Brookings released a sobering study on how the government will run up 1 trillion dollar deficits for the next ten years even with optimistic conditions. We are definitely in a pinch. I hope this is a call to tie tax and healthcare reform together.
most people i know who are very well-versed in these types of matters disagree with you completely... in fact, most seem to think things will get significantly worse and that any sort of '09 recovery is a complete pipe-dream.
If you define "recovery" to mean economic indicators stop being net-negative, very late 2009 may indeed be the literal turning point. The problem is a real recovery won't begin for a couple of years. The country is going to stay in the pit for a while.
I dont see how we're going to get out of this. The federal governmetn is piling on debt on top of the massive private debt there is. Probably should wait till the recovery before spending a lot of money on anything. I've seen too many people laid off or just unable to find jobs.
oh yeah?? well my friends can beat up your friends!!! they're looking at indicators on a chart from a super-slick program...comparing it to historical trends...seeing the bottom IN THE MARKET (not the economy, jobs, etc) by June...seeing unemployment hit its highest point about 9 months out from that. same program had them pulling their peoples' money out about 3 weeks before the crash. i think you guys are reading more in my posts than are there. like i'm telling you all is going to be fine for everyone in June. i'm saying the height of the unemployment numbers are still 9 months out from that. and for some of you, it seems as if you're offended by my opinions, which i can't begin to understand. IN MY OPINION...this is the time to make money if that interests you...this is where you buy and hold to ride back up. in my view, it's a helluva lot easier to make money from these conditions than it is when things are zooming along...unless you're selling products to a market. but if you're an investor in the market or elsewhere, and you presume any sector is going to rise eventually...well, they're all good buys right now assuming you're holding long term. now if we're going to zero, you can say you went down fighting when the zombies invaded...we're all screwed anyway and the dollars you saved will be worthless. but more than likely civilization will tick on and there will be a healthy economy again. we're not entirely unproductive, after all. if you're riding for short terms gains right now, you're doing it wrong, anyway. but there are all sorts of distressed assets (financial and otherwise) to pick up on right now if you have the means to do so. again..all that presumes you have some margin to take advantage of those opportunities and that you feel relatively safe in your job. if you do not, then absolutely positively do not. to everything...turn turn turn..there is a season...turn turn turn. [preaching]remember if it works...and you make money...that you should give it away generously to those in need. the less tightly you hold it the easier it is on your heart and your life when we go through these downturns. money is just a tool...nothing else...unless you let it control you. read ecclesiasties for perspective. [/preaching] disclaimer: all of the above could be wrong. all sorts of other things could happen, including but not limited to: comet strikes; black hole events; escape of laboratory-created vampire monkeys; perpetual time travel because someone turned the wheel underneath the island; cubs win world series. (though in all likelihood, i really doubt the latter)
You got to get past prevailing conservative wisdom to what economists generally think. Massive government debt is how you get out of this. Deficit spending during a severe recession helps. There won't be a recovery if you wait until then to spend.
Put conservative and liberal aside for a second. Isn't one of the biggest problems with our economy that we have massively overlevered ourselves (that includes individuals, corporations, financial institutions, etc)? We (we includes the same "people" mentioned before) used the leverage to buy stuff we didn't need at inflated prices. That means houses, cars, machinery for factories, securities, telecom equipment, computers, etc. Now, access to that leverage has been cut off by private institutions. So the government is piping in public leverage. All we're doing is replacing private debt with public debt. It may lead to a recovery, but it's just a false recovery and putting off the inevitable yet a little bit longer.
You don't have to be a genius to know that you raise taxes and cut spending in booms, and cut taxes and raise spending in the busts. Problem is that we didn't do that the last 8 years, thus the fiscal mess we are in. That's what Clinton had done right. Now, we have to follow that principle now. Taxes have already been cut - too much perhaps...but we have to spend. Once the economy recovers though, that's when the gov't has to really cut spending on a lot of programs - has to be done. We can't afford all this debt.
Hoover's legacy was the Smoot-Hawley Tariff: which killed global trade, exacerbated the Great Depression and helped lay the groundwork for World War II. James Buchanan's legacy was the Civil War. Nixon's legacy was the Khmer Rouge, the Fall of Saigon, Gerald Ford, Jimmy Carter and the Independent Counsel law.
