here come the drums of a global slowdown #2
- Thread starter trendsta
- Start date
thanks for putting that up GP - that inspires some confidence in me to start watching the micro for a chance to get in.
also makes me confident about the long term looking at the 87 spike/crash and the current spike/crash.
also makes me confident about the long term looking at the 87 spike/crash and the current spike/crash.
Trouble is I don't have data earlier than that, and by some accounts, we've been in a bull market since the early 80s when debt expansion started to take off. Those trend lines drawn there are around 7% pa growth, but maybe they are just intermediate-term bull market trends and we could be headed towards even longer-term mean reversion now (on the assumption that that trend would be lower than now).
Still, to me, being almost back at that red trend line means we're at a crucial decision point - the time vortex if you like.
The big question is will it hold or won't it...
GP
Still, to me, being almost back at that red trend line means we're at a crucial decision point - the time vortex if you like.
The big question is will it hold or won't it...
GP
if it holds, i'm in.
That chart is essentially the same as the one I posted, except that it's using a linear scale rather than log. I think that distorts the picture over such a large range, which is why your lower trend line doesn't touch all three points and shows the current price still significantly above it.
GP
GP
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Hiya Trendsta,
1. Your conclusion sounded so "fatalistic" and "pessimistic" in your post, which I do not and cannot entirely agree, at all.
2. Even IF your so-called global Recession has officially sets in, the world will still continue as usual before, albeit dancing to a different tune at best, during the new era.
3. The world is not just made up of the G7 or/and OECD member countries, there is also a BRIC still quietly abiding its time and patiently await to take on this global economic centre stage.
4. It is for Australia and its own various national leaders to decide for itself whether it will want to newly emerge as part of the rising dynamic Asia-Pacific Region and play a new role in the new era or/and continue to remain part of the heavily leveraged, indebted OECD /G7 member country with a ailing economy, which is likely to remain stagnant for a forseeable period before officially fading themselves off from the global centre stage and into its own history over the next 40-60 years time period.
5. For your further comments and discussion, please.
6. Thank you.
Cheers,
Kenneth KOH
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Hi Kenneth,
I think u mis-understood me..
i said "By the time recession is announced and publicly admitted it will be all over.. IMHO we’re not there yet in land of OZ."
what i meant is by the time everyone acknowledges the recession, the recession will be over and the world will be going into growth mode again ..
i may be a bit early on this, but i do think in equity and debt markets at least a lot has been accounted for .. in terms of global recession...
I think u mis-understood me..
i said "By the time recession is announced and publicly admitted it will be all over.. IMHO we’re not there yet in land of OZ."
what i meant is by the time everyone acknowledges the recession, the recession will be over and the world will be going into growth mode again ..
i may be a bit early on this, but i do think in equity and debt markets at least a lot has been accounted for .. in terms of global recession...
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Dear Trendsta,
1. Please correct me if I am wrong here: The economies in most if not all the G7 and OECD member countries have one common basic weakness: spending more than what it earns, through Debt and Leverage and with the American Economy as its key locomotive driver.
2, I personally believe that a new economic paradigm may soon eventually emerged, towards the other extreme of Capitalism i.e a more cautious and conservative spending habits change whereby the motto is likely to be "spending within one's limit or/ to earn enough to have some surpluses for (discretionary) spending", with the present assets and debt de-leveraging process rapidly taking place and spreading across the entire globe.
3. Personally, I "see" the American Economy falling into a prolonged and deep Recession in the near future.
4. Consequently, I doubt if the American Economy is likely to continue to remain as the world's largest economy for a foreseeable period of time in the near future, and to be sufficient strong enough to drive the global economy by itself, once again, as in the past.
5. I also believe that like the American Economy, many of the G7/OECD members countries are going to see their economies greatly contract over the coming years, into a similar prolonged Recession.
6. From the various last-minute measures adopted and implemented in Australia recently by the KR's ALP Federal Govt, which are essentially "Keynesian" in nature, I am not sure if the A$1 Trillion Australian Economy is sufficiently strong enough to be able to jump start by itself by only increasing its domestic demand and various infrastructural spending and through future deficit budgetting process.
