Recession?

This is the front porch of our forum. Pull up a chair, and talk about whatever's on your mind.
Dgflorida
Posts: 3488
Joined: Wed Oct 07, 2015 8:10 pm

Re: Recession?

Post by Dgflorida » Fri Sep 13, 2019 5:22 am

I agree IC, the CD market is lousy. And there doesn't seem to be any good place that is safe.

icfrugal1
Posts: 2389
Joined: Fri Aug 28, 2015 12:54 am

Re: Recession?

Post by icfrugal1 » Tue Sep 17, 2019 12:58 pm

So I "bought" a new CD for DH instead of the 3% he was getting until 2027, he is now getting 2.1% till 2024. (5 years) and no it's NOT call protected. :(

IC

Dgflorida
Posts: 3488
Joined: Wed Oct 07, 2015 8:10 pm

Re: Recession?

Post by Dgflorida » Wed Sep 18, 2019 7:54 am

Well, I am glad you were able to get something, ICfrugal. It looks like the recession talk was just politics. They threw it out there in August to see if it would stick. Apparently, it didn't. According to Logics, the current administration won't allow a recession to happen until after the election. This means a year or more before a downturn. But I haven't seen any scary news articles about it since the beginning of September. And the economic indicators are good. However, the EU, especially Germany, are in a slow down and Brexit is a destabilizing situation. I am so sorry for the Brits. The power struggle there and the fear mongering I read about are just awful.

colonialgirl
Posts: 1514
Joined: Sat Aug 29, 2015 2:01 am
Location: Central Illinois

Re: Recession?

Post by colonialgirl » Wed Sep 18, 2019 1:06 pm

Read a little further DG.

https://www.cnn.com/2019/09/17/business/overnight-lending-rate-spike-ny-fed/index.html

https://finance.yahoo.com/news/oil-prices-close-15-higher-230000355.html

There are indicators in the financial market every day of destabilization.

LogicsHere
Posts: 518
Joined: Sat Aug 29, 2015 9:49 am

Re: Recession?

Post by LogicsHere » Wed Sep 18, 2019 6:41 pm

Dgflorida wrote:
Wed Sep 18, 2019 7:54 am
Well, I am glad you were able to get something, ICfrugal. It looks like the recession talk was just politics. They threw it out there in August to see if it would stick. Apparently, it didn't. According to Logics, the current administration won't allow a recession to happen until after the election. This means a year or more before a downturn. But I haven't seen any scary news articles about it since the beginning of September. And the economic indicators are good. However, the EU, especially Germany, are in a slow down and Brexit is a destabilizing situation. I am so sorry for the Brits. The power struggle there and the fear mongering I read about are just awful.
Let me correct you. It wasn't according to Logics. It was an opinion from my broker. But regardless of pointers and indicators, I am still leary. Recessions seem to occur about once every 5 to 7 years so if history is correct and holds true to form, then we are actually overdue and does appear to be a possibility.

Recessions since 1929 (from Wikipedia):

Name Period Range Duration (months) Time since previous recession (months) Peak unemploy­ment GDP decline (peak to trough) Characteristics
Great Depression

Aug 1929–Mar 1933
3 years
7 months 1 year
9 months 21.3%(1932)[46]– 24.9%(1933)[47] −26.7% A banking panic and a collapse in the money supply took place in the United States that was exacerbated by international commitment to the gold standard.[48][49][50] Extensive new tariffs and other factors contributed to an extremely deep depression.[51] GDP, industrial production, employment, and prices fell substantially. The economy began to recover in the mid 1930s, with gold inflow expanding the money supply and improving expectations, but double dipped during the Recession of 1937–38. The ultimate recovery has been credited to monetary policy and monetary expansion.[52]

Recession of 1937–1938 May 1937–June 1938 1 year
1 month 4 years
2 months 17.8%[46]–

19.0%(1938)[53]
−18.2% The Recession of 1937 is only considered minor when compared to the Great Depression, but is otherwise among the worst recessions of the 20th century. Three explanations are offered as causes for the recession: the tight fiscal policy resulting from an attempt to balance the budget after New Deal spending; the tight monetary policy of the Federal Reserve; and the declining profits of businesses leading to a reduction in business investment.[54]

Recession of 1945 Feb 1945–Oct 1945 8 months 6 years
8 months 5.2%[53]
(1946) −12.7% The decline in government spending at the end of World War II led to an enormous drop in gross domestic product, making this technically a recession. This was the result of demobilization and the shift from a wartime to peacetime economy. The post-war years were unusual in a number of ways (unemployment was never high), and this era may be considered a "sui generis end-of-the-war recession".[55][56]
Recession of 1949 Nov 1948–Oct 1949 11 months 3 years
1 month 7.9%

