Remember what it was like before the recession?

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FlyingMoose
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Remember what it was like before the recession?

Post by FlyingMoose » Mon Dec 26, 2016 6:38 pm

I've seen plenty of posts where people mention what it felt like during the 2008/2009 market crash, but I've heard very few people talk about what it felt like before that.

It seemed like no investment was cheap and inflation was running away. Bonds seemed like a bad deal even at those high interest rates. Shadowstats was showing inflation much higher than even the government claimed. Prices kept going up and up in the grocery store, for office supplies, just about everything. It seemed like gold might be the only safe haven. It felt like you were really missing out if you weren't flipping houses.

My point is that it wasn't all just roses and then all of a sudden everything came tumbling down. It definitely felt like something was wrong. And I recall feeling a similar way before the dot-com crash.

While things may be considered expensive now, I don't have the same feeling I did before the big crashes, like the economy was really running hot and it was scary. Does anyone else feel the same way?

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GerryL
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Re: Remember what it was like before the recession?

Post by GerryL » Mon Dec 26, 2016 6:45 pm

The big difference I see right now is that no one is declaring that "this time is different," meaning the economy is playing by new rules and there is no such thing as a bubble. I understand that when anyone says "this time is different" they are trying to fool themselves.

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Re: Remember what it was like before the recession?

Post by BlueEars » Mon Dec 26, 2016 7:01 pm

FlyingMoose wrote:...

While things may be considered expensive now, I don't have the same feeling I did before the big crashes, like the economy was really running hot and it was scary. Does anyone else feel the same way?
Interesting question you asked and I'll be curious to see the responses.

It's hard to look back and remember things the way they were instead of the way we remember they were.

I remember thinking the real estate market was too hot and there had been some ugly scamming going on. But that did not carry over to my thinking about stocks. The valuations were not at a critical level by my standards. The gain in the SP500 was only 5% for 2007 so no overheating there.

But the yield curve had inverted. Nowadays I would see that yield curve inversion as a bright red flag. The Fed steeped the yield curve a lot by January 2008. But apparently the recession had already begun. I think it was late 2008 when the business council declared the recession had started in late 2007 -- way late as an indicator.

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Re: Remember what it was like before the recession?

Post by Dottie57 » Mon Dec 26, 2016 7:40 pm

At the time, I was way more worried about the outsourcing of my work (software development) at mega corp. I remember some PBS News Hour stories about mortgage problems coming, but current circumstances were way too overwhelming.

Adding

My retirement accounts have more than recovered. Outsourcing has stabilized although there is an undercurrent threat that if you don't produce enough you will be out. not as many worries as I had back then. I also know that if I needed to I could walk out the door.
Last edited by Dottie57 on Tue Dec 27, 2016 6:24 pm, edited 1 time in total.

KlangFool
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Re: Remember what it was like before the recession?

Post by KlangFool » Mon Dec 26, 2016 7:51 pm

FlyingMoose wrote:
I've seen plenty of posts where people mention what it felt like during the 2008/2009 market crash, but I've heard very few people talk about what it felt like before that.
FlyingMoose,

The only time that I did not face annual or quarterly lay off at my employer was before 2000. So, there is no recovery for many of us. As far as I am concerned, we are still in a recession.

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Re: Remember what it was like before the recession?

Post by FedGuy » Mon Dec 26, 2016 8:32 pm

KlangFool wrote:As far as I am concerned, we are still in a recession.
Huh? "Recession" is a technical term referring, generally speaking, to two or more consecutive quarters of negative growth. I fully acknowledge that times can be very, very tough for many people outside of recessions, but that's not relevant to whether or not a recession actually exists. To say that you consider this country to still be in recession because employment conditions aren't as rosy as anyone (myself included) would like is like saying "as far as I am concerned, it's still fall" simply because it isn't as cold as we expect winter to be.

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Re: Remember what it was like before the recession?

Post by KlangFool » Mon Dec 26, 2016 8:44 pm

FedGuy wrote:
KlangFool wrote:As far as I am concerned, we are still in a recession.
Huh? "Recession" is a technical term referring, generally speaking, to two or more consecutive quarters of negative growth. I fully acknowledge that times can be very, very tough for many people outside of recessions, but that's not relevant to whether or not a recession actually exists. To say that you consider this country to still be in recession because employment conditions aren't as rosy as anyone (myself included) would like is like saying "as far as I am concerned, it's still fall" simply because it isn't as cold as we expect winter to be.
FedGuy,

1) I am stating my opinion. You do not have to agree with me. Ditto, just because some statistic say that the economy is or is not growing has no relevance to me. I am not a statistic.

2) For some of us, there has been no change since 2000. We have been facing the same situation.

