Investing in the Market: What to Do After a Bad Day

[Greg Bernhardt]

anyone invest here? what a horrific day eh? I ended up getting hammered and sold most to wait out a few days.

 

[turbo]

Yes, I invest, but I invest long term, stay diversified, and ride out dips like this. Selling into a down market locks in losses, and I just can't afford to do that when I'll need the money for my retirement. Eventually, my portfolio recovers from these events and continues to grow. The official news is that the markets are concerned about cool-offs in the US and Chinese economies, but a more relevant concern is what will happen to the global economy if Bush orders bombing strikes on Iran. The insurance companies will not allow tankers to operate in the Gulf if he does that, and the price of crude will skyrocket, killing any potential for growth in manufacturing and transportation for the duration of the hostilities. When the financial reports come in tonight, it will be interesting to see which stocks took the hardest falls. I predict that companies with the most energy-intensive manufacturing lines will take some impressive nose-dives.

 

[Greg Bernhardt]

DJ hit -500pts at one pt, wow! seems to be bouncing back a bit though

 

[turbo]

Rapid market swings like this seem to be standard these days with so many trading programs designed to trigger on certain market conditions. The best bet for a short-term investor today would have been to hold and buy stocks in companies that dropped in "sympathy" with energy-intensive industrial companies and those making pricey consumer goods, but are themselves relatively less exposed to fluctuations in energy prices. Those stocks will bounce back pretty readily, and the savvy investors will have made a lot of money today.

 

[FredGarvin]

My worth in stocks is only valid when I choose to sell. Since I am holding on for a loooong time, I am with Turbo. I just ride them out. If I were close to retirement and pulling out of my 401k, I'd be in a fret.

 

[BobG]

If you're in long term, especially with 401k's where you're investing a certain amount no matter what, you can pretty much count on a steady gain. Dips are good because you're getting a discount for at least a little while. Of course, if you're in long term, those get canceled out by the periods where the market is higher than the long term gain - you're paying higher prices for a while.

If you're in short term, you should have sold as soon as China's market dropped about 9%.

 

[russ_watters]

Whoa.

I had some personal stuff up until a year ago when I sold all but one stock for the down payment on my house. The stock I kept...Toll Bros. D'oh. [so maybe I should buy some right now...] Now all I have is a little IRA in an S&P index fund, so it doesn't really hurt me any since I won't be taking any of it out for about 30 years...

 

[BobG]

It always comes back up. Even in the depression, when the Dow dropped from the $370's to about $50 in a little over 2 years. Sure enough, the price went right back up to the $370's ... about 22 years later.

 

[Astronuc]

The time to get out was last Friday.

Most of my investments are in the 401K which is doing quite well. A chunk of that is gas leases which have been doing well even with the drop in gas prices.

 

[turbo]

Well, if Toll Brothers can stay viable during the housing slump (not a problem, since they can avoid fixed costs by dumping employees) they will be in a great position when the housing market rebounds. Everyone needs to live somewhere, and new-home construction will rebound after the real-estate bubble. That stock would not be a bad one to buy while it is depressed - housing is quite cyclical and in the short term (1-2 years) they will probably riding high again.

 

[grant9076]

what a horrific day eh?

Not for someone who uses put options or someone who uses delta neutral strategies with positive gammas.

 

[gravenewworld]

ahh the first signs of the consequences of carrying massive budget deficits. this is only a tip of the iceberg, where is this great economy now bushies?

 

[twisting_edge]

ahh the first signs of the consequences of carrying massive budget deficits. this is only a tip of the iceberg, where is this great economy now bushies?

In a much better place than it was in the year 2000.

Who was president then? I forget.

 

[Ivan Seeking]

Something else that you seem to be forgetting
Dot-com bubble

If we get to blame Clinton for the fall, then we get to blame him for the phenomenal wealth generated as well. Then of course there is the deficit.

 

[twisting_edge]

Something else that you seem to be forgetting
Dot-com bubble

If we get to blame Clinton for the fall, then we get to blame him for the phenomenal wealth generated as well. Then of course there is the deficit.

