Comparing the past to the future

2009 should be an interesting year. It seems as though most on Wall St. feel as if stocks are “absurdly cheap” at current levels and should move higher in 09.

We shall see…

I just found this and thought it was very interesting…

It’s quotes from business, investment, economic, and political leaders from about 1927 through the depression.

The chart says it all…The REAL CRASH didn’t occur in October of 1929 as most people believe…THE REAL CRASH happened AFTER 1930 and saw the DOW decimated.

The chart has quotes dated and numbered to line up with their timeline compared to the DOW.

I find the comparison to TODAY’S quotes VERY INTERESTING…Pay particular attention to how many times the term “NEXT YEAR THINGS WILL BE BETTER” gets used during the 1929 -1930 time period.

It’s almost uncanny how these predictions mirror the current thinking that we’ll have a slow down until next summer then things will pick up in late 2009.

I mainly just lurk but since there has been such a low amount of traffic I thought maybe I should try and help stimulate the conversation.

With the little Christmas/Birthday money I received and the few grand I have saved up in my IRA and Stock (currently 24 and finishing up school) I thought I’d start loading up because the blood was in the streets and it looks like things are dirt cheap. Then I started hearing everyone else share the same opinion, including people that only have experience at losing money, and I’m a little hesitant.

I’ll probably start dollar averaging in slowly and see what happens. Luckily, if things go really bad I won’t be put out on the street or forced to work an extra decade until I can retire unlike a lot of baby boomers. I’ve really taken that contrarian mindset to heart and the current economic cycle mirrors the Great Depression so closely that it is eerie.

Final Note: I think it is absolutely hilarious that over the past few months people are just starting to come to terms and agree that we entered a recession over a year ago. Yet, they are crazy optimistic that the middle of 2009 will be the bottom and we’ll be swinging out of it by the end of the year or early 2010.

Yet, they are crazy optimistic that the middle of 2009 will be the bottom and we'll be swinging out of it by the end of the year or early 2010.

They were crazy optimistic about the second half of 2008 also!!! LOL!

The big question now is what will keep the market (and the economy) up in 2009. We’re losing jobs like crazy and the government is making things much worse by pumping literally trillions of dollars of imaginary money (pulled from thin air) into the economy. We got into a terrible mess by borrowing and spending more money that we can afford and the government’s solution is to borrow trillions more. Brilliant.


I think it’s definitely worth the time & effort to learn how to evaluate stocks, bonds etc… on your own. The education alone will at the very least enable you to become a better client if you were to hand your money over to a money manager. I’m of the opinion that managing your own portfolio CAN and SHOULD be learned and done by everyone. Not everyone is willing to put in the time and effort. I’ve just recently began my “portfolio managemnt” education. There is A LOT of things to learn. There is a TON of terminology and strategies to master. I can definitley see where people can give up and let their laziness just hand it over to someone and just put it on autopilot. But the more I learn, the better I feel about it. I’m not so dumbfounded to terms like puts, options, calls, technical analysis, fundamental analysis etc… Its difficult but learning new things is fun for me. Hopefully soon I’ll be " Master of my domain" :biggrin :biggrin

What you describe is probably the real reason for the Federal Reserve ceasing to report the economic statistic “M3” which many economists think is the best representation of the total amount of money in an economy.


Since there is kind of a beginning of the year rally do you guys think there will be another drop, the market will level out, or we’ll start to rise and when?

I’m thinking maybe a short rise or level out followed by another drop. Basically, I keep seeing the graph that was linked in the OP’s post and can’t disagree with it. I’m thinking the end of January or beginning of Feb will be the time line for the next drop. Seems like everyone sold for the loss on their taxes but now the stock market/economy will magically be better when they buy back in.

I think the economy will continue the downturn until at least Nov. It will take a long time for any type of economic stimulus to actually make a meaningful impact. It’s too difficult to sift through all the static you hear on CNBC. You certainly can’t trust info coming out of Washington. I’m tempted to do the EXACT OPPSOSITE of what I hear on T.V./ politicians.

Same here and I fail to see how it could be a bad idea/philosophy.

Question: Gas prices have plummeted but has anyone seen any savings at the grocery store? Those jerks kept going on about how expensive it is for them to make and ship food because of the gas prices. Now that gas is cheap again I’m still paying the same prices for everything else. I think everyone saw an excuse to gouge the crap out of their customers and now they can’t let go.