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Magox

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Was the economy really that bad on Monday, October 19, 1987?

 

I think Tom's got a point.

Yeah, who cares about the system that contains more than 25% of all the assets in this country? Who cares that it is, by far, the biggest collection of liquid assets in the world. Do you want to know where the money for business operations in the USA comes from? That's right... the stock market, bonds, CODs, etc... So yeah, !@#$ the markets.

 

 

 

We'll see how well the US economy does when there are no liquid assets to fuel it.

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Yeah, who cares about the system that contains more than 25% of all the assets in this country? Who cares that it is, by far, the biggest collection of liquid assets in the world. Do you want to know where the money for business operations in the USA comes from? That's right... the stock market, bonds, CODs, etc... So yeah, !@#$ the markets.

 

 

 

We'll see how well the US economy does when there are no liquid assets to fuel it.

Now you're trying to take words from people's keyboards. The fact is the stock market is PART of the ECONOMY. The two are not mutually exclusive of each other but the market by itself is not the economy.

 

No one was saying "!@#$ the market". Not the point at all.

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On 9/12/01, the economy wasn't even in business. Didn't you get the memo?

 

Just on 9/12/01?

 

How about the economy shuts down every weekend and holiday.

 

When the economy is open it's only open from 09:30-16:00, and sometimes only half days.

 

Too bad people can't do business any other time

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Now you're trying to take words from people's keyboards. The fact is the stock market is PART of the ECONOMY. The two are not mutually exclusive of each other but the market by itself is not the economy.

 

No one was saying "!@#$ the market". Not the point at all.

So no one should give a sh-- about the market?

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Not to the point of making policy to maximize the Dow's performance. The economy drives the markets, not the other way around.

 

However a bull market does drive confidence and optimism just as a bear hurts them. People tend to spend money during good times, whether they're are real or percieved so the markets do tend to be a factor in the economy.

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Not to the point of making policy to maximize the Dow's performance. The economy drives the markets, not the other way around.

All though I do for the most part agree with you, there are exceptions.

 

If the Federal Reserve prints enough money the price of "stuff" including stocks will go up.

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All though I do for the most part agree with you, there are exceptions.

 

If the Federal Reserve prints enough money the price of "stuff" including stocks will go up.

Why, if the FED has been "printing (so much) money" over the past year, are prices stable or in fact falling?

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Why, if the FED has been "printing (so much) money" over the past year, are prices stable or in fact falling?

 

Deflationary pressures offsetting inflation.

Most of the money is not M1 money, ie, it's not spendable but just on the books. All the TARP money for instance, went to banks to make them solvent.

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Deflationary pressures offsetting inflation.

Most of the money is not M1 money, ie, it's not spendable but just on the books. All the TARP money for instance, went to banks to make them solvent.

Correct. However, people (like Magox) have been repeating the mantra that the Fed has been printing money which will cause inflation. The Fed has been increasing reserves to the banking system, and reserves are part of the monetary base--the graphs that Magox linked to. The reserves are simply an electronic credit to the banks. Just as the Fed can giveth reserves, so can it taketh. As long as there are excess resources (i.e. high unemployment), there will be no inflation, no matter how many electronic chits the Fed gives to the banking system...

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Deflationary pressures offsetting inflation.

Most of the money is not M1 money, ie, it's not spendable but just on the books. All the TARP money for instance, went to banks to make them solvent.

its just a matter of time before it filters out to the real economy J.A

 

Once property and commercial real estate values stop their decline, and unemployment actually turns into employment, a lot of that money will filter it's way through credit extension and then things will turn quickly

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Correct. However, people (like Magox) have been repeating the mantra that the Fed has been printing money which will cause inflation. The Fed has been increasing reserves to the banking system, and reserves are part of the monetary base--the graphs that Magox linked to. The reserves are simply an electronic credit to the banks. Just as the Fed can giveth reserves, so can it taketh. As long as there are excess resources (i.e. high unemployment), there will be no inflation, no matter how many electronic chits the Fed gives to the banking system...
you nand I have had this discussion before, we just disagree.

 

We will see

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