“believe me, we are in a bubble right now”

Vern said:

I seen this "question" answered many times at this forum. Its odd that you missed it. President Obama was not only not allowed to spend like Reagan, republicans repeatedly tried to sabotage the economy. You don't threaten to default on the debt, threaten to let the Bush tax cuts expire for everybody, shut down the govt, stop a jobs bill to help the long term unemployed, attack the stimulus and auto bailout and claim you're trying to help anything but your own political agenda. Republicans even refused to compromise on deficit reduction to reduce the deficit faster. The deficit was the excuse republicans used to undermine anything that would have helped the economy.

How do conservatives reconcile their obedient agenda with the facts is a better question to ask.

Click to expand...

"President Obama was not only not allowed to spend like Reagan"
How so? The federal debt doubled (or nearly so) on Obama's watch. Still not enough debt?
Would seem to be pretty reasonable to put a curb on boundless runaway spending.

eohrnberger said:

"President Obama was not only not allowed to spend like Reagan"
How so? The federal debt doubled (or nearly so) on Obama's watch. Still not enough debt?
Would seem to be pretty reasonable to put a curb on boundless runaway spending.

Click to expand...

mmmm, that's odd too. I figured by now that you would know the deficit was made up of "spending - revenues". Reagan tripled the federal debt. And he wasn't handed revenues at only 15% of GDP. Still not as impressive as Bush being handed a surplus and doubling the nat'l debt.

Anyhoo, republicans attempts to undermine the economy for their own political gain more than answered your question.

Vern said:

So says trump at the debate. And this nugget “ but if you raise interest rates even a little bit (the stock market is) going to come crashing down”.

Mmmm, does that remind anybody of the constant claims from the right that the market would crash when QE ends? (don't forget the stimulus will cause "hyper inflation, dollar collapse, market to zero"). Besides the fact that we are in an 7 year old bull market with 7 years of doom predicted, the fed has already raised interest rates “a little bit”. Should he have said “ a little bit more”? Anyhoo, the market has actually been quite ho hum about rate increases. And anybody who opened a mortgage company in 2006 doesn’t exactly have a good track record predicting bubbles.

Click to expand...

Hi, I have a degree in economics. I'm also 'the right' as you say.

The 7 years of "doom" predicted in the last 8 years, is the same thing predicted since the stock market has been existence. It isn't necessarily right or left, because even the left does it. It's more about 'perma-bulls(people who ALWAYS think the stock market is going up) and 'perma-bears' (People who think the stock market is ALWAYS bound to go down)

The difference now is that the fed is acting hawkish, but talking dovish. As someone who reviews the FOMC minutes every month, they're afraid of raising interest rates because, even though the stock market has been 'roaring', the fundamentals of the economy are not growing as fast as they should be(GAAP earnings, wages, manufactoring, etc). This leads to what we see now, where the stock market rips up on bad news, because that means the Fed won't raise rates.

So the Fed wants to raise rates, clearly, and once they can 'guesstimate' a precise percentage they can raise it without causing the market to backlash and go down, they probably won't for the rest of the year.

The problem with QE, and we're seeing it now, is that this lack of growth in manufactoring is caused by both huge government spending alongside QE. This is called the crowding-out effect, where increased government spending puts downward pressure on the I-Component of GDP. This predictably, is why previous GDP reports continue to be revised downward.

Crowding Out Effect Definition | Investopedia

Vern said:

mmmm, that's odd too. I figured by now that you would know the deficit was made up of "spending - revenues". Reagan tripled the federal debt. And he wasn't handed revenues at only 15% of GDP. Still not as impressive as Bush being handed a surplus and doubling the nat'l debt.

Click to expand...

OK. So he did. Doesn't make it right or the best thing that he did. It also doesn't mean that doing a doubling under Obama's watch, or more which you seem to be in support of, would be the 'right' or best thing to do either. Inevitably that bill is going to come due and it will fall onto our children or grand children, who will no doubt curse us for it.

