'Recession' is Over!

Off Topic Politics and World Issues
1

Well, nearly anyways. We still have the formality of a couple votes and Barry’s signature, but the end is right around the corner. Now don’t get me wrong, it is certain that this stimulus is detrimental to the country in the long-term, I don’t think we even need to debate that. But, it will work to get us out of the current situation.

Let me first recap the so-called recession that began in Dec. 2007. It was so bad, that the GDP actually plummeted to a staggering increase of only 1.3%. Unemployment has skyrocketted to 7.6%, as of January 2009. The 25-30% rates of the Great Depression surely would have hit us by the end of March if not for the Stimulus.

In all seriousness, the recession never really was. Yes, we had major banking problems caused by the collapse of housing. Housing prices have now dropped and are stabilizing. Month-to-month real estate sales are now on the rise.

Banks are indeed lending, especially those that chose not to partake in the subprime mess. The markets have had a few bumps, but there is strong evidence that they bottomed out in November. Up until midway through 3rd quarter '08 GDP was cruising along at a 3% growth rate, perfectly acceptable. The Tech industry was strong, retail was steady, and manufacturing was no worse than any recent years.

We are currently in the midst of what I am calling a pseudo-recession. When banking came unglued, the Media and Obama took their love affair to a whole new level. All we have been hearing since October is how bad the economy is. The media hit on it relentlessly.

Now, everyone under the sun has an opinion on how bad things are out there, whether or not they actually have any economic sense. Obama has even changed his tune from “Hope” to fear-mongering. All he has spoken of this week is how catastrophic this crisis is.

Central to this issue is the consumer psyche. The market has already corrected for the actual problems in the economy. Consumer psyche isn’t something to be ignored and is a part of every recession. It is one of the major reasons as to why retail sails are the last thing to pick up after the stock market corrects itself.

So the question is why, after corrections were naturally made, is retail not picking up, despite even having the Christmas shopping season to help out? Because every time we turn on the TV, open the newspaper, or hop on the internet all we hear about is how bad of shape we are in.

You tell people that a few times and they start thinking twice before spending money. This uncertainty (or maybe I should say certainty of doom) that has been driven into us is exactly what is hurting us. You would think the POTUS would speak highly of things to boost psyche and get people to start spending money again, but apparently that was against his plan.

So now we sit here with an $800 billion stimulus in the midst. One of two things has to happen over the next few months. Either the media keeps reporting that the economy is in dire shape and that the stimulus is not helping, or they give up on it and hail Obama and his stimulus as the redeemer of the economy.

The first scenario would require the media to throw Barry under the bus already. I find this highly unlikely and don’t feel it even deserves comment. The second is much more likely, and it will work. Temporarily at least. The MSM loves this package and will continue to speak very highly of it.

As soon as we start hearing that things are getting better and that the stimulus is working, consumer psyche will begin to rise. Spending will increase and we will be out of the woods. Everybody will be happy and Obama will be the savior once again. 2009 GDP will be up, comparisons to FDR will abound, and the New New Deal will be written up as a country-saving piece of legislation.

And then comes the inflation…

2

I believe you are partly correct. The recession is almost over, but I think we about to enter in a depression.

3

[quote]tedro wrote:
it will work to get us out of the current situation.

[/quote]

Only if you believe what the mainstream media is busy lying about.
I think it’s a shitty short-term band aid, and a terrible long-term investment.

It would be great if it worked, but history AND current economical facts speak against this working.

4

[quote]tedro wrote:
the Media and Obama took their love affair to a whole new level. All we have been hearing since October is how bad the economy is. The media hit on it relentlessly.
[/quote]

Yea and Obama personally fired all those hundreds of thousands of people right?

yea this thing being blown out of proportion. But dont act like its all from obama and co. Have you already forgotten TARP? or the past 8 years lol. Theres plenty of blame to go around. Seems both the government and the markets are inept.

5

[quote]archiewhittaker wrote:
tedro wrote:
it will work to get us out of the current situation.

