War strangling the economy???


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Navy joe
March 19, 2003, 09:43 PM
I mean I wonder, it seems everyone is in a somber mood tonight, people out eating were down and I went to the shooting range to work on shotgun reloading and found it less busy than it has been since at least August 2001. I mean nobody out spending money! What, is everyone sitting on their couch eating cheezy poofs and watching the war? Or are people really scared? How's life in your town?

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twoblink
March 19, 2003, 09:51 PM
You know, don't want to "miss it" when the sky over Saddam glows :D

Cheezy Poofs, and CNN...;) :p Or better yet, Fox if you can swing it.

Here in Taiwan, they read about the war on the news just like they read about the weather, completely emotionaless...

ENC
March 19, 2003, 09:52 PM
War just makes for good TV
everyone is just watching their TV's to see what happens next.

ENC
March 19, 2003, 09:59 PM
dang it has just began

And i don't have cable oh well the networks will carry most of it.





God bless our troops

ahadams
March 19, 2003, 11:49 PM
'sokay unless we go to condition Red, Friday I get a new riot shotgun...even cleared it with management (my wife)! I'm doing my bit to help the economy!

Raymond VanDerLinden
March 20, 2003, 12:11 AM
It builds it, at least during the war.

Check your history people, the Depression ENDED right after Pearl Harbor. The resession that had started after WWII ended with the start of the Korean Conflict, The seventies Resession started right after we left combat.

The scare mongering from left wing papers is just that scare mongering. What was and has been Strangleing the Economy is the rummors of war, it's not knowing, and or being on the losing side. That is what is left from being hit and not having a clear enemy.

Look for another jump in the market, fuel prices to hold or reduce, And more Jobs to open up.

S_O_Laban
March 20, 2003, 03:54 AM
Howdy Ray, you wouldn't be near Lamoni would you? Just curious, I went to school there :)

Soap
March 20, 2003, 11:48 AM
Any time a government drags out the process of debating going to war, the economy suffers. Since the debate is obviously decided, look for the economy to pick up right after the conflict is over. After that, the market only has to resolve one more issue, then the market will truly be strengthened.

CZ-75
March 20, 2003, 12:08 PM
If we win quickly, I expect the economy to surge, like Daniel Flory said, after people's uncertainty shakes out.

Funny how major business decisions are really about emotionalism, rather than cold, hard fact.

Soap
March 20, 2003, 12:20 PM
CZ-75,

Another thing that is funny is that if people who agree with us spread the word, collectively, we will create a self-fufilling prophecy.

jmbg29
March 20, 2003, 12:32 PM
Or better yet, Fox if you can swing it.The FoxNews agency was expelled from Iraq a month ago. Saddam determined that they weren't on his side. The alphabet channels, OTOH, got to stay. ;) :D :D

Drjones
March 20, 2003, 09:41 PM
Just heard on the radio that the dow is up for the 7th straight day.

It has not done that for three years.

I also read elsewhere that the markets' performance is a very good indicator of a lot of things, and the fact that the market is rising at the beginning of a war bodes well.

:cool:

Navy joe
March 20, 2003, 10:24 PM
Yeah, I know that wars are great for the economy, it's just that two things seem sick, one that everyone stays home to watch the war and two we have an economy driven almost entirely by consumer confidence. Guess I better buy stock in cheezy poofs...

Soap
March 21, 2003, 08:24 AM
Navy Joe,

Since all markets are just a collection of individual's assessments of value, the market will be based on the collective confidence and/or value assessments. An economy that is based this way is as old as stone.

Billll
March 21, 2003, 09:56 AM
At least one assesment I read (sorry, no cite) suggested that the depression didn't really end untill after WWII, since government projects building war material are functionally identical to printing money to pay people to pound sand, then dumping the sand in the ocean.
The economy was put in the tank by Clintons last tax hike, something guaranteed to put the brakes on any booming economy, and I suspect won't come back untill we get some tax relief. An early end to the war will certainly help.
Whatever it takes; I've been out of work way too long.

longeyes
March 21, 2003, 12:03 PM
If it weren't for war and the fear of war, we wouldn't be on the Internet right now. ARPNET, you know.

JohnBT
March 21, 2003, 01:55 PM
Things seem to be pretty normal here. People are going about their business and the City Council is going to vote sometime soon on some anti-war statement that one of the yo-yo's submitted. Richmond City Council...the best comedy show on cable.

Meanwhile, my safe was delivered 2 hours ago - am I glad I paid for inside delivery. They had a power tailgate, an electric forklift and a staircrawler. This was a planned purchase and not war related. OTOH, the store owner told me they sold 300+ safes last year and business is even better so far this year.

We'll see how business is at the gun show next weekend.

John

Chris Rhines
March 21, 2003, 02:13 PM
Bill nailed it.

