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If we're in/going into a recession, how bad will it get?

Discussion in 'Sports and News' started by GBNF, Mar 14, 2008.

  1. GBNF

    GBNF Active Member

    Since many of the posters on the board are around my age (22-28), we have no idea what a recession really is s like.

    Can those from the mid-70s clue us in (I believe that was the last recession in the U.S.?)

    Thanks...I need to know how to prepare (my guess is losing $100 in poker isn't the answer)
     
  2. Lugnuts

    Lugnuts Well-Known Member

    There was a recession from July 1990 through March 1991.
     
  3. GBNF

    GBNF Active Member

    OK...I was six — and I couldn't afford that second Whitstlepop.
     
  4. In Exile

    In Exile Member

    The week I graduated from college with my English/creative writing degree, the unemployment rate in my state was just over 11%. In the next year I worked construction, sold tickets, did day labor and worked as a security guard. Of all the people I knew well from college, apart from the handful who continued on to graduate school, I can think of ONE who, in the next two or three years, had a job REMOTELY connected to their degree, and that was only because she could type. We were all scuffling along at minimum wage/multiple jobs for the better part of five years, and that was after I moved 700 miles to a state where things were nominally better.

    I lost my car because I couldn't afford to pay for the parking tickets, I had to sell my trombone to finance my move, and I remember walking places to save the then 50 cent bus or train fare, stealing pitchers at bars to turn in for the $1 deposit, checking change slots at every vending machine I ever saw. I had friends who did paid medical studies, delivered newspapers, worked as janitors and I wrote papers for rich college kids. You just had to do what you could.

    Looking back, had a hell of a time with nothing. And we all did okay, eventually. One author, one journalist, several teachers, one filmmaker, one software salesman, one attorney, one librarian, one doctor etc. It just didn't happen by age twenty-five. By thirty, getting there

    My advice? Get ready. Go to grad school and ride it out there if you can. Have something else you can do, like bartend, for the rough spots. Try to get a job at an educational institution or library - low pay but benefits.

    At least we were prepared for poverty, because things hadn't been great even before they sucked, but for you all in your early twenties, in many parts of the country, you've never experienced a time when it sometimes took months just to get a part-time minimum wage job, no matter how smart/talented/educated you were. And the last 20-30 years have been a total orgy of excess, comparatively.

    It's coming. And many of you have no f-ing idea, none, zero, zed. But when its done you'll be able to work the generation behind you under the table.
     
  5. PeteyPirate

    PeteyPirate Guest

    I'm going to have to cut back to $1,000/hour escorts.
     
  6. Rumpleforeskin

    Rumpleforeskin Active Member

    Paging spnited. He could probably tell us about The Great Depression and The New Deal.
     
  7. Flying Headbutt

    Flying Headbutt Moderator Staff Member

    AAA is warning about sub prime car loans now. If that happens, this country is so fucked.
     
  8. GBNF

    GBNF Active Member

    Can you explain this?
     
  9. Rumpleforeskin

    Rumpleforeskin Active Member

    I am going to take a stab at it, but since car loans will be sub prime, it will cause a chain effect of people buying less cars. Once people buy less cars, it will cause recession in the auto industry, causing them to lay off American employees, thus raising the unemployment rate. I could be wrong.
     
  10. steveu

    steveu Well-Known Member

    $1,000 a night call girls? Former Gov. Spitzer, I had no idea you posted here!

    OK, seriously now... the past few recessions we've had have been nothing compared to the pain of recessions in the 1970s and into the 1980s. The last really big recession (1981-82) was essentially forced on us by Paul Volcker at the Fed, as he was trying to tame inflation by dramatically raising interest rates. We had back then, what, 20 percent lending rates and 10-11 percent inflation? Throw in double-digit unemployment, the manufacturing sector crumbling throughout the Midwest, and it was one hell of a mess.

    While the past two recessions (1990-91 and 2001) have been painful for some, they certainly haven't been anywhere near what the early 1980s were like. Are we in one now? No. I think we will be in the first half when the first two quarters of GDP are announced.

    I predict we may have a third quarter of negative growth, but the stimulus plan, the interest rate cuts (more important) and the general wringing out of the subprime mortgage mess will make conditions better before year's end.
     
  11. SigR

    SigR Member

    The "credit crisis" just doesn't stop where it originated. The ripple effect is that if someone loses his or her house, there's a reasonable chance he isn't paying other bills like car loans either.

    Recessions or dips are part of the natural business cycle. Unfortunately, we don't have a natural business cycle on Earth. Though I hear Uranus does. Moving on, there is a lot of political tinkering, a lot of macro-economic engineering (hello hundreds of billions of dollars created out of thin air which continues to devalue the U.S. dollar), and a lot of decisions being made without thinking about long term consequences.

    I don't think it is time to freak out yet, but, in our lifetime I think it's possible that we start perceiving the United States akin to Rome or other great dynasties that have fallen. Look outside at our society. Look on tv at the commercials. Look at our leaders, look at the sheep. Look at how much we "need" today. Compare it with what we "needed" twenty years ago, forty years ago, etc. I don't guarantee that by any stretch--we are still a free nation, relatively, with many bright individuals and a basis of wealth and productivity to carry us. But I often look at America as a pyramid scheme of sorts, leveraging the future against the present with no hope of paying off in the end. I woke up cynical today, but the makings for the collapse are there from my perspective.
     
  12. funky_mountain

    funky_mountain Active Member

    what will happen with subprime auto loans, people with poor credit will buy more cars at first, in fact they will buy more car than they can afford at a higher interest rate. eventually, many will default on the loan because they can't afford the payment. that will leave lenders, who knew they're taking a risk in the first place, holding the tab.

    similar thing happened with subprime housing loans. people eventually could not afford the mortage over the long haul and the home went into foreclosure. people lost their homes, went into bankruptcy and lenders did not get paid.

    another thing, if you're deep concerned: don't use credit if you can get avoid. save when you can. and by the time a recession is officially announced, we're usually out of it. there's plenty of predicting right now, but if you're conservative with your money, you should be fine.
     
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