3) If you disagree with me, please tell me what are the difference between now and after 2008/2009?

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Re: Remember what it was like before the recession?

Post by GuitarXM » Mon Dec 26, 2016 8:56 pm

The difference is that your job field may be better, worse, or same since the recession.
On average that has no relevance to the economy as a whole.
On average income of corporations has been growing quarter after quarter.
Unemployment as a whole has gone down.

Your situation might not look as bright as the average situation and my situation is actually worse than the recession.
But our personal situations are very very different from the average job situation and therefore the economy as a whole.

So you or I may think what we want, but the labor department that publishes data on unemployment, gdp, etc shows that the economy is not in a recession.

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Re: Remember what it was like before the recession?

Post by MnD » Mon Dec 26, 2016 8:57 pm

It's beyond the pre-recession situation here in Denver metro to the upside.
Everything is way beyond the peak of the 2006-2007 economy.
Home prices and demand, rents, traffic, employment, trying to get a table at a good restaurant.....
The sale of $22/pound crab legs at Costco was something to see last week - it was like a mob at the seafood counter.
Even 2 years ago you could walk right up.
It's like the Spending Olympics here.
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Re: Remember what it was like before the recession?

Post by arcticpineapplecorp. » Mon Dec 26, 2016 9:06 pm

BlueEars wrote:
FlyingMoose wrote:...

While things may be considered expensive now, I don't have the same feeling I did before the big crashes, like the economy was really running hot and it was scary. Does anyone else feel the same way?
Interesting question you asked and I'll be curious to see the responses.

It's hard to look back and remember things the way they were instead of the way we remember they were.

I remember thinking the real estate market was too hot and there had been some ugly scamming going on. But that did not carry over to my thinking about stocks. The valuations were not at a critical level by my standards. The gain in the SP500 was only 5% for 2007 so no overheating there.

But the yield curve had inverted. Nowadays I would see that yield curve inversion as a bright red flag. The Fed steeped the yield curve a lot by January 2008. But apparently the recession had already begun. I think it was late 2008 when the business council declared the recession had started in late 2007 -- way late as an indicator.
I agree with all that. I also remember something happening that I never saw happen before--bidding wars for houses in which people payed MORE than the asking price. It was usually assumed that the asking price is a high price from which a seller will negotiate downward and the buyer makes an offer at a lower price and the two meet somewhere in the middle. This time, people were not only accepting the asking price of the seller, but then competing with others to pay even more. Perhaps it was a simple supply and demand situation or many first time homeowner's not knowing what they were doing. There was fear over missing out and prices climbing higher so people didn't care what they paid because they assumed the price would keep going higher so even the high price they paid might seem small in comparison. Eventually the music stopped and the dominoes started falling. That's some of my memories. I don't remember high inflation but I do have some vague memory of price increases at the grocery store.

Now as for the S&P500 being up only 5% in 2007...yes. But the OP asks "what was it like before the recession?" Well, how far before the recession are we talking? Yes the S&P50 was up 5% in 2007 but from Jan 1 2006 - Dec 31 2007 it was up 22%:

Image

But from Jan 1 2003 - Dec 31 2007 it was up 82.45%

Image
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cheese_breath
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Re: Remember what it was like before the recession?

Post by cheese_breath » Mon Dec 26, 2016 9:19 pm

When you're referring to inflation running away you're thinking about the late 70s and early 80s. It had been pretty well brought under control by 1983, and was below 5% ever since then. (A few months were exceptions.)
http://www.usinflationcalculator.com/in ... ion-rates/

But there are two things I really remember well...

(1) Foreign competition increased dramatically providing the first real threat to American economic dominance since WW II. The work place changed from comfortable and easy going to one where we worked out butts off in order to keep up with the competition. I'm retired now, but I understand you worker bees are still doing it.

(2) The '90s stock market boom increased my wealth dramatically. The S&P price rose from 340 January 1, 1990 to 1426 January 1, 2000.
http://www.multpl.com/s-p-500-historica ... e/by-month

The 1990s was a great time to be alive, but it might be argued seeds planted in the '90s contributed to the problems of the next century.
Last edited by cheese_breath on Mon Dec 26, 2016 9:33 pm, edited 2 times in total.
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Re: Remember what it was like before the recession?

Post by Spirit Rider » Mon Dec 26, 2016 9:31 pm

FlyingMoose wrote:It seemed like no investment was cheap and inflation was running away.
Huh???? The inflation rate for 2007 was just a little over 4%. I don't know what you think inflation should be, but running away, hardly!

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FlyingMoose
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Re: Remember what it was like before the recession?