You mistake me. I hadn't forgotten that at all.

But, in parallel, have you noticed the market was up a great deal this past year, a great deal more than the 5% it lost so far?

My point is the original poster in that case was exercising a clearly partisan and rather dumb point.

P.S.: As it happens, I do not approve of deficits and cannot stand Bush. I find both his policies and his personal attributes vile.

 

[gravenewworld]

You mistake me. I hadn't forgotten that at all.

But, in parallel, have you noticed the market was up a great deal this past year, a great deal more than the 5% it lost so far?

My point is the original poster in that case was exercising a clearly partisan and rather dumb point.

P.S.: As it happens, I do not approve of deficits and cannot stand Bush. I find both his policies and his personal attributes vile.

Try doing some research on budget deficits and how they relate to the twin deficit and foreign currency exchange rates. With the massive budget deficits Bush has accrued, something like this was bound to happen. Massive budget deficits also slow long term economic growth for a host of reasons (people write entire books on this), which we are already starting to see signs of.

 

[Gokul43201]

With the massive budget deficits Bush has accrued, something like this was bound to happen.

And where are the massive budget deficits and the Bushes in the rest of the world, to explain why the CAC and the DAX dropped 3%, the FTSE dropped 2.3%, the SMI fell by 3.4%, and the Madrid, Australian and Toronto indexes, all shed 3%, and virtually every major index in the world dropped by about the same fraction as the DOW or the S&P yesterday?

 

[Astronuc]

And where are the massive budget deficits and the Bushes in the rest of the world, to explain why the CAC and the DAX dropped 3%, the FTSE dropped 2.3%, the SMI fell by 3.4%, and the Madrid, Australian and Toronto indexes, all shed 3%, and virtually every major index in the world dropped by about the same fraction as the DOW or the S&P yesterday?

It seems that in the global market, when one sneezes, everyone catches a cold.

Actually, all those markets are tied to the Chinese markets either directly or indirectly. The concern is how the downturn in China might affect the US economy, which then would affect all other major industrial countries.


Anyway - the markets have rebounded slightly today - but watch out.

WASHINGTON (MarketWatch) -- Fed chief Ben Bernanke on Wednesday said his optimism about the U.S. economic outlook hasn't been shaken by recent economic data or the stock market decline on Tuesday.

What's he going to do - say that he expects a downturn?

Tech investors: Ignore history at your peril
Commentary: Why stocks are likely to move lower over next 6 months
http://www.marketwatch.com/news/sto...x?guid={C5950FA7-77FC-488F-BDA7-072DD1359187}

 

[gravenewworld]

And where are the massive budget deficits and the Bushes in the rest of the world, to explain why the CAC and the DAX dropped 3%, the FTSE dropped 2.3%, the SMI fell by 3.4%, and the Madrid, Australian and Toronto indexes, all shed 3%, and virtually every major index in the world dropped by about the same fraction as the DOW or the S&P yesterday?

Gokul, the global economy is extremely intertwined, when the US markets fail, the world economies go into recession. The WTO has repeatedly warned the US to control its deficit spending because of the effects it could have on the global economy. For crying oout loud, when Greenspan was in office, just a few words out of his mouth at congressional meeting would always cause large fluctuations in overseas markest in places like Britain and Japan. Notice what Bernanke also said today:

"Bernanke's prepared speech were nearly identical to remarks he delivered to a Senate panel last month. "A vicious cycle may develop in which large [budget] deficits lead to rapid growth in debt and interest payments, which in turn adds to subsequent deficits," he said in his prepared remarks.

He said that over time, the United States needed to move toward fiscal policies that were sustainable and that would promote more saving to support the Social Security retirement program without imposing undue costs on taxpayers. However, he offered no specific policy prescriptions. "

clearly the budget deficit is on the FEDs mind.

 

[Gokul43201]

Gokul, the global economy is extremely intertwined,

Yes, and when markets in China go down, the rest of the world takes a dive too.

when the US markets fail, the world economies go into recession.

