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More about recession

Many people have been wondering how the US recession will affect Locombia.
One think that strikes me is that the Germans were able to uncript him...

http://news.yahoo.com/s/afp/20080130/pl_afp/germanyuseconomygreenspan;...

Former Federal Reserve chief Alan Greenspan cast doubt on the ability of the central bank to prevent a US recession in an interview to appear on Thursday.

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Greenspan told the German weekly Die Zeit that the Fed or political policies could "probably not" keep the world's biggest economy from sliding into recession, as financial markets widely expected the US central bank to cut its main lending rate.

"The influences of the global economy today are stronger than almost any monetary or budgetary response," the German-language weekly quoted Greenspan as saying.

Although he left the post of Fed chairman two years ago, Greenspan's opinions on the economy are still sought after.

"Real long-term interest rates have much more influence over the heart of economic activity than national decisions," he was quoted as adding.

"And central banks have less and less power to influence long term rates."

The former Fed chief put the chances of a US recession at 50 percent, but added: "We have few indications that would allow us to say we are already there."

Some analysts have said that low interest rates under Greenspan's watch were responsible in part for the US housing bubble that burst last year, and led to the current financial crisis.

Die Zeit quoted him as saying he found it hard to understand that "the Federal Reserve policy had somehow allowed housing and stock prices to rise."

Fallout from the crisis, which began with a meltdown of the US market for high-risk, or subprime, mortgages, continues to rock international financial markets and now threatens the US economy with a recession.

For Greenspan however, the turmoil was "entirely the result of market forces at a global level."

The Fed's Open Market Committee (FOMC) was to announce its decision on US lending rates later on Wednesday.

It surprised markets last week by slashing the base Fed funds rate by three quarters of a percentage point to 3.50 percent, but it is widely expected to follow through with another cut to 3.0 percent.

By jorgegdiaz on Jan 30, 2008, 09:55 in Friendly Talkzone.

jonas says on Jan 30, 2008, 10:34:

for those interested, I enjoy reading Chuck Butler´s daily newsletter "The Daily Pfennig" at www.dailypfennig.com He has helped me better understand the coming economic turmoil as well understanding the Federal Reserve´s politics. It´s free.

Simon Presidente!

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scotty says on Jan 30, 2008, 12:14:

the recession is prediction, it hasnt happened yet and maybe it wont happen at all.

Get Rhythm, when you got the blues. Johnny Cash

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Frank Rizzo says on Jan 30, 2008, 12:59:

Hi Scotty....I think we better tell South Florida that there is no recession. They don't know.

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podborski says on Jan 30, 2008, 14:31:

I just don't see how the biggest credit bubble in history can pop without some really bad effects.

How bad, how long, when, I don't know.

When everything is going well the cycle reinforces itself, people have jobs so they spend money, which creates other jobs, etc.

But when it goes into reverse...hard to stop it. I think we are going into reverse. But maybe the low dollar and low rates will ease the pain?

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germuno says on Jan 30, 2008, 15:00:

Thanks jonas. Just perused your referral and looks like a keeper

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germuno says on Jan 30, 2008, 15:07:

Under modern rules a prediction of a recession is sort of like looking backwards a few months. So the states could be in one but don't know.

In my college days a recession was defined in econ 101 as the downward side of a depression which is what the states are undergoing right now.

Whay's it all mean. Beats me. Just felt like writing something

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aztec says on Jan 30, 2008, 15:08:

Greenspan is like a cancer. He just will not go away (Like Jimmy Carter). His comments are designed to insure his value as a speaker. He earns thousands with his dog and pony show.

Every time he opens his mouth there is damage. Would not surprise me if it is not designed for his buddies in the stock market. You know, he can now warn his investor friends before his upcoming statements. He is no longer restricted by government regulators.

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aztec says on Jan 30, 2008, 16:04:

gringoinbogota, it doesn't make sense. You see people rushing to purchase the market when it is 14,000 but are afraid to buy when it is under 12,000.

This is the time to selectively look for bargains. Assuming you are a long time investor this is one of those rare opportunities.

My advice is not to attempt to be a market timer and unless you are a day trader look to the long term.

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scotty says on Jan 30, 2008, 16:41:

Greenspan, Jimmy Carter, Al Gore, Bill Clinton and all those old retired dudes need to go fishing and stop talking.

