…the beginnings of a market crash? Oil pricies are hitting record highs ($44.00/barrel), and the economy looks like it is slumping into recession again. Is this the time to be buying stocks? Or are we looking at a MAJOR (10-30% correction)? :smack:
Don’t forget the elections. Regardless of one’s politics, a significant amount of global money that invests will be selling off dollar assets if Bush gets re-elected. Again, I put this forth as what most global money will do as they add up the economic implications of another 4 years of slashing taxes, massively increasing spending and a balloning deficit that would make any bondholder sleepless for years.
Any way you slice it, interest rates are headed higher which is another damper on equities.
Short term I have no idea. You’ve been posting some pretty doom and gloom threads, and I’m assuming you are long and wrong. If you’re thinking of averaging down, I’ll bet you have a lot of chances over the next couple of months to do so. No need to rush more money into the market today.
This certainly belongs in GD. However, I do not think we are heading back into a recession. I don’t see negative growth for the remainder of 2004.
Many people thought the stock market was due for a correction. The Dow in particular increased greatly in 2003. The employment figures are disturbing. The unemployment rate at 5.5% isn’t bad, but I wonder what the underemployment rate is?
Bush said in his 2000 campaign that as an oilman, he’d know how to deal with OPEC. I can’t believe that with Bush and Cheney in office, they can’t do more about the price of oil. The single minded focus on Iraq and phony terror warnings is really coming back to haunt this administration. Our poor relationship with Russia hampers our ability to do anything about this Yukos mess. I’m sure Bush will use the price of oil to beat that dead ANWR horse again.
I think Friday’s numbers may have sealed the fate of the Bush reelection effort. This has too many 1992 parallels. I’m not even sure an October surprise by pulling Osama out of a cave on Oct 31 will help.
I think there is still some considerable room to fall yet. I predicted a Dow close under 9500 before the election in this thread, and I think this is the beginning of that correction. Oil prices aren’t going down anytime soon, and have pretty much sucked up any benefit from the tax cuts, so were are back to where we were two years ago. * “Fasten your seat belts. It’s going to be a bumpy night.” *
Perhaps they want the price of oil to be high. Don’t high oil prices benefit those who own and produce oil? As with any unusual market situation, there’s a group that benefits and a group that loses because of high oil prices. Even if investors pull out of the US and the dollar drops in value, there are still some who benefit. Also, I’ve heard reports (in mainstream news) that there are plans to manipulate oil prices for political reasons.
dalej42: What exactly are the parallels with 1992? At what point do voters begin to pay attention to the deficit, stock indexes, and unemployment, rather than to the divisive issues the campaigns focus on instead?
I’m here only to remind you that economists have predicted eleven of the past four recessions. Panic is a poor tool for an investor.
Only fools try to time the market… and you know what they say about fools and their money. You are basing your investing decisions on your political views which is usually one of the worst things you can do. Earnings are strong. The economy is on pace to do about 4.5-5% growth for the year, which is phenomenal and the unemployment rate and interest rates are low. There is some debate about how many jobs were added during the last month but there was still a net gain.
I run a small business and I can tell you that there aren’t a lot of employable people left out there who don’t already have jobs. We are hiring people who we would never have even called back in the past.
The rest of this thread belongs in GD but since it’s here I guess I am compelled to respond (keep the groans down to a dull roar please). I don’t know how to use the quote thingy so bear with me.
1: “Oil prices aren’t going down anytime soon, and have pretty much sucked up any benefit from the tax cuts, so were are back to where we were two years ago.”
The logical culmination of this argument is that we are lucky we had the tax cuts or we would be behind where we were two years ago. Somehow I don’t think that is what you meant to say but since that is your reasoning I’m not going to argue with it.
2: “I can’t believe that with Bush and Cheney in office, they can’t do more about the price of oil.”
Like what? The world is pretty much pumping at full capacity but since India and China have freed their economies their energy usage is rising along with their standard of living (indeed the two are inseperable). We could drill in ANWR but that would be beating a dead caribou now wouldn’t it? Perhaps you would also care to enlighten me about what we could do about “Yukos” short of dropping paratroopers in to secure the oil fields. At any rate Putin seems to get along with Bush just fine. I guess we could always put Saddam back in power and re-institute the oil for food program. We could probably get some pretty good rates from him too considering the position he is in now… but that would be blood for oil and we can’t have that now can we?
3: “Also, I’ve heard reports (in mainstream news) that there are plans to manipulate oil prices for political reasons.”
Yep, that’s Bush’s secret plan for getting re-elected… high oil prices. Did you figure that out all by yourself or did you get the Michael Moore decoder ring?
4: “phony terror warnings”
Perhaps I shouldn’t pick on you for a poorly timed post but we now know that we had a key member of the terrorist communications network in our pocket when the last warning was issued and we then proceeded to to pick up a good many of his network. A lot of the people in the “mainsteam press” are doing the country a tremendous disservice by playing politics with our national security. In that the reports about the last terror alert being called for political purposes may have lead us to move quicker than we wanted or to reveal more about the source of our information than would have otherwise been necessary, they may have also cost us lives.
None of the arguments I quoted above are really rational. They are just longwinded ways of saying “I hate Bush.” I hate how much money he is spending on the domestic side but all of this ankle biting is counterproductive given the fact that we need to show a united front to the lunatics who are running around looking for ways to kill us. Legitimate criticism is always ok but this type of poorly reasoned crap is wearisome in the extreme and lacks any sense of perspective. Save the hate for those who hate us… like the French.
Definitely a topic for debate. So I moved it from GQ.
samclem GQ moderator
No. There are short-term benefits to raising oil prices, like big profits, but OPEC in particular run the risk of having the US (their biggest market) get tired of rising oil prices and look for alternative fuels/power. If we were to develop some alternative to oil, then OPEC, et al. would know that we wouldn’t need them anymore. That’s why they occasionally agree to produce more oil per day in an attempt to drop the price. They want prices high to maximize profits but not so high that their customers are encouraged to go some other direction in an attempt to wean their dependence.
The real problem with oil is that the Middle East is a powder keg and nobody is willing to make any investments in an instable region, production and refinery capacity is maxed out, and demand is up all over the world. That makes the prices high, and there’s nothing that OPEC can do about it now.
I suspect that we’ll see a crash program in the next 10 years to lessen our oil usage, CAFE standards will go way up, and alternative power sources will start to proliferate (like wind, despite the attitudes of the NIMBY people like those on Cape Cod).
Correct me if I’m wrong, but isnt the OP generally a Bush backer?
That’s what I get for posting before coffee- I now uderstand that you weren’t attacking OP, but the responses. Sorry.
First of all, the decline last week has nothing to do with a recession coming, but rather that the Street got an unpleasant surprise - and they hate surprises.
I agree that this runup in oil prices isn’t the fault of anyone in particular - not that the oil companies are hurting. But improved mileage standards, and money for research for alternatives that will be useful in less than a decade could have helped some - and those are things the Republicans are deadset against.
I don’t know what business Voluble is in, but I know very employable people without jobs still - though it is better than it was a year ago.