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Author Topic:   Back to the Double Dip?
Node
Knowflake

Posts: 1278
From:
Registered: Apr 2009

posted June 01, 2011 08:32 PM     Click Here to See the Profile for Node     Edit/Delete Message   Reply w/Quote
Many financial experts have warned that we are dangerously close to a double dip recession.
Today the Market dropped over 200 pts. Why? because of the dismal jobs news [for one]

so I clicked over to Robert Reich to see what he has to say:

quote:

....

The recovery has stalled. It is unlikely that America will find itself back in recession but the possibility of a double dip cannot be dismissed. The problem is not on the supply side of the ledger. Corporate profits are still healthy. Big companies continue to sit on a cash hoard. Large and middle-sized companies can easily borrow more, at low rates. The problem is on the demand side. American consumers, who constitute 70 per cent of the total economy, cannot and will not buy enough to get it moving. They justifiably worry that they will not be able to pay their bills, or afford to send their children to college, or to retire. Banks, with equal justification, are reluctant to lend to them. But as long as consumers hold back, companies remain reluctant to hire new workers or raise the wages of current ones, feeding the vicious cycle.

...

The timing is unfortunate. Foreign consumers will not help much even if the dollar continues to slide. Europe’s debt crisis and embrace of austerity, Japan’s tragedy and China’s fiscal tightening have reduced global demand. At the same time, the federal stimulus in the US has almost run its course. The Federal Reserve is about to end its $600bn of purchases of Treasury bills, designed to bring down long-term interest rates and make it easier for homeowners to refinance. Worse yet, state governments – starved for revenue and constitutionally barred from running deficits – continue to cut programmes. Local governments are now in worse shape, laying off platoons of teachers and firefighters.


Rob offers possible solutions, not just analysis....

quote:

Under normal circumstances, this would be the time for the federal government to take bold action to ward off a double dip. For example, it could put more cash in peoples’ pockets while giving employers an extra incentive to hire by exempting the first $20,000 of earnings from payroll taxes, for a year or two. It could lend money to state and local governments. It could launch a new Work Projects Administration (modeled after its antecedent during the Great Depression) to put the long-term unemployed to work on public projects. It could amend the bankruptcy law to allow people to include their prime residences in personal bankruptcy, thereby giving homeowners more leverage to get mortgage lenders to mitigate the terms of their loans.



.....

But these are not normal circumstances. America has been through a devastating recession that poked a giant hole in the federal budget. And with a presidential election coming up next year, both parties are already maneuvering for tactical advantage. Since taking over the House of Representatives in January, Republicans have focused on cutting government spending and paring back regulations. Their colleagues in the Senate, whose leader has proclaimed his major goal to unseat President Barrack Obama, are almost as single-minded. Cynics might suspect Republicans of quietly hoping the economy stays rotten up until election day.


We need bold action--something I feel is unlikely to happen.

If Obama had not 'bailed-out' the auto makers we would be in even more serious difficulties.

I am of the opinion that the stimulus worked, but the problem was (and is) that it was not enough money, so now it is quite possible that the monies that were not spent then will be needed twice fold now.


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Randall
Webmaster

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From: The Goober Galaxy
Registered: Apr 2009

posted June 01, 2011 08:41 PM     Click Here to See the Profile for Randall     Edit/Delete Message   Reply w/Quote
Expect gas prices to decline.

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katatonic
Knowflake

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posted June 01, 2011 10:35 PM     Click Here to See the Profile for katatonic     Edit/Delete Message   Reply w/Quote
gas prices are already declining. and that puts MORE money in the consumers' pockets, not less. they have been declining for sometime now, at least where i live.

of course if history is anything to go by, they will decline to just ABOVE where they were before the frenzy, and sometime in the near future bounce up a little further than their most recent high, then slip down to ALMOST as low as before...an on and on. the allegory of boiling frogs in water comes to mind. and it was the same when bush was president, and those before him too.