Vern said:

Anyhoo, republicans attempts to undermine the economy for their own political gain more than answered your question.

Click to expand...

As long as you can maintain your partisanship all is well? I suppose, but it's not the measure that I'd use.
At some point doesn't fiscal sanity force dealing with the federal debt on us all?

eohrnberger said:

OK. So he did. Doesn't make it right or the best thing that he did. It also doesn't mean that doing a doubling under Obama's watch, or more which you seem to be in support of, would be the 'right' or best thing to do either. Inevitably that bill is going to come due and it will fall onto our children or grand children, who will no doubt curse us for it.

As long as you can maintain your partisanship all is well? I suppose, but it's not the measure that I'd use.
At some point doesn't fiscal sanity force dealing with the federal debt on us all?

Click to expand...

ending the Great Bush Recession and maintaining growth was the best policy. republicans attacked that based on the lie they were concerned about the deficit. And eohrn, your whining (again) about my partisanship allows you to ignore the points I made. And those points answered your question. Here they are again. See if you can address them this time.

Vern said:

I seen this "question" answered many times at this forum. Its odd that you missed it. President Obama was not only not allowed to spend like Reagan, republicans repeatedly tried to sabotage the economy. You don't threaten to default on the debt, threaten to let the Bush tax cuts expire for everybody, shut down the govt, stop a jobs bill to help the long term unemployed, attack the stimulus and auto bailout and claim you're trying to help anything but your own political agenda. Republicans even refused to compromise on deficit reduction to reduce the deficit faster. The deficit was the excuse republicans used to undermine anything that would have helped the economy.

How do conservatives reconcile their obedient agenda with the facts is a better question to ask.

Click to expand...

DarkWizard12 said:

Hi, I have a degree in economics. I'm also 'the right' as you say.

The 7 years of "doom" predicted in the last 8 years, is the same thing predicted since the stock market has been existence. It isn't necessarily right or left, because even the left does it. It's more about 'perma-bulls(people who ALWAYS think the stock market is going up) and 'perma-bears' (People who think the stock market is ALWAYS bound to go down)

Click to expand...

sorry, the non stop predictions of doom from the right was nothing but pandering to an ignorant base that allowed republicans to not only not work with President Obama but to actually try to sabotage the recovery. Do you think the govt shutdown, threatening to let the Bush tax cuts expire for everybody, threatening to default on the debt were good policies?

And I don't disagree that the fed wants to raise rates but they just don't have a reason. Low inflation and low growth are not conducive to raising rates. mmmm, do they ever mention that in the FOMC minutes? And fyi, the market has been quite blasé about rate hikes.

Vern said:

sorry, the non stop predictions of doom from the right was nothing but pandering to an ignorant base that allowed republicans to not only not work with President Obama but to actually try to sabotage the recovery. Do you think the govt shutdown, threatening to let the Bush tax cuts expire for everybody, threatening to default on the debt were good policies?

Click to expand...

Well, this "right" was very quick to blame bush for whiping out the US economy and inflation during the financial crises and gold investing boom, but that's none of my business......

also, no. Uncertainty tends to be bad for the economy. But, it should be telling to you, that DESPITE the government shut downs and budget impasse, the stock market continued to soar. It just proves my point above. Maybe....the creation of a bubble? You don't think that, the market ripping upwords despite all the uncertainty and falling earnings is the sign of a bubble?

And I don't disagree that the fed wants to raise rates but they just don't have a reason. Low inflation and low growth are not conducive to raising rates. mmmm, do they ever mention that in the FOMC minutes? And fyi, the market has been quite blasé about rate hikes.

Click to expand...

Right, I know nothing. The guy who graduated summa cum laude with an economics degree and has been investing in the stock market since 2004 knows nothing. Alright.

Also, I'm sorry that you inflate "conservative economists" with Ron Paul, who complains about the value of the dollar, despite the fact a high dollar would kill industry. Trump is hardly any different, with his hatred for free trade, which goes against the most basic economics.

Vern said:

ending the Great Bush Recession and maintaining growth was the best policy. republicans attacked that based on the lie they were concerned about the deficit.

