the second great recession?
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http://www.marketwatch.com/story/our...2?pagenumber=1
Above is the link to the first page of this two page article, the provided link by the OP was to the second page of the articale.
As for my thoughts... yep... ticking time bomb is right on. The whole economy is on life support. What remains to be seen is which one of these "bad" things occuring will set off the downslide again.
I read stuff like this all the time, it's a gamble for sure, but unfortunately we don't know the odds, or even how the game is played.
My best defense... be as prepared as possible. Food, shelter and warmth are what I'm investing in these days.
Best of luck to us all
Above is the link to the first page of this two page article, the provided link by the OP was to the second page of the articale.
As for my thoughts... yep... ticking time bomb is right on. The whole economy is on life support. What remains to be seen is which one of these "bad" things occuring will set off the downslide again.
I read stuff like this all the time, it's a gamble for sure, but unfortunately we don't know the odds, or even how the game is played.
My best defense... be as prepared as possible. Food, shelter and warmth are what I'm investing in these days.
Best of luck to us all
I think it is probably true. I mean 20 different was that the global/US economy could implode. Any one of them 'could' do it. I am sure one of them 'will'. I think this situation has slowely been building for a while, that it is possible to reverse it, however, it would take everyone in the country putting on the 'big kid panties' and working together.
This, (everyone working together) is not something that I have much faith in that anyone in power would do till the last nanosecond. And at that point, I really think it will be too late.
I think on the consumer level the only real course of action is to get the family financial house in order as much as possible. No debt (including mortgage if possible), an emergency fund, stocked pantry, and try to get a local economy as possible. For instance, getting food from local farmers, knowing local tradesmen that services can be bartered, etc.
This, (everyone working together) is not something that I have much faith in that anyone in power would do till the last nanosecond. And at that point, I really think it will be too late.
I think on the consumer level the only real course of action is to get the family financial house in order as much as possible. No debt (including mortgage if possible), an emergency fund, stocked pantry, and try to get a local economy as possible. For instance, getting food from local farmers, knowing local tradesmen that services can be bartered, etc.
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the thing is, economic prediction is a tricky game. No one really knows what's going to happen. Look back on all the folks saying that real estate was a sure bet, etc. a few years ago--and then boom.
So now, it is "safer" to say that we're heading for a huge recession/depression--and here are all the reasons why.
So now, it is "safer" to say that we're heading for a huge recession/depression--and here are all the reasons why.
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I'm with Denvergirlie.
But in the words of my grandparents' generation, prepare for the worst and hope for the best. It is all you can do. It's something you should do anyway even in a good economy because you never know what will happen and all your bases should be covered just in case.
But in the words of my grandparents' generation, prepare for the worst and hope for the best. It is all you can do. It's something you should do anyway even in a good economy because you never know what will happen and all your bases should be covered just in case.
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Well Paul Farrell has been singing that song for awhile, but seriously, folks, never mind recession, how are we not currently in a depression? The fed pumped huge amounts of cash into the economy--remember the fears of inflation?--so why haven't we seen any to speak of? Why is gold still not to the 2K mark that everyone predicted in '08? IMHO because we're in a deflationary depression and have been.
Even though I'm a believer, that article peeved me. OK, Paul, the world's coming to an end--what do we do? "Kiss our retirement good-bye"--any advice? I think this guy is a fear-monger-er, and that's how he gets his readership.
Anyway, I don't think there will be a "bomb", per se, more like taxes will be raised across the board and SS and Medicaid/care will face cuts. And as far as the R anti-tax fear, BO's current tax proposals only add 1.5% to incomes over 250K, that's nothing IMHO. We need to jack those back up to Reagan levels at the very least.
I'm going to be optimistic and say that these articles are back in the spotlight to prepare us all for more taxes, which IMHO is the only logical, sane and useful thing to do at this point. Or stop military spending--hahahahahahahahah! (heavy sarcasm since that'll never happen)
Even though I'm a believer, that article peeved me. OK, Paul, the world's coming to an end--what do we do? "Kiss our retirement good-bye"--any advice? I think this guy is a fear-monger-er, and that's how he gets his readership.
Anyway, I don't think there will be a "bomb", per se, more like taxes will be raised across the board and SS and Medicaid/care will face cuts. And as far as the R anti-tax fear, BO's current tax proposals only add 1.5% to incomes over 250K, that's nothing IMHO. We need to jack those back up to Reagan levels at the very least.
