I want to apologize to my readers for the few posts. It is so humbling to actually get comments and emails asking for more frequent postings.
My various business and consulting gigs are all retail related and go into high gear in December. Generally I'm working 18 to 20 hour days and I absolutely love it. If (heaven forbid) retailing gets into your blood, this time of year is the World Series, Super Bowl and Kentucky Derby all rolled into one. Posts will be light until after the holidays.
But....... All you faithful readers already know I've been trying to tell anyone who will listen that we are not in a recession, but are instead heading into a Depression that will dwarf the 1930's. I am appalled that our so called financial leaders in Washington either can't or won't see the coming disaster.
Our current activities in Washington will not help. The proposed auto bailout is a huge mistake. We are plunging the nation into a deep national debt from which we may never recover.
Today's record breaking unemployment report is a harbinger of things to come: Employers cut 533K jobs in Nov., most in 34 years
Make your personal financial decisions based on the coming disaster.
16 comments:
Washington won't see the coming disaster, Wizard. I'm not usually Chicken Little yelling, "The sky is falling." They won't see, Wizard, because this disaster falls squarely on the shoulders George Bush and his chicanery.
I, too, saw the news this morning and just shook my head. I don't envy the job ahead for the new Congress and president. People who are unaware that it takes four years to clean up the mess from a prior administration will blame Obama for the legacy Bush left who ran every company he owned into bankruptcy.
Even America.
Job Losses just keep comming and comming. The items I see for Job Creation from our new president appears ill advised or less then useless.
ANY Government bailout of a private industry is a mistake.
The numbers we are getting from the auto-makers show that mismanagement is a current CEO skill.
BDS aside Stella, I wonder how you justify "this disaster falls squarely on the shoulders George Bush"
While President Bush spent like a democrat, the House and Senate are VERY culpable.
Actually Stella, I agree largely with Lee. I find little or nothing to fasten any blame for this current crisis to President Bush.
Factually, there has been NO deregulation under Bush. There has been no relaxing of standards or proceedures or control.
In fact, Bush actually tried to add regulations and reduce and tightly control Sub-Prime mortgages. The Democrats, especially Chris Dodd and Barney Frank fought the measures with every fiber in their bodies.
But.... Where Bush NOW deserves blame is the huge mistakes being made over just the last 30 days by Secretary Paulson and the White House economics team. However, much of this program was developed (with typical huge earmarks) by the Democrat controlled Congress.
The bubble in the housing market caused this problem. Sub Prime mortgages are the fuel that caused the wildfire.
You cannot place that blame on either party.
Lee and Wizard, you know I greatly respect both of you, but this is an issue where Bush provided no oversight to the financial industry. Accordingly, the leader of any team, just like the commander of troops, must accept responsibility for the people s/he serves.
Bush spent like a Democrat on increasing military spending and, admittedly, decreasing veterans' benefits for six years in a row. Please refer to the GAO reports.
The Bush Administration spent billions of dollars on military contractors. While our soldiers made $20/hour driving tanks, Halliburton employees got $100/hr. Further, all military contractors were hauled in front of Chair Henry Waxman, House Oversight Committee, to explain losses in the billions of dollars.
Off-shoring has been increased so that hundreds of thousands of Americans have lost their jobs. I would like to know why tech writers and IT development have been outsourced to India. I don't have anything against India, but that money should have stayed here. Bill Clinton may have signed NAFTA, but a Republican Congress supported the bill (no pun intended...)
I am not convinced that Bush doesn't bare responsibility for deregulation. The Bush administration objected to a proposal to have an independent regulator of Fannie Mae and Freddie Mac be an independent unit of Treasury, much like financial regulators housed in the agency that oversee banks and thrifts.
The Washington Post article states, The White House is working to enact a wide array of federal regulations, many of which would weaken government rules aimed at protecting consumers and the environment, before President Bush leaves office in January.
The new rules would be among the most controversial deregulatory steps of the Bush era and could be difficult for his successor to undo. Some would ease or lift constraints on private industry, including power plants, mines and farms.
