08-05-2004 07:45									#31
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You're such a cheerleader Dan.

	08-05-2004 08:13									#32
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Rah rah sis boom bah

	08-05-2004 08:57									#33
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quote: Originally posted by Jaguar When it crosses 1 million next month, GePap still will argue that we are in the greatest bear economy since 1932.

Who is arguing that? I am simply not as optimistic as all the economist or DanS- we will see, but by November, unless something miraculous happens, Bush will still have that sad label of having less Americans working when he ends his term than before he begun, and when you realize that there are at least 4-5 million more Americans period since 2001, well, that is not that great a news.

	08-05-2004 09:12									#34
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quote: Originally posted by DanS Well, there was a real bubble economy in 2000 that needed adjustment in the worst of ways. We don't have that now. [Cue Hershell] Besides, these interest rates are the lowest since 1958. This can't last forever.

Why do you think there was a bubble back then? Explain.

	08-05-2004 09:50									#35
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I recall you didn't quite agree there was a bubble going on back then. How can you tell there isn't a bubble now if you can't recognise it?

	08-05-2004 10:19									#36
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There was a "bubble" because people bought shares in tech stocks that hadn't yet made a profit, with the expectation that they would soon. But they never did. Another problem was that a lot of companies lied and said they earned more than they did. So it was a bubble inflated by false expectations and lies.

	08-05-2004 23:41									#37
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Reports say that the United States spent 944 billion dollars in March on housing, roads and public works. That is a rise which is three times expectations.
The rise was 1.5 % compared to March 2003. Construction is equally divided between the private and public sectors. Meanwhile the American governments planned public works is making progress. The projects are a part of Bush's struggle to bring down unemployment. This has for instance meant a $18.6 billion package to the public traffic sector, and increase of 8.5%

I elsewhere made the point that current US economic policy is more akin to Socialdemocracy, than conservatism.

I wonder how this sudden surge in expenditure on public works is financed?

	08-05-2004 23:48									#38
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quote: Reports say that the United States spent 944 dollars in March on housing, roads and public works.

I think you're confusing the United States and Zanzibar.

	08-05-2004 23:55									#39
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quote: Originally posted by mrmitchell I think you're confusing the United States and Zanzibar.

I do know there lots of new jobs in Force Protection thanks to all the terrorism and guerilla action in the Middle East. A lot of guys from my National Guard unit the just came off our one year mobilization and are taking jobs in this field and its a big pay raise over what they did before the mobilization.

	09-05-2004 00:47									#40
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quote: I recall you didn't quite agree there was a bubble going on back then. How can you tell there isn't a bubble now if you can't recognise it?

I agreed that there was a stock market bubble. There was a bubble, but it was only in a few asset classes. So when a crisis picture was painted by Hershell and he went on and on about real estate prices, I found it difficult to get all worked up about it and thought that it would all work out OK. To be fair, Hershell was describing a set of real risks. I just thought the probability for the worst case was low.

But you're right that at that time, I probably wouldn't have described it as a bubble economy. Now, I just did describe it as a bubble economy. I should probably hash that out. Certainly, parts of it were unsustainable. Profits at very low levels and rapidly increasing investment, for instance.

Anyway, we probably know right now that we aren't in a bubble economy. It's true that in some areas -- like my own -- you could make the argument that we have a residential real estate bubble. But I doubt that will have much impact economy-wide when it all comes to an end, as it is rapidly doing.

	09-05-2004 07:08									#41
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On a related issue..

I am an Area Manager over parts of 6 southeastern counties in coastal North Carolina..in the ready mix concrete industry.

We are having a major problem is the Eastern United States region...a lack of cement!

From reports gathered and published, or perhaps "promoted" predictions are in the >46% range for cement to go to China, with the rebuilding efforts in both Iraq & Afghanistan depleting an already scarce source.

We have been on allocation for the first time in my tenure..19 years..although other states have been ..

The cement suppliers in this area are 5..Roanoke Cement,LaFarge,Holcem,Cemex & Giant...2 of the 5 have been without cement for 2 or more weeks..

we have received 5 price increases in 40 days and have just as of Friday received word of an additional allocation handcuff forthcoming..

Petroleum,metal and now this...

last week steel was up 48% and dont even start me on fuel costs...

I know prices have to go upward..but now our area..is doing so darned well..BUT..will grind to a screeching halt if no product is vailable

But...this will weed out the "Haves" from the "Have nots"..we are one of the largest producers in the Southeast..so purchasing power is a help to some extent..

Some markets have gone to a 4 day workweek (Ready Mix Concrete Industry that is)

Well...we couldnt keep growing at this pace forever I reckon...

~sigh~

Grandpa Troll

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	09-05-2004 08:00									#42
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quote: Originally posted by Jaguar So it was a bubble inflated by false expectations and lies.

In other words, it was a bubble.

	09-05-2004 08:04									#43
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quote: Originally posted by DanS Anyway, we probably know right now that we aren't in a bubble economy.

No, it's still a bubble. Stocks are still insanely overpriced compared to their earnings expectations. Right now, I think the average stock price is based on predicted earnings for the next seventy years. I fail to see how that could be anything but speculation.

	09-05-2004 08:49									#44
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No, stocks aren't insanely priced. They are overpriced, but only slightly. In the 15%-20% range. Hardly anything to really worry about from an overall perspective.

	09-05-2004 08:59									#45
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Troll: thanks for the detailed report. That must be the kind of stuff that Warren Buffett talked about a couple of weeks ago when he said he was seeing inflation. His company, Berkshire Hathaway, is in a lot of basic industries like yours.

Luckily for the economy as a whole, even expensive cement adds much less to our inflation than it does to the vast majority of other countries. Just imagine the inflaton that China is facing. They have to outbid the US in the open market. That can't be fun for them!

