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XMFSinchiruna (27.35)

Join the Quest for Recovery Confirmation

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December 14, 2009 – Comments (32)

I spend every hour of every workday searching for a single convincing source of confirmation of the much-touted economic recovery, but like political incumbents seeking votes for their next elections, I keep coming up empty handed.

Join the Quest for Recovery Confirmation

What will it take for YOU to feel comfortable declaring that a truly sustainable recovery process is indeed underway. Please vote in the article's poll and then discuss.

Even if your reply is "recovery schmecovery", that's still $0.10 for the Thurgood Marshall Academy. :)

Chris

 

P.S.   Have you bookmarked my Twitter feed yet to keep track of all my articles?  You don't have to sign up for Twitter to access this. :)

 

32 Comments – Post Your Own

#1) On December 14, 2009 at 5:39 PM, Imperial1964 (97.77) wrote:

I'm looking to my usual indicators like railroads and steel.  Also, I am looking for the point that interest rates start rising (Yes, you heard me right!!) and the stimulus is being withdrawn.

I'm looking for the beginning of a return to normal.

That doesn't mean I am not adding money to the market, but I am adding it at a slower rate now that the market has recovered much of its losses.

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#2) On December 14, 2009 at 5:45 PM, Turfscape (44.18) wrote:

Well, I'm human, and as Plato pointed out, I'm greedy by nature...so the only way I'm going to judge an economy is by my own statements. I'm going to look at my pay stub, my bank account, my portfolio return, 401k, IRA and other holdings.

So, for me..."what recession?"

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#3) On December 14, 2009 at 5:51 PM, tkell31 (24.32) wrote:

Well said Turf.  The recession has moved up my retirement date about 15 years.  Another 12 months of this and it will be moved up to 1/2011.

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#4) On December 14, 2009 at 6:05 PM, XMFSinchiruna (27.35) wrote:

I take a more communal perspective.

If I can't see recovery for my fellow countrymen and women, then I see no recovery. Every body of demographic statistics contains outliers, and I'm glad that you two Fools have been spared some direct impacts of the crisis, but I submit that to focus excessively on one's own condition is to ignore a meaningful body of data that may be trying to communicate to you the scale of remaining risks in the very system that has treated you so uncommonly well.

Wishing for the return of prosperity to our nation...

Chris

 

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#5) On December 14, 2009 at 6:18 PM, Turfscape (44.18) wrote:

TMFSinchiruna wrote:
"If I can't see recovery for my fellow countrymen and women, then I see no recovery......in the very system that has treated you so uncommonly well."

But that's just my point. I've done nothing uncommon, nor do I feel I've been treated uncommonly. If I can't see recession in those around me, and I am not subjected to the "pain" being described so fervently in various media outlets, is it really a recession?

I watched round of layoffs in my workplace last year. Those stopped, and the ones I knew personally who were affected have jobs again. Through 2008, my statements continually declined...my paper value dropped. I have since seen my paper value not only recover, but exceed 2007 levels. I'm not Buffett...hell, I can't even keep my CAPS score above 30. So, if I'm out of recession, then I say "what recession"...

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#6) On December 14, 2009 at 6:46 PM, XMFSinchiruna (27.35) wrote:

Turfscape

The value of anecdotal evidence, while significant, is strictly limited. The collective data, meanwhile, like those cited in the above article, speaks with a clear voice.

In other words, to extrapolate excessively from anecdotal evidence is to risk missing the forest for the trees. That's just my opinion.

Indications of recession are everywhere, and the hail mary pass of fiscal intervention risks that recession sinking into a prolonged depression flanked by a dollar deterioration the likes of which no American has seen in his or her lifetime. I hope this can be averted, but I believe that for this to occur people need to ponder en masse the potential consequences of fiscal intervention of the scale presently underway... and then communicate to their elected representatives their concerns about our fiscal condition.

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#7) On December 14, 2009 at 7:16 PM, Option1307 (29.67) wrote:

truly sustainable recovery process is indeed underway.

That depends on what you consider truly sustainable. I'm not buying into the "everything is sunshine and lollipops"attitude that has been so prevelant lately, but I also don't underestimate the power the FED/gov/etc have over the market etc. It often takes a long time for reality/fundamentals to take hold.

I don't know how we can be in a "recovery" with 10% unemployment. I don't care how much of a lagging indicator it is, ask those without jobs if we have recoverd...

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#8) On December 14, 2009 at 7:57 PM, AvianFlu (37.54) wrote:

There are plenty of signs of recovery...in other countries.

Here, I am not so certain. My commercial landlord tells me that the commercial defaults are coming...and they will be grim. We would certainly have to make it through that first.

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#9) On December 14, 2009 at 8:02 PM, alstry (34.94) wrote:

How about when Alstry turns positive;)

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#10) On December 14, 2009 at 8:34 PM, rd80 (98.26) wrote:

What will it take for YOU to feel comfortable declaring that a truly sustainable recovery process is indeed underway.

When McDonald's doesn't have the biggest gain or smallest decline in US same store sales of any restaurant.

When government isn't the only sector of the economy growing.

When refiner crack spreads start to increase.

