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Are YOU Hard Hit By The Worsening Economy?
Well, if you think the economy is bad and you say you’re being hurt, then you’re just part of the problem — you’re part of a “nation of whiners.”
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20 Responses to “Are YOU Hard Hit By The Worsening Economy?”
Phil Gramm and his wife have arguably done more than just about anyone else when it comes to get policies passed that allowed for the massive explosion of unsustainable debt and financial “engineering” that is threatening to bring down the entire economy.
It's interesting that this is coming out on the same day that a former fed governor called Fannie Mae/Freddie Mac “insolvent” …. implying the government might need to backstop trillions of dollars of mortgages or have mortgage rates skyrocket to about 10-15% and destroy real estate even more. I'm sure that's just all whining too. They are in so much trouble because of the real estate bubble that was a direct result of the sort of deregulation Gramm enabled. Also Lehman Bros is at new lows, again because of a situation that they would not have been in a mere 10 years ago.
I'd say BigOil monopolies siphoning billion$ in public funds to finance their hostile corporate takeover of sovereign Iraq's oil and maintain a military presence so their puppet goverment now there will cowtow until reserves dry out (about 100 years), is what is killing our economy.
And to add icing to the cake, they are price-fixing what is left of our fiscal solvency at the pumps to drain the last bit of life-blood from our nation and placing it in a position of world vulnerability.
Are there other vultures joining in the feast? Sure, amorality isn't just a BigOil phenomenon. The word “treason” comes to mind. Texas good old boys did say they would get even for our forcing “The Lone Star State” into the Union. Who knew they would hold a grudge for this long?
The thing is we need to examine just what is patriotic and actually pro-american and what isn't. Then when we make that distinction, we should go after the real threats to the american dream and way of life. There's still time, though just barely, to save the dying dream our forefathers sacraficed everything for to create for us.
Great comment Silhouette
To answer Joe's question, no, I'm not hard-hit. We have three gas sipping used cars in the family, all three with about 130,000 miles and still going strong. Debt? None. We live in a rented house. Our expectation is not to own a home, but to have a place to live. So, if we can live in retirement as the same level we do now – adequately, not lavishly – then who cares? Life's not about stuff.
Stupid comment. Yep John McCain is clueless for having a man say something like this. Barak Obama has no testicles because Jesse Jackson said so. Yep that proves it.
Meanwhile gas goes up, every day the national debt grows by astounding amounts and we are busy trying to prove to each other who has the bigger balls or the more insensitive handlers.
Meanwhile Congress Fiddles and America Burns.
Definitely just in our heads:
BTW Gramm isn't just a “handler,” he's one of the two chief economic advisors to McCain and helps McCain craft all his policy.
From “the Bush economy” to “the Gramm economy” to “the Bush-Gramm-McCain economy” (another variation of the Big Lie) — I can anticipate it, along with more misuse of the word “crisis” and more hyperventilation in the months to come.
Yes DLS, because it's definitely not a crisis when there is a situation that is widely regarded as the “worst since the Great Depression” in many of the underlying financial markets. Or when many participants that have been around for 40+ years say it's the worst they've ever seen. Or how there are tens of trillions in swaps, where a very small decline (that's already occurred and isn't reflected yet because of accounting rules and the banks are begging the government to change the rules) will wipe out most banks.
If you want to say that it's not just the Republican's fault and bring up fractional lending, the end of Bretton-Woods, the misguided subsidizing of housing, the political pressure to short circuit recessions, the fact that these supercycles seem inherent to human nature…etc. that's one thing. Or if you want to talk about how a lot of the Democratic proposals on the table are completely idiotic and potentially could risk the fiscal future of the country, that's another thing. But I have yet to read any comprehensive analysis — from anyone — in the last two years that these issues have been hot that comes even close to convincing that it isn't a major….crisis.
The empty shelves in food pantries for the poor tell their own tales, while taxpayer money goes to mopping up the mess greedy executives created, yet one more time.
