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All-In [48078]
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Dow Jones Industrial Average
May 16, 2019, 10:05 AM
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I see it is down for the last month and only up 230 points for the last 6 months. Is this economy starting to slow? What say you?
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Heisman Winner [119597]
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+205 today...thanks, Barr!
May 16, 2019, 10:06 AM
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No, it isnt slowing...
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All-In [48078]
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Re: +205 today...thanks, Barr!
May 16, 2019, 10:14 AM
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The DJIA has ups and downs, but over the last 6 months isn't really on the rise.
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CU Medallion [73569]
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it was 23000 Jan 1 lol. My 401k is up 17% ytd.
May 16, 2019, 10:11 AM
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Funny how easy it is to manipulate numbers based on simple things.
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All-In [48078]
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Re: it was 23000 Jan 1 lol. My 401k is up 17% ytd.
May 16, 2019, 10:15 AM
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Good work.
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Heisman Winner [119597]
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Good thing youre not a stock broker/money manager...***
May 16, 2019, 10:17 AM
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All-In [48078]
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Re: Good thing youre not a stock broker/money manager...***
May 16, 2019, 10:21 AM
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Youre rambling dotard.
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Heisman Winner [119597]
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And you are are flipping psycho....***
May 16, 2019, 10:24 AM
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All-In [48078]
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Re: And you are are flipping psycho....***
May 16, 2019, 10:27 AM
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Am I. I think you're projecting. Youre the one who has to start junk over a simple comment about the DJIA being pretty flat overall for the last 6 months. You'll be okay. It was just a post. You're not going to get all drunk again and send me private messages wanting to fight me and calling me all kinds of names are you?
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Heisman Winner [119597]
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Dude, you are a super-sensitive nut case
May 16, 2019, 10:32 AM
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My first reply was Dow +205 and you go off the deep end?
Get some xanax, quickly for youre own good...
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All-In [48078]
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Re: Dude, you are a super-sensitive nut case
May 16, 2019, 10:37 AM
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Yawn. The post was about the last 6 months Einstein. Maybe you need some adderall for the day time for comprehension and then some Xanax for your tirades at night challenging people on the internet to fight. Just trying to be helpful.
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Heisman Winner [119597]
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So...you look at small snippets in time?
May 16, 2019, 10:39 AM
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and make judgements about the market? LOL
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All-In [48078]
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Re: So...you look at small snippets in time?
May 16, 2019, 10:42 AM
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6 months is reasonable. You're a little defensive.
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Oculus Spirit [83020]
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Heisman Winner [119597]
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And it was 21,792 in Dec 2018, so what's your point
May 16, 2019, 10:37 AM
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It is up over time and if you arent in the market, youre making a mistake...
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Oculus Spirit [83020]
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I'm in but if I was your age I might be
May 16, 2019, 10:48 AM
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pulling out at this point.
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Heisman Winner [119597]
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I have tempered my risk the last few years
May 16, 2019, 11:12 AM
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but I will stay in the market till I'm deaded...
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Heisman Winner [111433]
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Re: Dow Jones Industrial Average
May 16, 2019, 10:21 AM
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consumer spending and confidence is a much better indicator of the health of our economy.
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All-In [48078]
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Re: Dow Jones Industrial Average
May 16, 2019, 10:28 AM
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True dat.
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All-In [48078]
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CU Guru [1878]
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The tax-break sugar rush is wearing off***
May 16, 2019, 10:22 AM
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Heisman Winner [119597]
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Link?***
May 16, 2019, 10:24 AM
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All-In [31864]
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All-TigerNet [12851]
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it means it could rain gold nuggets and still trump sux***
May 16, 2019, 11:46 AM
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Legend [18007]
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Oculus Spirit [93618]
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I say 'they wish,' because that's dems' only hope in 2020.***
May 16, 2019, 10:40 AM
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All-In [48078]
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Re: I say 'they wish,' because that's dems' only hope in 2020.***
May 16, 2019, 10:46 AM
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I dont think it will ever fall of enough for this election to be a major factor. I think the economy will always be a strength for Trump in 2020. That election is not far enough off. That said, whoever wins after 2020 will probably residing over an economy that isn't so hot. That's good news in a way for the Repubs if the Dems win. It will just look like the economy kind of tanked once a Dem was in office. Trump will probably win though.
