Friends, I've been thinking about some of the financial implications of these dreadful attacks. Whatever happens, it's important not to panic (remember Y2K?) but also important to be careful. Considering all the financial firms with offices in the WTC or nearby, the financial markets are likely to be disrupted for some time. Try not to join in any panic selling. It will take forever to sell, and when your order finally gets through, you'll just end up selling at the bottom, right before the rebound begins. Life insurance is not likely to be affected. A few billion in death claims will not bankrupt the life insurance companies. Casualty insurance companies could pay out huge amounts for losses and for negligence awards. Some airlines could go bankrupt if their insurance isn't enough. Most likely result: auto and other insurance rates could go up. It's possible that the dollar could fall on international markets, forcing Greenspan to raise interest rates. Results: a real recession, which we haven't had for years, and higher interest rates on credit cards. Also: higher payments on any new mortgages. It may be a good time to avoid new debt. Just a friendly warning at a time when it's hard to make any decisions at all. And remember, money isn't everything. Your life, and your freedom in this great country, are much more important. RichGuy
I agree. I would also try to pay off the debt you have, I am talking basically credit card debt as paying off a mortgage or car loan would be too much for anyone. Be careful on how you spend your money. Our economy was not the best to begin with at this time. Only time will tell what this disaster will do.
I hope those places had good off site backups or folks might be losing/gaining money.... sad world we live in..
Trully something to be concerned about in these times. Have a look at how the world markets are reacting already. (I think I'm clamping down on all credit temporarily.) http://www.smartmoney.com/bn/ON/index.cfm?story=ON-20010911-000372-1341
I am a large equity trader. I do daily business with several firms in the towers. Several clearing firms have been destroyed which will impact electronic trading. Some economic impact is certain. The dollar was trading lower and there could be quite a selloff when the US markets open for trading. I would encourage people not to sell into any panic. I have personally suspended my business for the day and will head to my neighbor's to "weed wack" his yard. I feel like doing something kind. I am so sad. Bless you all.
God Bless you, too Jeff. I just got back a few minutes ago from giving blood at my nearby community hospital. There were a few people wandering in, trying to find something useful to do to help make sense of this tragedy, but it all felt so surreal.
Hope, Good Move. Everyone should go to there local American Red Cross and give Blood. Even if you are in BUM F Egypt you can help! Go give Blood they need every type.
You're right, Hope. It's totally surreal. It's someone else's violent fantasy, repeated thousands of times, that finally got turned into reality. When are we going to realize that it isn't all a game, that when criminals try to intimidate us on the street, or when foreign powers threaten our country, they really mean it? They'e just waiting for a time when they think they can get away with it. That's the evil side of human nature. We can condemn it, and should, but we can also do things like donate blood or help our neighbors to demonstrate, once again, that Americans are decent people.
I also work for a very large east coast financial firm, we to were shut down today. Just an FYI, the last i looked some foreign markets were already down substancially and oil prices have risen 10% to 31 dollars a barrell. I don't know how it will affect credit, but it is safe to say we should see a very negative impact in the market concerning this tradgedy. A horrible day in all aspects of life.....
Good comments Richguy!! I like your common sense post(s) on all topics here on the board today. This tradgedy is indescribably hellish. All I can offer is my prayers for those who suffer. Keep up the good work. Best regards, Jim
Although I agree some very good advice was given on this thread I disagree with the economic forecasts. Greenspan will not increase the interest rates. It is fiscally impossible and would deflate any confidence that we have left toward our government and banking systems. As sad as this is to say, I believe what occurred today will keep our economy out of a recession. It is very likely that we will end up going to war (awful, but possible). Also, the World Trade Centers and Pentagon needs to be rebuilt. All this attributes to higher output in manufacturing products, additional workers, and longer hours. This will boost the economy and in my opinion, keep us out of a recession. A little bit of growth goes a long way. Just my .02. Dani
This terrible tragedy will affect u.s. citizens in other ways than financially. This will affect our government agencies and their lack of providing proper security for our country. It will affect our airlines temporarily because of lack of trust. Our economy will get stronger and credit will not be affected. We are too free in letting "others" into this country.What if atlas shrugged? Well,we see now what happens when "our country" gets involved in helping other countries fight their wars.World peace will never be.In God, we trust, will take care of the innocent human beings who lost their lives today and those who are responsible for this horrendous act.
River, There were some very good points in your post. Too bad we had to disagree about other things. One question: how will this event make the economy stronger? Is that what you were saying?
WW II ended the Great Depression in the sense that unemployment was greatly reduced. But the standard of living was actually reduced because of inflation and rationing. If you hadn't bought a new car by 1941, you basically had to drive your old car until 1947. If you could get enough gas to drive it, that is. The use of resources during a war is staggering. Military use means that resources aren't available for civilian use. That raises prices and cuts civilian consumption. If a war ever creates prosperity, it's usually much different from prosperity before the war. In a more modern context, the Gulf War caused the recession of 1990-1991. Part of that was due to the disruption of oil supplies and the consequent rise in oil prices. But that usually happens during wars. Supply lines get disrupted, which lowers production. Government deficit spending to keep armaments factories humming is only part of the story. Because of supply problems, civilian production usually suffers during a war. After all that, I still think that we should fight a war if necessary. Not to create prosperity during the war, but to keep our country safe.
WWII did jump start our economy and end the great depression and no professional I know of thinks rates will be raised. The fed said today they would add liquidity. Raising rates is a tightening move. Can't imagine that option would even be considered at this point. Not trying to pick on you RichGuy. This board a great place to educate yourself about credit. Finance/economics ?????? We have all had a tough day. I wish you all the best. What's in the mail today Breeze, Hope?
Yes, it's good news that the Fed said it would add liquidity. That worked well in some past financial crises. IF the dollar goes down relative to other currencies, then the Fed might have to raise interest rates. It could happen, but it hasn't happened yet. I didn't mean to scare anyone.