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katatonic
Knowflake

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posted June 01, 2011 10:36 PM     Click Here to See the Profile for katatonic     Edit/Delete Message   Reply w/Quote
and unless the so called "jobs creators" get it, there will be no more consumers to float their boats. bu-bye record profits, oh dearie me!

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Node
Knowflake

Posts: 1278
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Registered: Apr 2009

posted June 02, 2011 12:19 AM     Click Here to See the Profile for Node     Edit/Delete Message   Reply w/Quote

poached froggy! How apt.

it is amazing how that works, a year can go by and there is the rollback price with 9/10th of a difference. Never more.

Gas started to go down as soon as OBL cocked his toes

------------------
People like Sarah Palin haven't elevated the conservative movement.
foxx news chief--Roger Ailes

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jwhop
Knowflake

Posts: 3551
From: Madeira Beach, FL USA
Registered: Apr 2009

posted June 03, 2011 10:01 AM     Click Here to See the Profile for jwhop     Edit/Delete Message   Reply w/Quote
Yeah, the diminutive Robert fails to mention that those so called "public works" projects soaked up all the capital in the economy in Roosevelt's time...and prolonged the depression for another 5 years.
Wonderful idea.

Oh wait, didn't we just spend about a TRILLION dollars on "shovel ready" public works projects?

Well, that's what O'Bomber sold America and it was a total lie.

So now, it's a proven fact that O'Bomber and his economic team of dunces have failed miserably. Unemployment at 9%, falling dollar value, Moody's threatening to downgrade the US credit rating, declining residential real estate values, declining manufacturing output, Americans saddled with an additional 5-7 TRILLION dollars in public debt...you name it, the dunce economic team O'Bomber has produced it.

Time now for O'Bomber, his Kool-Aid drinking leftist comrades and sycophants to sit the hell down, shut the hell up and get the hell out of the way of the private sector which produces all the wealth and jobs in America.

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katatonic
Knowflake

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posted June 03, 2011 11:16 AM     Click Here to See the Profile for katatonic     Edit/Delete Message   Reply w/Quote
there are going to be a lot of jobs lost if the budget gets cut severely, and you know it, jwhop. the jobs being cut in wisconsin and elsewhere are largely PUBLIC sector jobs. so not only are more people unemployed but even MORE will be without firefighters, police assistance, libraries, schools, and medical help. perhaps all those public servants should start up for-profit versions of those services. that will STILL leave a lot of people, who can't afford to pay, without assistance in emergencies and everyday life.

charming, i'm sure.

personally, without some of the big "jobs producers" i think we might return to a world where craftsmanship and love of producing a quality product would be seen. i'm not interested in the cheap goods that have been flooding the market of late years. i would like to wear shoes that are made with skill and not a stamp machine, sized for human feet and not the conveyer belt. for instance.

i prefer local small farm food to monsanto and massive farms churning out uniform veggies and hormone filled cows.

i say stop subsidizing the big guys and let us go back to quality. that means less govt interference too.

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iQ
Knowflake

Posts: 2817
From: Chennai, India
Registered: Apr 2009

posted June 03, 2011 01:08 PM     Click Here to See the Profile for iQ     Edit/Delete Message   Reply w/Quote
Athithi Devo Bhava.
The Guest is a god. Treat him thus, went the ancient Vedic Adage.

10-15 million good international families will splurge thousands of dollars annually as happy tourists in USA if they are treated well from Visa to Immigration in all airports.

The true untapped wealth for middle class America is from tourism. America has so much to offer for tourists.

Open the borders to the educated and well to do of the world instead of drug barons, and USA will pay off its deficit debt in 5 years.

I have told this before, will say it again. US Real Estate is at mouth watering levels for more than 20 million rich Chinese, Korean and Indian entrepreneurs.

My cousin is a citizen, came here asking for real estate prices. When I cross checked the prices, I find that my local carpenter has enough saved to buy 20 acres in many states of US of A. Problem is they will not give him a Visa. Nor will they give a visa to thousands of uneducated businessmen here who have 2-3 million idle cash to splurge in buying US Homes/real estate/machines.

