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John,
Speaking of food for thought, sounds to me like the answer is DiGiorno so
that the economy won't need a Tombstone. Remember, "it's not delivery, it's
Digiorno!"
Pizza-ingly,
Norman
----- Original Message -----
From: "John Cappello" <jvc689@xxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Cc: <MedianLine@xxxxxxxxxxxxxxx>
Sent: Monday, August 12, 2002 11:56 PM
Subject: [RT] One Man's Opinion-Depression/Recession
> I found this Lycos post of interest and wanted to share it.I do not
> necessarily agree with all within, but there is certainly food for
> thought.
>
> John
>
> "It is my understanding that a depression is defined as 4 quarters of
> negative GDP. I suppose that the same group that declares recessions
> also declares depressions. It would be well to note that this same
> group has not yet declared an end to the last recession! They don't
> meet often because its bad for the economy to have that much
> negativism in one room
>
> Just as Pmcw and I had our disagreements on efficiency and
> effectiveness a number of posts ago, there are different ways to
> define an economic downturn. As far as the term depression goes, its
> association with the great economic disaster that was the decade of
> the 1930's has forever altered it! If a recession is a mild form of
> the Great Depression, and you flatten the curve by eliminating the
> mildest recession and the greatest depression, you do come out with a
> different view of the whole concept.
>
> It is virtually impossible to compare what went on in 1929 and beyond
> to what is going on now simply because there is no comparison to the
> society then as opposed to now. There are almost no companies left in
> the indexes that were there in 1929--and we all know the Ford and ATT-
> T stories all to well!
>
> As far as deflationary periods go, they do not necessarily lead to a
> depression. Look at the period from 1979 through early 1982, when
> interest rates went down from around 18 percent to a more normal
> historical level. The problem with the 1979-82 period is that it
> began the period of modern inflation that has lasted to this very
> day. Everybody remembers when coffee went from a dollar a pound to
> what it currently is. Ask Juan Valdez what it costs, I don't buy the
> stuff all that often. Another factor that has affected this price
> inflation is the historic rise in the price of oil that occurred in
> the first energy crisis in the mid-1970's when OPEC became a
> household word. And, of all things, the price of tobacco has also
> been a major contributor to price increases in the United States
> along with the rise of lottery tickets. Remember when the Irish
> Sweepstakes was the best you could do!
>
> On the price deflation front, long distance telephone calls have
> probably lead the way to a potential deflationary period of time. So
> have the price of personal computers! Our biggest culprit on the
> deflation battlefront has been the training of generations of people
> to look for the lowest price, all too often to the exclusion of good
> service and careful manufacturing!
>
> The search for the lowest price is the death knell of a service
> economy! As the service gets worse as the prices continue to spiral
> downward, it becomes a viscous cycle that, after a time, becomes very
> hard to break! We have now reached the point where Pizza Hut is
> leading the charge toward bad service by beginning to charge the
> consumer for delivering pizzas to their abode! What this is doing to
> the pizza delivery system in this nation is nothing short of a
> national tragedy!
>
> Please don't laugh because it's not really funny! As I look at the
> leaves on my favorite plants, they begin to die by browning at the
> edges and working their way toward the center! If your next pizza is
> burned on the edge, just consider that to be another leaf of the
> economic pie gone bad! My last one was delivered sort of on time. It
> was, however, not what I ordered! It was too late in the evening to
> do much about it so I ate the whole thing anyway. I was kind enough
> to call the pizza shop to report what had happened and was told that
> since I had consumed it, they couldn't do anything about it! I hadn't
> asked them to in the first place but ended up getting upset because
> of the attitude I received for my phone call. The phone call was not
> long-distance so it probably cost me more to make it than it should
> have, with all of the fees attached! There is still pricing power
> where there is a monopoly and I suppose that our economy now rests on
> angry consumers getting into their a!
> utomobiles to go to the pizza place! We survived the conversion to
> self-service gas at a higher price so I suppose that we can pay more
> for the free gas we get with our pizza. It's always been there and
> they say that natural gas is the play to make in the next few months
> in order to make a few loud bucks!
