Dow Repeats Great Depression Pattern

**pollypurebred39** · 07-07-2010, 04:10 AM

My Sister just sent me this.

Certainly disconcerting, makes me feel very nervous about the days ahead. Glad I have the FV to glean the best $ advice.

Dow Repeats Great Depression Pattern : New Patriot Journal

**ml2620** · 07-07-2010, 06:21 AM

Interesting article, I am certainly concerned from a personal perspective.

But I also work at an SECOND regulated financial services company. I am the purchasing director and they have me spending money on infrastructure like crazy, millions on computer equipment, networking, phone systems, etc. Perhaps they are spending now so our infrastructure is sound when the next wave hit (and maybe our company will have some value to it if they have to sell).

All that said, we are not hitting our sales target these days.

**JanieD** · 07-07-2010, 11:08 AM

Well, I'm not surprised since looking over a recent mutual fund statement. Its dropped 14% in 3 months. Wonder how long before I start getting statements saying I owe them money?

**mek42** · 07-07-2010, 11:19 AM

More importantly, what else happened in the 1920s that happened in the 90's and double-oughts? That's right, people went nuts spending on credit.

Just saying. I've been worried about this for years. Didn't know what to do about the worry, but I won't be surprised to findout that the dog ate the tub stopper that was pulled out of the economy bathtub, but we weren't done bathing yet.

Yes, our dogs do eat tub stoppers.

**CrazyCat** · 07-07-2010, 11:28 AM

well.....at least it's not a chair or something. Bathtub stoppers...can be replaced relatively cheaply.~HAH.

A girlfriend has a dog that ate her recliner.

**Inkstain82** · 07-07-2010, 11:36 AM

We may or may not have another Great Depression, but I found that article less than convincing.

**Cricketlegs** · 07-07-2010, 12:41 PM

We have backed off of retirement a bit as we have a bad feeling it may take a dump around the new year.

We are still contributing at a good rate to our 401k and do have employer contributions to but we have more"money between the matress" savings than we have ever had.

We took some of our savings and paid off around $5000 in debt which includes my car so we have no car payments now.

Snowball will start on dds student loans next month.

We are really cleaning house around here just to be on the safe side.

Sure we aren't making any money off our savings but better to have it be there in cold hard cash then to have the market dump and have nothing but tumbling tumbleweeds blowing through our 401k.

So in a nut shell we are:

A. Still contributing to 401k retirement
B. Saving more cash
C. Losing debt as fast as we can

That is all I can think to do to weather these hard times.

**monkeywrangler71** · 07-07-2010, 12:53 PM

Whether or not that is a head and shoulders formation is debatable, they aren't truly identifiable until they are past. Looking at a couple months worth of lines you can pretty well see any shape you want. It could just as easily be a bounce on the way up, the indication of the end of a wave on the way down, or a meaningless blip of nothing like the majority of the individual hills and valleys on the market charts.

And to jump from spotting a potential head and shoulders formation to comparisons with the Great Depression is nothing more than fear mongering and sensationalism. This is one of the most common patterns found in market charts. It happens all the time and it doesn't foretell anything more than that the current uptrend is ending.

**mek42** · 07-07-2010, 05:41 PM

Originally Posted by Cricketlegs

We have backed off of retirement a bit as we have a bad feeling it may take a dump around the new year.

...

Sure we aren't making any money off our savings but better to have it be there in cold hard cash then to have the market dump and have nothing but tumbling tumbleweeds blowing through our 401k.

...

Have you thought about allocating new retirement savings to a money market mutual fund / sweep vehicle in order to have it ready to invest when the market goes on sale?

**pollypurebred39** · 07-07-2010, 09:00 PM

*GIGGLES* "Just saying. I've been worried about this for years. Didn't know what to do about the worry, but I won't be surprised to findout that the dog ate the tub stopper that was pulled out of the economy bathtub, but we weren't done bathing yet.

Yes, our dogs do eat tub stoppers." Oh Gosh! *GIGGLES*

I'm not a The Sky Is Falling Type Gal, more of a ducks in the row type. I like signs that say, "Watch Your Step", "Curves ahead", "Beware Of Dog".

When this whole thing began for us 3 years ago, there was a lot of conflicting advice. Turns out, the ones who said we had nothing to worry about were wrong. We were very fortunate to have been ducks in a row kind of people. 3 years still struggling, but not gone under yet.

I see wisdom in heeding the warning signs, and preparing for the famine. So to speak.

The Pharaoh's dreams were a sign. The dream was given, by the LORD, for Pharaoh to have, and for Joseph to interpret. The dream was a warning of what was coming - and who it was (i.e. Joseph) that could guide Egypt through the crisis, not only for the sake of the people of Egypt, but for the survival of the people of Israel who would come to take refuge there (as Joseph later explained to the brothers that sold him away i.e. "50:20 But as for you, ye thought evil against me; but God meant it unto good, to bring to pass, as it is this day, to save much people alive" Genesis 50:20 KJV

I don't need anything so profound in my world to make me heed the signs. The Dow, may or may not be a warning of coming times, but I can not ignore the lack of gainful employment, the lack good employment prospects on the horizon (near or distant future), or the sparseness of our cupboards. For me, these are more then enough of a sign of impending trouble.
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**a.nonymous** · 07-08-2010, 08:02 AM

Well, I'm not quite convinced, either. Head-and-Shoulders patterns occur frequently. It's just a matter of time that they show up after each other.

In the recent months I've been getting more and more offers from banks across Europe trying to contract me with compensation a fair bit above what they used to two years ago.

But then again, I am a specialist of a certain Portfolio and Risk Management software product. Maybe they're only finally starting to actually use the stuff.

**StanleyJohnson** · 07-08-2010, 09:01 AM

The boom or bust articles get all of the attention. Usually the truth is somewhere in the middle.
It seems like we are following in Japan's footsteps.
First a market boom/bust. Then a housing boom/bust. Then 15 years of a no growth/slow growth economy.
It will feel like a recession but technically if you have some growth it is not.

**Greebo** · 07-08-2010, 09:49 AM

Originally Posted by monkeywrangler71

Whether or not that is a head and shoulders formation is debatable, they aren't truly identifiable until they are past. Looking at a couple months worth of lines you can pretty well see any shape you want. It could just as easily be a bounce on the way up, the indication of the end of a wave on the way down, or a meaningless blip of nothing like the majority of the individual hills and valleys on the market charts.

And to jump from spotting a potential head and shoulders formation to comparisons with the Great Depression is nothing more than fear mongering and sensationalism. This is one of the most common patterns found in market charts. It happens all the time and it doesn't foretell anything more than that the current uptrend is ending.

Its nice not being the only one here shooting down the gloom and doomers along with the over exuberant optimists.

**Preston** · 07-09-2010, 02:13 PM

Do not let fear drive you. Harness it and use it as a weapon to keep you focused and intense, but not control you.

In other words, be prepared... but don't spend money building a bunker.