I'm going to be optimistic and say that these articles are back in the spotlight to prepare us all for more taxes, which IMHO is the only logical, sane and useful thing to do at this point. Or stop military spending--hahahahahahahahah! (heavy sarcasm since that'll never happen)
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maybe they could stop all of the unConstitutional spending before stopping spending on the one thing that's mandated.
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Originally Posted by newbymom05  I'm going to be optimistic and say that these articles are back in the spotlight to prepare us all for more taxes, which IMHO is the only logical, sane and useful thing to do at this point. Or stop military spending--hahahahahahahahah! (heavy sarcasm since that'll never happen) |
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What spending are you referring to found in the Constitution? I don't think the FF envisioned a standing military or invasion of foreign countries. Military, SS and Medicare are the big budget killers, and no one wants to go without any of those three. Oh, and interest payments, lol.
I hear people (not here) rant about Congressional spending, but the problem was/is 2 unfunded wars that were off the books until Monday's CBO report plus concurrent tax cuts and Medicare prescription expansion. Unfortunately, we can't stop the $$ spigot at this point without increasing unemployment and/or depriving Americans.
Originally Posted by meandk0610 maybe they could stop all of the unConstitutional spending before stopping spending on the one thing that's mandated.
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I hear people (not here) rant about Congressional spending, but the problem was/is 2 unfunded wars that were off the books until Monday's CBO report plus concurrent tax cuts and Medicare prescription expansion. Unfortunately, we can't stop the $$ spigot at this point without increasing unemployment and/or depriving Americans.
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"provide for the common defense". i'm not going to spend time looking up any amendments because i'm just not in a place where it's that important to me right now.
Originally Posted by newbymom05 What spending are you referring to found in the Constitution? I don't think the FF envisioned a standing military or invasion of foreign countries. Military, SS and Medicare are the big budget killers, and no one wants to go without any of those three. Oh, and interest payments, lol. I hear people (not here) rant about Congressional spending, but the problem was/is 2 unfunded wars that were off the books until Monday's CBO report plus concurrent tax cuts and Medicare prescription expansion. Unfortunately, we can't stop the $$ spigot at this point without increasing unemployment and/or depriving Americans. |
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Yup. I think we're screwed.
Originally Posted by A&A #12 and #13 kind of contradict each other, don't they? The two things on that list that really scare me are the fed. deficit and peak oil. |
Well, I have to consider the source, TBH. Paul Ferrell, IMO, has been long on fear-mongering and very short on any factual predictions. I don't think we're in for some horrible Great Depression worse than any we've seen before. I think that we're in for a rough ride and any of the factors he listed can be contributing to the problem. Some, we have very little control over. For example, if some rogue nation attempts an attack on us, it could hurt us and our economy... but I bet you, like after 9/11 it would unite this country again and make it stronger. I also don't think that many of these factors are likely to come together to create a "perfect storm". Could they? Sure... anything's possible when you're predicting the end of the world. We could have an interstellar gamma ray burst that strips the Earth of its atmosphere and all die today.
I tend to follow, Paul Krugman, the NYTimes Nobel Laureate of Economics at Princeton, who is more moderate and, IMO, smarter. I believe that he states level-headed facts, follows them up with solid economics, and gives an opinion (albeit a bit an opinion a bit left-of-center) that neither incites panic nor gives people an excuse to put their heads in the sand. He thinks we're in for a rough ride, but it's not the end of the world. I think we could see what could be called a worse recession/mild depression over the next few years, still. I also think it can be headed off, as Krugman says, believe it or not, by propping up unemployment... get the people working again even if it adds to the deficit. Debt isn't necessarily bad. Sometimes you have to use it to your advantage. That's JMO and of course not everyone is going to agree with me, but there it is.
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I'm not changing the way we do any of our investing or anything else. I already prepare for economic downturns, blips, upticks, etc. I'm an ant, not a grasshopper, so while I'm worried, I'm aware and prepared, and that's the most important factor.
I tend to follow, Paul Krugman, the NYTimes Nobel Laureate of Economics at Princeton, who is more moderate and, IMO, smarter. I believe that he states level-headed facts, follows them up with solid economics, and gives an opinion (albeit a bit an opinion a bit left-of-center) that neither incites panic nor gives people an excuse to put their heads in the sand. He thinks we're in for a rough ride, but it's not the end of the world. I think we could see what could be called a worse recession/mild depression over the next few years, still. I also think it can be headed off, as Krugman says, believe it or not, by propping up unemployment... get the people working again even if it adds to the deficit. Debt isn't necessarily bad. Sometimes you have to use it to your advantage. That's JMO and of course not everyone is going to agree with me, but there it is.