>
> If we look at the economic charts, many of the ones that count are
> heading in the wrong direction! The definition of a depression for my
> era is as follows: If I have a job its a recession, if I don't its a
> depression. This is an updated play on the older version which says:
> If my neighbor is unemployed its a recession, if I am its a
> depression! We have to update this term simply because there are so
> many people out there these days who have either retired early, or
> made a killing in the stock market that they no longer have to work!
> We are, just like our census data, no longer absolutely sure what is
> going on in our neighbors abode! We used to be more sure of what went
> on there but since 19 people who aboded among us who flew planes
> where they should not have gone...! Then we have these people who,
> almost on a daily basis now, are not sure where their daughter are!
> And then we have the friendly priest and we're not sure about our
> sons anymore either!
>
> Are we seeing more and more inaccuracies in our economic data as
> reflected in revised government figures because of bureaucratic
> tampering with the results in order to influence definitions such as
> recession and depression, or simply because they can no longer figure
> out what is going on in the first place? I don't know if it's
> effective or efficient but I do know that we are efficiently not
> getting the desired result!
>
> The retail sales 10-year history is at its lowest point in 10-years!
> Business inventories are where they were last August! The Industrial
> Production 5-month Upswing is swinging back down! CPI inflation, as
> measured by the Department of Labor, again sits where it did in 1980--
> 22 years ago! This is important because that was the period of the
> last great beginning in over-all inflation. It sits theree with all
> of these wonderful efficiencies that we have achieved in the last 22
> years fully in place! Real Spending Gains, although positive for 6
> straight months, are now trending downward while they are less than
> they were before September 2001! Fed funds are at levels not seen
> since I was 12--I have an illegitimate AARP card--and are wistfully
> expected to go lower still! (A legitimate AARP card is 55 or over,
> thank you!)
>
> There is a corporate profit turnaround--if you can believe the
> accounting and haven't discounted the options thing! The problem with
> that is, if you look at a chartt on percent year-over-year, you don't
> want to look at what it is that they're comparing with last year!
>
> We are, as a people, saving more at 3.1 percent than we did, at 1.1
> percent a year ago. But we are also spending more just as well! And
> that doesn't count what we are spending as a government, which has
> apparently offset the personal savings rate and is heading on further
> south as the deficits continue to build! The surplus is gone!
>
> There is no doubt that there is one depression going on out there
> right now--the stock market and financial communities face one on a
> daily basis, and have for some time! I suppose that it just goes too
> show that we still have some modification to do in the definition of
> depression. Just about everyone that I know is depressed about the
> markets, so it blows the part away about you and your neighbor,
> unless you look at it from a Greenspan point of view! I am reminded
> of the cartoon of AG counting the number of bodies falling past the
> window of his office and counting them before he issues another rate
> cut! Ninety-eight, ninety nine...Cut! After, what is it now--11 cuts,
> I just hope that he can still see out his window as the bodies
> continue to pile up!
>
> You don't have to have a depression to have social disruption either,
> but it helps! I think that type of disruption may be on so many minds
> as we go forward these days. We remember the disruptions that
> occurred less than a year ago, and how depressing they were!
> Somewhere along the line, human depression and economic disruptions
> blend together and their chart's flow along in an indistinguishable
> blur. The Enron Age has depressed so many people that there is no
> actually chart to reflect that trend. There may be a Laffer chart for
> the efficiency of government spending, but there may need to be a
> crier chart to reflect what is currently going on! We are all giddy
> about the rise in the Dow that occurred last week while we should
> probably be praying that Greenspan can engineer a miracle and restore
> pricing power to interest rates. If he can't, you can look up your
> own chart as to where the Dow was sitting the last time they stayed
> this low!
>
> IMHO!
>
> Regards,
>
> Tin
>
> PS-I'm still going to post here because I still have things that I
> want to say-and you arguably need to hear them!
> Well, some of them anyway! When my ego and my humbleness get to
> fighting and want to go hide from each other, just consider it a
> domestic disturbance and call the local psychiatric police! The cat
> simply sleeps through it all!"
>
>
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