The Economic News Isn't All Bleak
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The Economic News Isn't All Bleak
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Re: The Economic News Isn't All Bleak
#2No comment on whether the future is bleak or not.
But extending beyond economics, also consider the US political commentary of the past year and a half. It was, not to put too fine a point on it, shit. Take the conventional wisdom for any day of your choice four weeks before the election to a year before the election, then come back to it two months later. Uniformly, the boldly-made predictions and much-blabbered conventional wisdom were horribly, horribly wrong. As I like to say, if it had been right, we'd be awaiting President Clinton's swearing in after defeating Guiliani 75-25.
Future predictions have never been that great, and maybe it's just that I'm paying attention now, but the "horizon of wrongness" seems to have moved a lot closer to the present now. Pundits are rarely even close to right for events a month in the future now, and it's getting to the point that I can't understand why anybody even listens to them, because they are so wrong, I can't hardly even point out the people who were right.
Play it conservative. Keep your savings up. Any techie after 2001 should know that anyhow. Maybe the future will indeed be awful, but at this point, I'm burned out on punditry, and I would say that at the very least, try not to let this doom and gloom depress you too unduly. The people selling you doom and gloom... and I use the term "selling" on purpose, because it's the literal truth... have a horrible track record. Let's wait and see what happens.
Re: The Economic News Isn't All Bleak
#3A few months ago, Goldman Sachs "experts" were predicting oil at over $200/barrel. Obviously, things didn't work out that way, which is why the concluding paragraph is exactly right -- information now travels faster than ever in our economy, which will affect the way the economy rebounds. Still, nobody knows exactly what will happen.
It seems to me that the best predictor of how the economy is doing is the way that it is perceived. For all the talk of this being the "worst economy since Hoover," we're not in a depression and not all is lost. I see a lot of optimism accompanying the incoming administration, which will probably do more for the economy in the short-term than any sort of monetary or fiscal policy could.
Re: The Economic News Isn't All Bleak
#4I was thinking the other day: lets assume that there is some average economic cycle that 1 out of 7 years is a recession.
If that cycle is invariant, but via some means the time variable could be compressed, such that 1 in 7 days was a recession - suddently that seems not so bad (kind of what the article was hinting at?). So you compress time, increse the severity of changes but reduce the impact time (which is I guess where the real human damage is done). Will be interesting to see.
Re: The Economic News Isn't All Bleak
#5I keep saying it - things are fine. Real value has not been wiped out - the amount of real value lost is not big when compared to the general economic numbers. The U.S has a bigger problem than the rest of the world, but the U.S is still very dynamic, and many world currencies still measure against the USD.
China is developing fast, but a lot of the development does not go very deep. So China is not yet ready to function as a counterweight to the U.S.
Europe is doing fine, even if it is sluggish as always. Africa is at it's most conflict-free of the last 50 years and lots of >5 growths there.
In general, the U.S needs to get a bit more dynamic, modernize it's infrastructure, take back the production, and it will be as fine as always.
The fundamentals of the economy are fine.
Re: The Economic News Isn't All Bleak
#6No comment on whether the future is bleak or not. But extending beyond economics, also consider the US political commentary of the past year and a half. It was, not to put too fine a point on it, shit . Take the conventional wisdom for any day of your choice four weeks before the election to a year before the election, then come back to it two months later. Uniformly, the boldly-made predictions and much-blabbered co…
Great post. One thing I found interesting about this piece was the blatant revisionism on display in the second paragraph of the article:
"less than two years ago, conventional wisdom dictated that the housing bubble would be painful but that global economic growth would remain stable."
Forgive me, Mr. Writer, but my recollection is that less than two years ago, few people in the mainstream were acknowledging that a housing bubble even existed. Hell, even a year ago, half of the mainstream press was essentially reprinting press releases from hacks like Lawrence Yun (widely quoted "expert" for the National Association of Realtors), who never saw a bad housing statistic that he couldn't spin for the positive. Those who were calling a bubble a bubble early on (as early as 2003) were labeled jealous curmudgeons who missed out on the easy-money party.
I keep trying to come up with a lesson from this, but the only thing I can think of is that our society doesn't reward dissent. No matter how insane and extreme the conventional wisdom, it doesn't pay to be the guy who vocalizes against the herd. If you're a contrary thinker, it's best to just keep your head down, your mouth shut, and do whatever you were going to do anyway.
Re: The Economic News Isn't All Bleak
#7I (along with many of you I'm sure) have been listening to Peter Schiff's podcast since his predictions from 2004-2006 have materialized, and his outlook on the future of the US economy is very bleak. http://europac.net
Duh, no one knows exactly what will happen or how, but I do believe it is foolish to write off these 'bleak' predictions from analysts who have proven their credibility and can back up their predictions with logic and reason.
Plus, this article is self-defeating is it not? If we are supposed to ignore these 'bleak' predictions because of how innacurate predictions have been in the past, shouldn't we ignore the optimistic predictions like this one, too?
EDIT: I don't endorse everything Schiff says.
Re: The Economic News Isn't All Bleak
#8No comment on whether the future is bleak or not. But extending beyond economics, also consider the US political commentary of the past year and a half. It was, not to put too fine a point on it, shit . Take the conventional wisdom for any day of your choice four weeks before the election to a year before the election, then come back to it two months later. Uniformly, the boldly-made predictions and much-blabbered co…
Great post. One thing I found interesting about this piece was the blatant revisionism on display in the second paragraph of the article: "less than two years ago, conventional wisdom dictated that the housing bubble would be painful but that global economic growth would remain stable." Forgive me, Mr. Writer, but my recollection is that less than two years ago, few people in the mainstream were acknowledging that a…
"my recollection is that less than two years ago, nobody in the mainstream was acknowledging that a housing bubble even existed."
My recollection is different, because I was reading Business Week more than three years ago. The housing bubble has looked like a bubble for a long time to people who considered how much faster house prices increased than wages.
Michael Lewis's collection of articles, Panic,
http://www.amazon.com/Panic-Story-Modern-Financial-Insanity/...
includes articles that foresaw the housing crash more than two years ago.
Re: The Economic News Isn't All Bleak
#9Earlier quoted context omitted.
Great post. One thing I found interesting about this piece was the blatant revisionism on display in the second paragraph of the article: "less than two years ago, conventional wisdom dictated that the housing bubble would be painful but that global economic growth would remain stable." Forgive me, Mr. Writer, but my recollection is that less than two years ago, few people in the mainstream were acknowledging that a…
"my recollection is that less than two years ago, nobody in the mainstream was acknowledging that a housing bubble even existed." My recollection is different, because I was reading Business Week more than three years ago. The housing bubble has looked like a bubble for a long time to people who considered how much faster house prices increased than wages. Michael Lewis's collection of articles, Panic, http://www.ama…
Yes, there were a few people who were calling the bubble early. However, their view wasn't in the mainstream two years ago. It certainly wasn't "conventional wisdom".
I have edited my post to replace the word "nobody" with "few". Mea culpa.
Re: The Economic News Isn't All Bleak
#10No comment on whether the future is bleak or not. But extending beyond economics, also consider the US political commentary of the past year and a half. It was, not to put too fine a point on it, shit . Take the conventional wisdom for any day of your choice four weeks before the election to a year before the election, then come back to it two months later. Uniformly, the boldly-made predictions and much-blabbered co…
This dude has consistently nailed it: