[quote]tedro wrote:
How exactly do you have positive growth in a RECESSION?[/quote]
You don’t.
With the (expected) drop in real estate prices (buy that house now,) and the ignorance that caused it:
Joe Blow: “I make $500 a month, and want a $2,000 a month mortgage.”
Banker: “No Problem.”
Of course some banks are going to have a problem.
Anyone who spent the past 8 years calling Bush an idiot were proven right in the past year. But how this whole thing was manipulated by the media was terrible.
The economy was not going to collapse, but telling everyone that it was caused a panic, and the market to crash. All the lemmings got out, and Buffet started buying like he does every time the idiots forget the oldest adage in investing. Buy low, sell high. (It’s low people, what the fuck are you selling for?)
Now we are in the terrible situation of having unemployment as bad as it was in the early 90’s. Interestingly we got out of that without a couple of $700 billion spending bills.
The reasons for all this are simple. Take a financial problem, blow it up into a giant crisis through total bullshit, and scare everyone, and guess what? They got their candidate in. And Bush, who is no friend of McCain, didn’t care if any of this hurt him.
Now all that needs to happen is that a depression does not occur, and the media will be calling Obama an economic genius.
Now, with my crystal ball, I will tell you what is going to happen. The economy is not going to tank much further. Companies have cut as far as they are able to. The media fucked up, went overboard scaring everyone about the economy, so this year will be fairly flat.
Some people are going to delay their retirements, but large numbers of people are retiring over the next few years, regardless. That means there will not be the 25% unemployment everyone has been scared of. (Especially with the massive hiring of temps for the census.)
I say it is a toss up over whether or not Obama is in good standing by the end of this year. But next year the Bush tax cuts expire, and taxes are going to go up, but this won’t be called a tax increase. (That fun political double speak where budget cuts are actually reductions in increases.)
That will give the economy a kick in the ass, dropping Obama’s approval rating by the end of 2010, or early 2011. (May not be in time to change congress though.)
By 2011 the inflation, caused by these massive bills and the ones to come, will really start to kick in, and interest rates will climb. (Stay out of most debt, and buy bonds once they hit double digits. Although leveraged real estate may be a good investment if the mortgages are in place before the interest rates climb.)
As interest rates climb, you will see the next wave of foreclosures as people discover why an adjustable rate mortgage is called an ARM, (and a LEG.)
Lets realize that Washington is not going to save us. And as long as we sit around waiting for somebody else to solve our problems, those problems will never be solved.
My personal economy is actually doing pretty good, comparatively speaking. After getting tons of medical bills paid off, and eliminating a lot of stupid debt, I have more money left over at the end of the month then ever before.
And that exact same formula will work for the government.