7. This is especially so, with the continued falling external demand for its goods and services together with a rapidly weakening Australian Dollar Currency, as a result of the continued fallling commodities prices and world-wide demand.
8. Unless the RBA will quickly further reduce its official Interest Rate significantly and the Australian households willing to freely spend their monies to help drive up Australian Economy out of its impending Recession, we shall soon see the rapidly slowing down Australian Economy falling into an official Recession.
9. For your further comments and discussion, please.
10. Thank you.
Cheers,
Kenneth KOH
Hi KKoh,
Dont have much time atm, so will try summarise.
There is a lot of fear and uncertainty at the moment. Guess what, it comes as no surprise to many.
The biggest weakness of many investors and general media is 'extrapolating'. They see a trends and assume it to continue to infinity. When there are booms, these ppl believe it will keep going, when there is a bust similarly they think the bust will keep going. It doesnt work that way. Economies and markets in general are like an elastic band.. At 6800 the asx was stretched one way, and there were ppl extrapolating that we will go to 10000 by 2010 based on commodities rah rah rah... and here at 3900 i believe it has stretched the other way, and again we have many ppl saying this is the end of the world, asx to 2000 rah rah rah ..
Yes, this global slowdown/recession will shift the mindsets and the way financial world works, with more stringent regulations and controls, more focus on productivity than paper printing.. but the world will continue, as long as there are billions going to work each day adding productivity, improving life etc.
My main point is here we are nearly 50% from the top, an event that has happened less than 5 times in a century, despite world wars, depression, oil shotting up 10x times in a very short period etc etc etc. Yes things are very bad (surprise, surprise), but guess what, in some asset classes those have largely been taken into account. While in other markets they have hardly been accounted for. Maybe the system will completely fall and we will go back to trading sheeps and goats.. i bet that we dont.
Dont have much time atm, so will try summarise.
There is a lot of fear and uncertainty at the moment. Guess what, it comes as no surprise to many.
The biggest weakness of many investors and general media is 'extrapolating'. They see a trends and assume it to continue to infinity. When there are booms, these ppl believe it will keep going, when there is a bust similarly they think the bust will keep going. It doesnt work that way. Economies and markets in general are like an elastic band.. At 6800 the asx was stretched one way, and there were ppl extrapolating that we will go to 10000 by 2010 based on commodities rah rah rah... and here at 3900 i believe it has stretched the other way, and again we have many ppl saying this is the end of the world, asx to 2000 rah rah rah ..
Yes, this global slowdown/recession will shift the mindsets and the way financial world works, with more stringent regulations and controls, more focus on productivity than paper printing.. but the world will continue, as long as there are billions going to work each day adding productivity, improving life etc.
My main point is here we are nearly 50% from the top, an event that has happened less than 5 times in a century, despite world wars, depression, oil shotting up 10x times in a very short period etc etc etc. Yes things are very bad (surprise, surprise), but guess what, in some asset classes those have largely been taken into account. While in other markets they have hardly been accounted for. Maybe the system will completely fall and we will go back to trading sheeps and goats.. i bet that we dont.
We heard it here first!
Fox News eat your heart out.Question for you. In your original post you referred to commodities, and specifically copper, being a good leading indicator. And this was your basis for the beating drums. How does this relate to the actual credit-crunch? Or are you saying that the downturn of the forward prices indicated that there was a downturn of some sort coming and being factored in? To my mind, falling commodities prices, in of themselves, didn't cause the situation we have now but that rather it was due to credit practices and inflated asset prices. Help me out here.
Does anyone remember DOW 24000 and DOW 36000?
hi, I hate the R word & would avoid it if I could. I also feel that Australia is not technically in recession but we have collectively brought about the very result we wish to avoid by the contraction of spending.
however, just received some disturbing news from Singapore/Malaysia. My niece just this morning arranged for her Singapore factory to shut for 1 week. During the week, they lay off 15 staff. They employ 40. The news from my sister in Malaysia is that the lay offs have already begun & they're expecting 30000 to return to Malaysia because there's no work for them in Singapore.
