Bank stocks inflating the stock market!

[Root beer]

DJ Industry: 7,924.56 +174.75      

Nasdaq Comp: 1,587.00 +58.05      

S&P 500: 832.86 +18.98      

On a side note, today in Economic class, we was doing multiplier effect and other boring crap. We had table with Full Employment number (number of people employed) The GDP output the employment level produce, and the total Expenditure.

Well, the full employment level had numbers like this:

130 (millions) 700 billions (output) and 680 (billions) What that means is the economy had a full level employment everyone had a job and produced 700 billion dollars worth of goods we only bought 680 worth. Which translate in plain English that the economy is now in recession.

Point is folks, recessions come and go. No need to hit the panic button.

[done]

I would partially agree. However, for the folks like my cousins (1 with a degree in construction management, the other a builder) and my uncle (construction project manager) who have found themselves unemployed for the first time in their lives with little or no hits on resumes, panic is unavoidable.

[Marty]

Point is folks, recessions come and go. No need to hit the panic button.

They certainly do come and go, but this is not your typical recession. The market was down almost 60%, people are living in cars and retirees have lost a huge amount of assets (as have non-retirees).

My son found a job four months after being laid off, he took a pay cut of 20-25% and I consider him to have been hugely lucky considering what's going on. It's easy to say don't hit the panic button, but tell that to someone who doesn't know where their next month's rent is coming from.

[daviscw]

I don't know enough about all this to say whether it is, or isn't happening, but I do know that my grandma retired from the exact same company 30 years ago that my dad retired from last October and she is drawing double what he is. I just think that's crazy.

[SirSnookalot]

Point is folks, recessions come and go.  No need to hit the panic button

Boy could write volumes on this subject.  The statement is true but a narrow view of the situation.  If your job is not in jeopardy and you have little or no money invested and own no real estate, then there is no need to panic.

However for many Americans this just isn't the case.  I've been thru every recession as a business owner since 1974 (now retired ) and they aren't fun.

As a rule my income suffered between 25-60%.  I was fortunate enough to have only about 75 employees so I never laid anyone off and healthcare was intact , rare in this day and age.  Corporate responsibility is to share holders (owners of the corp) not to labor.  When product demand is down the only way to keep profits or lose less money is to reduce costs and that is labor, pensions, changes in healthcare etc.

What makes this recession different than others is the lack of credit for business to be able to expand and gain market share thru attrition, the weak fall by the wayside in these types of conditions.

I'm not an economist but a big problem is write down of toxic assets, the government needs a new formula to get these off the books as financials generally lead the way to recovery.

On the bright side but not to get overly cocky, factory starts are up, new home building starts are up, retail sales are up and commodity prices are trending up ( steel and copper are well worth watching as that pertains to what the Chinese are doing and that's Americas ticket out of the recession).  The stock market as rule is a precursor of things to come, things are looking up, however there will be more layoffs and my heart goes out to those people.