But the cause here is not the US markets going down. If that were the case, how did the European markets experience their dip before US markets?

 

[Astronuc]

But the cause here is not the US markets going down. If that were the case, how did the European markets experience their dip before US markets?

Trading started 6 hrs earlier in Europe. Also don't forget after hours and on-line trading. Plenty of time and paths for panic to spread.

 

[turbo]

Trading started 6 hrs earlier in Europe. Also don't forget after hours and on-line trading. Plenty of time and paths for panic to spread.

And just because trading has not yet begun in a particular location, that does not mean that orders have not already been placed with the brokers. If I decide at 1am that I want my broker to sell off x shares of company xyz, I can place that order on-line in the middle of the night. Large brokers are in a privileged position WRT the market because they can identify and exploit trends long before the markets open.

 

[Anttech]

when the US markets fail, the world economies go into recession.

Is there an example (actual example) that's shows this holds true?

 

[russ_watters]

The WTO has repeatedly warned the US to control its deficit spending because of the effects it could have on the global economy.

I agree that the US has a big impact, but why would the WTO be warning the US about an issue where the US is basically in-line with other developed nations?

Public debt fraction of gdp:
US: 64.7%
UK: 43.1%
France: 66.2%
Germany: 67.3%
Japan: 158%
[google]

I agree that our public debt should be lower, but it isn't the crisis many people think it is.

 

[Astronuc]

Is the worst yet to come?
http://marketplace.publicradio.org/shows/2007/03/02/AM200703023.html

AMBROSE EVANS-PRITCHARD:

Well clearly, this great sell-off, although it was sort of triggered by an event in China, is really not about China. It's about America and the really dire data that's been coming out of the United States for the last sort of month or two, the collapse of the sub-prime sector, the fears that it could extend to the whole credit sector in the United States. And where the initial reaction was to sell Turkey, sell Poland, you know all these peripheral markets got hit really hard.

Well, much greater levels of debt accumulated in the United States. The U.S. has gone from being the world's biggest creditor nation in the 1908s to it's by far the biggest debtor nation. Personal debt levels have reached historic highs and we've had Americans living beyond their means, driving down the savings rate to lows since the Great Depression, they've been drawing money out of their homes and at some point the economy's going to have to come back into alignment.

The subprime market seems to be in trouble, and defaults on subprime mortgages might reach 20%. If housing values decrease, home equity loans might be in trouble for some people.

 

[Anttech]

I agree that the US has a big impact, but why would the WTO be warning the US about an issue where the US is basically in-line with other developed nations?

Public debt fraction of gdp:
US: 64.7%
UK: 43.1%
France: 66.2%
Germany: 67.3%
Japan: 158%
[google]

I agree that our public debt should be lower, but it isn't the crisis many people think it is.

You do know why Germany and Japan are in such debt right? AND we can include the UK Belgium France into the mix. The USA owned these countries for a long time (post war stab in the back the UK sees it as) because of the debt they were given for reconstruction, in which the USA pushed its anti-imperial (full circle) anti-communist pro-capitalist agenda that HAS shaped the word of today.

Are you sure you are on a level footing with these mentioned countries? Your Debt is new, and due to your misconceived wars abroad. Not due to some ideological war over 50 years ago

 

[gravenewworld]

I agree that the US has a big impact, but why would the WTO be warning the US about an issue where the US is basically in-line with other developed nations?

Public debt fraction of gdp:
US: 64.7%
UK: 43.1%
France: 66.2%
Germany: 67.3%
Japan: 158%
[google]

I agree that our public debt should be lower, but it isn't the crisis many people think it is.

Because the US economy is by far and away the largest economic entity on the planet. 64.7% debt of an $13 trillion dollar economy is much greater than the UK's 43% debt fraction of a $2 trillion dollar economy.

Is there an example (actual example) that's shows this holds true?

Is The Great Depression a good enough example for you? Greenspan also warned that the U.S. budget deficit, which for 2006 fell to $247.7 billion, the lowest in four years, remains a concern.