Post by FlyingMoose » Mon Dec 26, 2016 9:53 pm

Spirit Rider wrote:
FlyingMoose wrote:It seemed like no investment was cheap and inflation was running away.
Huh???? The inflation rate for 2007 was just a little over 4%. I don't know what you think inflation should be, but running away, hardly!
I remember that a case of paper (which I used a lot of in my business) went from $17 or so to $25 or so...

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FlyingMoose
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Re: Remember what it was like before the recession?

Post by FlyingMoose » Mon Dec 26, 2016 9:58 pm

cheese_breath wrote:Foreign competition increased dramatically providing the first real threat to American economic dominance since WW II. The work place changed from comfortable and easy going to one where we worked out butts off in order to keep up with the competition. I'm retired now, but I understand you worker bees are still doing it.
I remember pundits saying things like "The dollar is going to become worthless..." That is when International stocks were doing well.

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Re: Remember what it was like before the recession?

Post by White Coat Investor » Mon Dec 26, 2016 9:59 pm

FlyingMoose wrote:I've seen plenty of posts where people mention what it felt like during the 2008/2009 market crash, but I've heard very few people talk about what it felt like before that.

It seemed like no investment was cheap and inflation was running away. Bonds seemed like a bad deal even at those high interest rates. Shadowstats was showing inflation much higher than even the government claimed. Prices kept going up and up in the grocery store, for office supplies, just about everything. It seemed like gold might be the only safe haven. It felt like you were really missing out if you weren't flipping houses.

My point is that it wasn't all just roses and then all of a sudden everything came tumbling down. It definitely felt like something was wrong. And I recall feeling a similar way before the dot-com crash.

While things may be considered expensive now, I don't have the same feeling I did before the big crashes, like the economy was really running hot and it was scary. Does anyone else feel the same way?
It was like this where nothing seems particularly attractive.

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BlueEars
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Re: Remember what it was like before the recession?

Post by BlueEars » Mon Dec 26, 2016 10:01 pm

arcticpineapplecorp. wrote:...
Now as for the S&P500 being up only 5% in 2007...yes. But the OP asks "what was it like before the recession?" Well, how far before the recession are we talking? Yes the S&P50 was up 5% in 2007 but from Jan 1 2006 - Dec 31 2007 it was up 22%:

But from Jan 1 2003 - Dec 31 2007 it was up 82.45%
I don't think of a 2 year 22% increase as being much above average returns for the SP500.

That 82% gain from 2003 to 2007 works out to a 12.7% gain per year which was a few percent above average but that was coming out of the previous recession. So I'd say overall these returns were not extraordinary.

Now we are talking about what it felt like and I felt the returns were good but not too unusual. I wasn't feeling like the housing excesses would flow into the general economy picture. It may be that because I've seen such real estate speculation in Silicon Valley I was not as prepared as others to see the general picture as alarming in 2007, just before the decline period.

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Re: Remember what it was like before the recession?

Post by danaht » Mon Dec 26, 2016 10:19 pm

KlangFool wrote:
FedGuy wrote:
KlangFool wrote:As far as I am concerned, we are still in a recession.
Huh? "Recession" is a technical term referring, generally speaking, to two or more consecutive quarters of negative growth. I fully acknowledge that times can be very, very tough for many people outside of recessions, but that's not relevant to whether or not a recession actually exists. To say that you consider this country to still be in recession because employment conditions aren't as rosy as anyone (myself included) would like is like saying "as far as I am concerned, it's still fall" simply because it isn't as cold as we expect winter to be.
FedGuy,

1) I am stating my opinion. You do not have to agree with me. Ditto, just because some statistic say that the economy is or is not growing has no relevance to me. I am not a statistic.

2) For some of us, there has been no change since 2000. We have been facing the same situation.

3) If you disagree with me, please tell me what are the difference between now and after 2008/2009?

KlangFool
+1, If you are in the IT industry - you have been constantly faced with the risk/pressure of being downsized / outsourced since 2000. This is especially true for developers. I definitely feel that most development careers in the US are all on borrowed time - and have been since 2000. Save and prepare for forced early retirement - or adapt and become an onshore team leader for an offshore team.
Last edited by danaht on Mon Dec 26, 2016 10:24 pm, edited 2 times in total.

MathWizard
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Re: Remember what it was like before the recession?

Post by MathWizard » Mon Dec 26, 2016 10:22 pm

Before the crash, my wife and I knew housing was overpriced.

Given that we had a house, and did not plan to sell it anytime soon, we did not see how this affected us.
Boy were we mistaken,

Mortgage backed securities, with tranches, with high leverage, with credit default swaps were things we had never heard of,
but which had a huge effect in the economy. I slowly learned it, but The Big Short does a good job of explaining what was going on
(in my humble opinion.)

