Does Anyone feel like Bailing

[tw]

Originally Posted by classicman

Do you think it worked? With underemployment and unemployment at what now 17-18% ? Do you think it worked?

We know due to economic mismanagement in the 2000s (ie tax cuts for the rich, Enron accounting without any prosecution, etc) that we created a 2008 meltdown. History says massive jobs losses will occur in 2012. That is inevitable due to money games played and encouraged throughout the 2000s.

The question is - and nobody can answer it - is how bad the inevitable job losses will be. With intelligent people replacing political extremists, we have seen a major economic disaster averted. Now we will learn how expensive it was to avert disaster.

Only wackos would blame Obama for this - as they are lining up to do. As Obama accurately said when he took office (and the overwhelming consensus from the Jan 2009 Economist's convention in San Francisco), we will be paying for the 2000s for the next ten years.

A concept repeated repeatedly. Money games result in economics taking revenge. That revenge is ongoing due to a $trillion wasted in Mission Accomplished, et al, welfare for the rich, welfare to industries such as big Pharma, protection for some of America's least productive industries (ie big steel), all but open encouragement of Enron accounting, subversion of the SEC, a ten year 2% reduction of American incomes, etc. Whereas problems could have been solved at the source (ie bankruptcy of big steel, proper regulation and oversight of finance institutions, innovation required from big auto, honesty about threats to America, mythical tax cuts, the lessons from LTCM, etc). Now everyone becomes innocent victims as economics takes revenge. Lessons learned from history.

We must sell off major parts of America to pay for those money games. Or bankrupt many corporations. Or massively downsize the military. Or further depreciate the American dollar (below the already 40% drop compared to the Euro). Or massive unemployment. Or increase foreign debts. All examples of how the American economy may have to suffer to correct economic money games through the 2000s.

How high must unemployment rise when economics takes revenge? Nobody can say. But we do know this. The American standard of living is expected to drop in response to so much economic mismanagement ten years previous. No way around reality and the lessons of history. It has hardly begun.

The lies of Vietnam in 68 and 70 resulted in misery - years centered about 1979. 30 years later, a new public is doomed to relive the lessons of history. Nobody can say how large unemployment might be to pay for the 2000s. We know this. It would have been a hell of a lot worse if not for intervention at the highest levels of government.

They were given eight hours to save the American economy. It was no exaggeration.

Originally Posted by tw

We know due to economic mismanagement in the 2000s (ie tax cuts for the rich, Enron accounting without any prosecution, etc) that we created a 2008 meltdown. History says massive jobs losses will occur in 2012. That is inevitable due to money games played and encouraged throughout the 2000s.

The 2000s were a lost decade, but some, particularly the critics, obviously chose to ignore that.

Many economists see job growth returning by this summer, but that still wont address the long-term need to retool and restructure the economy on a much larger scale.

Repeating myself (from my link on the lost decade):

Most of the recovery money has yet to be spent (by intent) and is directed towards retooling the economy by focusing on developing new energy technologies, a national broadband network, wide spread infrastructure improvement, investments in health technology, investments in education...all critical if you're interest is looking forward to be better positioned to compete in a global economy in which we may have lost the competitive edge that we enjoyed for decades.

I still havent heard a better approach from the critics here...they just keep on bailing out.

[tw]

Originally Posted by Redux

I still havent heard a better approach from the critics here...they just keep on bailing out.

I would love to believe the stimulus has cured everything. But I am not that naive that any stimulus could. This recession current appears in patches. Among some groups - no significant adverse effect and no job losses. Among others - massive adverse effects.

For example, a construction machine company owner told me he could not sell his Case backhoe - only give it away. The recession has been that destructive to his business.

In another company - a wholesaler - business is down. But not enough to lay anyone off. Even a few restaurants say they have seen less business - but not enough to reduce staff.

Too many contradictory numbers confirm what history suggest. The massive job losses should occur years from now.

Meanwhile, it is possible that Bernanke's solution has been more successful than expected. Economics data does not and cannot predict. The next five years will be an economist's dream - an opportunity to (maybe) learn things about economics that nobody has even seen. One fact we do know. No two recessions pan out the same.

Originally Posted by tw

I would love to believe the stimulus has cured everything. But I am not that naive that any stimulus could. This recession current appears in patches. Among some groups - no significant adverse effect and no job losses. Among others - massive adverse effects.

For example, a construction machine company owner told me he could not sell his Case backhoe - only give it away. The recession has been that destructive to his business.

In another company - a wholesaler - business is down. But not enough to lay anyone off. Even a few restaurants say they have seen less business - but not enough to reduce staff.

Too many contradictory numbers confirm what history suggest. The massive job losses should occur years from now.

Meanwhile, it is possible that Bernanke's solution has been more successful than expected. Economics data does not and cannot predict. The next five years will be an economist's dream - an opportunity to (maybe) learn things about economics that nobody has even seen. One fact we do know. No two recessions pan out the same.

I'm not suggesting the stimulus plan cured anything, but simply helped keep the economy from further collapse, particularly the state/local stabilization funds. I talk to local officials all the time and the adverse impact w/o those funds would have been significantly worse.

Jobs in many sectors will never come back, which is why I think the bulk of the unspent stimulus funds committed to a national broadband network, developing new energy technologies, wide spread infrastructure improvement, health technology and other high tech investments, education and job re-training, etc. are a step in the right direction.

And I cant say I have firm grasp on Bernanke's monetary policy, but i do think it helped keep the flow of credit from drying up, particularly to consumers and small business....but then again, the level of irresponsible personal (consumer) debt is unsustainable and another meltdown waiting to happen.

I'm under no illusion....we're in deep shit after wasting years built on the promises of an economic plan based on tax cuts that would lead to economic prosperity for all, at a cost of more than $1 trillion, no job creation and the stagnation of middle-class real income.

It will be a long, slow haul and those opposed will politicize it every step of the way w/o offering a better way forward.

added:
Thanks for your insight. You always offer something to consider.

[glatt]

Just got off the phone with my wife. We had some CDs that matured, so she went down to the bank to see what they were offering. The rates on the new CDs are a joke. But that's not why I'm posting this. The thing that struck me was that she said they pushed very hard to get us to borrow money. They wanted to give us a line of credit on our house. We didn't even ask, nor do we want one.

I thought the banks stopped throwing money at people. Isn't that what got us into this mess?

[Pete Zicato]

Originally Posted by glatt

Isn't that what got us into this mess?

Pushing loans on people who were not qualified to repay them got us into this mess. I'm sure you're qualified to repay.

[glatt]

Originally Posted by Pete Zicato

Pushing loans on people who were not qualified to repay them got us into this mess. I'm sure you're qualified to repay.

I'm actually not, which is why I don't want one. I think they probably figure anyone who doesn't want a loan is showing responsibility, and is therefor a good risk. But being responsible AND having that nice income is what they should be looking for.

[ZenGum]

Originally Posted by glatt

Just got off the phone with my wife. We had some CDs that matured, so she went down to the bank to see what they were offering. The rates on the new CDs are a joke.

Whatever you do, I suggest you consider something that is not in US$. With the debt, that might well depreciate over the next half decade or so. Just a thought.