More depressing talk from Gary Shilling: He thinks Europe fell into recession last quarter, a...


More depressing talk from Gary Shilling: He thinks Europe fell into recession last quarter, a downturn as deep as in the U.S. during 2007-09, and enough to tip the relatively better U.S. economy into recession during Q1 of 2012. Even China won't be spared, he says, as consumers in contracting developed economies tighten their belts.
Comments (15)
  • TruffelPig
    , contributor
    Comments (4206) | Send Message
     
    This contrasts the somewhat more optimistic view expressed by Credit Swiss today. They think Europe might even get away. That with the down-turn isn't true as the labour market in Germany was VERY healthy. Spain etc etc didn't get worse - already abyssal.
    20 Jan 2012, 06:23 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4291) | Send Message
     
    Shilling understands that Western economies cannot grow their economies fast enough to get ahead of their debt. The same probably holds true for China as well. Besides, who are they going to export to? Until the debt is dealt with, a sluggish economy is the best we can hope for. Meanwhile, keep trading on the news and keep some powder dry.
    20 Jan 2012, 06:32 PM Reply Like
  • Papaswamp
    , contributor
    Comments (2241) | Send Message
     
    Guess we will find out in 6 months
    20 Jan 2012, 06:41 PM Reply Like
  • Tack
    , contributor
    Comments (16261) | Send Message
     
    Just add Shilling to the perpetual-gloom crowd, along with Roubini, Rosenberg and ECRI.

     

    Heck, even ECRI's data improved today, absent much, if any, comment from them
    20 Jan 2012, 07:05 PM Reply Like
  • SA reader
    , contributor
    Comments (176) | Send Message
     
    I think it'll only take one piece of bad news to gap the market down 300 points. Honestly, we haven't seen anything yet in Europe. Anyone ever tried to get out of a recession by cutting government spending and raising taxes to address your debt issue? Spain is at 5% on the 10-year and Italy 6.5%, that's not sustainable.
    20 Jan 2012, 07:06 PM Reply Like
  • Tack
    , contributor
    Comments (16261) | Send Message
     
    Italy and Spain have both endured higher rates and survived, long before crisis hysteria was fashionable.
    20 Jan 2012, 08:34 PM Reply Like
  • Papaswamp
    , contributor
    Comments (2241) | Send Message
     
    Spain has much larger internal issues than it's rates.
    20 Jan 2012, 09:17 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4291) | Send Message
     
    Tack: What are your buy recommendations.? I bought VXX today and I'm down 3%.
    20 Jan 2012, 10:10 PM Reply Like
  • Hoopono
    , contributor
    Comments (381) | Send Message
     
    They say that "to a hammer everything looks like a nail" and to Shilling everything looks like a downer. No one knows, but we will survive and prosper regardless of what the nay-say crowd tries to push, just stay on the right side of the market.
    20 Jan 2012, 08:26 PM Reply Like
  • torahislife
    , contributor
    Comments (400) | Send Message
     
    Correction. We will survive, but we may NOT prosper.
    20 Jan 2012, 08:56 PM Reply Like
  • Papaswamp
    , contributor
    Comments (2241) | Send Message
     
    When I see GDP growth exceed debt growth and the employment participation rate begin to rise, then I will agree with you.
    20 Jan 2012, 09:19 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3527) | Send Message
     
    If you don't like what you hear, shoot the messenger. Otherwise examine the logic and determine what you agree with and what you disagree with and invest accordingly.
    20 Jan 2012, 09:25 PM Reply Like
  • TruffelPig
    , contributor
    Comments (4206) | Send Message
     
    As long as their are bears out in the wild the market will stay bullish. When there are all bulls left it will drop. I would wish for a healthy 5% pull back of the market to really start a stampede up. I think we will be done at around 1400 to 1450 this year but will revisit 1200 on the way. Plan accordingly and keep some powder dry.
    20 Jan 2012, 09:46 PM Reply Like
  • untrusting investor
    , contributor
    Comments (9903) | Send Message
     
    Will be interesting to see if Shiling is correct and EU did fall into recession in Q4.
    21 Jan 2012, 12:30 AM Reply Like
  • TruffelPig
    , contributor
    Comments (4206) | Send Message
     
    Everyone thinks they fell in a slight recession. The question is how much recession.
    21 Jan 2012, 06:17 AM Reply Like
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