She also says that commodity prices have dropped 60%. I assume that she meant rubber & oil palm. Sounds like deflation to me.
I'm not scaremongering. I'm more upbeat than most. But I'm getting jittery. No buying of shares just yet! Really conflicted because yesterday I was picking stocks to watch.
Is it a worldwide domino?
KY
however, just received some disturbing news from Singapore/Malaysia. My niece just this morning arranged for her Singapore factory to shut for 1 week. During the week, they lay off 15 staff. They employ 40. The news from my sister in Malaysia is that the lay offs have already begun & they're expecting 30000 to return to Malaysia because there's no work for them in Singapore.
She also says that commodity prices have dropped 60%. I assume that she meant rubber & oil palm. Sounds like deflation to me.
I'm not scaremongering. I'm more upbeat than most. But I'm getting jittery. No buying of shares just yet! Really conflicted because yesterday I was picking stocks to watch.
Is it a worldwide domino?
KY
It does seem that each day is worse than the one before. SE Asia seems particularly vulnerable with Viet Nam a standout because it is the late starter.
Hope things go well with your family.
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Hi KY,
1. Singapore has indeed fallen into an Recession at the end of Q3 2008, in case you are still not aware of it, at this point in time.
2. For the first time in its history, the Singapore Government is now willing to dip into its National Reserves to help its people to cope with and overcome this Recession. It has never done so previously , not even during the last 1997 Asian Financial Crisis.
3. There is no doubt that the present rapid debt and asset de-leveraging process is presently underway world-wide.
4. However, the IMF is still speaking about the possibility of a global Recession occurring in 2009-2010 period, as its worst case scenario, at this point in time, and not a similar "Depression" worldwide as the 1929-1932 Great Depression.
5. I believe that we can take some comfort that China with its huge population number, is likely to develop itself as the world's further largest consumer market in the world, in the near future.
6. China has reportedly replaced Germany as having the 3rd largest Economy in the world, at this point in time. It is further said that China has similarly replaced US as the biggest trading partner for Japan.
7. The present global financial crisis seems to be hitting partcularly hard only the highly debt-leveraged Western World and OECD countries with many of these Western Economies likely to fall into a Recession soon while the countries like Brazil, Russia, India and China (BRIC) countries seems to be much less adversely affected, at this point in time.
8. Consequently, let us continue to remain optimistic in our own economic outlook.
9. Glenn Steven, the RBA Governor is still talking about achieving a soft landing for the Australian Economy in the immediate near future, despite the recently rapidly slowing down of the Australian Economy and despite the RBA's having lowered its 2008 growth forecast for Australia recently,
from its previous 2.25% growth projection, down to its present 1.5% growth figure.
10. For your further comments and discussion, please.
11. Thank you.
regards,
Kenneth KOH
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Hi Kenneth thanks for the update. Sunfish, thanks for your well wishes. My family are into cash [sisters are absolute ultra conservative, much to my disgust, most times. She said my brother's biz is alright. Our family farm sold 3 months ago. We collected the deposit don't know whether it settled]
I hate R because EVERYBODY suffers.
Kenneth, I was in Singapore running a quite successful little one woman biz when 9/11 happened. The subsequent SARS episode was so emotionally unsettling that I nev er ever want to see a recessionary period again but if you say that the govt is dipping into its reserves, it appears that this time it's even worse.
*&^# maybe I should start praying that things will be alright.
Here in SA we still seem OK but the hairdresser next door has 'lost' $100K in his super. He's not fazed - sits in his car listening to music.
What's more serious is that Holden has shut its Elizabeth plant.
Well, we shall continue to adjust our own affairs.
Have a good weekend, everyone.
KY
I hate R because EVERYBODY suffers.