Click to expand...

Nicely side stepping the pertinent observation that increasing the federal debt might not have been the best choice, rather blaming your Republican boogie man in a most partisan fashion. Yeah, I was right, it's pretty useless to try and have a reasoned conversation with you.

Vern said:

And eohrn, your whining (again) about my partisanship allows you to ignore the points I made. And those points answered your question. Here they are again. See if you can address them this time.

Click to expand...

I ignored nothing, responded to your post I did, however, you don't even return the courtesy.

Yeah, I was right, it's pretty useless to try and have a reasoned conversation with you.

eohrnberger said:

Nicely side stepping the pertinent observation that increasing the federal debt might not have been the best choice, rather blaming your Republican boogie man in a most partisan fashion. Yeah, I was right, it's pretty useless to try and have a reasoned conversation with you.

Click to expand...

eohrn, I've side stepped nothing and your "observations" are obedient not pertinent. I've clearly stated President Obama made the best choice. the failure of austerity and the flaming hypocrisy of republicans on deficits proves my point. and eorhn, the perfect example of side stepping is you side stepping the point I made in my first post to concerning the flaming hypocrisy of republicans on deficit reduction and their attempts to sabotage the recovery. that's exactly what side stepping looks like.

Yeah, I was right, it's pretty useless to try and have a reasoned conversation with you.

Click to expand...

In the future when you accuse me of something you should realize you already did it. Yep, you side stepped like a professional ballroom dancer and its pretty useless to try to have a reasoned conversation with you.

The over arching question financial people ask is: "Where do I go to make money?"

Right now, the stock market is unnaturally supported by cheap and plentiful money, thanks to the feds. Also, low bond yields have forced a shift of retirement assets into stocks, too. That can have serious consequences for retirement portfolios. Especially the billion dollar ones... Stocks are pretty much the only game in town other than real estate. Who's expanding and want's to buy? Not many.

IMO, the stock market is on thin legs right now. Why? If bonds are 1.8% you'd be better off on stocks, but a healthy investment market has a better mix of stocks and bonds than we have today. The ratio of stocks to bonds is pointing to a stock overload, yet if rates go up, bond prices fall along with stocks.

So since we have no place to go with interest rates, eventually they have to rise, and that will lead to a pull out from stocks, and a fall in bond prices, driving down the market - a very bad thing for the party in power. The economic fundamentals indicate that interest rates should go up, and should have done so already. So we are putting off the pain until after the election. Yellen is blind to politics... she says...Whatever. It's her call.

But to get your money out of a falling market, you have to dump fast and early and that terrorizes the market. So usually the fed jumps in and lowers interest rates to try to stabilize the markets. We really have no meaningful way to lower rates unless we go into negative interest. This would be terrible.

So now what do I do? Well, you can invest in real estate and create a new bubble there instead, but real estate costs you money - interest, taxes, insurance, maintenance, marketing, etc.

Our Federal reserve rate right now is close to zero @ 1/2%. During the 9/11 terrorist attacks the U.S. Federal Reserve dropped interest rates from 6.5% to 1%. We have no place to go if we have a significant event like that.

So what does all this have in common? The federal government using the banking system to try to manage the economy using "what used to work".

Result:
20 trillion in debt that will cost more to service as interest rates go up.
Interest rate influence pretty much a gonner.
Employment growth is barely above replacement level
The economy is weak. We need 3.5 - 4% just to begin to smile.
Inflation is low - (It takes forever to get out of debt without some of it).

And worst of all: A general lack of faith in our institutions we rely on to "do their job".

Vern said:

eohrn, I've side stepped nothing and your "observations" are obedient not pertinent.

Click to expand...

No, you have side stepped a rather significant point. What future would all this federal debt bring?

eohrnberger said:

. . . . Inevitably that bill is going to come due and it will fall onto our children or grand children, who will no doubt curse us for it.

Click to expand...

Vern said:

I've clearly stated President Obama made the best choice. the failure of austerity and the flaming hypocrisy of republicans on deficits proves my point.