Only if you believe what the mainstream media is busy lying about.
I think it’s a shitty short-term band aid, and a terrible long-term investment.

It would be great if it worked, but history AND current economical facts speak against this working.[/quote]

I think Ted’s argument is not that the stimulus will work because of any merits it has (it doesn’t) but because the consumer psyche will be buoyed by the thought that “something has finally been done about it”, and the fact that the MSM will not throw Obama under the bus by keeping up their incessant harping on the horrid state of the economy.

Basically he’s saying this is History’s most ridiculously expensive psychological fix. Not that it’s a good package.

6

[quote]PB-Crawl wrote:
tedro wrote:
the Media and Obama took their love affair to a whole new level. All we have been hearing since October is how bad the economy is. The media hit on it relentlessly.

Yea and Obama personally fired all those hundreds of thousands of people right?

yea this thing being blown out of proportion. But dont act like its all from obama and co. Have you already forgotten TARP? or the past 8 years lol. Theres plenty of blame to go around. Seems both the government and the markets are inept.
[/quote]

Of course there is plenty of blame to go around, and it stems from events that happened much longer than 8 years ago (Fair Housing). The facts are that we only have one President now and nobody cares about Bush’s opinion on the economy, which was only ever so slightly more informed than Obama’s. He made plenty of mistakes and TARP is a disaster, yet despite this the economy has been surprisingly resilant.

I mean look at it. Literally everywhere you look you hear about the imminent doom that is the economy, but somehow GDP actually had a positive growth rate in 2008. How exactly do you have positive growth in a RECESSION? The entire thing is psychological and it is now Obama’s, not Bush’s, patriotic duty to be truthful with the US people. All it is going to take to get out of this is some positive news that gets consumers spending money again. The stimulus will be spun as that positive news.

7

[quote]Aragorn wrote:
archiewhittaker wrote:
tedro wrote:
it will work to get us out of the current situation.

Only if you believe what the mainstream media is busy lying about.
I think it’s a shitty short-term band aid, and a terrible long-term investment.

It would be great if it worked, but history AND current economical facts speak against this working.

I think Ted’s argument is not that the stimulus will work because of any merits it has (it doesn’t) but because the consumer psyche will be buoyed by the thought that “something has finally been done about it”, and the fact that the MSM will not throw Obama under the bus by keeping up their incessant harping on the horrid state of the economy.

Basically he’s saying this is History’s most ridiculously expensive psychological fix. Not that it’s a good package.[/quote]

Do you think we could just pretend to pass it? Kind of like one big placebo? After all, as you understood, the methods by which this works will be the exact same as that of a placebo.

8

[quote]tedro wrote:
Well, nearly anyways. We still have the formality of a couple votes and Barry’s signature, but the end is right around the corner. Now don’t get me wrong, it is certain that this stimulus is detrimental to the country in the long-term, I don’t think we even need to debate that. But, it will work to get us out of the current situation.

Let me first recap the so-called recession that began in Dec. 2007. It was so bad, that the GDP actually plummeted to a staggering increase of only 1.3%. Unemployment has skyrocketted to 7.6%, as of January 2009. The 25-30% rates of the Great Depression surely would have hit us by the end of March if not for the Stimulus.

In all seriousness, the recession never really was. Yes, we had major banking problems caused by the collapse of housing. Housing prices have now dropped and are stabilizing. Month-to-month real estate sales are now on the rise.

Banks are indeed lending, especially those that chose not to partake in the subprime mess. The markets have had a few bumps, but there is strong evidence that they bottomed out in November. Up until midway through 3rd quarter '08 GDP was cruising along at a 3% growth rate, perfectly acceptable. The Tech industry was strong, retail was steady, and manufacturing was no worse than any recent years.

We are currently in the midst of what I am calling a pseudo-recession. When banking came unglued, the Media and Obama took their love affair to a whole new level. All we have been hearing since October is how bad the economy is. The media hit on it relentlessly.

