Steven_1974
Member
So now we were up too much before?
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Misc Stock Market
- Thread starter ForsythSnow
- Start date
More tariffs on steel this morning. After early green, the markets are red again after the news.
Interested to see how Ontario reacts since they threatened to cut off all electricity into the US.
I haven't done anything....I went all cash in swing/IRA/401k at SPY 600. If we get a flush again today I might consider putting 1/3 back in for 401k but I think we are headed for a severe recession and we are going much lower. We are probably due for a short term bounce but it's not worth getting chopped up.
This to me is worse than 2022 and I think market will be worse than what we saw in 2022.
This to me is worse than 2022 and I think market will be worse than what we saw in 2022.
ForsythSnow
Moderator
I don't think many people understand how extreme our inflation really has been. If housing and food are any indicators expect us to come out of it with them halved because correction is needed and it's going to be a huge hit regardless. We passed sustainable years ago.
Based on history I see little chance for overall food prices to be halved from current levels. Even the Great Depression, alone, didn’t see quite that much of a drop. According to the following link, food dropped a total of 38% from 12/1929 through 6/1933:
One hundred years of price change: the Consumer Price Index and the American inflation experience
This article examines the American inflation experience over the past hundred years, as captured by the Bureau of Labor Statistics Consumer Price Index, and the reaction of the public and policymakers to that experience.
www.bls.gov
OTOH, during the longer period June 1920 til June 1933, which incorporated two severe downturns, that link does show that food dropped 56%. But it took two severe downturns over a period of 13 years to do that. Who would want that?
Regarding overall (not food alone) inflation since the early 1900s, it has been much worse in the US than it was during the post COVID pandemic period per the following link:
Consumer Price Index, 1913- | Federal Reserve Bank of Minneapolis
Historical data from the era of the modern U.S. consumer price index (CPI)
www.minneapolisfed.org
Highest annual inflation was 1917-20, when it averaged a whopping 16.5%/year! This was during the latter portion of and just after WW1.
Others: 10.9% in 1942 and avg annual of 7.3% 1941-3
14.4% in 1947 with average annual >10% 1946-8 due to postwar inflation as price controls were lifted
1974-5 averaged 10.1%/year and nearly 9%/year 1973-5 during that energy crisis.
1979-81 averaged nearly 12%/year.
In contrast 2021-3 averaged “only” 6.5%/year with the highest annual of 8.0% in 2022 though that period was the worst by far in 42 years.
So, not to minimize its effects since it’s by far the worst of the lifetime of anyone younger than 43, but 2021-23’s inflation was far from the worst as it was only the 6th worst for a 3 year+ period for the US since WW1 and well under 1/2 of the levels during the horrible inflation of 1917-20!
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GeorgiaGirl
Member
Good job laying down the law @GaWx .
It's pretty much what I've alluded to. If you want 2019 prices back, you're going to need an economic depression for them.
I've said it previously I think here, but I think the only, ONLY way that isn't going to make many mad involving solving what occurred in 2021-2022 is probably 2 years of 1-1.5% inflation, with wages still growing a lot more than that (near 2.5% maybe), and slow economic growth at the same time.
And maybe that's exactly what we're seeing and it's just getting slammed anyway, who knows, but I do think GDP growth for this Q specifically will probably be 0-1%.
It's pretty much what I've alluded to. If you want 2019 prices back, you're going to need an economic depression for them.
I've said it previously I think here, but I think the only, ONLY way that isn't going to make many mad involving solving what occurred in 2021-2022 is probably 2 years of 1-1.5% inflation, with wages still growing a lot more than that (near 2.5% maybe), and slow economic growth at the same time.
And maybe that's exactly what we're seeing and it's just getting slammed anyway, who knows, but I do think GDP growth for this Q specifically will probably be 0-1%.