The word “crisis” is emotionally and stupidly overused all the time, as any review of a newspaper, kids on the Net, or listening to the radio will tell you. (I could add TV, too, but I don't watch it.)
I am not denying there is a recession (not as bad as the media and politicians exploiting it would have you believe unless you're willing to let them) nor that there are some systemic problems. Nor are all creditors blameless when it comes to the bad mortgages and foreclosures we're seeing (with more to come). But a good dose of reality is needed in place of hype and childish anger that we see too often from too many.
Incidentally, there will be pressure not only on the GOP now (good luck there) but on the Obama administration to short-circuit the depression, largely by spending even more than he already threatens to do with his administration that promises everything to everybody.
Here we go again.
Liberals waiting, hoping, praying (in a very non-denominational, respectful to all other religions sort of way) for THE GREAT DISASTER to happen.
“worst since the Great Depression” I have heard that phrase kicked around in the 70's. 80's, 90's, 00's, over and over again. You guys just can't WAIT for ruin and destruction to descend upon the US. The reality that things are cyclic in nature, and that we recover as a nation every time, really ticks you off, too.
Another basic difference between Liberals and Conservatives – Conservatives believe that hard times can be overcome through self-sufficient means, and that eventually we come out stronger.
Liberals believe the end of the world is always about to happen. Except of course in Socialist countries. Everything is wonderful there all the time.
Oh, and no, the 'worsening economy' (you know, the one that actually keeps growing) hasn't affected me negatively.
Bizarrely enough, like the leading economic indicators, our company is growing, my pay is growing, and I enjoy my 5 1/2 weeks of vacation a year.
Thank you very much for asking.
Well to me the scariest thing is the people I've read that are the gloomiest (within reason of course) are the ones that are the least emotional and most data driven. In their writing is an obvious trace resignment and hope that they are wrong. That said I do feel the greatest long term threat is that our politicians will overreact and do something that undermines the long term prospects for the country…but that doesn't mean that there aren't programs that can be developed to alleviate the short term pain and panic. Both sides are way too focused on preserving unsustainable levels of debt and excess and are apt to throw away hundreds of billions (or perhaps trillions) in that futile effort, instead of using a fraction of the money as a holdover for basic needs and to stop the spiral once most of the excess has been destroyed. Keynes wasn't completely wrong, his ideas just really should only be applied to situations where there is a deflationary spiral and a vast amount of damage has already been done.
“THE GREAT DISASTER”
I remember the 1980s EVIL REAGAN DEPRESSION AND NATIONAL DISASTER [tm] quite well. In fact, Bush the elder was also “responsible” for THE GREATEST DEPRESSION AND ECONOMIC CATASTROPHE SINCE THE GREAT DEPRESSION prior to the 1992 elections.
“Keynes wasn't completely wrong, his ideas just really should only be applied to situations where there is a deflationary spiral and a vast amount of damage has already been done.”
Since the 1930s it has been “tax and tax, spend and spend, elect and elect” all the time. Not only that, but unless Republicans are in the White House, “the deficit scare” is nothing but a “myth” if you rely on liberal economists who substitute their politics for economics.
As to a deflationary spiral, something like what happened in Japan happening here sometime in the future is an intriguing (not implying a necessarily positive) prospect. Nobody predicted it in Japan; what about here?
Yes I am very upset that I think the US is going to suffer massive hardship that is not just cyclical instead of timing the completely predictable cyclical rebound and making millions of dollars. I really do hate my own success that much.
And you know, I'm not talking about many “Liberals” that think this, as most of the people I find to have the most accurate take on the situation are all Free Market Libertarians (I tend to agree with them strongly on what we shouldn't do even as I am very skeptical that if we do what they wanted then things would be better off over the long term).
And sure you might have heard that phrase a lot during those decades, but we didn't have the same amount of debt back then. Global debt has doubled in the past 8 years…debt to GDP (or debt to income) are far above the levels before the Great Depression. Britain has the highest levels of personal debt in history. Heck all those socialist countries are way worse off than we are, and once people finally realize that the Euro is going to plunge.