Over half of these subprime loans came from mortgages companies not covered by CRA. Deregulation has been a key policy during the entire Bush Administration: Conservative Republicans always want the government to stay out of business and avoid regulation as long as they are making lots of money. When their greed, however, gets them into a fix, they are the first to cry out for rules and laws and taxpayer money to bail out their businesses. Obviously, Republicans are socialists. The Bush administration has decided to socialize the debt of the big Wall Street Firms.
The New York Sun writes, "Eight years of deregulatory zeal by the Bush administration, an attitude of 'The market can do no wrong,' have led us down a short path to economic recession," Mr. Schumer said from the Senate floor late last week. Later, he said Mr. McCain "has been a leading advocate for deregulation for a very long time."
Obama noted, Bemoaning "the most serious financial crisis since the Great Depression," Democrat Obama faulted Republican McCain's domestic policy agenda as the same as President Bush's — "one that says we should just stick our heads in the sand and ignore economic problems until they spiral into crises."
This quote is almost verbatim to Wizard's: we are not in a recession, but are instead heading into a Depression that will dwarf the 1930's. I am appalled that our so called financial leaders in Washington either can't or won't see the coming disaster.
There's more. The American Prospect cites that Conservatives blame the housing crisis on a 1977 law that helps-low income people get mortgages. It's a useful story for them, but it isn't true.
It's clear to me that deregulation and giving tax checks back to the public instead of keeping the money in the federal reserve, especially when America was in a deficit, was foolhardy. And I'm being kind.
Alternatively, Fact Check takes a more even-handed view, spreading the blame for the financial crisis among many factors, one of which is The Bush administration, which failed to provide needed government oversight of the increasingly dicey mortgage-backed securities market.
You all know I'm willing to listen, but lack of financial oversight by the Bush Administration is a key, if not primary, factor in the financial crisis in which we find ourselves.
Lee, the Democrats have only held a slim majority in Congress for two years: the Republicans often overturned regulatory bills. We must remember that Republicans controlled Congress for 12 years. Yes, the House and Senate are clearly culpable, but which House and Senate? The Republicans controlled Congress for 83% in the last 14 years. That's clearly an issue to consider.
And, off-topic Wizard, what about the environmental deregulation Bush is pushing through in his last days in office?
What Stella says....
I'm taking Wizard's word to the wise. The personal financial decision I'm taking for the impending disaster' is to go out a buy a trunk load of assault weapons.
Vig, Wizard's absolutely right. I've felt the same way for the past few months. And I said I wasn't going to rant anymore. LOL!
You can hardly blame Bush for not providing oversight when it was the Democrats that block all efforts at such oversight. This has been a typical Democrat strategy: block all progress, then blame the other side for not get anything done. On the other hand, Bush was all to ready to trumpet the increased home ownership that happened on his watch. There is clearly plenty of blame to go around.
Let's also remember that the Great Depression was just a recession, until the government came in and did exactly the wrong things. They tightened the money supply and raised taxes. In this crisis, we have dramatically loosened the money supply, and nobody is talking tax increases right now. That bodes well.
Relax a bit: the economy is the worst it has been in 34 years, but comparisons to the Great Depression are way premature. We would need almost 5x the current unemployment to get there. The economy is still not nearly as bad as it was during the Carter administration.
Lastly, you can usually tell the top of a bubble: it is when everybody is yelling "Buy! Buy! Buy!". Likewise, market bottoms are usually herolded by utter despair at the future.
Vig: "trunk load of assault weapons"? I thought you were the gun control guy? :P
What part of sarcasm don't you get, Shoo? Besides, I don't need to beef up the contents of my trunk when I have a restless young Doberman. It's a lot safer sleeping with her than with a loaded shotgun.
Vig the :P kinda shows Shoo "gets" sarcasm as well as he receives.
Stella, partial response here.
Military and war spending is government money comming into the US. If anything it helped the economy.
Offshoring does cost jobs, it also lowers cost. If that cost is passed to the consumer it helps if it goes to stockholders it helps.
Making loans to people who cannot or will not pay loans back is just bad business. However, a bank that is doing well will offer loans with higher risk. Having Janet Reno threatening to investigate your lending institution if you do not make risky loans, is over the top.
Telling companies that Freddy and Fanney will underwrite the loans...
Well, yeah, big big mess.