Kenneth, I was in Singapore running a quite successful little one woman biz when 9/11 happened. The subsequent SARS episode was so emotionally unsettling that I nev er ever want to see a recessionary period again but if you say that the govt is dipping into its reserves, it appears that this time it's even worse.
*&^# maybe I should start praying that things will be alright.
Here in SA we still seem OK but the hairdresser next door has 'lost' $100K in his super. He's not fazed - sits in his car listening to music.
What's more serious is that Holden has shut its Elizabeth plant.
Well, we shall continue to adjust our own affairs.
Have a good weekend, everyone.
KY
Dear All,
1. Iceland, has become the first Western country, to be officially "bankrupted" by the recent global financial crisis since 1976.
2. The Singapore Business Times Newspapers has reported today that
"THE Icelandic government says it has reached agreement with the International Monetary Fund for a US$2.1 billion loan over two years as part of an aid package to assist the crisis-hit Nordic country."
http://www.businesstimes.com.sg/sub/news/story/0,4574,302713,00.html?
3. Likewise, the Singapore Business Times Newspapers has recently also reported that: "Pakistan facing meltdown, seeking fund"
"(ISLAMABAD, Pakistan) Pakistan's new leaders are scrambling for foreign cash to ward off a possible economic meltdown at a time when they are trying to contain soaring violence by Islamic fundamentalists.
Battered by high inflation and a plunging currency, the nuclear-armed country hopes that global powers and financial institutions will not want to see it further destabilised and hand over the dollars that it needs.
But the plea for help comes as potential donors in the West are distracted by the global financial crisis and deepening fears of recession in their own economies.
Pakistan requires an immediate commitment of at least US$2 billion to restore confidence in the country after an alarming slump in its foreign reserves, economists say. Up to US$8 billion more will be needed to repay sovereign debts due to mature next year."
http://www.businesstimes.com.sg/sub/news/story/0,4574,302265,00.html
4. Which country is likely to be next to officially seek bail out from the IMF to reascue their National Economy in the immediate near future?
5. Will it next be Hungary, Ukraine, Belarus, South Korea, Argentina, Brazil, Turkey or Russia?
http://www.businesstimes.com.sg/sub/specialfocus/story/0,4574,302129-1224705540,00.html?
6. For your further comments and discussion, please.
7. Thank you.
regards,
Kenneth KOH
1. Iceland, has become the first Western country, to be officially "bankrupted" by the recent global financial crisis since 1976.
2. The Singapore Business Times Newspapers has reported today that
"THE Icelandic government says it has reached agreement with the International Monetary Fund for a US$2.1 billion loan over two years as part of an aid package to assist the crisis-hit Nordic country."
http://www.businesstimes.com.sg/sub/news/story/0,4574,302713,00.html?
3. Likewise, the Singapore Business Times Newspapers has recently also reported that: "Pakistan facing meltdown, seeking fund"
"(ISLAMABAD, Pakistan) Pakistan's new leaders are scrambling for foreign cash to ward off a possible economic meltdown at a time when they are trying to contain soaring violence by Islamic fundamentalists.
Battered by high inflation and a plunging currency, the nuclear-armed country hopes that global powers and financial institutions will not want to see it further destabilised and hand over the dollars that it needs.
But the plea for help comes as potential donors in the West are distracted by the global financial crisis and deepening fears of recession in their own economies.
Pakistan requires an immediate commitment of at least US$2 billion to restore confidence in the country after an alarming slump in its foreign reserves, economists say. Up to US$8 billion more will be needed to repay sovereign debts due to mature next year."
http://www.businesstimes.com.sg/sub/news/story/0,4574,302265,00.html
4. Which country is likely to be next to officially seek bail out from the IMF to reascue their National Economy in the immediate near future?
5. Will it next be Hungary, Ukraine, Belarus, South Korea, Argentina, Brazil, Turkey or Russia?
http://www.businesstimes.com.sg/sub/specialfocus/story/0,4574,302129-1224705540,00.html?
6. For your further comments and discussion, please.
7. Thank you.
regards,
Kenneth KOH
The United States of America. Im only half joking.