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All-In [47795]
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we all know democrats are praying for a slowdown
May 16, 2019, 10:56 AM
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ok, well not praying since, well you all know they don't do that. maybe they're just wishing for a slowdown
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All-In [48078]
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Re: we all know democrats are praying for a slowdown
May 16, 2019, 11:00 AM
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I don't think the Dems like myself are. I like money and a strong economy. Maybe Biden or Harris are. I don't think this topic ia supposed to be a political one though. It was just one wondering if the economy is slowing some.
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All-In [47795]
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yeah I'm just joshing. my serious answer
May 16, 2019, 11:01 AM
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is that it will soon slow down but I really don't think we're there yet. the recent market issues are a result of the trade war
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All-In [48078]
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Re: yeah I'm just joshing. my serious answer
May 16, 2019, 11:07 AM
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It's been doing well for so long. We are close to the longest economic expansion in US history. Makes me wonder how long it can last.
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110%er [9648]
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It's down for the last month due to the Tariff War with
May 16, 2019, 11:30 AM
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China. I don't think it indicates a slowing economy - just a sudden "unknown" thrown into the mix that has shaken everyone a bit.
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Oculus Spirit [97677]
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I say the DJIA is not an economic indicator anymore
May 16, 2019, 11:32 AM
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TLDNR - It's mostly a debt serviceability indicator.
It's mostly a debt serviceability indicator. Cheaper the debt is to service, the higher it goes. More debt costs, the further south it goes. The market basically leveled off when the FED started raising rates. Wages, when adjusted for inflation, have been stagnant my entire life. That's the key to everything, and that's not going to change. If it does, we're in trouble.
Just think of the companies in the US that are profitable only because they can service their debt at 4% or whatever. If they have to pay 8% interest on their debt, they suddenly become unprofitable, and go out of business. Your 30 year mortgage, for example, that relies on a flat wage buying power. Annuities, commuted value, all types of financial instruments run on that flat wage buying power, and low inflation.
Something very fundamental shifted in our economy in the 1980's. You will notice the rise in illegal immigration started in the 80's. The DJIA started shooting skyward in the 1980's. Our national debt started skyrocketing in the 1980's. Credit cards became popular in the 80's. Mortgage rates on 30 year fixed home loans started a slide to almost nothing (3%). In the 80's, mortgage rates were north of 15% at one time.
And if you really want to understand today, and how it started in the 80's, you need to understand the 1970's. We had a booming economy in the 1970's, even though the numbers don't indicate it. We saw some serious inflation coming out of the 1970's, and everything we've seen since then has been a response to the 1970's. The theory in the 80's was if you lower rates, people take on more debt, and that improves the economy. Remember GWB begging people to still spend money in 2008? Well, when you have interest rates at zero, and a shitload of debt at every level of our economy as a result, well, there's only one way rates can go from zero, or 2.5% or whatever. And when rates are that low, when you raise rates from 1% to 2%, you're doubling what the government pays to service the debt. You're doubling mortgage rates. Credit card rates, everything doubles.
Obama was right when he said we had to get used to this new economy. It will remain stagnant for years and decades to come, and that's IF properly managed. And by managed, I mean that buying power of the average wage remains flat. If we see what we saw in the 1970's, where GDP growth was often 10% or more (great numbers right?), we will suffer a far greater hit on the economy. The 70's were generally considered a "bad" decade for the economy, but the numbers (some) indicate otherwise. With 10% GDP growth we got inflation, which actually hurt us to control. Well, 10% GDP growth today kills us. Like crash, way worse than 2008. The FED has tried mightily, and successfully, since the 80's, to keep GDP growth 5% or less. But this is why the market jumps higher today when bad economic news is announced, and sinks when good economic news is announced (corporate earnings notwithstanding). Bad economic news means cheap debt. Good economic news means expensive debt. REALLY awesome economic news means we crash. Wall Street knows this. But we're at a point where the game can't continue. If our economy ever heats up, and you see wages increase, and you see inflation, we're hobbled in the ability to control that inflation now since we're leveraged in so much cheap debt. Then the calculation is do we devalue the dollar, and let it absorb the losses that way, or crash the economy with higher interest rates and preserve the value of the dollar? Wall Street has leveled off ever since the Fed started raising rates from zero.