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Re: Remember what it was like before the recession?

Post by Peter Foley » Mon Dec 26, 2016 10:24 pm

I remember thinking there was a real estate bubble and warning family and friends to get out of their real estate investing/rentals while they could. I did not see the resulting banking crisis so I was not as defensive as I might have been.
I also clearly remember thinking valuations were too high in tech in the year 2000. That one I did manage to avoid for the most part. 2000 was pre Boglehead for me so avoiding meant not being over weighted in tech.

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Re: Remember what it was like before the recession?

Post by whodidntante » Mon Dec 26, 2016 11:03 pm

We thought we were going to be rich by selling our houses to each other.

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Re: Remember what it was like before the recession?

Post by auntie » Mon Dec 26, 2016 11:18 pm

When I became aware that they were lending money for overpriced houses to anyone with a pulse I considered selling my paid for house while it was still worth a lot. But I would then have to find a place to live so I decided to just wait it out. I knew it couldn't last.
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JoMoney
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Re: Remember what it was like before the recession?

Post by JoMoney » Mon Dec 26, 2016 11:45 pm

The inverted yield curve is what I remember, especially this (somewhat associated) reaction from Cramer: https://www.youtube.com/watch?v=SWksEJQEYVU
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Re: Remember what it was like before the recession?

Post by BolderBoy » Tue Dec 27, 2016 12:07 am

MnD wrote:It's beyond the pre-recession situation here in Denver metro to the upside.
Everything is way beyond the peak of the 2006-2007 economy.
Home prices and demand, rents, traffic, employment, trying to get a table at a good restaurant.....
The sale of $22/pound crab legs at Costco was something to see last week - it was like a mob at the seafood counter.
Even 2 years ago you could walk right up.
It's like the Spending Olympics here.
Close to 1 million-ish more people have moved to Colorado since 2006-2007, too.
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Smorgasbord
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Re: Remember what it was like before the recession?

Post by Smorgasbord » Tue Dec 27, 2016 12:21 am

Well, in 1998 and 1999, everyone at my family's Christmas gathering was talking about their stock portfolios, and in 2006/2007 people were talking about how much their houses had gone up in value. Since this year's main topics of conversation at Christmas were political in nature, I'm guessing another recession is not right around the corner.
Last edited by Smorgasbord on Tue Dec 27, 2016 12:26 am, edited 2 times in total.

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Re: Remember what it was like before the recession?

Post by Fallible » Tue Dec 27, 2016 12:22 am

I remember talking with the neighbors about our soaring house prices and thinking it was too good to be true. By '85, when Greenspan talked about "froth" in housing and there were increasing news reports of bad loans, we knew it was just a matter of time before it would all end. Of course we didn't know how truly awful it was or how tragically it would end.
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Re: Remember what it was like before the recession?

Post by 22twain » Tue Dec 27, 2016 12:50 am

FlyingMoose wrote:I've seen plenty of posts where people mention what it felt like during the 2008/2009 market crash, but I've heard very few people talk about what it felt like before that.

It seemed like no investment was cheap and inflation was running away.
During the early 2000s, inflation was higher than it is now, but I would not have called it "running away." But then, I remember the late 1970s and early 1980s, so my perspective may be different from yours. In 1982 (IIRC) the interest rate on my money market account was briefly about 18%.

The annual averages on the following page are supposedly based on the CPI-U, although I haven't checked them against the BLS web site:

http://inflationdata.com/Inflation/Infl ... ation.aspx
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Re: Remember what it was like before the recession?

Post by badbreath » Tue Dec 27, 2016 12:57 am

I do remember looking at my 401k and it was down a lot but I was to busy with work to think about it and keep on investing in it
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Re: Remember what it was like before the recession?

Post by HomerJ » Tue Dec 27, 2016 12:58 am

KlangFool wrote:
FedGuy wrote:
KlangFool wrote:As far as I am concerned, we are still in a recession.
Huh? "Recession" is a technical term referring, generally speaking, to two or more consecutive quarters of negative growth. I fully acknowledge that times can be very, very tough for many people outside of recessions, but that's not relevant to whether or not a recession actually exists. To say that you consider this country to still be in recession because employment conditions aren't as rosy as anyone (myself included) would like is like saying "as far as I am concerned, it's still fall" simply because it isn't as cold as we expect winter to be.
FedGuy,

1) I am stating my opinion. You do not have to agree with me. Ditto, just because some statistic say that the economy is or is not growing has no relevance to me. I am not a statistic.

2) For some of us, there has been no change since 2000. We have been facing the same situation.

3) If you disagree with me, please tell me what are the difference between now and after 2008/2009?

