The Economy is in Big Trouble

[Hannah Bell]

Imagine the reaction at the White House when the Department of Labor released its weekly unemployment figures on Thursday. Jobless claims rose by 12,000 to 500,000 in the second week of August. There's been no improvement in the jobs market in 9 months and now unemployment is edging upwards again. This wasn't supposed to happen. The Obama administration had bet everything that the economy had turned the corner and would gradually get better. Many economists saw less than a 10 per cent chance that the economy would tip back into recession. After all, double dip recessions are "extremely rare". Now more people are losing their jobs and Team Obama is caught in the headlights. There is no back-up plan, no Plan B. The Democrats will face the midterms with no stimulus to create new jobs and with an economy that is steadily deteriorating. It's going to be a massacre and they know it.

Obama and his lieutenants have stopped talking about austerity measures. The plan to dismantle Social Security has been put on hold,( though the Commission headed by the appalling former Senator Alan Simpson grinds on with its mission of destruction.) No one wants to hear about belt tightening when the future is uncertain and they're worried about losing their jobs. Obama will have to shift-gears again; switch from promoting the elitist "privatize everything" agenda to his "I feel your pain" routine. He might want to dig up some archived video of B. Clinton chewing his lip and blinking back the tears.

All of the economic data is being revised downwards. The economy is in big trouble and the politicians are just starting to catch on. Stocks fell sharply on Thursday (Dow down 144 points) on news that manufacturing (Philly Fed Index) shrank in August beyond analysts expectations. Nearly every category fell including shipments and new orders. The Dow Jones is off 10 per cent since April 23, more than a 1,000 point loss in the last 4 months. Also, Moody's reported that commercial real estate prices slipped another 4 per cent in June. According to Calculated risk website, "Commercial real estate values are now down 41.3 per cent from the peak in late 2007." It's a bloodbath.

Bond yields on US Treasuries continue to tumble as investor pessimism grows and increasingly bleak news feeds the fears of another slump. The two-year note has been setting records nearly every day. The benchmark 10-year which peaked at 3.99 per cent in April has since descended into Bernanke's inferno. It was last seen parachuting to terra firma at 2.61 per cent. If it continues to plunge at this rate, it will be below 2 per cent by year-end.

http://www.counterpunch.org/whitney08192010.html

[louis-t]

1. Thanks, Hannah Sunshine!

:hi:

[RC]

2. This is what happens when Big Money is in charge of a "recovery"

Without living wage manufacturing jobs, there will be no recovery.

[okieinpain]

3. all he has to do is build war stuff. tanks planes, guns and bombs.

[LAGC]

22. Nope, that won't work.

Despite conservative propaganda, war spending takes away from the economy, not adds to it.

We need heavy re-investment in America, not more wasted billions dumped in endless ventures overseas.

We need to grow the economic pie, not eat more of it.

[okieinpain]

48. oh I didn't mean wars I meant just having the stuff built. some new

subs, personal carriers, that kind of stuff. put people to work at good jobs building stuff here in america and it would be hard for the repugs to fight it. hell buy a new fleet of volts for the post office.

[maryf]

46. and make sure the educational institutions

prepare a willing and ready stream of troops...:sarcasm:

[Vincardog]

4. What will it take for Obama and the Corporatists to give up on their agenda and get with real

Populist programs and reforms?
Do they really have to let the rich 1/2 of 1% crash the world economy AGAIN?

[DJ13]

5. The Obama administration had bet everything that the economy had turned the corner

Obama needs to stop listening to the supplysider leftovers from the Clinton admin now in his administration and start thinking for himself.

You cant fix a consumption based recession by propping up the producers and forgetting to help the consumers.

[Fumesucker]

7. "Forgetting" implies that it wasn't deliberate..

I don't believe that it wasn't deliberate.

[DJ13]

10. I think it was deliberate too

But I'll give Obama the benefit of doubt and say he was misled into thinking that the economy would improve even as he was ignoring the consumers.

Supplyside is like a religion in DC in both party's now.

[Fumesucker]

12. As someone said on another thread..

Voodoo economics is the state religion of the USA..

[ixion]

21. I think it was intentional as well...

if you look at the 'message' over the past few years, I think you'll see that from the so-called 'Ownership Society' all the way to the so-called "Consumer Protection Act."

They knew quite well what they were doing.

[cowman]

15. You can prop up the producers

all you want but if the consumers have no money or jobs to earn money than whats the use of producing goods that no one can afford.

[BadgerKid]

20. Succinctly: It's time for another Henry Ford Model T idea person. n/t

[Hannah Bell]

25. we're not really propping up producers - that would at least be sensible.

we're propping up financial speculators -- otherwise known as non-productive drains on the real economy.

[Fumesucker]

6. I woke up this morning and I got myself a beer..

The future is uncertain and the end is always near..

[FirstLight]

8. my eyes glaze over when they start talking econ/ stats/metrics

alls I know is that I am supposed to be finding a job, and there's none out there...

If there's a 32 hour a week requirement of 'job-related activity' for foodstamps/etc...then how long is the search supposed to last?
Indefinately?

[yella_dawg]

45. It lasts until you finally have a nervous breakdown.

Then hopefully, you get disability coverage.

[bluesmail]

9. Here's a way to destroy a country, destroy it economically.

Saves the explaining about all those weapons of well you know what. The Safest way.