"The American budget deficit is clearly a very significant concern for all of us that are trying to evaluate both the American economy's immediate future and that of the rest of the world," he said via satellite at the VeryGC Global Business Insights 2007 Conference.

 

[russ_watters]

Because the US economy is by far and away the largest economic entity on the planet. 64.7% debt of an $13 trillion dollar economy is much greater than the UK's 43% debt fraction of a $2 trillion dollar economy.

And that means what? When you go to buy a house, how much you can buy is based on your debt-to-income ratio, because that's what determines how much debt you can support! It works pretty much the same for a country.

 

[turbo]

And that means what? When you go to buy a house, how much you can buy is based on your debt-to-income ratio, because that's what determines how much debt you can support! It works pretty much the same for a country.

That's true, Russ, but economists look at debt as a percentage of the market total, as well. If you and I were in a room with Warren Buffet and we averaged our debt-to-income ratio amongst the 3 of us, it would be an unrealistic picture. If I suddenly decided to buy a new car and finance it instead of paying cash (the way I have bought most of my vehicles in the past couple of decades) my ill-advised decision would have little effect on the debt-to-income ratio in that room in absolute terms, but would have a significant effect in the raw average. If Mr. Buffet decided to finance some enterprise that equated to a few percent of his net worth, the debt picture in that room would change dramatically (from our perspective in absolute debt, though not much in terms of averaged debt) and that might effect our decisions. As the world's largest economy, fluctuations in the US market can shake smaller markets as their investors try to re-configure their portfolios to avoid large losses and perhaps lock in some gains.

 

[gravenewworld]

nd that means what? When you go to buy a house, how much you can buy is based on your debt-to-income ratio, because that's what determines how much debt you can support! It works pretty much the same for a country.

Point noted. The US public debt just isn't owned by US citizens, it is also owned by foreign entities. Foreign entities own almost 50% of the US's national debt in the forms of bonds and other securities. Most of the debt held by foreign entities are owned by foreign central banks. Why has the WTO warned the US about its fiscal policies?? It is well known that large budget deficits increase inflation and inflation is detrimental to the value of bonds. Budget deficits also lower the value of the dollar and since many countries peg their currencies to the dollar, the effects of US budget deficits are felt all over the world.

 

[Anttech]

Because the US economy is by far and away the largest economic entity on the planet.

No its not, the EU is bigger!

The US may be the largest national economy in the world, but it isn't the largest economic entity.

 

[gravenewworld]

No its not, the EU is bigger!

The US may be the largest national economy in the world, but it isn't the largest economic entity.

The CIA's world factbook doesn't agree with you. The US is the biggest economic entity on the planet with an estimated GDP in 2006 of $12.98 trillion dollars in terms of PPP (which is the measure of GDP that economists prefer the most). The entire EU comes in a close 2nd with an estimated GDP of $12.82 trillion dollars.

 

[Anttech]

the cia factbook? nice and nonbias? :)

The cia factbook is wrong, go look on the WTO, international monetary fund www site. The fact is you are asserting the USA is by far the largest which is BS, and show how little you researched that. The EU gdp is over 13 trillion, maybe the CIA was obfusing the figures by posting them in Euro's and the USA in Dollars?

http://epp.eurostat.ec.europa.eu/portal/page?_pageid=2693,61100649,2693_62309131&_dad=portal&_schema=PORTAL

download the pdf nd read it for yourself... The EU has a bigger population, has more money, and thus more purchasing power that the US. It has a higher GDP because of this...

 

[russ_watters]

Anttech, it isn't a big deal - gravenworld doesn't consider the EU to be a fully-integrated economy (and I would agree that in this discussion they are not) so he didn't think of them. Whether the EU has a $12.9b or $13.1b gdp doesn't really change anything about the discussion.

Also, when citing sources, it is proper etiquette to cite a source where someone can easily find the information being cited - not making them search and gather the information themselves.

 

[Anttech]

Russ, what you and gravenworld think is irrelevant to the actual facts. The fact is the USA is not the biggest economy in the world by far. That assertion is the bases of his argument isn't it?

