are predicting a 10 to 15 year depression starting in 2009. Others thing that the credit crunch is nearing its end and that housing will begin to strengthen this fall.
I don't know what to think.
Skyhigh
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They also have claimed we have been in a recession for the last 6 months, yet we still haven't had a true quarter of recession. I don't think the economy is strong, but the news has no incentive not to get the most negative doom sayer to sell their product.
I believe the media drives the economy. All they have to do on the evening news one night is to broadcast......"could it be the end of our recession?" Analysts are saying homes are selling fast, and you must act fast."
The mainstream media has predicted 19 of our last 6 recessions.
haha, I got this email from my financial planner today and he paints a bit of a rosier picture...
Quote:
The Fed has done its part (or so it thinks). After reducing interest rates for the 7th time since mid-September 2007, the nation’s central bank sent a clear signal that the US financial markets should not be expecting any more cuts in the near term. If the Fed is right, the end of many of our economic woes is closer than pessimists may think. When the government reported last Friday of “only” a drop of 20,000 jobs nationwide in April, far less than the 90,000 decline that was expected, stock and bond investors reacted with a level of optimism not seen since last October (source: DOL, Barron’s).
The spending of the US consumer may be vital to pulling our economy out of its financial funk. In spite of rising energy prices, higher food costs, a lessening ability to borrow money at banks, falling home values, and in some cases a loss of jobs, Americans need to spend. An estimated 70% of our $14 trillion economy is driven by consumer spending (source: Department of Commerce).
The trading week begins with the S&P 500 above 1400 and the Dow north of 13,000, the first time that has happened since 12/31/07. Since bottoming 8 weeks ago today, the S&P 500 has gained more than +11% on a total return basis (source: BTN Research).
I too tend to believe we have to hit bottom at some point soon and start regaining these losses.
Since the great depression, there have been multiple governmental and banking policies set in place to prevent a depression from happening again.
I doubt we go into a depression. Recession? Yes, it will be good for us.
Throughout this recession, the banks will rewrite their policies to not give rediculous loans that overspend the individuals budget. Which will reduce foreclosesures.
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