Now, everyone under the sun has an opinion on how bad things are out there, whether or not they actually have any economic sense. Obama has even changed his tune from “Hope” to fear-mongering. All he has spoken of this week is how catastrophic this crisis is.

Central to this issue is the consumer psyche. The market has already corrected for the actual problems in the economy. Consumer psyche isn’t something to be ignored and is a part of every recession. It is one of the major reasons as to why retail sails are the last thing to pick up after the stock market corrects itself.

So the question is why, after corrections were naturally made, is retail not picking up, despite even having the Christmas shopping season to help out? Because every time we turn on the TV, open the newspaper, or hop on the internet all we hear about is how bad of shape we are in.

You tell people that a few times and they start thinking twice before spending money. This uncertainty (or maybe I should say certainty of doom) that has been driven into us is exactly what is hurting us. You would think the POTUS would speak highly of things to boost psyche and get people to start spending money again, but apparently that was against his plan.

So now we sit here with an $800 billion stimulus in the midst. One of two things has to happen over the next few months. Either the media keeps reporting that the economy is in dire shape and that the stimulus is not helping, or they give up on it and hail Obama and his stimulus as the redeemer of the economy.

The first scenario would require the media to throw Barry under the bus already. I find this highly unlikely and don’t feel it even deserves comment. The second is much more likely, and it will work. Temporarily at least. The MSM loves this package and will continue to speak very highly of it.

As soon as we start hearing that things are getting better and that the stimulus is working, consumer psyche will begin to rise. Spending will increase and we will be out of the woods. Everybody will be happy and Obama will be the savior once again. 2009 GDP will be up, comparisons to FDR will abound, and the New New Deal will be written up as a country-saving piece of legislation.

And then comes the inflation…[/quote]

I hope you are right, So does the rest of the country

9

[quote]tedro wrote:
PB-Crawl wrote:
tedro wrote:
the Media and Obama took their love affair to a whole new level. All we have been hearing since October is how bad the economy is. The media hit on it relentlessly.

Yea and Obama personally fired all those hundreds of thousands of people right?

yea this thing being blown out of proportion. But dont act like its all from obama and co. Have you already forgotten TARP? or the past 8 years lol. Theres plenty of blame to go around. Seems both the government and the markets are inept.

Of course there is plenty of blame to go around, and it stems from events that happened much longer than 8 years ago (Fair Housing). The facts are that we only have one President now and nobody cares about Bush’s opinion on the economy, which was only ever so slightly more informed than Obama’s. He made plenty of mistakes and TARP is a disaster, yet despite this the economy has been surprisingly resilant.

I mean look at it. Literally everywhere you look you hear about the imminent doom that is the economy, but somehow GDP actually had a positive growth rate in 2008. How exactly do you have positive growth in a RECESSION? The entire thing is psychological and it is now Obama’s, not Bush’s, patriotic duty to be truthful with the US people. All it is going to take to get out of this is some positive news that gets consumers spending money again. The stimulus will be spun as that positive news.[/quote]

I’m coming around to the idea that TARP and the rest of the bailouts will more likely push us into another depression than get us out of it, which is exactly what happened during the first great depression. They tried to inflate their way out, and all they got was…inflation and more unemployment. The media loved FDR as much as they loved Obama, yet they weren’t able to change the facts on the ground. All they were able to do was make themselves look more like the pravda that they actually are.

The best the government can do is help facilitate increased productivity from workers and a decrease in consumer and government debt. The best way to increase worker productivity is to stop taxing it like you’re trying to kill it. Whatever you tax you get less of. The best way to decrease government debt is to rein in government spending.

The consumer debt crisis we now have, IMO, is due largely to the fact that people borrowed (and spent) against their houses with the foolish idea that their house values would always appreciate. I know several people personally who have done that.

10

[quote]PRCalDude wrote:
tedro wrote:
PB-Crawl wrote:
tedro wrote:
the Media and Obama took their love affair to a whole new level. All we have been hearing since October is how bad the economy is. The media hit on it relentlessly.