The pdf is a full economic break down of the EU, it gives the readers a full picture. As for the WTO and IMF.

wiki- http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)

 

[russ_watters]

Point noted. The US public debt just isn't owned by US citizens, it is also owned by foreign entities. Foreign entities own almost 50% of the US's national debt in the forms of bonds and other securities. Most of the debt held by foreign entities are owned by foreign central banks. Why has the WTO warned the US about its fiscal policies?? It is well known that large budget deficits increase inflation and inflation is detrimental to the value of bonds. Budget deficits also lower the value of the dollar and since many countries peg their currencies to the dollar, the effects of US budget deficits are felt all over the world.

Sooooo the world community is upset that the US has too much debt, because so much is owned by the world community? Anyone else see the irony here...?

 

[russ_watters]

Russ, what you and gravenworld think is irrelevant to the actual facts. The fact is the USA is not the biggest economy in the world by far. That assertion is the bases of his argument isn't it?

No, it isn't. This discussion is about public debt. Each member of the EU has its own.

 

[gravenewworld]

Russ, what you and gravenworld think is irrelevant to the actual facts.

The CIA world factbook is an excellent source for information, you should read through it before labeling it as biased since it might not agree with what you believe. I worked in reference for 5 years at my university's library so I definitely know how to look for credible information. The US is listed as 1 in the IMF, World Bank, and CIA tables by country. The EU is separated from everyone else, because like RUSS said the EU isn't fully integrated.

The fact is the USA is not the biggest economy in the world by far. That assertion is the bases of his argument isn't it?

Uhhh no. You are making a huge mountain out of a molehill. The crux of my argument is the fact that a $13 trillion dollar per year economy (the US) will have a profound impact on the world economies when it is running up deficits every year in excess of 200-400 billion dollars. I don't know why you insist on getting sidetracked on minute differences in statistics from different organizations. Here is the link for the CIA world factbook

https://www.cia.gov/cia/publications/factbook/

it is one that should be bookmarked.
Maybe I shouldn't have used the word entity, but instead country. My mistake, I apologize. Would that calm you down? I am not here to argue about semantics, but economics.

 

[Anttech]

The US is listed as 1 in the IMF, World Bank, and CIA tables by country. The EU is separated from everyone else, because like RUSS said the EU isn't fully integrated.

The EU isn't fully integrated? Per tell what do you and Russ mean by that? We have a common policy, free movement of people, free job market, common currency (in the most). If you want to argue about what is and what isn't the EU, let's start another thread.

Maybe I shouldn't have used the word entity, but instead country. My mistake, I apologize. Would that calm you down? I am not here to argue about semantics, but economics.

Im calm

You are making a huge mountain out of a molehill. The crux of my argument is the fact that a $13 trillion dollar per year economy (the US) will have a profound impact on the world economies when it is running up deficits every year in excess of 200-400 billion dollars

Dont disagree with that, but same could be said of the EU.

 

[Anttech]

No, it isn't. This discussion is about public debt. Each member of the EU has its own.

Yes and when you add those up you get the EU debt, bit like your States

 

[gravenewworld]

Sooooo the world community is upset that the US has too much debt, because so much is owned by the world community? Anyone else see the irony here...?

Credit card banks don't like it when their customers run up huge tabs that they won't be able to pay off. The US will always be able to pay off its debt but too much debt is no good. If the US borrows money from a country like britain in the form of say a $50 bond what good will that bond be to Britain in the future if it is only worth $49.50 in real terms because of inflation? It is pretty much undisputed that large deficits increase inflation over the long run which will take a chunk out of the values of US securities owned by other countries. Also, not being fiscally responsible makes it harder to sell US debt to other countries because the value of the dollar falls when large deficits are accrued by the government and also because of the fact that the US's reputation as being an economically stable country is tarnished.

 

[russ_watters]

The EU isn't fully integrated? Per tell what do you and Russ mean by that?

Germany (for example) has its own national budget, not set by the EU. Heck, that's why it is still possible to find the national debt of European countries! They still have their own! "Integrated" on this issue would mean that the EU had one budget, one GDP, and one public debt.

