Okay DU financial wizards, it looks like we're in a depression. What does that mean for me?

[Barack_America]

Or for any of us?

Who gets screwed by this and who skates by?

I'm about as economically inept as you can get, other than having the common sense to live below my means and not carry credit card debt. So this crisis is a bit of a mystery to me, I'm ashamed to admit.

[pitohui]

1. don't plan on being able to retire, don't plan on your parents not hitting you up for money

for one example they are talking about cuts to medicare to pay for this bail out package, if your parents are retired and can't get medical treatment where will they turn? can you afford to support two households? can you afford to pay thousands every year to supplement their care and still have anything to save for when you in your turn get sick and/or old?

one of my parents is over EIGHTY, he cannot buy private insurance, if doctors won't accept medicare because the gov't reimburses them too low, what happens next?

that's how it affects you, assuming you have living relatives

anyone who has living older parents is screwed as far as i can see, unless those parents are quite well to do

you can make a choice not to have kids but how do you make a choice not to have parents?

our first priority must be to refuse to be stampeded into accepting cuts to social security and medicare, once we accept those cuts there is no hope for our future at all, it is too late for me to go back in time and decide to be born to kathy hilton

ANYONE can live "within their means" exactly until the day they get sick or injured, at which point you lose all control over your expenses and you will be billed for whatever the docs, hospitals, rehab facilities, and nursing homes think they can get away with

[2speak]

6. True words.....Make them pay those that caused this!

[Anticon]

8. If it crashes money won't be worth crap

so it doesn't matter if you have it stored or not. Better move out of the city and learn to hunt.

[2speak]

18. That isn't true, money was worth something in the last

depression as a matter of fact prices held stable for 10yrs straight. Homes dropped but pretty much everything else stayed the same. No inflation.

[galileoreloaded]

21. Sorry, this is the deflation of cash coming off the table....

the next step is hyperinflation, without the benefit of a 1930 gold standard.
Your money won't be worth crap.

[2speak]

26. That isn't what happend before so unless you have a crystal

ball and can see into the future (by the way can I borrow it?) the only thing we have to go by is the past.

[Barack_America]

10. Mom's already laid off.

Can't find work. We're moving her up to Philly. Hopefully not to live with us, but you never know. Philly's housing market hasn't collapsed yet, thankfully, so our little microeconomy is still okay.

I already know that I'll be providing for her long-term and we've discussed how we'll work with this situation.

Sorry to hear that you're in a somewhat situation (though a bit more dire than mine, I'm especially sorry to hear).

Obama cannot get elected soon enough.

[JustFiveMoreMinutes]

2. Should be interesting now that we're a service economy instead of mfg.

[unblock]

11. not for long...

assuming we have a protracted contraction, the dollar will resume its decline, and people will be out of work. this will make manufacturing and hiring in america more attractive than it has been in a long time.

manufacturing won't completely return to its heyday, but a good chunk of the decimation will be reversed.

parts of the service sector will just vanish. no plants to mothball. just disconnect the phones and poof, gone.

[JustFiveMoreMinutes]

38. I understand mfg coming back but what part of the service sector would disappear?

Well except as the natural progression of technology to do away with many service jobs.

Reading Xrays can now be done anywhere.
Localized Radiologists are -not- (on edit) necessary anymore.

[unblock]

39. well, a lot of jobs in finance have already gone poof

the jobs will remain as a category, but their numbers will be much smaller. the finance sector will be much smaller because there's so much less capital AND less leverage to play with.

[JustFiveMoreMinutes]

41. Thanks, I think I was thinking a little too broadly there.

but on a brighter note, wont we need many MORE financial counselors to deal with all the people having to reshuffle?
NOT funny.. but sigh............

[unblock]

43. yeah, funny, sad ... i guess some of us wall street types could go retail...

[Anticon]

3. Me too

and most of my family. Personally I couldn't give a shit if a bunch of rich people lose all their wealth. Let the Rothschilds live in the street. Just as long as normal people can keep their shit together and not riot or freak out, everyone will be fine.

[pitohui]

12. "everyone" who never plans to get old will be fine

the rest of us not so much as our retirement plans and those of our parents have been gutted

my dad is over EIGHTY, he can't replace the money lost and he doesn't have another 20 years to "ride it out," EVERY investment has gone bad, not just the stock market but "safe" ones like bonds and his CDs are returning so far beneath the rate of inflation that he is losing money for every dollar invested -- and he has to pay taxes on the pitiful returns to boot!

look at it this way, say you have $100K put in a CD with a return of 5 percent -- but inflation is going up in the double digits -- my property tax just went from under $100 to $1500, we all know about gas and milk -- medical/insurance costs have been double or triple inflation for years resulting in costs that no honest working person could ever pay --

there is no way that "everyone" will be fine, there is no way that a person who worked and saved their whole life can be fine

only the thieves will be fine

[stray cat]

17. now thats the right answer!