(Oct 1949) −1.7% The 1948 recession was a brief economic downturn; forecasters of the time expected much worse, perhaps influenced by the poor economy in their recent lifetimes.[57] The recession also followed a period of monetary tightening.[35]

Recession of 1953 July 1953–May 1954 10 months 3 years
9 months 6.1%
(Sep 1954) −2.6% After a post-Korean War inflationary period, more funds were transferred to national security. In 1951, the Federal Reserve reasserted its independence from the U.S. Treasury and in 1952, the Federal Reserve changed monetary policy to be more restrictive because of fears of further inflation or of a bubble forming.[35][58][59]

Recession of 1958 Aug 1957–April 1958 8 months 3 years
3 months 7.5%
(July 1958) −3.7% Monetary policy was tightened during the two years preceding 1957, followed by an easing of policy at the end of 1957. The budget balance resulted in a change in budget surplus of 0.8% of GDP in 1957 to a budget deficit of 0.6% of GDP in 1958, and then to 2.6% of GDP in 1959.[35]
Recession of 1960–61 Apr 1960–Feb 1961 10 months 2 years 7.1%
(May 1961) −1.6% Another primarily monetary recession occurred after the Federal Reserve began raising interest rates in 1959. The government switched from deficit (or 2.6% in 1959) to surplus (of 0.1% in 1960). When the economy emerged from this short recession, it began the second-longest period of growth in NBER history.[35] The Dow Jones Industrial Average (Dow) finally reached its lowest point on February 20, 1961, about 4 weeks after President Kennedy was inaugurated.[citation needed]

Recession of 1969–70 Dec 1969–Nov 1970 11 months 8 years
10 months 6.1%
(Dec 1970) −0.6% The relatively mild 1969 recession followed a lengthy expansion. At the end of the expansion, inflation was rising, possibly a result of increased deficits. This relatively mild recession coincided with an attempt to start closing the budget deficits of the Vietnam War (fiscal tightening) and the Federal Reserve raising interest rates (monetary tightening).[35]

1973–75 recession Nov 1973–Mar 1975 1 year
4 months 3 years 9.0%
(May 1975) −3.2% The 1973 oil crisis, a quadrupling of oil prices by OPEC, coupled with the 1973–1974 stock market crash led to a stagflation recession in the United States.[60][61]

1980 recession Jan 1980–July 1980 6 months 4 years
10 months 7.8%
(July 1980) −2.2% The NBER considers a very short recession to have occurred in 1980, followed by a short period of growth and then a deep recession. Unemployment remained relatively elevated in between recessions. The recession began as the Federal Reserve, under Paul Volcker, raised interest rates dramatically to fight the inflation of the 1970s. The early 1980s are sometimes referred to as a "double-dip" or "W-shaped" recession.[35][62]

1981–1982 recession July 1981–Nov 1982 1 year
4 months 1 year 10.8%
(Nov 1982) −2.7% The Iranian Revolution sharply increased the price of oil around the world in 1979, causing the 1979 energy crisis. This was caused by the new regime in power in Iran, which exported oil at inconsistent intervals and at a lower volume, forcing prices up. Tight monetary policy in the United States to control inflation led to another recession. The changes were made largely because of inflation carried over from the previous decade because of the 1973 oil crisis and the 1979 energy crisis.[63][64]

Early 1990s recession in the United States
July 1990–Mar 1991 8 months 7 years
8 months 7.8%
(June 1992) −1.4% After the lengthy peacetime expansion of the 1980s, inflation began to increase and the Federal Reserve responded by raising interest rates from 1986 to 1989. This weakened but did not stop growth, but some combination of the subsequent 1990 oil price shock, the debt accumulation of the 1980s, and growing consumer pessimism combined with the weakened economy to produce a brief recession.[65][66][67]

Early 2000s recession Mar 2001–Nov 2001 8 months 10 years 6.3%
(June 2003) −0.3% The 1990s once were the longest period of growth in American history. The collapse of the speculative dot-com bubble, a fall in business outlays and investments, and the September 11th attacks,[68] brought the decade of growth to an end. Despite these major shocks, the recession was brief and shallow.[69]

Great Recession Dec 2007–June 2009[70][71] 1 year
6 months 6 years
1 month
10.0%
(October 2009)[72]

Dgflorida
Posts: 3488
Joined: Wed Oct 07, 2015 8:10 pm

Re: Recession?

Post by Dgflorida » Thu Sep 19, 2019 6:58 am

Thanks you for the correction. Please note: Logics broker is the source of the information that our current President will not allow a recession before he is re-elected.

I do not consider CNN or Yahoo to be a source of good financial information, therefore I do not read them.

I do agree that historically a recession seems to occur every decade. We will have to see if it holds true under a successful businessman compared to past ones under a politician. However, the world economy has historically pulled us down and the EU certainly is trying to go into a recession. So I am also watchful. But I hope Logics' broker is right.

Post Reply