Click to expand...

I understand completely that it's your opinion that "Obama made the best choice". In fact, you've stated that you would have preferred that Obama had spent even more.

It calls to question how much would have been enough? Rather than just doubling the federal debt on his watch, should Obama have tripled it? Would have satisfied you? $30T? in Federal debt?

Why not a four fold increase in the federal debt? $40T in federal debt? Still not enough? How much is enough?

From my perspective, a doubling of the federal debt was already too much. I know you and I differ on that opinion, but I question the wisdom of that spending, and how it puts the US in a more vulnerable fiscal position in the future.

Vern said:

and eorhn, the perfect example of side stepping is you side stepping the point I made in my first post to concerning the flaming hypocrisy of republicans on deficit reduction and their attempts to sabotage the recovery. that's exactly what side stepping looks like.

Click to expand...

"exactly what side stepping looks like" Take a look in the mirror.

I've side stepped nothing. What you call "flaming hypocrisy of republicans" for "republicans attempts to undermine the economy" I called
"Would seem to be pretty reasonable to put a curb on boundless runaway spending."

What have I sidestepped?

Vern said:

In the future when you accuse me of something you should realize you already did it. Yep, you side stepped like a professional ballroom dancer and its pretty useless to try to have a reasoned conversation with you.

Click to expand...

Your love of ad hominem attacks, which aren't even based in reality, shines through.

How about trying to conduct an adult conversation with out the invectives? Or is that beyond you?
I challenge you to drop the ad hominem attacks and invectives in your posts for the next 24 hours. Think you can do it? I'm betting you can't. Let's find out.

TobyOne said:

The correlation is still there.

Click to expand...

Interesting, now show the causation.

eohrnberger said:

No, you have side stepped a rather significant point. What future would all this federal debt bring?

Click to expand...

You're now side stepping your own point. lets review.

You asked why the recovery was so slow. "Shouldn't stronger growth be expected?" I answered your question. There were two parts, republicans attempts to undermine the recovery and President Obama wasn't allowed to spend like Reagan (not that he was trying to spend like Reagan).

Now Eohrn, that answered your question. But you sided stepped to "its okay to put a curb on boundless runaway spending". Your false hyperbole was only to deflect (or side step as you prefer) from the answer. Besides the fact there was nothing in my post that could in any be categorized as " boundless runaway spending", your answer tells me that you already knew why the recovery was slow. You were side stepping your own question. When democrats said we need to get the economy going, conservatives railed about "out of control spending." And as usual, the narratives conservatives obediently believed wasn't true. The biggest cause of the massive Bush Deficits President Obama inherited was because of revenue collapse. You don't fix revenue collapse with austerity.

Republcans used your "out of control" fear of debt to sabotage the recovery. But they also attacked things that would reduce the deficit faster. That makes them flaming lying hypocrites on deficits. There just no way for you as a conservative to reconcile your agenda with the facts. Hence you side step any fact that doesn't support your "narratives".

Gimmesometruth said:

Interesting, now show the causation.

Click to expand...

I cant even get him to explain "correlation." good luck with causation.

Vern said:

I cant even get him to explain "correlation." good luck with causation.

Click to expand...

Its interesting how the MB has no scale.

Gimmesometruth said:

Interesting, now show the causation.

Click to expand...

The affect it had on the dollar was the cause. QE really did little to help because, again, the big bankers pretty much took the money and padded their wallets. It's interesting to see someone who hates banks talk about how great QE was lol.

Vern said:

You're now side stepping your own point. lets review.

You asked why the recovery was so slow. "Shouldn't stronger growth be expected?" I answered your question. There were two parts, republicans attempts to undermine the recovery and President Obama wasn't allowed to spend like Reagan (not that he was trying to spend like Reagan).