[Barack_America]

33. Yeah, I haven't started saving for retirement yet.

I probably should have, but it wouldn't have amounted to anything anyway, I guess.

In any case, I think that this has taught me a valuable lesson. When I DO start my career and start saving for my retirement, it's treasury bonds all the way, baby. Fuck the stock market, I'll never touch it.

[greguganus]

44. Well the hell with exercising and eating right. Might as well die young. n/t

[stray cat]

4. Truth is no one knows - if its as bad as forecast unemployment due to business failure or no money

Any retirement plan may be gone. Hope you never have to borrow money for something like a car and you have the money on hand in a bank to pay cash on everything. If as people advice you have 3-6 months income stored away that would help - most of us probably don't.

[Barack_America]

20. 3-6 months?

Yeah, no way.

But we're both, fortunately, paid from government grants. Not sure if those grants will be there next year, but we've got at least 6 mos. left on the current ones. While we've got funding it's going to be all about saving. This is truly unsettling.

Hope you'll fare okay.

[gravity]

5. Do what ever you can to keep your job

That is the one thing you have some control over.

[greguganus]

45. We just hired 4 more people this week, and we have just started expanding our company.

I work for a foreign pharmaceutical manufacturing company. I've been volunteering for everything, cutting wasted costs whenever I can, and working overtime whenever they ask. My wife has Lupus so she can't work. I couldn't afford her meds if I lost my health coverage. Day by day.

[nadinbrzezinski]

7. We are not in a depression YET...

words and definitions matter

I expect at this point a deep recession

but we are not in a depression

Now regardless hang on to your cash... get out of debt, keep your job... standard things

[Subdivisions]

19. Is there a possibility it could get worse and we in fact do

end up in a Depression? What would need to happen and could it evolve from current conditions? Thanks.

[galileoreloaded]

23. Nadin, 40% off S & P, its a depression. I hate to argue but.........n/t

[nadinbrzezinski]

25. The definition is not the Standards and Poor, but a contraction of Gross

National Product... we will easily hit even 8% by definition that is a DEEP recession

Once we reach 10% or more, that is a depression

[Common Sense Party]

32. No, that's not a depression. That's a bear market.

there's a huge difference.

[Barack_America]

27. Yeah, I really don't understand the distinction between "recession" and "depression"

It seemed obvious to me that we've been in a recession for a long time and nobody in "charge" wanted to admit it. So now that they're admitting we're in a recession, I assume that means we're actually in a depression.

I'm not sure what the difference means to me. I really wasn't trying to be alarmist.

So I guess that I just keep my powder dry. My job is definitely okay until next April or so. Then we'll see. Should be okay unless the government cuts its education grants. Guess those plans to buy a house are scrapped (but I've been holding off on that for years. I just don't think the homes around me are truly worth what they're selling for). Mom's already laid off, and moving here up to Philly (FL's economy is dead) is our current objective.

Not happy times.

[Common Sense Party]

34. Here's the wiki definition:

In economics, a depression is a term commonly used for a sustained downturn in one or more national economies. It is more severe than a recession (which is seen as a normal downturn in the business cycle). Considered a rare but extreme form of recession, a depression is characterized by "unusual" increases in unemployment, restriction of credit, shrinking output and investment, price deflation or hyperinflation, numerous bankruptcies, reduced amounts of trade and commerce, as well as highly volatile/erratic relative currency value fluctuations, mostly devaluations.

There is no official definition for a depression, even though some have been proposed. In the United States the National Bureau of Economic Research determines contractions and expansions in the business cycle, but does not declare depressions. A common rule of thumb for depression is a 10 percent decline in gross domestic product (GDP). The corresponding rule of thumb for recession is two quarters of negative GDP growth. Hence using these figures, the threshold for depression is vastly more severe than that for recession. A GDP decline of such magnitude has not happened in the United States since the 1930s.

Generally periods labeled depressions are marked by a substantial and sustained shortfall of the ability to purchase goods relative to the amount that could be produced given current resources and technology (potential output). One could say that while a recession refers to the economy "falling down," a depression is a matter of "not being able to get up."

The most noted depression is the Great Depression that affected much of the world in the 1930s. Also notable is the U.S. Long Depression that lasted from the 1870s until the 1890s.

Today many economists believe that the combination of the social safety net and a much better understanding of macroeconomics makes another Great Depression highly unlikely.