Also while I think things are going to get really bad, I think that a) the relative strength of the US will increase significantly (in fact I feel bad for all the emerging countries that are going to be absolutely slaughtered right as they were starting to make ground) and b) that we will become a lot more stronger and self sufficient, as we will have gotten rid of most of the stupid excess and can focus on better allocation of resources.
Also about the “leading economic indicators” don't get me started. If you don't point out that every single “leading economic indicator” has been changed since the mid-90s, from CPI (which is super important as it says what real growth is and is 2-3% lower than the prior calculations) to the job stats (in which we would have lost a million jobs by now if not for a model that has only been in use since 2004) then sure the economic indicators are great. But the fact of the matter is that they have all been tweaked significantly in the last 10 years and there has been no “real” economic stress that has happened with the new indicators in place. In ten years we'll look back and see they are just all BS.
We've been living better at the expense of the Chinese for years now. We import far more than we export. As a result our $ is crumbling, while oil naturally goes up.
This, of course, doesn't matter to the rich. They have an ever increasing share of the wealth left in this country while the peons get squeezed.
Meanwhile the fat cats in Washington are busy making sure that we have a National Corvette Day.
“As to a deflationary spiral, something like what happened in Japan happening here sometime in the future is an intriguing (not implying a necessarily positive) prospect”
Well that's the question ain't it? In Japan they just zombified all the banks and they've basically been in stasis for nearly two decades with no end in sight. Now the citizens had tons of money saved and were very risk adverse so they had a lot to live on the whole time and the government tried everything to get people to spend…while here, not so much. So that's completely different and what “worked” there might not work here. If we tried that here it might just collapse the dollar and cause massive inflation.
But did it really work? Who knows? If they had let things get bad then maybe they'd be a lot better off today, or maybe not. Hard to say. What's not hard too hard to say is that our central bankers are scared to death of deflation (er excuse me, an “unwelcome decrease in inflation” since they never say deflation) and also that the Federal Reserve has already tied up more than half its reserves trying to stop deflation from happening and just praying that asset prices go back up. Unfortunately, since banks have so little capital that they can barely lend, and that the new projection is for $1.5 trillion in losses (which would lead to a decrease of about $10 trillion in loan capability) I fail to see how deflation won't happen.
Austin Roth–
Are you saying the economy is no cause for concern?
“debt to GDP (or debt to income) are far above the levels before the Great Depression”
I'm aware of the ratio. It's used by liberals to defend debt (as long as Republicans aren't in the White House) and often used by (broader-definition) neoconservatives (those happy with Big Government in Washington, as long as _they_ are buying the votes rather than liberals and Democrats; “me, too”) when they say “deficits don't matter” or simply substitute debt for taxes (“pay later” appeal to childish instinctive avoidance of the unpleasant).
“What's not hard too hard to say is that our central bankers are scared to death of deflation (er excuse me, an 'unwelcome decrease in inflation' since they never say deflation) and also that the Federal Reserve has already tied up more than half its reserves trying to stop deflation from happening and just praying that asset prices go back up. “
Meanwhile, the public is concerned about inflation, not merely the increase in fuel prices (rippling through the rest of the economy) or the falling dollar (making things more expensive by another means).
I believe the most likely situation is a repetition of 1970s into the 1980s based on our experience to date, but if the fuel prices increase to the point where it drastically slashes the rest of people's budgets*, then there could eventually be deflation from the demand side even if people aren't saving much here currently.
* This hasn't happened yet insofar as necessary travel is concerned. I've seen a reduction in discretionary travel, less traffic on the highways during the holidays. But in town here people aren't modifying their habits and they still speed and use heavy-throttle to full-throttle acceleration routinely. Even people too dense normally to know better would learn better eventually if it were necessary to control their costs.