Get Rhythm, when you got the blues. Johnny Cash

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miamimike says on Jan 30, 2008, 21:11:

LOL--There you go again Scotty, Blame all the Democrats. The Republicans like Bush who have plunged us Far into Debt are Lily White without any blame,,,Two Billion Dollars a week being blown by Bush on the Iraq War and this doesn't have a Negative Effect,,,Considering we are borrowing it from the Chinese and Japanese,,,Amazing sense of Economics you have,,,

My Avatar-- Sarah Palin Says " "You know the difference between a pit bull and a hockey mom?? Lipstick!" Now on a Short Verbal Tether by the Honorable John McCain

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jorgegdiaz says on Jan 31, 2008, 04:12:

You think Greenspan make a ruccus every time he opens his mouth? Of course ! The guy purposely doesn`t make sense.
Who do you think was responsabile for economic policy during Bush Sr and Clinton? He and his buddy Milton Freidman.
Or being chairman of the federal reserve for about 20 years is as easy as blurting all day in PBH.

"To err is human - and to blame it on a computer is even more so."Robert Orben

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miamimike says on Jan 31, 2008, 06:05:

GIB--FYI, Greenspan is a Republican first appointed by then Prez Reagan in 1987,,,
History of Greenspan:
http://en.wikipedia.org/wiki/Alan_Greenspan

My Avatar-- Sarah Palin Says " "You know the difference between a pit bull and a hockey mom?? Lipstick!" Now on a Short Verbal Tether by the Honorable John McCain

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jorgegdiaz says on Jan 31, 2008, 07:13:

oh, yeah, little detail. I forgot to mention about his affiliation.
His first time was with Ford, but I don`t remember if it was as chairman.

"To err is human - and to blame it on a computer is even more so."Robert Orben

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jonas says on Jan 31, 2008, 07:55:

Doomsday coming?

Simon Presidente!

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miamimike says on Jan 31, 2008, 19:05:

GIB--Don't forget under Reagan, we got the Disasterous 1987 IRCA Amnesty Reform Bill which granted de facto Amnesty to 2 Million Illegals. He signed the bill into law then "Forgot" to fund it. Talk about a Disaster,,,This is the same bill only whitewashed that Bush/Kennedy/McCain tryed to ram down our throats in 2007 but we massed a campaign and defeated it. Now by Chance if John McAmnestyCain would get in, we could look for a Repeat of Reagan's Disasterous Bill,,,McCain is just chafing at the bit to legalize 12 Million Illegal Aliens,,,Romney isn't,,,

My Avatar-- Sarah Palin Says " "You know the difference between a pit bull and a hockey mom?? Lipstick!" Now on a Short Verbal Tether by the Honorable John McCain

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miamimike says on Jan 31, 2008, 19:11:

IB--I remember a Really Bad Bear Market in my time starting in 1973; we have had them and they are a Doozy! The Party never lasts forever--even here in the USA,,,

http://news.bbc.co.uk/1/hi/business/3746044.stm

My Avatar-- Sarah Palin Says " "You know the difference between a pit bull and a hockey mom?? Lipstick!" Now on a Short Verbal Tether by the Honorable John McCain

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podborski says on Feb 1, 2008, 03:33:

the 70's recession was a bad one, I was a kid but I remember things changed dramatically at my house, no more meat, and powdered milk instead of the real stuff. uggghhh. I think I ate a lot of grilled cheese sandwiches.

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aztec says on Feb 1, 2008, 04:30:

MICROSOFT CORP. MAKES $44.6 BILLION BID FOR YAHOO INC.

A 62 percent premium to Yahoo's closing stock price Thursday.

The deal could also give lift to the entire technology market.

Clear MSN thinks we are in a period for buying the market. Now if only they can keep European regulators out of the merger plans.

http://www.chron.com/disp/story.mpl/front/5504890.html

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tomtom33 says on Feb 1, 2008, 04:55:

Neither party has had much effect on the economy, and they are both to blame for the small negative effects that they have had.

There was a recession in the 70's? I was too busy playing Army and going to school. My first real job was in 1974 after graduate school. Guess I was so used to being broke that I didn't see that others were too.

Where are we going now? Beats me. I think maybe up, then down, then up, ... Just don't let me miss my afternoon nap.

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Albatross says on Feb 1, 2008, 09:02:

All I know is that my 401K dropped $20,000 over the past two months from the market crash. (Yeah, I'm pissed)

Not to mention the fact the as a foreign traveller, the dollar dive has been no picnic either. (R.I.P. - U.S.D.)

“Democracy - a pathetic belief in the collective wisdom of individual ignorance." - H.L. Mencken

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tomtom33 says on Feb 1, 2008, 10:23:

What goes down will go up.

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tomtom33 says on Feb 1, 2008, 13:19:

That is an interesting hypothesis. However, there are many differences between now, what I foresee in the next 20 years(my effective lifespan), and the 20's/30's. I do believe in spreading my risks around just in case. But I won't be around to see what happens in 30 years anyway.

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slguy says on Feb 1, 2008, 13:47:

You young whippersnappers! ;) I remember having to almost drag the first ex-Ms. Slguy to a job interview with EF Hutton in St. Louis. The Dow then? 850, or -

Before you throw me out, make sure I pay my bar tab

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