Yea and Obama personally fired all those hundreds of thousands of people right?

yea this thing being blown out of proportion. But dont act like its all from obama and co. Have you already forgotten TARP? or the past 8 years lol. Theres plenty of blame to go around. Seems both the government and the markets are inept.

Of course there is plenty of blame to go around, and it stems from events that happened much longer than 8 years ago (Fair Housing). The facts are that we only have one President now and nobody cares about Bush’s opinion on the economy, which was only ever so slightly more informed than Obama’s. He made plenty of mistakes and TARP is a disaster, yet despite this the economy has been surprisingly resilant.

I mean look at it. Literally everywhere you look you hear about the imminent doom that is the economy, but somehow GDP actually had a positive growth rate in 2008. How exactly do you have positive growth in a RECESSION? The entire thing is psychological and it is now Obama’s, not Bush’s, patriotic duty to be truthful with the US people. All it is going to take to get out of this is some positive news that gets consumers spending money again. The stimulus will be spun as that positive news.

I’m coming around to the idea that TARP and the rest of the bailouts will more likely push us into another depression than get us out of it, which is exactly what happened during the first great depression. They tried to inflate their way out, and all they got was…inflation and more unemployment. The media loved FDR as much as they loved Obama, yet they weren’t able to change the facts on the ground. All they were able to do was make themselves look more like the pravda that they actually are.

The best the government can do is help facilitate increased productivity from workers and a decrease in consumer and government debt. The best way to increase worker productivity is to stop taxing it like you’re trying to kill it. Whatever you tax you get less of. The best way to decrease government debt is to rein in government spending.

The consumer debt crisis we now have, IMO, is due largely to the fact that people borrowed (and spent) against their houses with the foolish idea that their house values would always appreciate. I know several people personally who have done that. [/quote]

Does anyone else remember the thread last summer where some bozo was arguing that the massive national debt is a good thing?

11

[quote]PRCalDude wrote:

The best the government can do is help facilitate increased productivity from workers and a decrease in consumer and government debt. [/quote]

Another point of view might be that the best that government can do is set to “set the rules of the game” that would lead natural economic behavior to the intended result, being economic growth. Perhaps the stimulus dollars and time would be better spent reworking the current tax and incentive system of capitalization, such that it would promote investment in new technologies and reinvestment of profits as opposed to distribution of cash. Should they look at what is holding back entrepreneurialism in our economy? After all, something like 70% of all US jobs are provided by companies with less than 100 employees.

The best “stimulus” package that was ever created in my opinion, was the increased military technology spending during the cold war. It spawned a tremendous amount of innovation and the booms of the 80’s and 90’s were pretty much a direct result. How about this for a concept, if we seem intent on spending $800B…spend the entire amount on making our Military solar powered. Extreme, sure. But think about how far the technology would come with $800B invested, and how much economic growth would come from all the resulting technological innovations.

12

Absolutely. The business environment in the US has become absolutely toxic.

13

The Obama stimulus package will only lengthen the ever widening recession. We’re in this problem because we have over spent. What the Obama plan does is put even more money in the hands of people (many of which never paid taxes to begin with), telling them to over spend once again.

This is tantamount to handing an alcoholic another drink. We need to “dry out” not continue to drink. No doubt the economy will enjoy a short lived bump, but after that we will continue to spiral downward along with Obama’s ratings.

14

[quote]Loose Tool wrote:
PRCalDude wrote:
tedro wrote:
PB-Crawl wrote:
tedro wrote:

Does anyone else remember the thread last summer where some bozo was arguing that the massive national debt is a good thing?[/quote]

That was basically the consensus of this entire board. Funny how quickly that tune changed, sort of at the same time there was an election i think?

One thing that always made me wonder, is why 24hour news media is prone to spinning this crisis worse than it is? I mean, if they spun it positively, or made a point to constantly high light positivite things, like our gdp growth, would they lose viewers or funding? do people really like hearing bad news more than good?

i swear, any time i turn on the news, particularly fox, its like its 2012.

are the news corps getting a sweet deal with the stimulus package? so they hype up the doomsday rhetoric?

or is there some hidden benefit of spinning things negatively vs positively.