Unfortunately, in order to fund the invasion of Iraq, the Bush administration is going to have to either jack up income taxes, or start printing out more money (thereby increasing the inflation rate and making our money worth less.) My bet is on the latter.

If the USG ends up occupying Iraq on a long-term basis, well, we could be looking at another long depression.

- Chris

Soap
March 21, 2003, 02:30 PM
If the USG ends up occupying Iraq on a long-term basis, well, we could be looking at another long depression.

I would disagree. I believe that once the Iraq conflict is resolved, and once the shady accounting issue is resolved, we will experience a significantly forward moving economy. Why do you say that a depression could ensue?

Waitone
March 21, 2003, 02:51 PM
A traditional dance takes place toward the end of a president's first term. Head of the FED goes to the President and they talk out how much in inflate the currency supply. Availability of currency goes up, interest rate goes down, voters grin, politicians get happy and re-elected.

IIRC only two presidents have refused the deal. Jimmuh Carter and George Bush XLI.

There'll be inflation but not because of the war. It'll be because George XLIII learns his lessons faster than most and that he wants another 4 years.

Fly320s
March 21, 2003, 02:52 PM
War strangling the economy???

Not my economy.

Mine is the best it has ever been. My company is profitable, I'm making more than I need, I'm getting married soon, looking for a house, looking for more guns.

To steal a line from a cheesy 80's song, "My future's so bright, I gotta where shades."

:D

Chris Rhines
March 21, 2003, 02:54 PM
Three reasons -

1 - If the Iraq invasion is resolved quickly, then the bills for the war will come due, and we'll be looking at either some higher degree of inflation, or a tax hike. Either way, the depression/recession/whatever we're in right now will probably continue on for a few years.

2 - I doubt the Iraq invasion will be resolved quickly. I see the US maintaining forces in Iraq for a long time to come, and that takes money. The US will be paying out of pocket to rebuild the war damage in Iraq, and that takes money too. Then, there's going to be the intermitable low-level conflict between the Turks (I suspect they'll annex a piece of northern Iraq), the Kurds, the Shi'ites, the Sunnis, and all the rest of the interested power blocks. Put it all together, and we're looking (again) at tax hikes or inflation, and a much longer term of it.

3 - The incalculable level of economic damage being caused by the Bush administration's domestic security measures and economic policies. Nationalizing the airline industry was just a start.

- Chris

Chris Rhines
March 21, 2003, 02:57 PM
Waitone - Here's an interesting project for you. What is the current inflation rate in the United States, today? Last year I've found records for was 2000, in which it was 3.4% (which means the actual rate was probably more like 6%.)

- Chris

Soap
March 21, 2003, 03:49 PM
Chris,

I see your points. However government spending is part of the GDP...and GDP is generally the acid test of an economy. When G goes up, the GDP goes up. While it completely sucks for my economy, i.e., my checkbook, it still makes the entire economy go up. We can actually see here in a few years to see if the real GDP will actually rise (since its adjusted for inflation).

We can wager say a steak dinner whenever we go to train at one of the major training centers. You in? :D

As for #3...don't get me started...argh.

Ebbtide
March 21, 2003, 04:28 PM
FYI: Dow has best week since 1982, up 13% in last two weeks, 8% this week alone. Gold dips below $330.00 an ounce, and oil prices falling fast. War must help the economy:confused:

Raymond VanDerLinden
March 21, 2003, 05:10 PM
What did I tell you? Now we just have to see if we can sustain it after this part of the war is over.

Waitone
March 21, 2003, 05:36 PM
A few random thoughts:

--Financial markets ain't the economy.

--Financial markets are the pilot fish of an economy.

--Financial markets sometimes lead the economy, sometimes follow the ecoomy, sometimes clarify the economy, sometimes obscure the economy.

--Financial markets claim rationality, but in reality make use of a healthy dolop of emotion.

--Today's run up in financial markets are driven by emotion. Nothing in the economy has improved between yesterday and today.

--There are structural changes taking place in the economy which are not being measured by conventional economic measures.

--The economy is suffering the consequences of decisions made 10 to 15 years ago. A war today will not repair the damage caused by those decision.

--Congress will try to improve the ecomony by tweeking dials and flipping switches long since disconnected.

--We are beginning to see the outlines of what de-industrialization looks like in a developed economy.

--Islamofascist terrorists' target is the US economy. We are doing our best to make the terrorist's job easier.

--Tax policy is the air hose of the economy. Right now we have a 600 lb gorilla standing on the air hose and we're discussing adding another gorilla. Smart, really smart.

Ebbtide
March 21, 2003, 06:55 PM
I wish I had random thoughts like that.

Nice post.

Soap
March 21, 2003, 08:41 PM
Waitone-

Financial markets claim rationality, but in reality make use of a healthy dolop of emotion.

They don't claim rationality...but anyway, now that you have come to the realization that financial markets are irrational: You can make a piles of cash by using the inefficiencies to your favor.

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