When Citigroup reports a profitable quarter that doesn't rely on one time events. 

 

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#11) On December 14, 2009 at 8:39 PM, nuf2bdangrus (< 20) wrote:

When we have "growth" without government intervention....

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#12) On December 14, 2009 at 9:39 PM, tkell31 (24.32) wrote:

TMFsin, I suggest you take the time to get out more and see how people in this country really live.  There's a good percentage who cant take care of themselves much less be successful at anything.  Is it sad? yes it is.  Is it changeable? unfortunately not, it is part of the human predicament.  Like Turf I'm certainly not exceptional, but I work hard, dont complain and try to make work a better place to be for everyone.  I also elected to live within my means, give up some material goods and a bigger house in the interest of saving money and not living check to check.  Anyone could do it, it's not like being responsible and having self-restraint is some secret formula.  Believe me I work with plenty of miserable losers who complain about everything. Fortunately for us we have a stock market where we can take advantage of growth in every country in the world simply by investing in stock or ETFs from that country.  Would I like to see salaries have some relationship to the contribution a person makes to the company? Of course, but so long as a select few make those decisions I'm not holding my breath for a change.

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#13) On December 14, 2009 at 9:55 PM, russiangambit (29.14) wrote:

> What will it take for YOU to feel comfortable declaring that a truly sustainable recovery process is indeed underway.

When the FED finlly feels confident enought to stop micromanging the economy. FED still buys majority of MBSs and conduct QE. What recovery are you talking about? If you need a couple trillion spent each year just to keep the system from collapsing on itself that ius a full-blown crisis and government intervention digs us deeper into the hole. Wasn't TARP extended until the next October? I would say , let FED's QE expire in March, then we'll see about the recovery.

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#14) On December 14, 2009 at 10:15 PM, selfdestruct2 (41.80) wrote:

The Federal government has to get the heck out of the way and stop the incessant quest to control our lives.

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#15) On December 15, 2009 at 11:25 AM, binve (< 20) wrote:

Sinch, what russian said :)

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#16) On December 15, 2009 at 12:36 PM, vriguy (68.42) wrote:

Recovery for me will be when I see some meaningful restraints placed on institutions that have been declared too big to fail.  Yes, you can argue that regulations (like generals) basically fight the last war, not the next one, and the next crisis will come from some unforeseen direction.  What I find disconcerting that we have not even corrected our proven regulatory errors that led to this crisis.

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#17) On December 15, 2009 at 1:12 PM, TheClub55 (< 20) wrote:

When Obama come dashing out of the white house on a horse off to "tame" the greedy banksters that robbed "joe" main street of his/her future...  O wait that was the liberal dream.

 I guess I'll know know a recovery when I see one!

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#18) On December 15, 2009 at 1:26 PM, AntiRonChapmanJr (99.78) wrote:

There will be no real recovery...ever.  Permanent decline until it's all over.

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#19) On December 15, 2009 at 3:47 PM, eldemonio (98.79) wrote:

When our country produces more than it consumes.

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#20) On December 15, 2009 at 3:59 PM, Turfscape (44.18) wrote:

eldemonio wrote:
"When our country produces more than it consumes."

Really? Would that actually be your measure of a recession? I ask because, as a nation, we haven't produced more than we consume for something like 40+ years. That's quite a recession...

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#21) On December 15, 2009 at 4:07 PM, eldemonio (98.79) wrote:

turf, 

What will it take for YOU to feel comfortable declaring that a truly sustainable recovery process is indeed underway.

I believe that was the original question.  Your reading comprehension sucks.  So yes, really - that is what it would take for me to feel that we had a sustainable recovery process underway. 

Thanks for the history lesson.  Really.

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#22) On December 15, 2009 at 4:28 PM, tonylogan1 (28.00) wrote:

Agree with Russian.

It is hard to look at housing and say "there is a recovery" when the government is massively subsidizing the industry.

Same for auto sales and pretty much every other key metric.

The downside being the debt and dollar devaluation it is piling up is just postponing the eventual pain.

The pain will come in 6 monthsor 30 years. Too soon to tell.

I'll feel comfortable saying recovery is underway once we start rewarding productive behavior (like creating goods and services the world wants), and I don't anticipate that happening anytime in the next 3 years.

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#23) On December 15, 2009 at 6:52 PM, chlyd (< 20) wrote:

  I agree with russian also.

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#24) On December 15, 2009 at 7:01 PM, Turfscape (44.18) wrote:

eldemonio wrote:
"I believe that was the original question.  Your reading comprehension sucks.  So yes, really - that is what it would take for me to feel that we had a sustainable recovery process underway."

Wow...ask a serious question, get a snarky answer. Not sure how my reading comprehension plays into this...I read the original post correctly. Responded to your post correctly. It seems to me (point of opinion here) that you took my post to be some sort of "shot" at you.

I still find it impressive that it would take a reversal of over 40 years of trade deficit for you to feel that we have a sustainable recovery. Given that context, I can only assume that prior to this recession, you felt that the country was in a dire economic rut spanning multiple decades.

