commissioner.org
| Source | Don Parker |
| Date | 02/11/08/03:56 |
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Interesting, pessimistic, sobering. I feel more like playing defensively. I do think the economy and the market are much affected by collective feelings of pessimism and optimism, some of which is self fulfilling. The self fulfilling part is probably one reason why markets and economies often over correct. Anyway I think the best indicator may be how people are feeling and to the extent that can be predicted it is a good indicator. Part of getting a feel for what will happen is looking at how you feel yourself. Then how are others feeling. And then the question is how will people be feeling in say a year. War in Iraq and middle east could intensify. Although the Iraq part could be fairly quick and give us a temporary feeling of power. Another bad terrorist attack in the U.S. would make us less optomistic and somewhat more fearful but it would also be accompanied with a lot of determination that would have people grimly refuse to let terrorisists win. Some more unemployment could come but people still want a lot of goods and services and will keep buying, even if at a somewhat lower level. People do not like the stock or corp bond markets much, because they have been burned and they don't trust business leaders. That is likely to continue for a while. I think people want security and still want to invest in things they control like their own businesses and real estate. Owning something makes me feel more secure so that is probably true for others too. In the face of fear and skepticism and consequent lack of investment in public companies, and with R takeover we'll probably get a capital gains reduction which might actually cause both buying and selling of real estate. Selling to take advantage of the new law. That could cause some short term reduction in prices of rental property, but others who want to own something and who want a better or safer return than with stocks or bonds or money market funds, will step in if they are not feeling too pessimistic. On the other hand... |
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