Now Eohrn, that answered your question. But you sided stepped to "its okay to put a curb on boundless runaway spending". Your false hyperbole was only to deflect (or side step as you prefer) from the answer. Besides the fact there was nothing in my post that could in any be categorized as " boundless runaway spending", your answer tells me that you already knew why the recovery was slow. You were side stepping your own question. When democrats said we need to get the economy going, conservatives railed about "out of control spending." And as usual, the narratives conservatives obediently believed wasn't true. The biggest cause of the massive Bush Deficits President Obama inherited was because of revenue collapse. You don't fix revenue collapse with austerity.

Republcans used your "out of control" fear of debt to sabotage the recovery. But they also attacked things that would reduce the deficit faster. That makes them flaming lying hypocrites on deficits. There just no way for you as a conservative to reconcile your agenda with the facts. Hence you side step any fact that doesn't support your "narratives".

Click to expand...

Except you're wrong because the "crowding out effect" is why it's been so slow. Do you know anything about the GDP? Do you know anything about what QE actually did? DO YOU KNOW the difference between fiscal and monetary policy?

Vern said:

ending the Great Bush Recession and maintaining growth was the best policy. republicans attacked that based on the lie they were concerned about the deficit. And eohrn, your whining (again) about my partisanship allows you to ignore the points I made. And those points answered your question. Here they are again. See if you can address them this time.

Click to expand...

You don't think QE1, started by the Bush Administration in December of 2008, extended the recession?

Vern said:

I cant even get him to explain "correlation." good luck with causation.

Click to expand...

also: BONUS question, do you know how the deficit is financed?

DarkWizard12 said:

Except you're wrong because the "crowding out effect" is why it's been so slow. Do you know anything about the GDP? Do you know anything about what QE actually did? DO YOU KNOW the difference between fiscal and monetary policy?

Click to expand...

DarkWizard12 said:

You don't think QE1, started by the Bush Administration in December of 2008, extended the recession?

Click to expand...

DarkWizard12 said:

also: BONUS question, do you know how the deficit is financed?

Click to expand...

DK, it greatly helps the discussion if you actually make a point. Asking questions as if you’re making a point is not debate. Do what I do, make clear straight forward point as a reply. Watch how I respond clearly and straight forward to your points

DarkWizard12 said:

Well, this "right" was very quick to blame bush for whiping out the US economy and inflation during the financial crises and gold investing boom, but that's none of my business......

Click to expand...

But you should have blamed bush. Don’t compare holding Bush accountable for his policies after the fact to the non-stop lies and spin "predictions" from the right the last 8 years.

also, no. Uncertainty tends to be bad for the economy. But, it should be telling to you, that DESPITE the government shut downs and budget impasse, the stock market continued to soar. It just proves my point above. Maybe....the creation of a bubble? You don't think that, the market ripping upwords despite all the uncertainty and falling earnings is the sign of a bubble?

Click to expand...

No I don’t it’s a “sign of a bubble”. And for someone who seems to want to make sure we know how smart they, you should make a better case. First I see no “uncertainty” about interest rate hikes. As I said, the market seems blasé about them. (we’ll discuss that more in a minute). And “Continue to soar” doesn’t seem like the right phrase. We had several pullbacks/corrections. I know this because conservatives could not hide their glee that “finally” the economy was crashing as they hoped. For future reference, this is what a bubble looks like.

DarkWizard12 said:

Right, I know nothing. The guy who graduated summa cum laude with an economics degree and has been investing in the stock market since 2004 knows nothing. Alright.

Click to expand...

This was your response to me telling you the market was blasé about rate hikes. I’ve never said you know nothing. I’m just countering your false conservative narratives (well articulated but still false). And obviously I’m doing a pretty good job because you’re whining about things nobody posted. Instead of constantly telling us how smart you are, you should show it. Case in point, where's that summa cum laude type explanation to counter my point? all I got was "wah wah I'm an expert". I even have to infer you saying I'm wrong because you didn't say it. Are you saying the market is not blasé about rate hikes? (thats a question in direct response to what you posted in case you're wondering).

Also, I'm sorry that you inflate "conservative economists" with Ron Paul, who complains about the value of the dollar, despite the fact a high dollar would kill industry. Trump is hardly any different, with his hatred for free trade, which goes against the most basic economics.

