Discussion of this stuff could lead to "hijacking" of the thread, but since it's yours Jim, I guess it's okay.:)Quote:
Originally Posted by J. Robinson
Two words........................election year. You're right about much of the doom and gloom being media driven. And if something is repeated often enough it can become what's known as a self fulfilling prophecy.
I'm not interested in (or trying to) causing a political argument, I'm looking at this as a modest investor and someone who has to make economic decisions based on historical performance. I think there's a tendency to "panic" (to some degree or other) when normal cycling of the economy occurs. Those that "panic" usually are the losers, those that are circumspect are more likely to be winners over the longer haul. In the housing market what we're seeing today, in general economic terms not specifics, is not appreciably different than the last significant market adjustment around 1990. In adjusted dollar terms it's not quite as bad today (yet) as it was then. Most of us lived through that just fine. We also lived through much worse performing economies in the late 70s.
As for election years and the media, recent history can be summed up in a few examples, more if you go back further in time. In '92 it was a popular campaign chant that we were "suffering the worst economy in 50 years", usually followed by "it's the economy, stupid". The media were simpathetic to that particular candidate and never challenged that cannard for the obvious, oh let's be charitable and call it an exaggeration, that it was. Was the economy in a down trend compared to the previous 9 years? Yep, but hardy worthy of the 50 year indictment. In '96 when the PC/technology driven market was maturing (not unlike the automotive industry in the 20s, and the electricity revolution that preceded that) not a word about negativity in the economy. On the other hand, in 2000 when the thinning out of the tech market started to occur (actually, in hindsight there are milestones in 1999 that indicated the shrinkage had begun, but they weren't as visible in real time until 2000) the media took an opposite tact. When a certain political candidate tried to point out that the economy was starting to take a dip, the media ran with the "you're trying to talk down the economy" approach. I wonder where those writers are today?:rolleyes: Well, many of them have been writing opinion pieces disguised as news talking about how miserable the economy is/has been for................oh, it seems like close to 7 years. Not sure what that might coincide with, but maybe after a little research...........................:HMMM:
Anyway, for all the doom and gloom that supposed smart people preach, we've had pretty much a straight up strong economic trend for 26 years with the current contraction being just the third in that period. Could it be the worst of the three? Anything is possible, but not likely, barring any major political action that might induce the market to completely retract.
The major shrinkage in the hot rod market won't happen of it's own accord until us boomers start dying off more quickly. Of course politics could change all that if we become the target for those who demagogue the environmental "issues".