I'm not changing the way we do any of our investing or anything else. I already prepare for economic downturns, blips, upticks, etc. I'm an ant, not a grasshopper, so while I'm worried, I'm aware and prepared, and that's the most important factor.
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I have to respectfully disagree here. Debt must be repaid, or there are consequences. As a country and as individuals, we are still collectively spending beyond our means (this includes stimulus spending), which means we are counting on having MORE money in the future than we have now in order to pay back that debt (or just shoving that responsibility off on future generations, which is an incredibly unfair burden). It carries an implicit assumption that we can continue growing our production indefinitely to increase our revenue. But we can't - limits to world oil resources will limit how much can be produced, and we are already seeing a critical drop in world oil supply/production in places like Mexico.
IMO it's better for us all to realize this now and start adjusting our expectations, our spending, and our income needs downward. I think the idea that pumping new money into the economy will somehow stimulate it back to a trajectory of increased growth is mistaken. Yes, the money may well artificially prop up consumer demand and therefore production and therefore jobs, but that effect can only be temporary. It only postpones the pain.
Our economy is now dependent on stimulus. Stimulus depends on the creation of many new dollars, which ultimately causes the value of all dollars to drop, resulting in inflation, which would need to be balanced by increased production to be comfortable.
It's good for morale if people are working, but when the stimulus ends and production outstrips demand, or even if demand continues but production cannot match it because of limited natural resources that are necessary to production (like oil, but also other things), there will be less jobs. I don't see how we can avoid a production ceiling, given the limits and challenges already being experienced with world oil supply.
So I really think the best thing is not to prolong the process of people adjusting downward. I think the stimulus is just temporary and any illusion of economic "recovery" is just that - an illusion.
Originally Posted by velochic I also think it can be headed off, as Krugman says, believe it or not, by propping up unemployment... get the people working again even if it adds to the deficit. Debt isn't necessarily bad. Sometimes you have to use it to your advantage. |
IMO it's better for us all to realize this now and start adjusting our expectations, our spending, and our income needs downward. I think the idea that pumping new money into the economy will somehow stimulate it back to a trajectory of increased growth is mistaken. Yes, the money may well artificially prop up consumer demand and therefore production and therefore jobs, but that effect can only be temporary. It only postpones the pain.
Our economy is now dependent on stimulus. Stimulus depends on the creation of many new dollars, which ultimately causes the value of all dollars to drop, resulting in inflation, which would need to be balanced by increased production to be comfortable.
It's good for morale if people are working, but when the stimulus ends and production outstrips demand, or even if demand continues but production cannot match it because of limited natural resources that are necessary to production (like oil, but also other things), there will be less jobs. I don't see how we can avoid a production ceiling, given the limits and challenges already being experienced with world oil supply.
So I really think the best thing is not to prolong the process of people adjusting downward. I think the stimulus is just temporary and any illusion of economic "recovery" is just that - an illusion.
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This is why debt for job growth is different from debt to fund wars, to prop up failing market (AIG, GM, etc.). When people are not working, they are not paying taxes. The biggest source of revenue that the government has... it's only source of real income, is taxes. Without people paying federal taxes, their income is limited. There are, what, 15 million people out of work? Using just hypothetical numbers... if they spend 50 billion dollars that result in 10 million jobs... if those 10 million people pay just $10,000 in taxes, in just a single year, that will generate revenue of 100 billion dollars a year. Seems like a pretty good return on investment. That's why job creation is so important. These people will also not be using social services as much (causing a draw on local and state governments) and instead be contributing to local and state taxes as well. Not to mention that they will spend money and stimulate the economy in that way.
So, while I see what you are saying, I don't really consider stimulus specifically for job creation to be a negative. JMO.
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And why I think it's important to tackle this head-on as a priority above any other factor to jump start the economy... and avoid a deeper/longer recession/depression.
Originally Posted by amyamanda I have to respectfully disagree here. Debt must be repaid, or there are consequences. As a country and as individuals, we are still collectively spending beyond our means (this includes stimulus spending), which means we are counting on having MORE money in the future than we have now in order to pay back that debt (or just shoving that responsibility off on future generations, which is an incredibly unfair burden). |
So, while I see what you are saying, I don't really consider stimulus specifically for job creation to be a negative. JMO.
Raising taxes to the pre-Reagan level would destroy whatever good is left in the economy. JFK knew that the best way to stimulate an economy was to lower taxes on those who spend, and that is what he did.