KlangFool
(2) is incorrect. It's not an opinion to say you have been facing the same situation since 2000. Every year has not had the same employment prospects as every other year. Some have been better, some have been worse.

You might want to look at different employers, instead of waiting to get laid off.

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Re: Remember what it was like before the recession?

Post by HomerJ » Tue Dec 27, 2016 1:00 am

I remember thinking that the housing market was insane, but I had no idea how to monetize that knowledge, and no idea that a housing crash would equal a stock market crash.

I remember going to a conference in Vegas in 2006 or 2007, and my cab driver told me his condo was worth 10x what he paid for it (like over a million). I told him he better sell, but he said "But anything I would buy would be high-priced too".

He should have sold, and rented, but I'm sure instead he rode that crash all the way down. Poor guy. :(

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Re: Remember what it was like before the recession?

Post by HomerJ » Tue Dec 27, 2016 1:02 am

MnD wrote:trying to get a table at a good restaurant
Every restaurant I've visited this year in Kansas City is packed, even on Tuesday nights.

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Re: Remember what it was like before the recession?

Post by ray.james » Tue Dec 27, 2016 3:20 am

I was in school. Few friends schemed 0% credit card to escape paying interest on education loan. Bleh, it was a rush when most credit lines got closed when the recession started.

1) I do think the market will be facing heat as it will get much harder to pass everything that it is expecting in legislation. It ran ahead
2) Malls are packed and people are spending. Not much on clothing but food, entertainment, fashion, consumer goods etc.,
3) Restaurant inflation is picking up thanks to wage/Minimum wage increases. As other noted, restaurants are packed despite the cost!
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Re: Remember what it was like before the recession?

Post by MossySF » Tue Dec 27, 2016 8:02 am

I remember in 2004, my wife & I walked into Washington Mutual to open a CD. The conversation soon took this turn:

Banker: "Are you planning to buy a house?"
Me: "Of course but it'll probably take us another 2 years to save up the downpayment."
Banker: "You know, many of our customers just have their parents take out a HELOC for the downpayment ... and looking up the info, they have plenty of equity." (My parents and I had some linked accounts so we can jointly make deposits/write checks in case of emergencies.)

In hindsight looking back at this conversation, no wonder WAMU went under if they had their "bankers" aggressively peddling every option possible in order to write more mortgages. And if this had been 2007, I'm sure the WAMU banker would instead of said "Downpayment? Nobody does that anymore -- here's our 0% down IO NINJA ARM."

No, the environment is not the same but that doesn't mean anything if we are talking stock bear markets. Bears happen all the time .. they don't need a horrid recession to trigger it.

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Re: Remember what it was like before the recession?

Post by gd » Tue Dec 27, 2016 8:09 am

I perceived a specific bubble in high-tech and housing. Other things were being affected, but the pattern of irrational expansion in those areas, with irrational boosters, anxious followers and a few nay-sayers was clear. The two situations were quite different in their basis and components, but the flawed human elements behind them were similar. Railroads, tulips, whatever. I see nothing like that now. That means nothing useful, just that whatever happens in the next x years isn't going to be caused by the sort of widespread financial bubble effect of 2000 & 2006 periods. I am pessimistic about the near- and mid-future in general (although not so much for me personally), but for different reasons than those two events. It is easy to incorrectly associate those emotions with recent history.

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Re: Remember what it was like before the recession?

Post by BogleMelon » Tue Dec 27, 2016 8:16 am

IMHO, the thing that could trigger another recession these days is the credit cards. Everyone can easily get one with tens of thousands of dollars as an available limit, even if he is unemployed! All he has to do is to fill out an online application and lie and says he is making $100,000 a year! No verification is being done from the bank and he is granted the card and the loan immediately.
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Re: Remember what it was like before the recession?

Post by KlangFool » Tue Dec 27, 2016 9:04 am

HomerJ wrote:
KlangFool wrote:
FedGuy wrote:
KlangFool wrote:As far as I am concerned, we are still in a recession.
Huh? "Recession" is a technical term referring, generally speaking, to two or more consecutive quarters of negative growth. I fully acknowledge that times can be very, very tough for many people outside of recessions, but that's not relevant to whether or not a recession actually exists. To say that you consider this country to still be in recession because employment conditions aren't as rosy as anyone (myself included) would like is like saying "as far as I am concerned, it's still fall" simply because it isn't as cold as we expect winter to be.
FedGuy,

1) I am stating my opinion. You do not have to agree with me. Ditto, just because some statistic say that the economy is or is not growing has no relevance to me. I am not a statistic.

2) For some of us, there has been no change since 2000. We have been facing the same situation.