[SoCalDem]

9. Want less, buy less, owe no one.. n/t

[NNN0LHI]

14. And call in any debts owed to you while the getting is good

[Barack_America]

31. Sounds good to me.

I'm a bad "consumer". I really couldn't care less about buying things.

I just want good health for my family and pets.

[Blue Meany]

13. We are all going to have to change the way we live in big ways:

Buy only what we need; grow gardens; can our own food; taken in boarders (or relatives or friends who have lost their jobs); bicycle, walk and use public transport. We will need to work together in families and communities to rebuild our economy and society from the bottom up.

[pitohui]

22. why should i pay for the excesses of the rich?

there is a reason people like to live in their own home instead of boarding w. friends and families and it's because people who live crowded on top of each other w.out privacy are miserable
(it's simple science, rats crowded together kill and eat each other, and we happen to be mammals, we are territorial and need space for our own sanity, ignoring the reality that we are animals may sound pretty but it's hell in practice)

why should my life be destroyed and my independence taken away so that the rich investment class can waltz off with stolen billions?

people who talk of starting a garden and canning their own food need to try it for a change, it is WAY too expensive, have you actually priced canning supplies since oh about 1995? have you actually tried keeping GOOD records and documenting the cost of a small garden vs. what you produce -- people simply can't AFFORD to do this, it's ridiculously pricey -- i've found very few items (mostly herbs) to be cost effective and herbs simply don't provide enough calories for survival

you want to give up and just be happy to settle for less instead of taking back what was stolen from us, well, i don't care to give up my independence so easily

if your dream for your mom's future is that she be happy to be a boarder in your basement, fine, but i want more than that, my mom wants more than that, and the majority of american families want more than that out of life

taking in boarders indeed, just shoot me now please!

i don't mean to sound so bitchy but what happened to wanting a better life? instead people think we should be happy to live in 1810? people weren't happy then and they sure wouldn't be happy now when they realize that better is possible -- if only we wanted it enough

[unblock]

15. keep your head down, keep working, save diligently, and wait for better times.

in a nutshell.

[Barack_America]

28. All right. That's how I was raised.

I come from hard-working blue collar folk. My 89-year old grandfather still works.

So I guess I just keep on keeping on. I've always planned on having to support my parents in their "retirement", so that it is now reality is no sudden shock for me.

[Tatiana]

16. Al Gore was right about the social security lock box.

What if all of our retirement savings were invested in this market like the Republicans want?

We'd be in deep shit.

Dems need to hammer this issue.

[kestrel91316]

24. I guess I will make my retirement plans based on the new reality:

Home:


Transportation:


Medical care:


Food:

[specialed]

29. It means that

women will have to sell themselves on street corners for apples no...just kidding.

No skating on this one. Everybody gets a slice.

I'd call it a recession.

[flamingdem]

30. Bright Side: Obama is gaining with the economic turmoil

Do not forget what a miracle it will be to get him elected.

We must be vigilent. Everyone needs to be aware that there
may be an attempt to stop Obama and we cannot predict it so
remember this when contemplating things that for all of us
it is CRITICAL that he get into the White House.

When he does the markets will again normalize.

[Barack_America]

36. But I fear that we're watching his proposals circling the toilet.

How do we tackle healthcare now? :(

[flamingdem]

37. The hope I have about Health Care is that Obama and Congress can

work against the bloat in the Health Insurance Industry. The plan points to that as a way to cover costs plus business will support it and pay for it -- can't get much worse for them covering employees as things are now..

[RoccoR5955]

35. Find a rich person...

steal all his or her money, and other wealth, then share it with your friends.
Finally, throw a big party, and eat the bodies of the rich!
:sarcasm:

Seriously, something has to be done here. The current administration will do nothing but line their own wallets, and those of their friends. The next administration has to investigate this matter, and fine/imprison the people responsible, and return the wealth of this country back to where it belongs... WE THE PEOPLE!

[dysfunctional press]

40. huh...? you apparently have no idea what a depression REALLY is.

but- this ain't it.

[W_HAMILTON]

42. Is it not going to lead to one?

I'm not as knowledgeable as many around here, but it doesn't exactly seem like good times when the DOW is losing 500+ points almost every day. I know it hasn't REALLY hit Main St. yet, so, are you saying it won't? I mean in terms of massive unemployment, people becoming homeless, ie, really dire happenings. What do you think the worst that will happen? The DOW just keeps falling and people's retirement funds take a beating, and some banks fail, and that's it?

It just seems like way too much "bad stuff" is happening not to cause a domino effect that would push us into a Depression-like situation. But again, I don't know the particulars, so what do you think?

[dysfunctional press]

47. that remains to be seen...

we'll have to see what exactly the future holds.

[BlooInBloo]

46. It doesn't matter. It's sensational-sounding, and that's good enough for DUers.