As far as peak oil, it is really only a theory and one that has been disproven.
http://www.usgs.gov/newsroom/article.asp?ID=1911 <http://www.usgs.gov/newsroom/article.asp?ID=1911>
"Hidden 1,000 feet beneath the surface of the Rocky Mountains lies the largest untapped oil reserve in the world. It is more than 2 TRILLION barrels. On August 8, 2005 President Bush mandated its extraction. In three and a half years of high oil prices none has been extracted. With this motherload of oil why are we still fighting over off-shore drilling?"
Doomsday experts and fear mongerers get loudest in times like these. They have been around for hundreds of years and always are disproven. Over and over again they scare people and make money of those who fear everything. When times improve, they simply vanish until the next bump in the road. Life is difficult, it is not a bed of roses. But if people are optimistic and do their part to make things better, they will not fall for those who seek to profit from someone's worst fears.
As far as peak oil, it is really only a theory and one that has been disproven.
http://www.usgs.gov/newsroom/article.asp?ID=1911 <http://www.usgs.gov/newsroom/article.asp?ID=1911>
"Hidden 1,000 feet beneath the surface of the Rocky Mountains lies the largest untapped oil reserve in the world. It is more than 2 TRILLION barrels. On August 8, 2005 President Bush mandated its extraction. In three and a half years of high oil prices none has been extracted. With this motherload of oil why are we still fighting over off-shore drilling?"
Doomsday experts and fear mongerers get loudest in times like these. They have been around for hundreds of years and always are disproven. Over and over again they scare people and make money of those who fear everything. When times improve, they simply vanish until the next bump in the road. Life is difficult, it is not a bed of roses. But if people are optimistic and do their part to make things better, they will not fall for those who seek to profit from someone's worst fears.
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I'm not sure if you were directing this at my post, but I am assuming so. I wasn't talking about *raising* taxes. I was saying that the more people that are working, the more people there are paying taxes. I can't see anything *BAD* about getting people back to work. As a side-effect, with fewer people paying taxes, that puts the burden on working people double-fold. They may have to pay more in taxes and those that are out of work are more likely to be utilizing social services, which are paid for by working tax payers. Don't get me wrong, I think that these safety nets are absolutely necessary and a boon to modern society, but I'd guess that 99% of the people who are unemployed right now would rather be working tax-payers than to not be (ETA: I'm, of course, not talking about SAHP or the disabled, etc. but people who had jobs and lost them). It could take a little more debt to dig out the jobless situation. And the joblessness could be really THE factor among all of these things mentioned that is most significant.
Originally Posted by mar123 Raising taxes to the pre-Reagan level would destroy whatever good is left in the economy. |
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I'm subbing. Aren't we pretty much already there * 2nd great depression* It is bad around here ( Pinellas, Fl) and I'm sure things are pretty much the same all over the US. There are no jobs. The classifieds are sad to look at, I mean when you look at general labor jobs, and you find 3 in the Sunday paper.. well, things aren't good.
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If any theory has been disproved, it's tax cuts or supply side/voodoo economics. It has never worked, including over the past decade. The rich get richer, but wages and growth remain stagnant. While it's nice for the top 1%, as we saw during the late 80's and we see now, it's not so great for the other 99% of us.
Re: the Kennedy tax cuts, if only. Kennedy dropped the rates from 91% to 70%, and I assume you are claiming a 70% tax rate led to growth. Reagan dropped them from 70% to 50% and from 50% to 28%. Deficits soared and growth remained stagnant until Bush I and Clinton raised the tax rate. Higher rates of employment followed.
The last 10 years have had the lowest capital gains, payroll and income taxes IN THE LAST 100 YEARS. YOu don't have to be Paul Farrell to see it has not worked out as supply siders predicted.
ETA and I"m talking about 1% or less--thanks to wealth concentration, another unintended result of supply-side economics, a Johnson-era tax rate of 90% would today effect less than one tenth of 1 per cent.
Re: the Kennedy tax cuts, if only. Kennedy dropped the rates from 91% to 70%, and I assume you are claiming a 70% tax rate led to growth. Reagan dropped them from 70% to 50% and from 50% to 28%. Deficits soared and growth remained stagnant until Bush I and Clinton raised the tax rate. Higher rates of employment followed.
The last 10 years have had the lowest capital gains, payroll and income taxes IN THE LAST 100 YEARS. YOu don't have to be Paul Farrell to see it has not worked out as supply siders predicted.
ETA and I"m talking about 1% or less--thanks to wealth concentration, another unintended result of supply-side economics, a Johnson-era tax rate of 90% would today effect less than one tenth of 1 per cent.
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