3) If you disagree with me, please tell me what are the difference between now and after 2008/2009?

KlangFool
(2) is incorrect. It's not an opinion to say you have been facing the same situation since 2000. Every year has not had the same employment prospects as every other year. Some have been better, some have been worse.

You might want to look at different employers, instead of waiting to get laid off.
HomerJ,

1) You are not me. How could you say that I did not face the same situation over the last 10+ years? You won't know that anyhow. And, if I faced quarterly and annual layoff with my employer over the last 10+ years, how could you say that my employment prospects is different?

<<You might want to look at different employers>>

2) I did. I worked with 4 separate companies over this time period. The only difference is between quarterly laf and annual lay off.

KlangFool

SQRT
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Re: Remember what it was like before the recession?

Post by SQRT » Tue Dec 27, 2016 9:22 am

Yes, I remember it well. Had just retired in late 2006. Still had lots of outstanding incentive comp awards to cash out. Seemed like the money just kept getting bigger. 2008 sure put an abrupt end to that feeling. Things worked out just fine but never did get the feeling of "money was endless" back. Probably just as well but sure felt good.

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Re: Remember what it was like before the recession?

Post by Rodc » Tue Dec 27, 2016 9:38 am

To be honest I do not remember feeling anything in particular. I was happy we had climbed out of the previous recession.

I was in mid-career, raising young children which took most of my energy. Work was fine. I remember housing was pretty hot, but I was not looking to sell or buy so that was not a big deal for me personally. I was just cruising along, making a paycheck and investing on auto-pilot, re-balancing with new money for the most part (until the crash later), raising a family.

I have more vivid memories of the crash that followed.
We live a world with knowledge of the future markets has less than one significant figure. And people will still and always demand answers to three significant digits.

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Re: Remember what it was like before the recession?

Post by Stormbringer » Tue Dec 27, 2016 10:23 am

FlyingMoose wrote:While things may be considered expensive now, I don't have the same feeling I did before the big crashes, like the economy was really running hot and it was scary. Does anyone else feel the same way?
Not like during the dotcom and real estate bubbles. However, I have a sinking feeling about what has happened to the balance sheets of central banks around the world. I find it difficult to believe that governments can just print trillions of dollars to make massive asset purchases without producing some horrible side effect at some point.
"Compound interest is the most powerful force in the universe." - Albert Einstein

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HomerJ
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Re: Remember what it was like before the recession?

Post by HomerJ » Tue Dec 27, 2016 10:39 am

KlangFool wrote: HomerJ,

1) You are not me. How could you say that I did not face the same situation over the last 10+ years? You won't know that anyhow. And, if I faced quarterly and annual layoff with my employer over the last 10+ years, how could you say that my employment prospects is different?

<<You might want to look at different employers>>

2) I did. I worked with 4 separate companies over this time period. The only difference is between quarterly laf and annual lay off.

KlangFool
What you are saying then is that YOU, personally, have been living in a recession and the same situation for the past 16 years.

Because the rest of us have not.

I'm not sure a "personal recession" can be a thing. I suppose it might give you comfort to think that everyone else is facing layoffs every quarter or every year, but I'm afraid you'd be wrong.

There are many many companies that have not been struggling to survive every year or looking to outsource every year for the past 16 years. And even if one did get laid off, finding another job was easy in some years and hard in others.

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Flymore
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Re: Remember what it was like before the recession?

Post by Flymore » Tue Dec 27, 2016 11:12 am

I remember a big sales push for home equity lines of credits back then.
Lots of adds for them, bankers coming to the lunch room and doing sales pitches for them. Bla bla bla I never got one.

My one colleague just bought a condo. He mentioned he added an equity lines of credit to his mortgage. Something I would never do.

Just came back from a visit with my cousin, we discussed the huge build up in Florida condos. (similar to what it was before the recession).
This time my cousin explained that it's different because a realtor told him people are buying these million dollar condos with cash.

Hmmmm I've never known a realtor to exaggerate, have any of you? :)

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Re: Remember what it was like before the recession?

Post by Grogs » Tue Dec 27, 2016 11:16 am

I didn't have much in investments at the time, and I wasn't contributing because I was in grad school, so I really wasn't paying much attention to the markets. The one thing that has stuck with me was when I went to sell my rental house. I listed it for $90k, which based on similar sales nearby and a recent appraisal. Before the closing, our agent said he had an offer, but apparently the buyer wanted to get a loan where he could pay 0% down as long as the appraisal was high enough that the difference covered the standard 20% down. Lo and behold, the buyer had an appraisal done and it came out just high enough to cover the 20% spread. I remember meeting the guy at the closing, and I was thinking that he didn't look like he could afford a $50k mortgage, but he had just bought a $90k house with a $112.5 mortgage. He was underwater even before the housing crisis started. I drove by the house nearly every day on my way to work, and I was not particularly surprised when, six months later, a new For Sale sign appeared in the front yard. I believe it changed hands 2-3 more times between 2007 and 2010 before a stable owner bought it, presumably at a much lower price.

