The Recession may be over (post #326)- part X

[Pharoh]

Originally Posted by wendersfan

I know you're being more than a little facetious, but there is a massive body of literature that states that's just what tends to happen in advanced democracies - the government reacts to, and insulates the public from, adverse economic conditions, especially those caused by globalization, by increasing its size.


Cameron, David R. (1978). "The Expansion of the Public Economy: A Comparative Analysis," American Political Science Review, 72, 1243-1261.



Rodrik, Dani (1998). "Why Do More Open Economies Have Bigger Governments?" Journal of Political Economy, 106, 997-1032.

I don't know how large the scope is of the literature, but regardless, many do question the reasons given, if not the actual findings of this body of literature. I am amongst them.

[Dr Mabuse]

Originally Posted by CRM114

Well half the country chooses to "advance" at least.

I would have expected more of a rationalization, or even a denial of the congress and Obama's socialist goals from you.

[orangecrush]

Originally Posted by wendersfan

I know you're being more than a little facetious, but there is a massive body of literature that states that's just what tends to happen in advanced democracies - the government reacts to, and insulates the public from, adverse economic conditions, especially those caused by globalization, by increasing its size.


Cameron, David R. (1978). "The Expansion of the Public Economy: A Comparative Analysis," American Political Science Review, 72, 1243-1261.



Rodrik, Dani (1998). "Why Do More Open Economies Have Bigger Governments?" Journal of Political Economy, 106, 997-1032.

If Dr Mabuse posts a graph, my world will officially be turned upside down.

[wendersfan]

I don't post graphs anymore.

[Pharoh]

Originally Posted by Pharoh

I don't know how large the scope is of the literature, but regardless, many do question the reasons given, if not the actual findings of this body of literature. I am amongst them.

Let me add, that whatever the reasoning is, insurance demand, terms of trade externalities, or something altogether different, the result isn't desired or beneficial.

[orangecrush]

Originally Posted by wendersfan

I don't post graphs anymore.

And I haven't read a long list of quotes from the good Dr in a long time. Don't try to change the way I think of members with facts

[kvrdave]

Originally Posted by JasonF

Not interested.

Let me know when they make a movie.

oh wait.....

Spoiler:

[fujishig]

http://www.latimes.com/business/la-f...,6899533.story

Front page story on the LA Times about how the worst may be over for the housing slump, basically because prices held steady and median sale price is less than half of the peak. What they fail to mention is that:
1) There was a government mandated foreclosure moratorium
2) Sales volume at the top of the market (1 mil and above) is really, really low, so the foreclosures that did go through artificially decreased the median. Try to find a house for the so-called median price in any of these areas
3) Unemployment in CA is >10% and rising
4) Vast majority of ninja loans are not yet due

Sometimes I wonder whether the media is just in the pocket of the realtors...

Meanwhile, the owners of the local Glendale Galleria filed for bankruptcy...

[Dr Mabuse]

Originally Posted by orangecrush18

If Dr Mabuse posts a graph, my world will officially be turned upside down.

[mosquitobite]

Originally Posted by fujishig

Sometimes I wonder whether the media is just in the pocket of the realtors...

Realtors have a lobbying group the same as many others.

Plus, I think people WANT to hear things are getting better. Why wouldn't the media report what people want to hear? Add in that the government also wants people to believe it's getting better and there's no reason the media has for reporting the truth.

[Ranger]

states unemployment rates updated:
http://www.bls.gov/web/laumstrk.htm
Michigan now at 12.6% - ouch. how high can that get? 16%?

[ernestrp]

Originally Posted by Ranger

states unemployment rates updated:
http://www.bls.gov/web/laumstrk.htm
Michigan now at 12.6% - ouch. how high can that get? 16%?

51 states!!!! I thought it was PR but it turned out to be DC.

[al_bundy]

Oracle is buying Sun Micro

[al_bundy]

Originally Posted by fujishig

http://www.latimes.com/business/la-f...,6899533.story

Front page story on the LA Times about how the worst may be over for the housing slump, basically because prices held steady and median sale price is less than half of the peak. What they fail to mention is that:
1) There was a government mandated foreclosure moratorium
2) Sales volume at the top of the market (1 mil and above) is really, really low, so the foreclosures that did go through artificially decreased the median. Try to find a house for the so-called median price in any of these areas
3) Unemployment in CA is >10% and rising
4) Vast majority of ninja loans are not yet due

Sometimes I wonder whether the media is just in the pocket of the realtors...

