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Old Oct 10, 2012, 05:38 AM
sensitive artsy type
Treetop's Avatar
Tucker, Georgia, United States
Joined Feb 2004
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Four years ago

On Oct. 11, 2008

WSJ: Dow Jones Industrials Lost 18% in Their Worst Week Ever

Quote:
BY ROB CURRAN

The 2008 stock-market crash may be the mother of them all, as the Dow Jones Industrial Average fell by more than 100 points and traded in a 1000-point range Friday to complete its worst weekly performance ever.

Sweeping efforts from governments and central banks world-wide have failed to restore trust between banks. Beyond the survival of banks and the stability of financial markets, the funding of corporations and consumers depends on the restoration of that trust. Now, the selling in the stock market set off by the credit crisis is feeding on itself, as funds and individuals are selling in ...
http://online.wsj.com/article/SB1223...googlenews_wsj

Gloom sweeps NYSE floor

Quote:
As Wall Street yo-yoed through another day of breathless ups and downs, a pall of dejection and despair hung over the august New York Stock Exchange, the epicenter of the country's economic malaise.

Harried traders frantically tried to recover from a week of spiraling losses, emerging grim-faced outside the exchange's imposing marble facade to puff on cigarettes. The sense of powerlessness was palpable.

"It's hell -- what do you think?" snapped one blue-jacketed employee at midday when queried about the mood.
http://articles.latimes.com/2008/oct...ess/fi-scene11

White House Overhauling Rescue Plan

Quote:
Two weeks after persuading Congress to let it spend $700 billion to buy distressed securities tied to mortgages, the Bush administration has put that idea aside in favor of a new approach that would have the government inject capital directly into the nationís banks ó in effect, partially nationalizing the industry.

As recently as Sept. 23, senior officials had publicly derided proposals by Democrats to have the government take ownership stakes in banks.

The Treasury Departmentís surprising turnaround on the issue of buying stock in banks, which has now become its primary focus, has raised questions about whether the administration squandered valuable time in trying to sell Congress on a plan that officials had failed to think through in advance.

It has also raised questions about whether the administrationís deep philosophical aversion to government ownership in private companies hindered its ability to look at all options for stabilizing the markets.
http://www.nytimes.com/2008/10/12/bu...anted=all&_r=0
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Old Oct 10, 2012, 05:56 AM
Bagpipes spoken here
Pipemajor's Avatar
United States, MN, St Paul
Joined Aug 2007
109 Posts
And it's still not over.

Feds sue Wells Fargo (again) for mortgage fraud.
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Last edited by Pipemajor; Oct 10, 2012 at 06:45 AM.
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Old Oct 10, 2012, 08:52 AM
Alarm Bells Continuing!
Big Foot 48's Avatar
Arizona
Joined Oct 2001
276 Posts
The stock market low was reached in Feb 2009 and was an interesting test of investor courage. Out of that came a suggested rule-of-thumb for the percent of stocks to own: "Tolerable Loss x 2 = Equity Allocation < 50%", with the creator of this rule saying no one should have more than 50% of their portfolio in stocks in case of a Great Depression event.
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Old Oct 10, 2012, 10:29 AM
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Lyle, WA
Joined Dec 2000
1,478 Posts
Both Bush and current idiocrats are running on the same flawed ideas.

Let the markets fail. Let the banks fail. Let the actual value of holdings fall to market clearing prices.

The recession would be over already if they had.
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Old Oct 10, 2012, 10:33 AM
Epoxy & CA Investor
DenverJayhawk's Avatar
United States, CO, Denver
Joined May 2010
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Quote:
Originally Posted by MtnGoat View Post
Both Bush and current idiocrats are running on the same flawed ideas.

Let the markets fail. Let the banks fail. Let the actual value of holdings fall to market clearing prices.

The recession would be over already if they had.
and you know this how? You're implying a depression would be good for the country?
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Old Oct 10, 2012, 10:43 AM
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Lyle, WA
Joined Dec 2000
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Quote:
Originally Posted by DenverJayhawk View Post
and you know this how? You're implying a depression would be good for the country?
I know this because of the nature of reality itself, judged from deciding how valid economics actually applies.

The fact that supposed wealth literally vanished proves the problem was financial bubbles. This implicitly means the prices involved did not match actual real values as seen by the markets.

Trying to merely reinflate the bubble to hold values up injects more of what harmed them in the first place. The collapse of market prices is a signal that said prices are unsustainable, to use a word favored among the people invested in State control.

A deflationary, market clearing recession is the only long term cure for prices out of whack with reality. It's good for people in the same way clearing an obstruction in their digestive system is. No fun, but necessary because of what came before.
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Old Oct 10, 2012, 11:04 AM
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Jacques Flambeau's Avatar
Backwoods Alabama
Joined May 2000
3,861 Posts
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Originally Posted by DenverJayhawk View Post
and you know this how? You're implying a depression would be good for the country?
I think he prefers the Somaili model of running things...

--Bill
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Old Oct 10, 2012, 11:49 AM
did a reversed Immelman..once.
SKYPILEIT's Avatar
Novi, Michigan
Joined Nov 2002
2,248 Posts
I suppose some have heard about the Benanke bounce.?Inflate the money supply before the elections...get a temp spike,then the bottom falls out after election.

...the long term effect of FED funny money.?massive inflation.

http://www.economicsjunkie.com/berna...uy-stuff-done/
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Old Oct 10, 2012, 04:24 PM
sensitive artsy type
Treetop's Avatar
Tucker, Georgia, United States
Joined Feb 2004
3,166 Posts
Quote:
Originally Posted by MtnGoat View Post
I know this because of the nature of reality itself, judged from deciding how valid economics actually applies.

The fact that supposed wealth literally vanished proves the problem was financial bubbles. This implicitly means the prices involved did not match actual real values as seen by the markets.

Trying to merely reinflate the bubble to hold values up injects more of what harmed them in the first place. The collapse of market prices is a signal that said prices are unsustainable, to use a word favored among the people invested in State control.

A deflationary, market clearing recession is the only long term cure for prices out of whack with reality. It's good for people in the same way clearing an obstruction in their digestive system is. No fun, but necessary because of what came before.
I don't disagree with a lot of this, Greenspan did use low low interest rates to reinflate the bubble in order to prevent recession from the fallout of the dot.com collapse. But we did have a recession, worst one in anyone's living memory, and the housing values are clearing over time, and opportunities have presented themselves to many buyers. Same for stocks, if you had capital and the stomach to risk it, you could have quadrupled it within a couple years. A once in a lifetime opportunity perhaps.

What was actually on the line was the credibility of our financial establishments, and with that, the performance of our government in fair regulation to prevent the sort of phony investment value that occurred. The penetration of these illegitimately rated investments was worldwide.
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Old Oct 10, 2012, 04:28 PM
Bagpipes spoken here
Pipemajor's Avatar
United States, MN, St Paul
Joined Aug 2007
109 Posts
Quote:
Originally Posted by MtnGoat View Post
Both Bush and current idiocrats are running on the same flawed ideas.

Let the markets fail. Let the banks fail. Let the actual value of holdings fall to market clearing prices.

The recession would be over already if they had.
Recession? You'd have something a lot worse than a recession if your way prevailed.
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Old Oct 10, 2012, 04:29 PM
Bagpipes spoken here
Pipemajor's Avatar
United States, MN, St Paul
Joined Aug 2007
109 Posts
Quote:
Originally Posted by Bill Harris View Post
I think he prefers the Somaili model of running things...

--Bill
Aaaargh!
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