Upcoming Recession
 

With this upcomming recession, have any of you guys heard, think, or are concerned that this might put a freeze on hiring for this year? Or do you think it's going to have a marginal effect on the industry because of the current 'shortage'?

First of all, we ought not begin a discussion on false pretenses. As reported in today's Wall Street Journal, economists expect "a period of unusually weak growth, rather than outright recession," with growth this year at 1.7% compared to 2007's GDP growth of 2.2%. It's still early enough to keep the economy chugging along....

The Sky is Falling The Sky is Falling, Geezzzzzz

I have Faith in out Country and our Economy slow growth dont mean Recession it just means slow growth... Now Go out and Spend we gotta keep this puppy running

nevermind..... sigh

Remember the definition of recession back from econ 101. There are numerous "baselines" used to define such an economic event. A "correction" in the equity (stock) market is 10%, a "recession" is 20% (which is a moving and debatable number in the current equity markets) and/or a LOSS in GDP in 2 or more consecutive quarters. We have a SLOWED economy, not a recession by any fundamental market tickers.

This being said volativity (the .vix index) is higher than ever. We are facing an interesting worldwide economy situation. A slowing and deflating of the housing market impacted the credit market, which impacted the equity markets of the US, which is the basis of most international markets, which directly effects the value of the dollar, which impacts the cost of all imported goods. In addition to the following flow or money we have a complex variable of commodity prices and inflationary woes. Oil prices have risen, commodity prices have risen- causing the consumer inflationary cost index to rise at a higher rate than both the average overall cost of inflation and the rise in median income. While I am no economist there are many variables effecting all of us in not only our industry but our standing as americans in the global marketplace.

Currently Cash is king. The Fed is acting (via reductions in the discount rate to banks) to bring the liquidity levels up in american households, the house/white house has convened to try to put a liquid infusion (of $140B) into the US economy. All of these actions are in hopes of reinforcing the median american consumer to bring up the global economy from the basis of the fundamentals. Right now is a great time to have cash to get into the markets- the equity markets, housing markets, and global markets are at a discount with the ability to get cash and financing cheap IF you are qualified and not in debt up to your eyeballs. Moral of the story is ALWAYS HAVE CASH ON HAND and NO Debt in depreciating assets!

Riddleeagle... I read your post before you changed it... and agree 100%.

With another rate cut, mortgage rates will eventually come down, which is good for the consumer. Of course just one of the flip sides, so will interest rates on bank accounts, allowing me to "earn" less on my own money. My Roth and 401k are tanking thanks to the stock market. I think it's borderline naive to think that a few hundred bucks in the form of a "rebate" will save our economy.

The fact of the matter is, we as a nation are in debt.. and I don't mean just personal debt. And saying "go out and spend" isn't going to help. Most people in America don't have the money to spend, or what they do spend will just end up being put on a credit card, increasing the level of debt.

Tristar my Brother my comment to go out and spend was a failed attemp at sarcasm.. hell I know most americans cant do that.. Hell I am Sallie Mae and Chase student Loan ***** and will be for some time unless I hit the Lotto.. oh wait you have to play to win.. all in all its going to be in intresting year in the world economy

Sorry man, I missed the sarcasm. Our current administration seems to think it will work though...

it won't work...government needs to let the market correct itself. The market is a far more powerful animal than the government can control and all of these pathetic attempts to make themselves look like they care are pathetic.

it's beyond just our economy, worldwide it's slumping

they react to us...we react to them..they react to use reacting to them...they react to us reacting to them reacting to us

oh no, i've gone cross-eyed.


Honestly though...the term recession has morphed from what it used to be back when the textbooks from Econ 101 were made. Wars are supposed to stimulate the economy, history has proven that. But that only works when the money we spend isn't already in debt.

Our economy is plain and simply, run by banks. Who desire nothing more than to make money. Every dollar that is produced, is sold to the US for distribution at a debt. This country will never, ever be out of debt with our current Federal Reserve system, which is RUN by banks!

That's for another discussion..do the research, it's kinda disturbing if you ask me.

Just my .02

i recently stimulated the economy by purchasing a truck that gets 12 miles to the gallon. What have you done lately :)

I might stimulate the economy by eating out tomorrow afternoon......

I am going to stimulate the economy by downloading music on Limewire...oh wait...:rolleyes:

Recession: When the guy next door loses his job

Depression: When I lose my job

Can someone change the title of this thread to spell upcoming correctly? It's so annoying every time I see the thread index.

Agreed. It's painful.

Amen, brother.

The notion that American consumers are living in debt from spending binges is misleading. The American consumer balance sheets are in pretty good shape.

If you take all Stocks, Bonds, Life Insurance Policy, Bank CDs, 401K holdings and add them all together, subtract out what people owe on credit cards and other forms of indebtedness and what they owe on mortgages and don't count the value of the house and treat the mortgage as pure debt will show the true accounting numbers of what Americans are worth. Subtracting the liabilities from assets will show that consumers assets total approximately 29 trillion. The American people have more savings than the world combined!

With tens of trillions of American assets in this country and abroad, I don't yet see how 300 to 400 billion in losses spread over a few years from bad lending practices is enough to place the economy into a full swing recession. The overall economic fundamentals are still pretty strong and I believe the economy will absorb the mortgage crisis if we have sound monetary policy from Washington and a reasonably stable geopolitical climate.

This economy is somewhat in a state of creative destruction -a shake out of the weak. Creative capital creation is a messy one and we will be seeing this for the next year and then investors will be going into the next big boom biz. The economy doesn't work in a smooth and polished quarterly growth at double digit rates, it binds, lurches with irregularities until all the kinks are worked out.

This country isn't going anywhere, we will survive this!

EAHINC

its a self fullfiling media hyped situation....is the economy slowing some yes.... but if we allow the media to tell us everyday that we are in a recession eventually everyone believes it ....and wal la .... people change their spending habit a CAUSE the recession.....

Speaking of America's credit-card debt, I just paid off the last of nearly 10K accrued for living and flying expenses while not working (and a short stint as CFI) for a year or so. It took 11 months of first-year pay, but you can call this American now a slave to no Bank!! Except for my SLM student loans, of course LoL

The problem with this is your looking at averages which are skewed by the erosion of the middle class. you have a standard deviation from the average that I suspect is huge. Youd be surprised how many people dont have anything in savngs, or dont invest in anything, or dont have insurance. Plus just because the economy is in a slowdown doesnt mean Im allowed to access my 401K without taking a huge penalty. Of course if it comes down to it then yes you have to tap into your retirement funds...

but also when it comes down to it, you have to let your house foreclose, as is the case right now with so many people. Thats bad news for all of us even the ones that are in good financial shape because we'll end up paying for that indirectly.