To be "integrated" in the fashion we are talking about, the EU would need to be a real federal government. It would have to do all those things that the countries now do for themselves like providing healthcare and welfare, the military, etc. and it would need to collect the taxes needed to do those things. That's what countries spend their money on and that's where the debt comes from.

Yes and when you add those up you get the EU debt, bit like your States

No, not at all like our states. The US's "national debt" is not the sum of the individual state debts. The EU is not a country [yet].

 

[russ_watters]

Credit card banks don't like it when their customers run up huge tabs that they won't be able to pay off. The US will always be able to pay off its debt but too much debt is no good. If the US borrows money from a country like britain in the form of say a $50 bond what good will that bond be to Britain in the future if it is only worth $49.50 in real terms because of inflation? It is pretty much undisputed that large deficits increase inflation over the long run which will take a chunk out of the values of US securities owned by other countries. Also, not being fiscally responsible makes it harder to sell US debt to other countries because the value of the dollar falls when large deficits are accrued by the government and also because of the fact that the US's reputation as being an economically stable country is tarnished.

So who is being more fiscally irresponsible, the US for selling that $50 bond, which pushes inflation or the UK for buying it?!

 

[Astronuc]

Comptroller General David Walker felt this week's U.S. market plummet was a call to attention for the country, and that maybe we shouldn't always depend on foreign investors to bail us out.

. . . .

I don't think that we should read too much into what happened in one given day or one given week of the market. But I do think that we have to recognize reality. And it's time that we start making tough choices in order to mitigate the risk and to hopefully avoid a larger crisis from ocurring in the future.

http://marketplace.publicradio.org/shows/2007/03/02/PM200703021.html

Some folks are concerned about the mounting debt in the US - both public and private.

 

[Anttech]

Germany (for example) has its own national budget, not set by the EU. Heck, that's why it is still possible to find the national debt of European countries! They still have their own! "Integrated" on this issue would mean that the EU had one budget, one GDP, and one public debt.

So does every nation in europe, BUT it is controlled by brussels to a degree.
Question: Do you think the UK a country?

To be "integrated" in the fashion we are talking about, the EU would need to be a real federal government.

we do have a centralised governmental body, the commission.

It would have to do all those things that the countries now do for themselves like providing healthcare and welfare, the military, etc. and it would need to collect the taxes needed to do those things. That's what countries spend their money on and that's where the debt comes from.

You really don't understand the EU do you? What has healthcare, and military got to do with the common market and economy? Anyway, we do have a centralised military task force, and we have frame works, which control the standards of health care.

No, not at all like our states. The US's "national debt" is not the sum of the individual state debts. The EU is not a country [yet].

It never will be a country, that's not the purpose of the EU.

 

[BobG]

Germany (for example) has its own national budget, not set by the EU. Heck, that's why it is still possible to find the national debt of European countries! They still have their own! "Integrated" on this issue would mean that the EU had one budget, one GDP, and one public debt.

To be "integrated" in the fashion we are talking about, the EU would need to be a real federal government. It would have to do all those things that the countries now do for themselves like providing healthcare and welfare, the military, etc. and it would need to collect the taxes needed to do those things. That's what countries spend their money on and that's where the debt comes from. No, not at all like our states. The US's "national debt" is not the sum of the individual state debts. The EU is not a country [yet].

I have to agree that healthcare and military shouldn't be tossed into the mix. Those are integrated into the US central government today, but if that's part of the definition then the US wasn't a real federal government until sometime in the 1800's at the earliest (and probably not really an integrated federal government until FDR).

Of course, that suggests that one shouldn't be too certain about the following quote:

It never will be a country, that's not the purpose of the EU.

The difference between the EU economy and the economies of individual countries is kind of a fuzzy line.

Of course, either way, it's kind of irrelevant (but interesting) to the point of the post that initiated the discussion about the EU.

 

[russ_watters]

You really don't understand the EU do you? What has healthcare, and military got to do with the common market and economy?

The issue I disagreed with gravenworld on was government debt. Those services are the source of the debt.

