Recession 2020

[The-Shoveler]

LOL I am starting to think, maybe there is just too many people (like me) sitting on the sidelines waiting for a crash for it to happen.

anyway IMO.

What happens when smart money cannot find an exit LOL.

[FlyerInHi]

[quote=The-Shoveler]LOL I am starting to think, maybe there is just too many people (like me) sitting on the sidelines waiting for a crash for it to happen.

anyway IMO.

What happens when smart money cannot find an exit LOL.[/quote]

Did you see the last recession coming or are you an eternal optimist?

I’m pretty optimistic, especially on real estate (not enough building to fill demand) but I think it is a good time to pause unless there is an inside deal through word of mouth. I just bought 2 properties from a terminally ill guy at a discount — no realtors, only title/escrow.

[FlyerInHi]

[quote=The-Shoveler]
IMO Trade deal will get done.

Stock Market Soars On China Tariff News; Apple Surges 5%

[/quote]

When? Trump just caved on China.
He started the trade war and he keeps on pushing back his own deadlines.
I hope the farmers have a good end of year holiday season.

[The-Shoveler]

Did you see the last recession coming ?

I would have to say yes (well mostly), I did not expect it to be quite as bad as it got, but I was definitely out in front of it.

IMO I have learned some.
IMO big fund managers need dumb money to step up so they can exit (else they are kind of stuck and they have a lot of influence).
(maybe I am wrong but that is the situation as I see it).

Dumb money has not stepped up/in yet in a big way.

The Trade deal will get done IMO. We will not get everything but neither will China, it simply could not continue the way it was going without change.

[FlyerInHi]

[quote=The-Shoveler]

The Trade deal will get done IMO. We will not get everything but neither will china.[/quote]

We started the trade war. Look at it from the Chinese perspective — by giving us something, they are giving us everything because they didn’t ask, nor will they receive something in return.

Trump is giving China a shopping list of American products to buy. But he wants the Chinese government to be less involved in the economy. Contradictory goals.

It will be difficult.

[FlyerInHi]

It’s not looking for the economy.

Let’s see how holiday sales go. My bet is that Trump will delay the tariffs yet again in December amidst worry about the economy.

https://www.cnn.com/2019/08/14/investing/yield-curve-inversion-bond-market-recession/index.html

“Historically speaking, the inversion of that benchmark yield curve measure means that we now must expect a recession anywhere from six-to-18 months from today,” said Tom Essaye, founder of The Sevens Report, an investment research firm, in a note to clients Wednesday.

[The-Shoveler]

Too much attention being paid to the yield curve IMO.

It takes a lot of research and confidence before you start pounding nails on a bunch of new housing tracts at the same time.

Don’t panic over the yield curve inversion: El-Erian

https://finance.yahoo.com/news/el-erian-dont-panic-over-the-yield-curve-inversion-el-erian-194459718.html

[ucodegen]

[quote=FlyerInHi]One thing weird about the US economy that Fox News no longer mentions is our labor participation rate. It’s lower than other developed nations, even though we have a younger population. I think we have a huge drug problem and a lot of mentally whack people who can’t hold jobs. 1 out of 5 on psychological drugs not counting recreational pot and illegal prescriptions.

It’s confounding economists.[/quote]
Actually, it is not confounding.. though it is interesting to look at. 1/2009 it was 65.7%, 7/2019 it was 63%. The interesting part is the ‘neck’ or bend in it. It is like a backwards hocky-stick(to borrow a phrase). It hit 63.7 on 1/2012 and has kind of bounced around that number till today. I think companies were ‘shedding’ their older workers to avoid the costs of health insurance on older people. If you look at the growth in insurance costs for older workers(50 yrs old and up), you will see that in under a period of 4 years, it has doubled… which would be a rate of about 19% per year { e^(ln(2)/4) }.

Anecdotally, I know of a co-worker who was laid off at approximately the same time as I was in 2008. He has a Computer Science degree and more than 10 years experience, is a very hard worker, and has gone from one short term job to another (2 years and under on average). He is currently making the same as he did 10 years ago.

I was forced into retirement (causes outside of my control), also being over 50 and getting crap offers even though I have an E.E.C.E. degree and well over 10 years of experience. Fortunately I planned ahead and am using my time to ‘improve my yields’ on investments – which I have found to give me better returns than the wage I was earning. Ironically, I show up as a ‘not participating in the labor force’.

On a side note to this, there is a large number of unemployed homeless.. my personal opinion is that while the stock market has ‘rebounded’ due to cheap money – the labor economy has not. The new touted ‘jobber/gig/contract work’ market is full BS, and is just a way for companies to shed liabilities and costs while draining the brains of the contract workers. One can only outsource so much, and eventually the companies you outsource to will actually become a company’s competitors.

NOTE: Because labor participation rate hit 63.7 around 2012, you really can’t blame Trump for that.
Linky: https://data.bls.gov/timeseries/LNS11300000
By the way, on the graph move the starting year to 2005.. or even earlier.

On closing question though: Does the U.S. remember how to manufacture efficiently? or is there too much red tape to be able to do that?

[The-Shoveler]

[quote=ucodegen]
On closing question though: Does the U.S. remember how to manufacture efficiently? or is there too much red tape to be able to do that?[/quote]

In California I think they have pretty much outlawed manufacturing any thing but software LOL.

Just kidding sort of.

[svelte]

[quote=The-Shoveler]Too much attention being paid to the yield curve IMO.

It takes a lot of research and confidence before you start pounding nails on a bunch of new housing tracts at the same time.
[/quote]

It’s not just the inverted yield curve.

https://www.businessinsider.com/trucking-truckers-bloodbath-signals-recession-inverted-yield-2019-8

[FlyerInHi]

I was recently advising a Central American asylee to become a truck driver, a plumber or electrician. Maybe truck driver is a bad idea unless he has the inclination to retrain later to become a virtual truck driver.

He should become a union plumber or electrician, or maybe a cop or fireman.

[ucodegen]

[quote=FlyerInHi]I was recently advising a Central American asylee to become a truck driver, a plumber or electrician. Maybe truck driver is a bad idea unless he has the inclination to retrain later to become a virtual truck driver.

He should become a union plumber or electrician, or maybe a cop or fireman.[/quote]
Fireman(muni, not forest service) – good benefits, good wage, less than 1 fire a day to go to, very rarely get shot at. There are brief periods of crazy work (ie Witch Creek Fire) but all in all – not very busy.

The minus, you need to be (must be) physically fit (which is not necessarily a bad thing).

Plumbers and Electricians used to be good options, but with reduction in manufacturing within the U.S. and using cheap labor in housing construction — not so good anymore.

[spdrun]

He should become a union plumber or electrician, or maybe a cop or fireman.

Any one of those BUT a cop … cops are essentially armed goons in the service of the state. A lot of their job is pushing people around and putting them in cages for victimless crimes. It’s a job that’s (justifiably) disliked, and anyone with half a heart would also grow to hate doing the job after a few years.

Not sure about firemen — they go to less than one fire a day, but they inhale a lot of toxic muck at those fires. Apparently, their life expectancy is 10+ years shorter than average.

[FlyerInHi]

So how do you think holidays sales will do?
There really nothing new that’s a must buy.

I expect disappointing holiday sales. We shall see…

[The-Shoveler]

Target Set To Break Out On Blowout Earnings

Stock market rally led by much-better-than-expected Target earnings. Target (TGT) soared in a buy zone, also lifting Walmart stock and Amazon stock, as the three retail giants fare relatively well. Meanwhile, Lowe’s (LOW) surged on earnings following well-received Home Depot (HD) results.

[Author]

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