Regulations go both ways, they hamper business and protect the public.
I agree with you Wiz. Bailing out the automakers will be a big mistake, but I think the government will try it anyway. And they will just keep coming back for more and more.
So tiresome is your dogmatic dichotomy of us vs. "the guv'mnt", John, that I'm tempted not to comment. So, I'll make it short. This conservative cant is epitomizes the right wing's false dichotomy between government and the people. The truth has always been that government is composed of people who have been voted in to represent the rest of us. (Where did you go to high school?) The irony is that you are the guys who voted the current sorry gang of people into government. You guys used to quote Ronnie Reagan characterizing liberals as saying the scariest words in the English language were,
"We're from the government and we're here to help."
In fact, the scariest words are,
"We're Republicans and we're here to fix government."
as has been proven out in the last eight years. It's not that government is bad, it's that Republicans have done their very level best to wreck it.
Take notes when that girl, Stella, deigns to time from her busy day and comment in these pages, John. She's casting pearls among ....
(Ooops! I went on too long!)
BTW, I'm not sure the people should bail out the SUV capitol-of-the-world either. Why not the people's represenatives write legislation to sell Detroit's automakers to the Japanese and the Chinese? They can make autos which meet the CAFE standards appropriate for the age of peak oil, if any one can.
(There! At least I proposed something.)
I'm not messin' with shoo. But I will respond.
Shoo, the Democrats did not block all efforts at oversight, such as Henry Waxman's tireless efforts as the Chair of the House Oversight Committee, particularly as concerns the wasted money of the military contractors. I am reminded of how Karl Rove ignored Waxman's summons to testify before the Committee.
Increased home ownership? Yes, as long as the banks gave junk loans to people who could not afford homes—particularly in California. I agree that the Bush Administration was ready to pat themselves on the back regarding the increased housing market: I don't think they can do that now. The GOP supports deregulation, which simply doesn't work. The idea of trusting the banking industry, telecommunications, or any industry to regulate itself is naive.
Shoo, I think we are slipping into another Great Depression, and don't believe FDR did the wrong things. His Great Society saved the nation from even worse financial ruin. I do feel FDR did err in ending the gold standard in 1933.
Unfortunately, when the nation is in the financial situation it's in currently, taxes must be raised and the money supply must be tightened. Further, America's deficit is the worst its ever been: you can't blame Clinton for that. I was against those stupid rebate checks Bush issued while the country was slipping into a deficit—that was a lame idea.
I truly appreciate your comment to "relax a bit," but the unnecessary Iraq war has all but bankrupted us. As concerns the Carter Administration, we were in an inflationary period and, admittedly, those were difficult times, but I could easily get a job back then. Not now.
During Clinton's Administration, unemployment dropped each year to a low of 6.8% at the end of his administration. Currently, unemployment is at 6.7%, and 7.8% in the greater Los Angeles area (#2 worst in the country). At the risk of repeating myself, Obama will be the fall guy for the clean up because people don't realize how long it takes to enact legislation.
So, Lee, check the unemployment index link. Notice that America's unemployment increases every time we go to war. It's only in the modern era that we've increasingly hired military contractors, and they are simply deleterious for the economy.
Lastly, you can usually tell the top of a bubble: it is when everybody is yelling "Buy! Buy! Buy!" Yes, so Bush advocated shopping after 9/11 to show the bad guys we were going on with out lives. His attitude still mystifies me. You're right, watch out when everyone says Buy! You know you're in trouble.
Likewise, market bottoms are usually heralded by utter despair at the future. Right again, Shoo. It's just like CSN&Y sang, "You know, the darkest hour, is always just before the dawn." (Please enjoy the "hippie" video...)
I always like people who make me rethink my perspective: you and Lee do a good job of that. Vigilante, you're the best.
Damn, in the unemployment comment, I meant to say "the Carter Administration dropped to a low of 6.8%."
Lee, you said Offshoring does cost jobs, it also lowers cost. If that cost is passed to the consumer it helps if it goes to stockholders it helps. If consumers have no jobs, how do they buy the product?
I'm in a niche area of IT and saw five job opportunities in my field. Unfortunately, they were in India.
Post a Comment