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Re: Remember what it was like before the recession?

Post by KlangFool » Tue Dec 27, 2016 11:35 am

HomerJ wrote:
KlangFool wrote: HomerJ,

1) You are not me. How could you say that I did not face the same situation over the last 10+ years? You won't know that anyhow. And, if I faced quarterly and annual layoff with my employer over the last 10+ years, how could you say that my employment prospects is different?

<<You might want to look at different employers>>

2) I did. I worked with 4 separate companies over this time period. The only difference is between quarterly laf and annual lay off.

KlangFool
What you are saying then is that YOU, personally, have been living in a recession and the same situation for the past 16 years.
HomerJ,

I had clearly stated that.

<<As far as I am concerned, we are still in a recession.>>

<< 1) I am stating my opinion. You do not have to agree with me. Ditto, just because some statistic say that the economy is or is not growing has no relevance to me. I am not a statistic.

2) For some of us, there has been no change since 2000. We have been facing the same situation.>>

KlangFool

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Re: Remember what it was like before the recession?

Post by Wakefield1 » Tue Dec 27, 2016 11:45 am

I did not like the run up to the 2008 corrections and I hope the easy money/count assets multiple times by creating "derivatives" and "synthetic collateral COD" whatisiits people never get control of the housing markets again-but I think they are coming into favor again -make money on the way up and again on the way down from the bailouts! At whose expense?
Tim Pat Coogan's blog (concerned the Irish experience of that time)and his anger at the culprits

I think good old 20% downpayment on a house is good policy-except for such special cases as war veteran's compensation

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Re: Remember what it was like before the recession?

Post by mac808 » Tue Dec 27, 2016 12:24 pm

I was working in real estate at the time. From early 2006 on I remember that prices felt way, way too high. But somehow even very smart people were drinking the koolaid and feeling the pressure to buy quickly or be forever priced out, even at the very end. It's not enough to identify the bubble (which could persist/grow for years), you also have to identify the catalyst that will cause it to pop. And I guess these days you have to try to guess what gov/central bank intervention will be also (good luck with that one).

2015
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Re: Remember what it was like before the recession?

Post by 2015 » Tue Dec 27, 2016 12:43 pm

danaht wrote:
KlangFool wrote:
FedGuy wrote:
KlangFool wrote:As far as I am concerned, we are still in a recession.
Huh? "Recession" is a technical term referring, generally speaking, to two or more consecutive quarters of negative growth. I fully acknowledge that times can be very, very tough for many people outside of recessions, but that's not relevant to whether or not a recession actually exists. To say that you consider this country to still be in recession because employment conditions aren't as rosy as anyone (myself included) would like is like saying "as far as I am concerned, it's still fall" simply because it isn't as cold as we expect winter to be.
FedGuy,

1) I am stating my opinion. You do not have to agree with me. Ditto, just because some statistic say that the economy is or is not growing has no relevance to me. I am not a statistic.

2) For some of us, there has been no change since 2000. We have been facing the same situation.

3) If you disagree with me, please tell me what are the difference between now and after 2008/2009?

KlangFool
+1, If you are in the IT industry - you have been constantly faced with the risk/pressure of being downsized / outsourced since 2000. This is especially true for developers. I definitely feel that most development careers in the US are all on borrowed time - and have been since 2000. Save and prepare for forced early retirement - or adapt and become an onshore team leader for an offshore team.
Depends. I have a sibling with no more than a high school diploma. He's well over 60. He has never had a job in management and doesn't want one. The money he makes is obscene. He has worked for or been courted by just about every big name IT company you can think of. Years ago, he was relocated across country by Google , who he no longer views as cutting edge (he's now working for what he views as the most cutting edge IT company--you'd recognize their name as it's mentioned constantly--no, it's not social media and it's not that dinosaur Microsoft nor ((currently)) has-been Apple). He chooses his jobs by what he can learn and how smart the people are who he will be working with. He's walked off of jobs where he thought people didn't know what they were doing. Dell corporation made him mad during negotiations so he turned them down. And he can't put his resume online because he's inundated by recruiters whenever he does. He told me he never interviews, he goes in an "has a conversation". What his secret? He reads. Voraciously. Constantly. Therefore, he has options. They need him and what he can do for them more than he needs them.

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HomerJ
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Re: Remember what it was like before the recession?