Simple message: Change the policies, get rich. Foreigners are good.

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jwhop
Knowflake

Posts: 3551
From: Madeira Beach, FL USA
Registered: Apr 2009

posted June 03, 2011 01:49 PM     Click Here to See the Profile for jwhop     Edit/Delete Message   Reply w/Quote
Bullshiiiit!

US wealth is created from inventing and making useful things; not from tourism.

On the other hand, there are millions of so called tourists and so called students in the US who are breaking US law by overstaying their visas and hiding out in our population.

Find them, deport them and put their names on the persona non grata list.

The bloated public sector...both state and federal needs to be cut, dramatically cut and so should their taxpayer paid salaries, pension and health care benefits.

I like craftsmanship but I'm not willing to drag America back into the 18th and 19th century to get it.

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katatonic
Knowflake

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posted June 03, 2011 02:29 PM     Click Here to See the Profile for katatonic     Edit/Delete Message   Reply w/Quote
no need to go back in time, though SOCIALLY you seem to think we should! you know, scupper the minimum wage, unions, everything that has made the working class prosperous, and everything will be fine, right?

how will you ever get craftsmanship on an assembly line at $3/hr? you think those people are really loving their jobs? isn't that why ford paid his workers better, so they would take pride in their work and buy his machines?

let's also go back to volunteer firemen, police and other assistance groups like nurses etc, and things will be even better, right jwhop?

hellyeah, let's revisit the gangs of new york era for some REAL free wheeling profiteering. when the police and firemen lined their pockets with what they scavenged from fires and crimescenes and if you protested you were left to suffer the consequences!

let's let anyone who doesn't want black customers put up a sign out front and see how he prospers.

immigration has been a problem worldwide forever. the israel question speaks to that too. as do the muslims in europe, mexicans here, shall i go on?

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jwhop
Knowflake

Posts: 3551
From: Madeira Beach, FL USA
Registered: Apr 2009

posted June 03, 2011 03:59 PM     Click Here to See the Profile for jwhop     Edit/Delete Message   Reply w/Quote
Public sector employees...union or otherwise are NOT making minimum wage.

Many Americans who pay public sector employees salaries and benefits ARE making minimum wage and that has to stop.

There are 77,000 federal employees being paid more than Governors of states.
http://www.washingtontimes.com/news/2011/may/31/77000-feds-paid-more-than-governors/

Stop attempting to play the race card here with me katatonic. That's a typical leftist tactic but it doesn't work with me.

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katatonic
Knowflake

Posts: 6484
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posted June 03, 2011 04:04 PM     Click Here to See the Profile for katatonic     Edit/Delete Message   Reply w/Quote
you seem to see race everywhere, jwhop, why is that? that was ONE of several examples, and straight from rand paul's mouth.

nor did i say public servants ARE making minimum wage, though that does look like what certain governors and lobbysists and congressmen are pushing for! and trying to take away their right to negotiate for anything too.

what i said was the minimum wage has been mentioned as a target. as have unions. ad nauseam. read the words, jwhop, not what you think i will say!

there are a great many more public employees making less than their private sector counterparts, madeira. and some who make more too.

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iQ
Knowflake

Posts: 2817
From: Chennai, India
Registered: Apr 2009

posted June 04, 2011 05:37 AM     Click Here to See the Profile for iQ     Edit/Delete Message   Reply w/Quote
Wake up JWH. Tourism WAS NEVER USED for making money in the past but it is the best option now.

The only option actually.

Yes, deport the law breakers and invite the good people in. Invite with honor and treat them with love and respect, with humility. They have more cash than the American public and are willing to put that in the pockets of American Citizens, and are willing to buy US Assets which are creating debt traps for ordinary Americans.

Only when there is a good cash surplus can American small business get back to inventing and producing innovative stuff.

Wealth in American big business IS NOT GOING TO HELP either. It will create a Plutocracy with armed thugs toting machine guns at the masses deprived of their livelihood.

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