Click to expand...

I've "inflated" nothing. I going to have to guess that your trying to post in a roundabout way that "the stimulus would cause hyper inflation, dollar collapse, market to zero" was some Ron Paul thing I should ignore. If that's your point then it too is a failure. "the stimulus would cause hyper inflation, dollar collapse, market to zero" was a mainstay of conservative delusion along with "Obama was born in Kenya" and "he wants to kill old people". An economics degree doesn't help when dealing with such delusion.

eohrnberger said:

How about trying to conduct an adult conversation with out the invectives? Or is that beyond you?
I challenge you to drop the ad hominem attacks and invectives in your posts for the next 24 hours. Think you can do it? I'm betting you can't. Let's find out.

Click to expand...

eohrn, where'd you go? I met the "delicate" standards you don't apply to yourself. And I met your "24 hour" requirement. Here it is again for you.

Vern said:

You're now side stepping your own point. lets review.

You asked why the recovery was so slow. "Shouldn't stronger growth be expected?" I answered your question. There were two parts, republicans attempts to undermine the recovery and President Obama wasn't allowed to spend like Reagan (not that he was trying to spend like Reagan).

Now Eohrn, that answered your question. But you sided stepped to "its okay to put a curb on boundless runaway spending". Your false hyperbole was only to deflect (or side step as you prefer) from the answer. Besides the fact there was nothing in my post that could in any be categorized as " boundless runaway spending", your answer tells me that you already knew why the recovery was slow. You were side stepping your own question. When democrats said we need to get the economy going, conservatives railed about "out of control spending." And as usual, the narratives conservatives obediently believed wasn't true. The biggest cause of the massive Bush Deficits President Obama inherited was because of revenue collapse. You don't fix revenue collapse with austerity.

Republcans used your "out of control" fear of debt to sabotage the recovery. But they also attacked things that would reduce the deficit faster. That makes them flaming lying hypocrites on deficits. There just no way for you as a conservative to reconcile your agenda with the facts. Hence you side step any fact that doesn't support your "narratives".

Click to expand...

Vern said:

eohrn, where'd you go? I met the "delicate" standards you don't apply to yourself. And I met your "24 hour" requirement. Here it is again for you.

Click to expand...

Sorry, but I've been polite in my posting. So I don't acknowledge your claim ""delicate" standards you don't apply to yourself" as being accurate.

It's clear that we'll never agree on the topic of recovery and federal debt. Neither of us are willing to move from our present opinions, so what's the point in continuing a futile discussion?

eohrnberger said:

Sorry, but I've been polite in my posting. So I don't acknowledge your claim ""delicate" standards you don't apply to yourself" as being accurate.

It's clear that we'll never agree on the topic of recovery and federal debt. Neither of us are willing to move from our present opinions, so what's the point in continuing a futile discussion?

Click to expand...

Polite? oh eorhn thanks for the laughs. I can only assume your opinion is based on the fact I don't whine when you insult me. And eorhn, the only "opinion' you've expressed about the recovery is "curb on boundless runaway spending". That not only side stepped my post but it side stepped your question. And you side stepped the point the massive Bush Deficits President Obama inherited cant be fixed by austerity. Oh and you're stepping I responded with your "delicate" standards. But since you continually come to a "gun fight with a pillow" feigning umbrage is the only "pillow" you have left.

Vern said:

Polite? oh eorhn thanks for the laughs. I can only assume your opinion is based on the fact I don't whine when you insult me. And eorhn, the only "opinion' you've expressed about the recovery is "curb on boundless runaway spending". That not only side stepped my post but it side stepped your question. And you side stepped the point the massive Bush Deficits President Obama inherited cant be fixed by austerity. Oh and you're stepping I responded with your "delicate" standards. But since you continually come to a "gun fight with a pillow" feigning umbrage is the only "pillow" you have left.

Click to expand...

And the insults are back after a brief 24 hour respite. We are done here.