Comments on: Consumers’ New Found Embrace of Savings Will Make for a Nasty Downturn http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings.html Sun, 22 Nov 2009 01:48:48 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: Idaho_Spud http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings.html#comment-22574 Idaho_Spud Wed, 22 Oct 2008 03:17:00 +0000 http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings-will-make-for-a-nasty-downturn/#comment-22574 "Love to see a link to the analyses that show that the last stimulus package was saved and not spent."<br/><br/>Ask and ye shall receive:<br/><br/>http://blogs.wsj.com/economics/2008/08/07/economists-most-stimulus-went-into-savings/ “Love to see a link to the analyses that show that the last stimulus package was saved and not spent.”

Ask and ye shall receive:

http://blogs.wsj.com/economics/2008/08/07/economists-most-stimulus-went-into-savings/

]]> By: locust http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings.html#comment-22566 locust Wed, 22 Oct 2008 01:39:00 +0000 http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings-will-make-for-a-nasty-downturn/#comment-22566 Bit hard to get out there and go shopping for crap you don't need nor really want to impress people you don't know nor care about when you're unemployed. Bit hard to get out there and go shopping for crap you don’t need nor really want to impress people you don’t know nor care about when you’re unemployed.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings.html#comment-22560 Anonymous Tue, 21 Oct 2008 22:20:00 +0000 http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings-will-make-for-a-nasty-downturn/#comment-22560 Is consumption 70% of GDP ie consumption contributes 70% to GDP or is consumer debt 70% of GDP? <br/><br/>I have read both of the above here in the last few days or so?<br/><br/>Can someone please clarify? Is consumption 70% of GDP ie consumption contributes 70% to GDP or is consumer debt 70% of GDP?

I have read both of the above here in the last few days or so?

Can someone please clarify?

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings.html#comment-22559 Anonymous Tue, 21 Oct 2008 22:08:00 +0000 http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings-will-make-for-a-nasty-downturn/#comment-22559 Love to see a link to the analyses that show that the last stimulus package was saved and not spent.<br/><br/>Given the talk of a special session of Congress to pass another stimulus package, it would be a pretty timely discussion topic.<br/><br/>flory Love to see a link to the analyses that show that the last stimulus package was saved and not spent.

Given the talk of a special session of Congress to pass another stimulus package, it would be a pretty timely discussion topic.

flory

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings.html#comment-22554 Anonymous Tue, 21 Oct 2008 19:22:00 +0000 http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings-will-make-for-a-nasty-downturn/#comment-22554 Yves, what does this mean for the many, many countries that now live off of tourism? All the people who run tours, preserve parks, build hotels, manage restaurants, make arts and crafts... increased emigration and brain drain. <br/>- Drew Yves, what does this mean for the many, many countries that now live off of tourism? All the people who run tours, preserve parks, build hotels, manage restaurants, make arts and crafts… increased emigration and brain drain.
- Drew

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings.html#comment-22516 Anonymous Tue, 21 Oct 2008 13:04:00 +0000 http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings-will-make-for-a-nasty-downturn/#comment-22516 Haven't spent money on anything but food, gas and housing expenses this year. I'm fine with this and can go on like this for the next 5 years. YOU go on and waste your money for the economy... Haven’t spent money on anything but food, gas and housing expenses this year. I’m fine with this and can go on like this for the next 5 years. YOU go on and waste your money for the economy…

]]> By: Jojo http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings.html#comment-22503 Jojo Tue, 21 Oct 2008 10:55:00 +0000 http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings-will-make-for-a-nasty-downturn/#comment-22503 And this is why Q4 and [at least] Q1 2009 earnings are going to go into the dumps.<br/><br/>Many people investing in stocks seem to lose the connection that companies exist to sell a product or service. If the consumer stops buying, it creates a cascading effect all the way up the chain to every company that sells not only to the consumer, but all the companies that provide raw materials/services to these companies, all the companies that provide advertising, etc. Further, companies that provide to the providers are hurt, ad infinitum until all are consumed. In other words, to quote an old maxim, nothing happens until the sale is made.<br/><br/>It is this effect that TPTB are so worried about stemming and why they are desperate to somehow get the consumer to spend again.<br/><br/>Eventually, some fool(s) is/are going to propose loosening lending standards [temporarily, of course ;)] again out of frustration and desperation. Mark my words. And this is why Q4 and [at least] Q1 2009 earnings are going to go into the dumps.