	09-05-2004 21:11									#46
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quote: Originally posted by Tripledoc Reports say that the United States spent 944 billion dollars in March on housing, roads and public works. That is a rise which is three times expectations. The rise was 1.5 % compared to March 2003. Construction is equally divided between the private and public sectors. Meanwhile the American governments planned public works is making progress. The projects are a part of Bush's struggle to bring down unemployment. This has for instance meant a $18.6 billion package to the public traffic sector, and increase of 8.5% I elsewhere made the point that current US economic policy is more akin to Socialdemocracy, than conservatism. I wonder how this sudden surge in expenditure on public works is financed?

Freddie Mac and Fannie Mae.

	10-05-2004 17:33									#47
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quote: Originally posted by DanS I agreed that there was a stock market bubble. There was a bubble, but it was only in a few asset classes. So when a crisis picture was painted by Hershell and he went on and on about real estate prices, I found it difficult to get all worked up about it and thought that it would all work out OK. To be fair, Hershell was describing a set of real risks. I just thought the probability for the worst case was low. But you're right that at that time, I probably wouldn't have described it as a bubble economy. Now, I just did describe it as a bubble economy. I should probably hash that out. Certainly, parts of it were unsustainable. Profits at very low levels and rapidly increasing investment, for instance. Anyway, we probably know right now that we aren't in a bubble economy. It's true that in some areas -- like my own -- you could make the argument that we have a residential real estate bubble. But I doubt that will have much impact economy-wide when it all comes to an end, as it is rapidly doing.

Well for the record, without intending to argue about it, I think the US has been entering a boom and bust pattern. I guess 2004 and 2005 will be good years, but I expect a new bust afterwards. IMO the recession was ended by pumping up asset prices again (mainly real estate), not by actually rectifying the imbalances.

	10-05-2004 18:30									#48
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quote: Originally posted by Colon I think the US has been entering a boom and bust pattern.

That's like saying, I think Belgians can breathe air. Boom/bust is inherent to the capitalist system. It's called a business cycle.

	10-05-2004 18:40									#49
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dp

Last edited by Colon on 10-05-2004 at 18:47

	10-05-2004 18:46									#50
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quote: Originally posted by chegitz guevara That's like saying, I think Belgians can breathe air. Boom/bust is inherent to the capitalist system. It's called a business cycle.

With a boom'n bust pattern the ferocity of the booms and the severity of the busts are markedly stronger and they happen in quick succession. If you look at the Eurozone's GDP growth since the late 90's you'll notice that even though GDP growth over the whole was smaller, the recession was less deep as well. (IIRC unemployment rose by just 1% in the eurozone from the lowest to the highest point, in the US that was something like 2.5%)

	10-05-2004 19:44									#51
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There doesn't seem much evidence to support your boom/bust economy theory. The latest recession was one of the mildest on record. Americans seem to hire and fire more quickly (almost everyone is employed at-will), which probably is why you get the amplified unemployment swings.

But, if you don't want to argue it...

Anyway, I agree that it's evident that we still have some imbalances. We're in a much better position to deal with them now rather than we were two years ago, however. For instance, corporate profits aren't pathetic, like they were.

Last edited by DanS on 10-05-2004 at 19:51

	10-05-2004 20:09									#52
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I hear the Nikei is tanking because money is being pulled out of Asia to invest here. Good for us, bad for them, which in turn could be bad for us if they can't buy our products, but then we can buy more of theirs which might keep them from tanking too far.

	10-05-2004 20:40									#53
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Don't worry about Japan. They don't buy much from us. Business in Japan is being boosted by big demand increases from China. As long as China is good, the Japanese recovery will continue.

	10-05-2004 21:21									#54
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So anyway we cut it, China is now the engine of world economic growth?

Puts a little bit of presure on the Beijing leadership.

	10-05-2004 21:39									#55
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China is now an engine of world economic growth. Much of the increase in demand from China is for parts for exported goods to the United States. Domestic Chinese demand is now also contributing in a substantial way, which is a change.

Anyway, the Chinese economy is overheating. They're unable to generate enough electricity to meet demand, for instance.

Last edited by DanS on 10-05-2004 at 21:45

	10-05-2004 21:49									#56
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Actually, both run hideous trade surpluses with the US, so we can influence Japan a great deal.

and Gepap, China is only buying from the Greater Chinese Area(Korea,Japan,Taiwan,Russia,etc). The AGOA,south America,etc can only sell to the US, and even there they only have the part of the market that isn't swamped with Chinese goods.

	10-05-2004 22:22									#57
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quote: and Gepap, China is only buying from the Greater Chinese Area(Korea,Japan,Taiwan,Russia,etc). The AGOA,south America,etc can only sell to the US, and even there they only have the part of the market that isn't swamped with Chinese goods.

That still does not mean China is not the one place growing like crazy and bringing the world along-I mean, 7%-9% growth for 20 years straight?

	10-05-2004 22:22									#58
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quote: Originally posted by Whoha Actually, both run hideous trade surpluses with the US, so we can influence Japan a great deal.

Yeah, but we buy that on credit, credit coming from European, Japanese and Chinese capital holdings.

	10-05-2004 22:34									#59
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credit created by the trade surplus, yes, but by there has been more property sold to foreigners to pay for the trade deficit then there has money borrowed right now.

by influence I mean that when we are unable to fund the trade deficit anymore, both will take hits if they are still addicted to exporting to us when we finally do collapse.

	10-05-2004 22:52									#60
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Typical Leftist line in here: Oh I hate job growth. I hate economic prosperity. I hate it because it is under Bush's watch. I hate jobs. I won't advance my stupid agenda if there is job growth.

Pathetic.