Meanwhile, the owners of the local Glendale Galleria filed for bankruptcy...

i've seen a list of stories from 1990 - 1994 where the NY Times declared the worst was over many times

[Ocelot]

i think the worse is over, but the cleaning up and recovering process are still in works. Honestly, i don't know how the worse for housing slump is over when there's a high % of unemployment. You can say whatever you want about your business, but if people don't have jobs, how the hell they have money to buy your stuff is beyond me.

[slop101]

Originally Posted by Ocelot

You can say whatever you want about your business, but if people don't have jobs, how the hell they have money to buy your stuff is beyond me.

Yup, that's the scary part. We're holding on for the time being, only because our overhead is so low, but if things don't pick up in a year, we're done - and we're fortunate as for most, things need to pick up much sooner. But if people are unemployed and aren't making money, they're gonna buy fewer goods and services, just like we, as a business, are buying less inventory.

[BigDaddy]

I am surprised that Oregon is the second highest on the list.

[kvrdave]

The places with low unemployment look like places no one wants to live.

[al_bundy]

Originally Posted by Ocelot

i think the worse is over, but the cleaning up and recovering process are still in works. Honestly, i don't know how the worse for housing slump is over when there's a high % of unemployment. You can say whatever you want about your business, but if people don't have jobs, how the hell they have money to buy your stuff is beyond me.

same thing as 2000 - 2002

rates are low and a lot of people are going to refi or buy new homes

[Tracer Bullet]

Originally Posted by Ocelot

i think the worse is over, but the cleaning up and recovering process are still in works. Honestly, i don't know how the worse for housing slump is over when there's a high % of unemployment. You can say whatever you want about your business, but if people don't have jobs, how the hell they have money to buy your stuff is beyond me.

We're not even at the end of the beginning.

[Ocelot]

Refinancing is fine... People who refinance usually mean they still have jobs and are able to keep up with the bills and stuff.

Buying new home? Not likely... Unless the jobs are stable and pays are good. I know most of people didn't get a raise or bonuses in 2008 (hell, people felt lucky that they still got a job). What's the current unemployment rate now? Say it's 12%, so that mean 88% can buy houses. But of course, of the 88%, some already have houses, some simply can't afford and some simply won't buy (prefer rent over own). I don't know what's the magic number, but whatever it is, i'm sure the buyers are more "educated" by now (i.e. barely cover the mortgage payment is not gonna cut it).

Sorry, current rate is 8.5%, the math if off but you know what i'm talking about (i hope).

[Ocelot]

Originally Posted by Tracer Bullet

We're not even at the end of the beginning.

damn, that's too negative don't you think

I'm going to put the 401K money market funds back into stock portfolios soon, so yeah, i truly think the worse is over. If i don't do that soon, i think i'll miss the boat...

[al_bundy]

when people buy new homes they usually buy new stuff like appliances and other long lasting expensive items.

if you read the archives of calculated risk or the big picture, there are articles that say that housing has played a role in every recession going back many decades

2000-2002 we also had unemployment around 7%, but a lot of people bought homes and in 1-2 years things improved. a lot of places have dropped in value and with the low rates a lot of homes are now affordable again

[orangecrush]

Originally Posted by kvrdave

The places with low unemployment look like places no one wants to live.

We're #3! Wait..

[sracer]

Originally Posted by Ocelot

damn, that's too negative don't you think

Is his quote too negative? Yes. Is it an accurate reflection of the reality of the situation? Yes.

Originally Posted by Ocelot

I'm going to put the 401K money market funds back into stock portfolios soon, so yeah, i truly think the worse is over. If i don't do that soon, i think i'll miss the boat...

If you believe that the worst is over then by all means get back into the market.

For your sake just make sure that the things that you think you know about the situation are true and not spin by those with an interest in manipulating perception.