Also, given that trade deficits tend to occur with wealthier, more economically robust nations, and trade surpluses occur in poorer nations with depressed labor forces, why would a trade surplus make you feel as though we were in a sustainable recovery?

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#25) On December 16, 2009 at 12:13 AM, eldemonio (98.79) wrote:

turf,

Regarding your literacy, I suppose we'll just have to agree to disagree.

Also, given that trade deficits tend to occur with wealthier, more economically robust nations, and trade surpluses occur in poorer nations with depressed labor forces, why would a trade surplus make you feel as though we were in a sustainable recovery?

What is this based on?  Be honest, did you pull this "evidence" out of your ass? 

Only 3 of the top 10 wealthiest nations (as measured by GDP per capita) run a trade deficit.  That increases a little to 7 out of the 20 wealthiest nations if we want to open it up a little.  Trade deficits are hardly a common thread to wealthy nations. 

Our nation, our government, our citizens are addicted to deficits and deficit spending.  How can we honestly say that our economy has been robust over the last few decades?  That would be like visiting a friend and marveling at his big screen TV, new car, fancy house, and expensive clothes without knowing that all of it was paid on credit.  People cannot sustain debt spending over a long period of time, what makes you think governments and economies can? 

 

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#26) On December 16, 2009 at 12:25 AM, binve (< 20) wrote:

eldemonio, nicely said man, couldn't agree more.

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#27) On December 16, 2009 at 1:04 AM, uclayoda87 (29.14) wrote:

I voted for Jobs.  The number of real jobs that must be created to drop the unemployment rate to 6% is beyond the capacity of the Federal government, because in order to pay the salaries of all these workers the government would have to issue a massive amount of debt that no one would want.

Therefore, real jobs would have to come from a real private sector economy.  If real jobs return, then the recovery is here.

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#28) On December 16, 2009 at 12:56 PM, Turfscape (44.18) wrote:

eldemonio wrote:
"Only 3 of the top 10 wealthiest nations (as measured by GDP per capita) run a trade deficit.  That increases a little to 7 out of the 20 wealthiest nations if we want to open it up a little.  Trade deficits are hardly a common thread to wealthy nations."

Ah, the fun of stats. GDP per capita or GDP, which is a better measure? Do we include oil exports in those figures or not? Is Hong Kong part of China? Here's a fun (partial) list of countries running trade deficits through 2008:
-Australia
-Austria
-France
-Greece
-Hungary
-Iceland
-Italy
-Korea
-Luxembourg
-Mexico
-New Zealand
-Poland
-Portugal
-Slovakia
-Spain
-Turkey
-U.K.

The G7 countries, as a group, would be on the list...as would the European Union as a group.

So, pulled out of my ass? No. The majority of G7 nations run a trade deficit.

Now...onto your next point:
"Our nation, our government, our citizens are addicted to deficits and deficit spending.  How can we honestly say that our economy has been robust over the last few decades?"

Budget deficits and trade deficits are not the same. I'm sure you know that, but are conveniently ignoring it to make your point. Fact is, I completely agree that deficit spending is quite possibly the most abhorrent of all policies.

I appreciate your clarification on why you would look to such a measure to feel like we were in a sustained recovery. I find it an odd measure, but can see your viewpoint on it.

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#29) On December 16, 2009 at 1:52 PM, eldemonio (98.79) wrote:

The majority of G7 nations run a trade deficit.

When you say majority, are referring to the 3 of the 7?  The United State, France, and the United Kingdom all have trade deficits as of 2008 - the other 4 do not.  Italy is shown as having balanced trade while the other 3 run a surplus.  I am no math wizard but 3 out of 7 is no majority.

Korea?  North or South?  Several of the countries on your list are very close to balanced trade, only running a very slight deficit.  Nonetheless, they are running a deficit. 

Budget deficits and trade deficits are not the same. 

I know they are not the same, but both are linked in that they both affect national saving.  

My position remains that we will not maintain our status as an economic powerhouse while continuing to run massive deficits of any kind.     

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#30) On December 16, 2009 at 2:04 PM, Turfscape (44.18) wrote:

eldemonio:
"The United State, France, and the United Kingdom all have trade deficits as of 2008 - the other 4 do not.  Italy is shown as having balanced trade while the other 3 run a surplus.  I am no math wizard but 3 out of 7 is no majority."

Italy in 2008 ran a Trade Balance of $-1.4 billion(USD) according to OECD stats. 4 of 7 is a majority.

eldemonio:
"Korea?  North or South?"

Come now, you should know better. By all official accounts, South Korea is Korea. North Korea is not a recognized country.

 

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#31) On December 16, 2009 at 2:39 PM, eldemonio (98.79) wrote:

I am getting some different numbers for Italy, but have to admit that I see Italy running a deficit from a couple of sources.  4 out of 7 is a majority - I would still argue that trade deficits are not an indicator of economic strength.  Would the US be stronger or weaker if we were running a surplus?  How long can we sustain such a deficit?

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#32) On December 16, 2009 at 4:28 PM, Turfscape (44.18) wrote:

eldemonio wrote:
"I would still argue that trade deficits are not an indicator of economic strength."

I'll concede that point.

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