[Starry Messenger]

11. Our politicians need to start living on minimum wage.

Perhaps then they would stop rearranging the deck chairs.

[Hannah Bell]

13. we need to make them, that's the trouble.

[Starry Messenger]

17. No one wants to bell the cat.

Well, we do but the cat keeps kneecapping us and acting innocent. I can't wait for all the surprised looks on the news from DC when rioting starts.

[Poboy]

26. And this is what it will take. -nt

[Starry Messenger]

29. Yup. n/t

[Fumesucker]

14. Eh, they work for tips..

They ought to get what wait staff gets, I think it's about $2.89 an hour right now but I could be out of date a bit.

[leftstreet]

34. +1

[Barack2theFuture]

16. Maybe he could get Geithner and Summers to give another

10 or 11 trillion to Wall Street banks. Surely it would work this time.

[MannyGoldstein]

18. NOBODY could have predicted this. Nobody.

Except Nobel Economics Prize winners Krugman and Stiglitz, and other prominent economists who predicted that last year's stimulus was insufficient and that other actions have been absurd, and that we were/are being governed into economic oblivion.

Why on God's green earth were serial incompetents like Summers and Geithner put in charge while Krugman, Stiglitz, and others with stellar track records were shunned?

This may be as much a faith-based White House as the last one.

And why should we believe that Obama's attack on Social Security has abated? Just last week he indicated, by loud omission in a speech, that he's in favor of fucking with it - and I'm pretty sure he's not thinking benefit increase here.

[Greyhound]

30. Why indeed.

The number of possible answers is pretty limited and none of them good.

[bbgrunt]

32. Greyhound, you certainly have a magnificent way with words. well put.

[Greyhound]

37. Thank you.

Now, if we can just get enough people to stop listening to propaganda that depends on ignorance of the system and issues to appear logical, we could get to the job of fixing this mess.

[blindpig]

40. Karl Marx predicted this.

Crises of overproduction are one of Marx's indictments of Capitalism.

Mebbe we oughta be paying The Old Man more attention.

[MilesColtrane]

19. Obama should have listened to the National Labor Coordinating Committee when it...

petitioned for a second stimulus bill.

Oh, well.

Whitney has been prophesying economic armageddon for a couple of years now.

The latest numbers mean more pain, but not the total collapse that he has been calling.

[Buns_of_Fire]

23. So, double-dip recessions are "extremely rare." That's good to know.

But what I'd really like to know is when we're scheduled to get out of the FIRST dip.

Oh, and Wall Street can kiss my ass. Just thought I'd toss that in.:mad:

[Steely_Dan]

24. Repairing Infrastructure = Jobs n/t

[Poboy]

27. White House ‘not worried’ about double-dip recession

Friday, Aug. 6, 2010

http://www.financialpost.com/news/White+House+worried+about+double+recession/3367533/story.html

[cowman]

28. Thats because

they are in DC, they have no fucking clue whats really happening in the real america.

[scarletwoman]

31. Oddly enough, when you rescue the parasites, they just go back to sucking the blood of the host.

There's no way out of this as long the financial sector has free rein.

[bbgrunt]

33. SW, words of wisdom, indeed.

[LatteLibertine]

36. Voting

Wall Street lackeys out of office is paramount, otherwise the cycle will never truly end.

We need real regulation and politicians who are concerned for the well being of the overwhelming majority of the population first.

Look at the gulf coast and this recent egg scare to see what happens when meaningless or no regulation and greed rule the day.

It was our buddy Dub-yah who put many of the Clinton food regulations on the shelf.

Also regulations are never going to be effective if it's more profitable to break the rules and eat the fine than to conform to proper standards.

Remember the Keating Savings and Loan scandal? That set the precedent for the 2008 crisis. Privatize the profits socialize the losses. Keating directly cost the taxpayers around 1.3billion dollars and the entire scandal domino effect racked up to 500billion. That fucker did 42 months in jail for that.

[TBF]

42. Voting in a rotten system is a band-aid -

we do it, but what we need is major surgery. It will come. Unfortunately it will likely get much worse before many start to notice.

[Poboy]

35. ttt

[Subdivisions]

38. It's no wonder considering that every economic report to come out lately has been

characterized as "unexpected".

The economists and those running the economy don't know what the hell they are doing.

Or, do they?

[ieoeja]

39. Investors are cashing out before the tax holiday ends.

Next year they will be pouring their money back into investments to escape higher taxes knowing a Republican will eventually lower taxes. And then the cycle repeats.

Too late for this November. Which is why we must remind people that the economy crashed before Obama was even elected.

[leeroysphitz]

41. Not to high-jack your thread, Hannah but this video really put all of this in perspective for me

and maybe those reading this thread who aren't economists etc... would benefit from watching and learning just why we are being screwed as well as how.


http://fora.tv/2010/04/26/David_Harvey_The_Crises_of_Capitalism_Animated

[Starry Messenger]

44. That video is great.

+1 I've started watching his series on "Capital" too.

[spin]

43. Remember that the 2010 census is finishing ...

Back in May, the census was responsible for 411,000 new jobs. Many of the Census workers will now be applying for unemployment.

While that doesn't change the fact that our economy is in bad shape, it does help to explain part of the problem.

[maryf]

47. Error:you can only recommend threads which were started

in the past 24 hours