Explain the economy to me...

[Eyeball Chambers]

OK, tell me where I'm wrong, any information is extremely appreciated.

We might be going into a recession because oil prices are high, and because of the "housing meltdown"?

Can someone explain the "Housing Meltdown"?  I think it means the interest rate was low and bankers were to confident so they gave out loans to anyone and everyone and then realized the people couldn't afford it so there were/are massive amounts of foreclosures on homes?

Please give me more detail and information or tell me if I'm completely confused lol.

Thanks,
RPF
 
P.S. Wasn't sure if I should post this here or on the Political Board.

[Eyeball Chambers]

Very helpful, thanks again for the information!

[chainsaw]

A recession means 2 quarters of declining GDP in a row.

[240 is Back]

simply put...

the wars were started to set up bases (saudis kicking us out in a decade, and we need a place to set up missiles), gain control of oil (US firms own 80 percent of Iraqi oil forever) and to make the military firms rich.

At this point, the war is won, AQ is more of a group of roving thugs than an army, and we're just there to let the military firms milk it til october, when bush will declare victory before elections.

The next person in office, likely a dem, will inherit the new 5 tril that bush borrowed in 8 years.

Good tradeoff for the 50 tril in oil we'll keep in dollars.

the housing bubble = greedy americans buying houses they can't afford and can't sell.  bush and congress let them to keep the economy stimulated to allow the war borrowing to occur.

next prez, if dem, will fix domestic economical issues by taxing the rick and scaling back war effort (and borrowing).  if repub, well, mccain will bomb iran within his first month in office, so no telling how long the economy can sustain war borrowing if he's in charge

[Spoony Luv]

simply put...

the wars were started to set up bases (saudis kicking us out in a decade, and we need a place to set up missiles), gain control of oil (US firms own 80 percent of Iraqi oil forever) and to make the military firms rich.

At this point, the war is won, AQ is more of a group of roving thugs than an army, and we're just there to let the military firms milk it til october, when bush will declare victory before elections.

The next person in office, likely a dem, will inherit the new 5 tril that bush borrowed in 8 years.

Good tradeoff for the 50 tril in oil we'll keep in dollars.

the housing bubble = greedy americans buying houses they can't afford and can't sell.  bush and congress let them to keep the economy stimulated to allow the war borrowing to occur.

next prez, if dem, will fix domestic economical issues by taxing the rick and scaling back war effort (and borrowing).  if repub, well, mccain will bomb iran within his first month in office, so no telling how long the economy can sustain war borrowing if he's in charge

So are you saying a dem/gets in the office, he or she won't start another war? Or pro-long this one?

[240 is Back]

So are you saying a dem/gets in the office, he or she won't start another war? Or pro-long this one?

Correct.

Mccain will likely invade iran.  He sings songs about it, and even TODAY he says they're still a threat despite all 16 of the US intel agencies in agreement they scrapped their nuke program 6 years ago.

hilary/obama will scale back iraq and focus more on afghanistan and use negotiation with iran. 

[jaejonna]

were fucked is basically whats the explaination is ..

[240 is Back]

were fucked is basically whats the explaination is ..

nah.  things have been good in the economy since 911... lots of borrowing, on the govt and individual level.

today we're seeing what happens when you borrow irresponsibly.

[youandme]

it moves up down and sideways.

[Decker]

The housing bubble was driven by low interest rates and risky lending by the mortgage lenders.  The average person has X amount of dollars they can spend per month paying for a mortgage.  When rates are low, they can buy a bigger mortgage for the same X amount of dollars.  So they bid up the prices of homes and everyone is into buying.  It becomes main stream.  Seen any of those TV shows about flipping houses to get rich?  It usually signals a long term top. 

Americans work hard but don't save much and prefer to live on credit which sucks money out of their pay checks so their reserves are low.  When the introductory low interest rate ends and their monthly payments on the mortgage go up, they can't make those payments.  That is where we are now. 

The lenders didn't seem to care if the borrowers could make payments down the line when their rates went up.  Greed at it's finest.  Same thing happens at the end of a stock market bubble.  IPO's come out for every possible company, whether it is a solid business idea or not.  Remember all those internet IPO's that opened at $100-200 and ultimately failed?  Remember the TV ads about taxi driver owning a tropical island from stock market profits?  Kind of like people flipping houses?

Imagine if interest rates rise to the levels we had in the 1980's.  If that happens consumers will only be able to afford a very small mortgage and housing prices will really plummet.  End of real estate bubble.  Will it happen?  Who knows.  Immigration has to continue and will probably escalate in the USA.  Why?  Because as the Baby Boomers retire, the government will have to come up with money to pay for the entitlements they were promised like Social Security and Medicare and they will get this money from tax revenue.  Since the Boomers are such a large part of the work force and will no longer be working, workers from other countries will have to come here to take their place and the government will get the tax revenue from them.  These people will need a place to live and that will help support the real estate market.

The chart of the HGX shows that the house builders topped out in mid 2005, long before the media started talking about the sub-prime mortgage problems.  People in the know knew it was not sustainable.  Want to know the best time to buy a house for an investment?  Watch the HGX and wait until it starts going up.  Then in 6-12 months the media will proclaim that the housing market is solid once again.  If you want to buy a house for reasons other than investment don't pay attention to any of this.

That's a pretty good explanation.  The Chrmn of the Fed artificially suppressed interest rates and the Bush administration opened the barn door for crooked lenders by pre-empting state accountability statutes for lenders.

[benz]

OK, tell me where I'm wrong, any information is extremely appreciated.

We might be going into a recession because oil prices are high, and because of the "housing meltdown"?

Can someone explain the "Housing Meltdown"?  I think it means the interest rate was low and bankers were to confident so they gave out loans to anyone and everyone and then realized the people couldn't afford it so there were/are massive amounts of foreclosures on homes?

Please give me more detail and information or tell me if I'm completely confused lol.

Thanks,
RPF
 
P.S. Wasn't sure if I should post this here or on the Political Board.

RPF

http://www.amazon.com/New-Paradigm-Financial-Markets-Credit/dp/1586486837

i bought it, seems to be good 

[Eyeball Chambers]

RPF

http://www.amazon.com/New-Paradigm-Financial-Markets-Credit/dp/1586486837

i bought it, seems to be good 

Cool, I'll go get that.

THANKS!

[benz]

Cool, I'll go get that.

THANKS!

You might be more lucky than me since because i ares spic and i ares not speak engrish i ares has to wait for da deliveryz and i ams hongers for readings da truth

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