15

[quote]That was basically the consensus of this entire board. Funny how quickly that tune changed, sort of at the same time there was an election i think?
[/quote]

Huh?

16

Best piece of commentary I have read on the bailout.

“The sparkle has gone from his eyes already,” an American acquaintance said to me yesterday, referring to Barack Obama. “He doesn’t know what to do.” Obama’s performance at his press conference confirmed that impression, with the rhetoric of the campaign trail, fluent and banal as piped musak, replaced with long hesitations not just between sentences, but between clauses. This was an auto-cue junkie suffering cold turkey.

When a political lightweight is out of his depth, he seeks to compensate by counterfeiting the certainty he is far from feeling. Obama’s rantings in defence of his stimulus plan have assumed an apocalyptic intensity. Unless Congress agrees to flush almost $1 trillion of Joe Citizen’s hard-earned bucks down the sanitation, “Our nation will sink deeper into a crisis that, at some point, we may not be able to reverse.”

So, America had better listen to the man who “screwed up” over Tom Daschle because he alone has the wisdom to extricate the US of A from financial disaster. The instrument of salvation is the biggest barrel of pork that the undeserving needy have ever seen in American history, from sea to shining sea. The financial crisis may seem complex, but the solution - the real solution - depends on one simple premise: tax cuts revive economies, handouts do not.

Trillion-dollar giveaways are like buses: there will be another one along in a moment. Driving the next vehicle is Treasury Secretary Tim Geithner, who thinks it would be a nice gesture to hand another $2 trillion to Gordon Gekko and his pals on Wall Street. Apparently the last handout made no appreciable difference, so better throw some more moolah into the piranha pool - some of those poor SOBs are down to their last executive jet.

Where will the money come from? No problem - we just divert it from Main Street to Wall Street, an increasingly familiar route to those in the White House and on Capitol Hill who specialise in redistributing wealth from the poor to the rich. This seems to be in addition to Geithner’s $0.5 trillion scheme to stimulate spending in real estate, drawing cash largely from the US Federal Reserve and the Federal Deposit Insurance Corporation.

So, overall, Barack and Tim are currently disposing of more than $3 trillion of taxpayers’ money. The only remotely comparable stimulus scheme proposed for America was a fictitious one: when the James Bond villain Auric Goldfinger planned to detonate a nuclear device in Fort Knox and irradiate the nation’s gold reserves. Incinerating $3 trillion in dollar bills could not be more wasteful than the Obama stimulus plan.

It is madness. These lunatics are mugging Main Street of $3 trillion and squandering it on a liberal fantasy. It could be a generation before America recovers - not simply from the loss of these funds, but from the economic mismanagement of which it is a symptom. The fall-out will be very serious for the rest of the world. Hope? Change we need? Vote in haste, repent at leisure.

17

http://www.drudgereport.com/flashpr.htm

I sure hope she doesn’t have to postpone her taxpayer funded trip on the military airplane she has claimed as her own for the trip.

That would be a tragedy wouldn’t it?

18

When all is said and done, the $3 trillion of paper money will be inflated to about $15 trillion (1/reserve ratio) and then taxed back by about a third. So as the “stimulus” stands right now, we should expect about $10 trillion in inflation.

During the Great Depression, people were paying for lunch with a wheelbarrow full of money.

19

[quote]hedo wrote:
http://www.drudgereport.com/flashpr.htm

I sure hope she doesn’t have to postpone her taxpayer funded trip on the military airplane she has claimed as her own for the trip.

That would be a tragedy wouldn’t it?[/quote]

My God.

This really is becoming the Former Soviet Union.

20

[quote]PRCalDude wrote:
During the Great Depression, people were paying for lunch with a wheelbarrow full of money. [/quote]

I thought the problem during the Great Depression was deflation, not inflation…?