Many people investing in stocks seem to lose the connection that companies exist to sell a product or service. If the consumer stops buying, it creates a cascading effect all the way up the chain to every company that sells not only to the consumer, but all the companies that provide raw materials/services to these companies, all the companies that provide advertising, etc. Further, companies that provide to the providers are hurt, ad infinitum until all are consumed. In other words, to quote an old maxim, nothing happens until the sale is made.

It is this effect that TPTB are so worried about stemming and why they are desperate to somehow get the consumer to spend again.

Eventually, some fool(s) is/are going to propose loosening lending standards [temporarily, of course ;) ] again out of frustration and desperation. Mark my words.

]]> By: Brad http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings.html#comment-22489 Brad Tue, 21 Oct 2008 07:14:00 +0000 http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings-will-make-for-a-nasty-downturn/#comment-22489 Jackson Brown did a great a song entitled "The Pretender" and I find it aprapos to the articles general route of the consumer malaise. As Jackson Brown concluded in his lyrics, true love is forsaken for legal tender. Money -- the desire of material possessions -- always triumph's over all else, except true faith. You think consumerism won't return, you think they won't be able to reflate in short order -- you think wrong. Jackson Brown did a great a song entitled “The Pretender” and I find it aprapos to the articles general route of the consumer malaise. As Jackson Brown concluded in his lyrics, true love is forsaken for legal tender. Money — the desire of material possessions — always triumph’s over all else, except true faith. You think consumerism won’t return, you think they won’t be able to reflate in short order — you think wrong.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings.html#comment-22485 Anonymous Tue, 21 Oct 2008 06:47:00 +0000 http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings-will-make-for-a-nasty-downturn/#comment-22485 12:24,<br/><br/>I imagine that you are speaking in jest.<br/><br/>The U.S. is not going to default on its debt. It will just ramp up the $$$ printing presses.<br/><br/>The dollar has a reprieve right now. Nevertheless, you are right, the dollar will eventually plunge. There is no other way out of this crisis.<br/><br/>On a positive note, Hank and Ben finally have seen the light and are putting ideology aside and doing what needs to be done (i.e., pump money into the economy). I think that we dodged the bullet. 12:24,

I imagine that you are speaking in jest.

The U.S. is not going to default on its debt. It will just ramp up the $$$ printing presses.

The dollar has a reprieve right now. Nevertheless, you are right, the dollar will eventually plunge. There is no other way out of this crisis.

On a positive note, Hank and Ben finally have seen the light and are putting ideology aside and doing what needs to be done (i.e., pump money into the economy). I think that we dodged the bullet.

]]> By: rahuldeodhar http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings.html#comment-22483 rahuldeodhar Tue, 21 Oct 2008 06:37:00 +0000 http://www.nakedcapitalism.com/2008/10/consumers-new-found-embrace-of-savings-will-make-for-a-nasty-downturn/#comment-22483 Fantastic post again! It is funny how we forget the basics.<br/><br/>Only when people are comfortable with the future they spend a lot. They even borrow against this "comfortable" future and spend it.<br/><br/>But when the future looks bleak - everyone goes in self-preservation mode. They save! Banks dont lend. They start fattening up (recapitalising)<br/><br/>We often start digging the well when we get thirsty!<br/><br/><br/>So Mr. Ben and Mr. Hank should realise that no stimulus is going to help. It back to good old Keynes proposal - infrastructure, public spending - just dig a hole and fill it up!<br/><br/>P.S - just wanted to know if the word verification is getting beyond human sensory capabilities or am I being targeted for weird comments ;-) Fantastic post again! It is funny how we forget the basics.

Only when people are comfortable with the future they spend a lot. They even borrow against this “comfortable” future and spend it.

But when the future looks bleak – everyone goes in self-preservation mode. They save! Banks dont lend. They start fattening up (recapitalising)

We often start digging the well when we get thirsty!

So Mr. Ben and Mr. Hank should realise that no stimulus is going to help. It back to good old Keynes proposal – infrastructure, public spending – just dig a hole and fill it up!

P.S – just wanted to know if the word verification is getting beyond human sensory capabilities or am I being targeted for weird comments ;-)

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