If This Is Such a Strong Economy, Why Does This Chart Look Recessionary? - News and Current Events | futures io social day trading
futures io futures trading


If This Is Such a Strong Economy, Why Does This Chart Look Recessionary?
Updated: Views / Replies:328 / 1
Created: by kbit Attachments:0

Welcome to futures io.

(If you already have an account, login at the top of the page)

futures io is the largest futures trading community on the planet, with over 90,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.

At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors Ė all of which you can find on futures io, utilizing our social trading environment.

With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you donít need to worry about fake reviews.

We are fundamentally different than most other trading sites:
  • We are here to help. Just let us know what you need.
  • We work extremely hard to keep things positive in our community.
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts.
  • We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

Reply
 
Thread Tools Search this Thread
 

If This Is Such a Strong Economy, Why Does This Chart Look Recessionary?

  #1 (permalink)
Elite Member
Aurora, Il USA
 
Futures Experience: Advanced
Platform: TradeStation
Favorite Futures: futures
 
kbit's Avatar
 
Posts: 5,872 since Nov 2010
Thanks: 3,301 given, 3,332 received

If This Is Such a Strong Economy, Why Does This Chart Look Recessionary?

Is the U.S. really a post-oil economy?

One way to gauge the real economy is to look at charts of the GDP, wages, household debt and the price of oil; another way is to correlate all of these on one chart. The following chart (courtesy of frequent contributor B.C.) plots these four metrics thusly: GDP/(wages/household debt)/price of oil.

What pops out of the chart is what happens when oil spikes higher or declines. In 1973, the first oil shock sent the economy off a cliff. Conversely, when oil fell to $12/barrel in the late 1990s while wages were rising strongly, the plotline peaked, reflecting a strong economy.

In 2008, oil spiked to $140/barrel in 2008, household debt reached record heights and wages began stagnating, and the economy fell into a sharp recession. When oil plummeted back to $40/barrel in early 2009, the plotline spiked up.
When oil prices and household debt are high while wages stagnate or decline, the economy sinks to recessionary levels.

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).

Here are B.C.'s observations:
This chart utterly discredits the economics profession and those who claim that the post-industrial economy ("deindustrialization" and "financialization") is not oil-constrained and the service economy is what the rest of the world should adopt as the normative standard at $100+/barrel oil.
The current plotline is hovering just above the recessionary levels of late 2008. Does this reflect a strong economy, or one that is weak? If oil keeps climbing, what will that do to a visibly weak economy? The Bulls are convinced that the U.S. has decoupled from the rest of the world and from the price of oil. This chart makes the opposite case: the price of oil matters, especially when wages are declining and household debt is elevated.

charles hugh smith-Weblog and Essays

Reply With Quote
The following user says Thank You to kbit for this post:
 
  #2 (permalink)
Elite Member
La Jolla, CA
 
Futures Experience: Master
Platform: Sierra Chart, X_Trader Pro, OptionsCity
Broker/Data: Advantage, Trading Technologies, OptionsCity, IQ Feed
Favorite Futures: CL, NG
 
Private Banker's Avatar
 
Posts: 1,040 since Jul 2010
Thanks: 1,713 given, 3,759 received

This is a good tool of reference. The so called economic recovery is nothing more than a result of central banks around the world constantly figuring out ways to inject liquidity into the system. If the Fed hadn't stepped in back in 2009, where do you think equities would be now? It'd probably be pretty ugly. Speaking of equities, this entire rally wreaks of central bank intervention. Whether it be the ECB's LTRO or the Fed's continued although not talked about much POMO. Equities are now an official central planning tool and appear to be in another bubble. For pure entertainment, I keep an eye on ES every day as it limps higher and higher with it's 5 -7 point daily range and it's endless bid. Sure, you can make a case for fundamental and technical reasons for it but a market with no pullbacks to speak of is getting juiced by something/someone. Sure there's micro retracements but as soon as there's a 10 handle, the BTFD'ippers step in with two hands and their freshly printed Bernank bucks.

The sad thing is what the central banks have now done is created a situation that will constantly require interventions because crises will continue to develop when all of this run up is artificial demand/AAPL. Couple that with the HFT's churning equities all day long higher and we've got a real comedy show. Then there's the current IPO scam's that are coming out. Case in point, Yelp's IPO today. Absolutely hilarious! The trick is, they float a whopping 10% - 12% to create a "high demand" while the current shareholders just have to sit back and watch their shares rip through the roof. "Fakebook" is about to do the same thing.

But hey, I'm doin alright.... Lol! Wasn't that an Andrew Dice Clay saying? Anyway, this will be very interesting to watch pan out as I don't think it will end well.

Cheers,
PB

Reply With Quote
The following user says Thank You to Private Banker for this post:

Reply



futures io > > > > If This Is Such a Strong Economy, Why Does This Chart Look Recessionary?

Thread Tools Search this Thread
Search this Thread:

Advanced Search



Upcoming Webinars and Events (4:30PM ET unless noted)

Jigsaw Trading: TBA

Elite only

FuturesTrader71: TBA

Elite only

NinjaTrader: TBA

Jan 18

RandBots: TBA

Jan 23

GFF Brokers & CME Group: Futures & Bitcoin

Elite only

Adam Grimes: TBA

Elite only

Ran Aroussi: TBA

Elite only
     

Similar Threads
Thread Thread Starter Forum Replies Last Post
Find Strong sectors nj121 The Elite Circle 8 January 5th, 2013 02:35 PM
I hate strong trends kk240 Currency Futures 27 October 22nd, 2011 10:59 PM
Earnings Looking Strong Now, But the Growth May Not Last Quick Summary News and Current Events 0 April 11th, 2011 02:50 PM
How do you define a strong trend arjfca The Elite Circle 15 January 14th, 2011 10:33 AM
Why the Strong Jobs Report May Not Mean All That Much Quick Summary News and Current Events 1 January 5th, 2011 01:19 PM


All times are GMT -4. The time now is 04:38 PM.

Copyright © 2017 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432, info@futures.io
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts
Page generated 2017-12-18 in 0.10 seconds with 19 queries on phoenix via your IP 54.221.136.62