Post by HomerJ » Tue Dec 27, 2016 12:51 pm

KlangFool wrote:
HomerJ wrote:
KlangFool wrote: HomerJ,

1) You are not me. How could you say that I did not face the same situation over the last 10+ years? You won't know that anyhow. And, if I faced quarterly and annual layoff with my employer over the last 10+ years, how could you say that my employment prospects is different?

<<You might want to look at different employers>>

2) I did. I worked with 4 separate companies over this time period. The only difference is between quarterly laf and annual lay off.

KlangFool
What you are saying then is that YOU, personally, have been living in a recession and the same situation for the past 16 years.
HomerJ,

I had clearly stated that.

<<As far as I am concerned, we are still in a recession.>>

<< 1) I am stating my opinion. You do not have to agree with me. Ditto, just because some statistic say that the economy is or is not growing has no relevance to me. I am not a statistic.

2) For some of us, there has been no change since 2000. We have been facing the same situation.>>

KlangFool
My apologies, KlangFool... I know that you hold very strong opinions, but the definition of a recession is bigger than you.

And you are not being honest if you think the chance of getting laid off and/or finding a job has been exactly the same each and every year since 2000.

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Re: Remember what it was like before the recession?

Post by KlangFool » Tue Dec 27, 2016 1:07 pm

HomerJ wrote:
My apologies, KlangFool... I know that you hold very strong opinions, but the definition of a recession is bigger than you.

And you are not being honest if you think the chance of getting laid off and/or finding a job has been exactly the same each and every year since 2000.
HomerJ,

1) I am not a statistic. I do not think. I experienced this. A person is either employed or unemployed. A person either find a job or not. X% unemployment has no meaning at an individual level.

2) I had been unemployed for more than a year a few times after 2000. Every employer that I worked with had quarterly and annual lay off. So, I have no idea about what do you mean about whether I am being honest? This was my experience.

3) My point is very simple. For some of us, nothing had changed since 2000. We had been in the same situation since 2000. Now, this may or may not apply to the rest of you. But, please do not discount our experience.

KlangFool

P.S.: This thread focused on what was it felt like before 2008/2009 aka recession. I am just stating my feeling that nothing had changed since 2000.

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HomerJ
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Re: Remember what it was like before the recession?

Post by HomerJ » Tue Dec 27, 2016 1:21 pm

KlangFool wrote:1) I am not a statistic. I do not think. I experienced this. A person is either employed or unemployed. A person either find a job or not. X% unemployment has no meaning at an individual level.
So your chances of being laid off were the same every single year since 2000? And your chances of finding a job after being laid off were exactly the same every single year since 2000?

Nothing in the outside world was affecting your personal experience? All companies were hiring and firing at the exact same steady pace for the past 16 years?

Because that's what you are saying.

I felt like you were derailing this thread by discounting the OP's question entirely ("Oh there was no recession in 2008, we've been in a continuous recession for 16 years.")

But of course, I've derailed the thread even further by arguing with you about it. My apologies to the OP.
Last edited by HomerJ on Tue Dec 27, 2016 1:22 pm, edited 1 time in total.

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Re: Remember what it was like before the recession?

Post by rustymutt » Tue Dec 27, 2016 1:21 pm

At age 60, I got to ask which recession? In jest, but we have had many recessions in my lifetime, and they didn't stop me from getting in on the action, so to speak.

:sharebeer
Last edited by rustymutt on Tue Dec 27, 2016 2:07 pm, edited 3 times in total.
I'm amazed at the wealth of Knowledge others gather, and share over a lifetime of learning. The mind is truly unique. It's nice when we use it!

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Re: Remember what it was like before the recession?

Post by Crow Hunter » Tue Dec 27, 2016 1:29 pm

I had left my very high stress on the edge of shutting down/being sold automotive industry job and went to work in the extremely lucrative and booming very high end construction industry. I was also at a 100% stocks allocation and 50% International.

:oops:

I sold my first house and made a nice (for me) profit on it at the beginning of 2007 and at the end of the year celebration at my new company everyone was really happy at the huge profit sharing check that they had received based on length of service. I didn't really receive much since I had only been working there for 8 months but I was impressed by the numbers that everyone was throwing around.

Then 2008 happened but there was hope that everything would turn around quickly.

Then 2009 happened and it became evident that this wasn't going to turn around quickly.

There were some very, very lean years mixed in there and I missed a monster rebalancing opportunity by being 100% in stocks.

This year, by the way, surpassed our 2007 profits and we are having trouble keeping up with order intakes if that is any type of indication as to where the housing sector of the economy is now.

I am also buying bonds like crazy making sure I keep up with my Age-10 asset allocation. :wink:

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