I understand the EU's function just fine.

I have to agree that healthcare and military shouldn't be tossed into the mix. Those are integrated into the US central government today, but if that's part of the definition then the US wasn't a real federal government until sometime in the 1800's at the earliest (and probably not really an integrated federal government until FDR).

You're missing the point: healthcare wasn't provided by the states before the federal government. That's the point here. The relevant services - whatever they are - are provided by the federal government, which is why we pay the lions' share of our taxes to the federal goverenment and are concerned about our federal government's debt.

In Europe, there is no comparable "EU debt", as Anttech claimed:

Yes and when you add those up you get the EU debt, bit like your States

Fine - if such a thing exists, show me where I can read about the concept.

It is a rediculous notion, what you are suggesting: when Germany takes on debt, it issues bonds that say "Germany" on them, not "EU". Germany decides how many to sell and when (if!) to pay them back. If Germany were to have a problem and need to isue more bonds, Germany would get hit by a big inflation spike. That spike would ripple through the world, but it would mostly just hurt Germany. If Germany decides to increase its military spending, it raises taxes to do so - it doesn't go to the EU for the money.

That is the point about a country's debt affecting the world community. All the decisions and primary effects are internal. The severity of any external effects depends on the relative size of the economy in question.

 

[Anttech]

The issue I disagreed with gravenworld on was government debt. Those services are the source of the debt.

Which is controlled by brussels, through a series of non-optional frameworks.

I understand the EU's function just fine.

If you did, you certainly wouldn't say this:
"The EU is not a country [yet]."

You didnt answer my question either:

Do you think the UK is a country?

 

[russ_watters]

Sorry, I was pulled away from my post and did a late edit...

Anttech, make a point. Don't ask rhetorical questions or make meaningless and derogatory 'if you understood, you wouldn't say...' statements. Tell me where I am wrong and why and support your arguments. If you want to claim that the EU is a country, define "country", tell me how the EU fits that description, and provide a reference.

I can't provide a reference for a negative except to show you links where the EU is not described as a country, but members are referred to both as "states" and "countries". Ie: http://en.wikipedia.org/wiki/European_Union

 

[Anttech]

Sorry, I was pulled away from my post and did a late edit...

Anttech, make a point. Don't ask rhetorical questions or make meaningless and derogatory 'if you understood, you wouldn't say...' statements. Tell me where I am wrong and why and support your arguments. If you want to claim that the EU is a country, define "country", tell me how the EU fits that description, and provide a reference.

I can't provide a reference for a negative except to show you links where the EU is not described as a country, but members are referred to both as "states" and "countries". Ie: http://en.wikipedia.org/wiki/European_Union

Russ, I wasnt claiming the EU is a country. I never asked a rhetorical question, and didnt make any meaningless of derogatory statements. If you take offense to my saying that you don't know much about the makeup of the EU, then sorry. Although I do recall you admitting that much a while back.

The question, Is the UK a country, is perhaps a leading question, because the answer would move me onto solidifing the point I already made, that the EU can be looked at as 1 economy, and your assertion of non-integration is false.

The UK is not a country its 2 countries and 1 principality. All of which form an economic Union. Scotland and Wales both have autonomy on there tax systems to some extent, Scotland also has its own Law's and schooling structure, and funds these through taxation of Scottish nationals. The makeup of the UNION Is not so dissimilar to that of the EU. The EU is 27 nations, that are all economically tied, by a framework which is debated and forged in Brussels. Each member states taxes how it pleases as long as it sticks to the rules, and ensures inflation, debt etc are all within EU guidelines. Money from richer countries flows to poorer, and people can move freely between all countries without hindrance.

Now is it as integrated as the States in America? No, but the integration is enough to be looked at as ONE economy.

As for the EU becoming a country, that won't happen, the EU isn't about centralising government and decrease the member states governing power. It is, in summary, about leveraging a larger consumer base, increasing Economic clought, ensuring we don't all kill each other again. In th short term its about bettering Poorer economies in Europe, and in the long term increasing Europes World Influence etc etc