To the extent Trump is successful in MAGA, we will suffer. We need crappy trade deals, cheap foreign products, and illegal immigration to keep wages and inflation flat. If illegal immigration stops, there's a labor shortage. If foreign goods become expensive, or we start making them ourselves again, they become more expensive, and wages increase. All "good" economic things that cause inflation. Good economic things that make debt a yuge problem though. This is the corner we've painted ourselves into. We can never be great again with our debt load in all sectors of the economy. We can only tread along. The debt has already been spent. It's already gone into the economy. It's grown the economy, and it runs the economy. And it will eventually kill the economy. Again, 10% GDP growth means inflation. And only 5% inflation means roughly a 7% federal lending rate, and at that level, our credit card payment in Washington grows to be the biggest expense, which increases our debt to pay off the debt. At 10% our total revenues will struggle to even make the minimum payment on our federal credit card, and everything else will be MORE debt.
The 15-20% federal lending rate of the early 1980's, which caused headaches back then, causes our government to default today, and our economy to collapse. We weathered the interest rates back then because we were not leveraged in debt. But even as recently as 2000, it was north of 6%. A 1% increase means we pay $100 billion MORE to service our debt. 6% and we pay $600 billion MORE to service our debt. And that's just $600 billion we have to tack onto the debt because we can't even balance our budget. It can be a vicious and very dangerous cycle. So yeah, Obama's right. Get used to a stagnant economy. We can't afford a good one. And truthfully, this is the greatest danger politicians see in Trump, parties notwithstanding. 95% of American's can't even understand the situation we're in or how dangerous and untenable it actually is. But it explains crappy trade deals, flat wages, no one actually raising the minimum wage (EVEN WITH OBAMA AND A DEM CONGRESS). They can't. We can't do anything really, and this is why Congress isn't actually DOING anything. We're spent. So the best we can do is hope the people watch the BS on news channels about stuff that's totally irrelevant to anything. When all is said and done, someday, we will only have ourselves to blame. Heck, debt runs our politics. The common theme with both parties is spending more. Pubs on defense, dems on entitlements. And no one ever suggesting cutting anything. All the noise from Russian collusion, to obstruction of justice, to payoffs to ######, to IRS filings, to whatever, it's all BS. It's not important. No democrat or Republican is going to fix us. That's why we have Trump. And that's why he will get reelected. And that's why the days of politicians are numbered, from both "parties". It's true today and was true decades ago. We would be better run by the first 535 people in the Boston telephone book, than by 535 faculty members at Harvard.
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CU Medallion [58379]
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I don't feel any better after reading that.***
May 16, 2019, 11:46 AM
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Oculus Spirit [97677]
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It's scary, but it explains a lot.
May 16, 2019, 12:35 PM
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Generally what explains things you can't figure out tends to be true more often than not, even if you don't want to believe it. I couldn't figure out the stock market for years and years. It made no sense when a good economic report caused it to drop and a bad economic report caused it to jump. But if you understand it, the government, and the entire economy runs on debt, and we ALL have a massive pile of debt, good economic news is scary, while bad economic news isn't so scary.
I can promise you that no republican an or democrat would dare do what Trump is doing, and probably for good reason. He's attacking the absolute biggest things hindering economic growth and more specifically WAGE growth. Illegal aliens work low wage jobs, and they're more than happy to work them for the lowest wages. If they left, and Americans had to do those jobs, they would demand higher wages. CAN'T have that! So you have that and then you have trade deals and tariffs. The other key to holding down inflation is keeping the cost of goods low. So we get cheap crap from China, and it's cheaper to have them make it there and ship it to us, than to make it here. Adios manufacturing. Hello cheap t-shirts, furniture, steel, everything. Ahh, but it gets better. China can charge huge tariffs on what little they import from us. That kills the most productive American jobs. Good for debt, keep this in mind. Environmental regulations, that's another thing that's expanded to put brakes on the economy.
And make absolutely no mistake about it, illegal immigration has nothing to do with wanting to help the downtrodden and poor people of Mexico and Central America. It has everything to do with cheapening labor. The way Congress sees it, if they enact reforms, and actually put the brakes on illegal aliens, that's less power they have to spend money using debt. That $22 trillion debt has kept a LOT of politicians from both parties, in Washington far longer than they should have been there, and given them far more power than they would have spending far less money with a balanced budget. Keep in mind Congress doesn't have a penny to spend, on anyone, to buy even a single vote, that it doesn't first take away from someone in the form of taxes, who's working in the economy. Ahh, but with DEBT spending, that money is pure power and control for Congress and politicians. Debt spending is like crack to them. Only through debt spending can Congress buy votes and actually contribute a net gain to the economy. Think of it this way, currently Congress and Washington has "given" the American people roughly a year's worth of their salary, on average. If they don't spend a penny of debt, they've actually not "given" a penny to people or put a penny into the economy.
Message was edited by: Tiggity®
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Replies: 34
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