FT: Merrill Lynch analyst calls "Depression."

WTF?_2

from the FT Alphaville blog:

http://ftalphaville.ft.com/

Well, it’s finally happened - a mainstream investment bank calling not just a recession, but a depression. How depressing.

In a note entitled “Some inconvenient truths”, Merrill Lynch’s North American economist David Rosenberg elucidates (emphasis ours):

..
As for depressions, there is no official definition, except to say that they have existed in the past. There were no fewer than four in the nineteenth century, one in the twentieth century, and we are very likely enduring another one today. Though this current one is muted by the fact that most countries have an elaborate social safety net (deposit insurance, unemployment benefits, welfare, and socialized health care).

Depressions are basically long recessions - they can last anywhere from three to seven years, while historically cyclical recessions last 18 months - and tend to follow years of leveraged prosperity of Gatsby-like proportions. Considering that in this most recent leveraged cycle from 2002-07, we reached a point where a record 40% of corporate profits were derived from financial activities, where household debt relative to income and assets surged to unprecedented levels and the personal savings rate briefly went negative at the height of the housing bubble, it is safe to say the down-cycle we are currently experiencing did indeed follow a classic elongated period of leveraged prosperity. It is now reverting to the mean.

So it's mainstream at last. The full article is worth a read, some scary figures.

louiser123

and i reckon it will get much worse before it gets better if it ever does!!

pandamonia

to be honest it sounds perfectly reasonable this will be a 3 or more year problem, even with 15% unemployment this country will still have 75% of the country running down the debt bubble. also it will take a few years for company losses to be averaged out to acceptable levels so they can start to reinvest. personally the government needs to rethink the tax system. im not talking about income tax im talking about stupid tax such as on the beer industry and also the tax on stuff people like to buy. government doesnt understand that they will make more money if people spend than if they super tax them so they dont spend at all

purch

So it's mainstream at last

Wha Haaay !!!! :j

Wow.............how exciting :T

You can't beat a good old depression !!!!!!! :beer:

Really2

Is that the Merrill Lynch that have lost 10's of Billions of $'s on subprime.

What great insight they must have. They must be right.:rolleyes:

A company that brought it's self to it's own knees saying how bad it is.
What do they say about work men and and their tools.

mewbie_2

There's no such thing as depression. Read other threads about workshy whatevers. It's just feeling a bit down, or simply being too lazy.

I could be an economist. Fail to see bleeding obvious until everyone else has cottoned on to it, then repeat nursery level mantra - two quarters make a recession, two years make a depression.

It's the teenage equivalent of Big Elephants Can Always Understand Small Elephants, a simple quote that they managed to remember from their pointless degree at the Nottingham University for Feeble Socialists.

mod: Please stop.

chucky

David Rosenberg was claiming something quite different just in October "A bottom is in sight but we aren’t calling it just yet. So, when I say we could be 85% of the way through, the flip side is that we probably have another 15% downside from here."

http://ftalphaville.ft.com/blog/2008/10/14/17018/bull-bears/

He can't have changed his mind in 4 months!!!
He and Merrills obviously have an agenda here.

The Dow Jones is up nearly 1% so they've totally ignored him as well.

Another non-bad news story by !!!!!! :rotfl:

purch

Another non-bad news story by !!!!!!

Yeah but the mere mention of Depession has probably made his week :j

Really2

purch wrote: »

Yeah but the mere mention of Depession has probably made his week :j

Apparently there is a direct link between the use of the word "Depression" and his tissue usage.
Don't mention hyper-inflation;)

WTF?_2

The usual pathetic personal attacks when I post an on-topic link for information and discussion. Wouldn't have expected any better to be honest

chucky

!!!!!!? wrote: »

The usual pathetic personal attacks when I post an on-topic link for information and discussion. Wouldn't have expected any better to be honest

i don't see any of the below post being a personal attack

it's confirming the fact that you started a typical doom mongering non-story on this thread. just because you may lose an a discussion it's not a personal attack

chucky wrote: »

David Rosenberg was claiming something quite different just in October "A bottom is in sight but we aren’t calling it just yet. So, when I say we could be 85% of the way through, the flip side is that we probably have another 15% downside from here."

http://ftalphaville.ft.com/blog/2008/10/14/17018/bull-bears/

He can't have changed his mind in 4 months!!!
He and Merrills obviously have an agenda here.

The Dow Jones is up nearly 1% so they've totally ignored him as well.

Another non-bad news story by !!!!!! :rotfl: