How Do You See The Economy

[pjorourke]

Originally Posted by NormalBob

I hope you're right.

Unfortunately we seem bent on institutionalizing the Europeanization of our economy. Even the "strong" economies of Europe have persistent 10-13% unemployment.

Word!

[TallTexan2009]

If you are employed it is a recession, tighten the belt a little and all will be fine. Shop at Walmart instead of the malls until it hurts.

If you are unemployed it is a depression, No health insurance, unemployment is just enough to cover food, the kids want to move back home but it is in foreclosure.

If you are wealthy, now is the time to gobble up everything in sight and get rid of those pesky employees by outsourcing everything to the far east. The best way to profit is always to hire cheap foreign labor too bad for the whiney, lazy Americans.

So, in essence, it all depends on what you started out with. Not a day goes by that I don't wish I had selected wealthy parents at birth.

[Fast Gunn]

I think that financial discipline is needed at this time, but even before that, one needs emotional stability to cope with the uncertainty of the times.

Too many people who are facing bankruptcy of their business or foreclosure of their homes are seeking solace in drugs or alcohol which is natural in a way, but exactly the wrong thing to do.

Fortunately, there is still money to be made out there, plenty of money! Look at how successful Google has been even in this tough environment while other search engines have gone out of business. Google is making money like bandits even if it's only at thirty cents per click, but raking in billions of dollars nonetheless!

Some people that I know have been buying foreclosed homes and renting them out and with the profit they make are buying more homes and getting very rich in the process.

A friend of mine tells me that he's going into "survival mode" until this thing blows over and that might be a good tactic to take while this recovery kicks into high gear.

I do feel for the providers because the service they provide is a luxury and luxuries are the first things men cut from their budgets when the economy gets tight.

[TexTushHog]

Originally Posted by DFW5Traveler

Blogs, again??? I read them both and they are both personal opinion pieces. Historical precedence is a better tool to use as a reference to our current path.

In the First article, he even says that the administration is "digging the economy out of its deep hole." The pole on this thread shows, even on a very small scale, that it isn't true. The article sounds like a "tingle up my leg" praise of Keynsianism and therefore cannot be objective.

In the second article, labelled "Comentary," it starts by labeling deregulation during the Reagan administration as a root cause to the collapse of 2008. He is right that deregulation caused part the problem; the repealing of the Glass-Steagle Act of 1933, a regulatory act, was a huge part of the problem. Thank you very much Bill Clinton. It seems you fail to believe that a Democrat could have any hand in the mess we are in. During the Bush administration Rep Kanjorski(D) said, "at some point it's better we don't mess with this than do a bad job," refering to Assistant Treasury Abernathy when he said, "there is the need for a new regulatory system." Abernathy reiterated "the Treasury view that the 12 Federal Home Loan Banks should also be regulated by the new entity but said that is not a requirement for administration support."

For the record, I agree that the repeal of Glass-Stegall was a part of the problem, although not a huge part. Most of the blame for deregulation goes to Reagan and the failure to do something about the housing bubble and the liquidity trap falls to Bush.

[Sarcastro]

Deregulation of the banking industry began with Carter, who signed into law the Depository Institutions Deregulation and Monetary Control Act of 1980. This was consistent with his deregulation of other industries: Trucking, aviation, railroads, oil and oil pipelines, interest rates, and so forth.

The failure to "do something" about the housing bubble requires that one first recognize that a bubble exists--something many bright minds (including members of Congress from both sides of the aisle) failed to do. If one really wants to point fingers then Greenspan is the most likely culprit for failing to shut off the money spigot when it became apparent to many observers that the housing market was becoming overheated and that consumers were over-leveraged. And Bush controlled Greenspan no more than Obama controls Bernanke.

I just purchased a Zimbabwean 100 Trillion Dollar note. It cost me $7.50 plus shipping.

[DFW5Traveler]

Originally Posted by Sarcastro

Deregulation of the banking industry began with Carter, who signed into law the Depository Institutions Deregulation and Monetary Control Act of 1980. This was consistent with his deregulation of other industries: Trucking, aviation, railroads, oil and oil pipelines, interest rates, and so forth.

The failure to "do something" about the housing bubble requires that one first recognize that a bubble exists--something many bright minds (including members of Congress from both sides of the aisle) failed to do. If one really wants to point fingers then Greenspan is the most likely culprit for failing to shut off the money spigot when it became apparent to many observers that the housing market was becoming overheated and that consumers were over-leveraged. And Bush controlled Greenspan no more than Obama controls Bernanke.

I just purchased a Zimbabwean 100 Trillion Dollar note. It cost me $7.50 plus shipping.

I completely forgot about that one. Thanks Sarcastro. Lets see, Weimar Republic and Zimbabwe both countries ran by central banks creating fiat money resulting in hyperinflation.

Read The Vampire Economy, Günter Reimann, for a true-to-life horror story of facism, published January 1, 1939.

[WOMBAT]

While I agree with those that feel deregulation of the banks was a very important starting point to the recent failure and not to start a firestorm also please excuse if not exactly on subject.

I run a small company and due to a salesperson/service manager leaving we had to change some management positions to fill the gap.

I had to move the schedule of a person for a while and was told by the person they would not work that schedule. When the schedule took effect he walked out and signed up for unemployment. I had offered to help him with recommendations to other jobs but he preferred unemployment.

Next I recently employed an unemployed bookkeeper through a personal refferal of a friend (??) after a couple of months things just weren't getting done, so we started monitoring the bookkeeper PC.
We found that for several weeks the bookkeeper had been coming in and playing Facebook for 6-7 hrs per day.

The point I am trying to make is there some valid point to be made that a lack of production may also play a part in the slowness of recovery?

In the same vein I see a lot of businesses raking it in while others in the exact same market are crashing can there be something in that maybe a lot of corporations grew fat employee wise while business was good and are just now having to finally justify their head count during lean times?

What I wish we knew is: What percentage of unemployment is people not able to find a job versus people not able to find a job they want?

And last but not least the news just mention credit card rates in the 70+ percent range.
I know of 39% but geez.... whatever happen to usury laws. If you want to help people out lock the rate back to 20% or less.

Just throwing this out there.

[Sarcastro]

What I wish we knew is: What percentage of unemployment is people not able to find a job versus people not able to find a job they want?

From my recent reading of the WSJ: Unemployment in the top decile of income earners (something northward of $150,000) is 3%. Underemployment for that same group is 1.6%. For the bottom decile unemployment is 31%, and underemployment is 21%.

So for the affluent or modestly well-to-do there is no labor market recession. They're fully employed. For the less affluent, well, not so much.

[DFW5Traveler]

Not to whine, but I'll offer cheese. I've been unemployeed over 3 months now. My job was shipped to a foreigner after the company was sold to a foreign investor. Instead of offering me the job in Canada, they decided to give it to someone who has never worked in a .NET environment.

I've talked to my former co-workers who told me that they have now payed a consultant to come in and fix what they screwed up. For what they paid the consultant they could have kept me on at my regular salary an additional three months.

I'm not giving up, but expanded my search to a myriad of other places. Unfortunatley, TX is or was in better shape than the rest of the country and it appears that the rest of the country is moving to places like TX to find work. I've even began looking at my original trade, avionics, as an alternative, but have been out of that game for over 10 years. Technology changes, so my experience is useless for current standards and the current administration is killing the airlines, so they aren't hiring.

As far as IT goes, i'm an intermediate level VB.NET programmer. Most companies in the DFW area will not hire VB.NET programmers, they opt for C#. HR reps do not understand that the 2 are interchangable. Both are compiled in the MSIL and can be converted back and forth within seconds. When HR reps don't see C# on a resume, it's an immediate disqualification.

I am bitter. My bitterness extends to both parties inside the DC beltway. Globalism is destroying this country. I am sick of seeing companies sold to foreign investors, jobs leaving for cheap labor, American products being manufactured in China, toll roads being sold to foreign investors, the DOE failure to curb foreign oil purchases, and even former congressmen sitting on the boards of companies sold to foreigners.

[Daniel]

We can all blame this party or that party or this Prez or that Prez, but think for a minute: We put them there. We have also allowed big money to own the people who make our laws. Keep in mind that 45% of your income tax is going to the dept of defense. What our government has been the most successful at is selling fear. We're in 2 wars and are involved in "police activity" all over the world. And what is the payback? Have you ever thought about how much oil this country could have purchased on the market with just the money that has been spent in Iraq? And don't kid yourself about why we went there. It was purely about the oil reserves. American companies are just now making deals with the Iraqi government to produce and develop their reserves. I know, I work for one of those companies. War is big business, especially the way our government outsources today. Eisenhower's most significant speech was one of his last where he said "beware of the military industrial complex". Fear: the government's best commodity - and we've been buying it for decades.

[ydnar22]

I personally have not seen a decline in the economy, I believe there is a Very serious problem But we have hired more staff, opened new locations and we are looking at our second record year in a row.

Unemployment numbers are not a reliable Indicator of much. We have approximately 6% unemployment all the time. And it has been that way since 1957. So we are only running less than 4% high. Why would you want to get a Job when you can draw unemployment for a year or longer and go to school or start your own business. And some states the numbers are off. Like California, for insistence you can be on unemployment and still working. For my Stores in Cali we will not hire anyone part time because of this. I assume its the same way for other business in Cali. We could normally employ 8-12 people per store, with 8 full time and 4 part time. So we now run our Cali stores with 8 people. Its not that the work is not there for more, its the fact that my unemployment insurance goes up for people that are employed. Same thing for our cronic Homeless population.

foreign owned debt, another point that was brought up, Less than 25% of the nations debt is in foreign hands. About 3.689 trillon of the total. With China owning about a quarter of that and japan owning about 20%. Which is not an all bad thing. Both of those countries need the US market for there own economy to remain stable.

52% of the debt is owned by the government and the Treasury and the Rest is Private US Money.

We all want Jobs back, We need to Start making goods here again. Close the loophole of tax free imports and Get the price of Third world products up to where US companies can Compete with pricing. We want government deficits to decline, we need taxes. Tax imports and the problem corrects its self. I used to own a T-shirt and screen Printing company in Germany, it was cheaper to move everything to the USA to import From India and China then it was to keep everything in Germany. Free Trade is a nightmare.

The current problem will not correct its self. The bailout money Put the Brakes on a problem, But i am watching the banks, there are 500 of 1340 banks that i for see failing in the next 3 years compared the 200 hundred or so that already failed over the last 24 months. These are the banks that are Overextended already, with Texas Ratios above 10 and have already been propped up with TARP funds.

Just wait till we see the fall out of commecrial Real estate. These are useally held by local Smaller Banks Not the big National banks that have been in the news for the last year.

When we live in a Dream world, it has to end sometime. The USA has one of the worst Saving rates in the world. We spend, spend, spend, and wonder why there is so many problems when Credit dries up.

housing prices are all artificial, For example my parents home they bought in 1971 in Central Cali for $45,000 We sold 3 years ago for $767,000. Nothing more than a 2 bedroom bungalow with a small lot. This because of easy Credit.

[ydnar22]

Originally Posted by WOMBAT

And last but not least the news just mention credit card rates in the 70+ percent range.
I know of 39% but geez.... whatever happen to usury laws. If you want to help people out lock the rate back to 20% or less.

Just throwing this out there.

Usury Laws are at the State level, And some states do not have them. Look where all the Credit card company's home office is and you will the states with lax consumer protections. This year you will some changes in this Area. I know that CITIBank one of the biggest issuers is shedding 8 million accounts to get ready for the new laws in July. So you will see this problem get corrected via new laws. The CC rates that where high are honestly for people that should not be using credit to begin with. If you use credit wisely your rates would never be that high. the high rates are people that have missed payments.

Personally it works out great for me. People rack these up these high Balances and can't pay, so the bank sells there accounts for 3-5 cents on the dollar, we average 15-18 cents on the dollar from collections. It works for me. But as much as it would hurt one of my business i would like to see the reform that is coming. I also believe that Banks should not be able to loan money backed by consumer deposit accounts that are insured by the FDIC.

[Fast Gunn]

Originally Posted by Daniel

And don't kid yourself about why we went there. It was purely about the oil reserves. American companies are just now making deals with the Iraqi government to produce and develop their reserves. I know, I work for one of those companies. War is big business, especially the way our government outsources today. Eisenhower's most significant speech was one of his last where he said "beware of the military industrial complex". Fear: the government's best commodity - and we've been buying it for decades.

Thanks, Daniel, that was an erm, eloquent rant against the government, but how do you see the economy, that was the question!

Hello!

[UrMyHiro]

government needs to give tax breaks to small businesses but cutback on 'free' money to others.

[ydnar22]

Originally Posted by UrMyHiro

government needs to give tax breaks to small businesses but cutback on 'free' money to others.

have never figured out how giving people that paid little to nothing in to the system get huge returns. Has never made any since to me. seems alot like a double dip on others dime, welfare and huge tax refunds.