this is based on the forward looking indicators of the business cycle. that s all we do is watch those indicators, monitor them. there s an overwhelming message when we look at those indicators that is consistent only with the new recession starting here. when you think back to 2008, while we made that call, then it was prior to the lehman crisis economists were looking backwards at gdp. once we saw the lehman crisis everybody was on board with the fact there was a recession. before that there was a question. correct. when you see gdp positive or jobs numbers positive, you say there isn t a recession and you get pushback. time will tell. harvard professor, chief economist for international monetary fund. you ve been on the show before. your point of disagreement, you say a lot of people feel the recession never ended. now, we are four years away from the official start of this recession. it started in december of 2007. we re certainly three years into the worst of it. w
which gold prices really didn t do much. these are speculative bubbles. once they develop momentum of their own they keep ongoing until they run out of buyers, usually a raise in margin requirements has an impact, steven is right in that regard. in the case of silver, the original run up was driven by the hunt brothers. once margin requirements were increased, prices pretty much crashed and stayed down for a long time. margin requirements mean that investors in this case in silver, which was up for a big run, people had to put more money up to invest it. that obviously pushes people away. steven, another area of your specialty is oil. you ve written a great deal about energy. you ve been our go-to guy on it. oil dipping below $100 a barrel this week, posting a biggest one day drop in more than two years. long term, you and i are on
price decline. now to a meltdown in commodity prices this week. silver was the first to crack, at one time below 20% for a high since friday. that forced them to raise cash. oil and gold well off the highs, investors trying to make sense of whether to buy on the dip or pull out entirely. steven leave is president of leave capital management. steven lieberman, president of lieberman capital. steven lieb, is it the commodity bubble bursting? we re looking at silver, gold taking a little bit of a drop. what is it? i think it s speculators getting a littles b bit ahead o themselves and the c and e raising margins. if you double margins, you re going to have basically people
cut education, we can t cut transportation. i mean, harold, what do you want to cut? i mean i agree with david gergen, david, i think you re right, if there s going to be a deal, republicans are going to have to agree to some cutbacks in defense programs. i think that should be on the table. but there s no deal if liberals say, we can t cut anything. harold? i think we can cut some things. but i think the main where you and i disagree, steven, is on what the main problem with the economy is what i see as a lack of private-sector investment. i think they re being crowded out by the public sector. i think most major american businesses have a growth strategy in other countries rather than here. that s where the growing markets are and that s where the cheaper production is. and they re moving there. so my view, which is classic keynsian, is that the public sector needs to step up. it s vinlt and things like transportation, because that s where the investment is mainly going to come
place and not the most important place it hits us. hsbc, pulled out the nomura report. i ll pull out another report from a guy who says he s been talking to executives in the country who says they re going to put their hiring plans on hold while they try to assess what kind of impact the oil situation is going to have for their business. because it means higher shipping costs, higher input costs. it s more expensive to run the factory in general. in general more expensive to buy products, packaging and everything. so that s something it could mean trouble for the economy if you still continue to see oil prices rise. steven, as you like to remind us, there s something good about oil over $100 or $150 a barrel. because it stimulates other investments in other types of oil. and oil goes back down and gas goes back down, we stop thinking about alternative energy and hybrid engines and solar and wind and things like that. yeah, unfortunately here we have oil flying up again for the