Posted on 05/02/2012 9:06:22 PM PDT by blam
/johnny
The next recession? I didn’t know that we were out of the current one.
I could be wrong, but didn’t Bernake testify recently that Jan ‘13 we will be going ‘over a cliff’ due to obamacare taxes?
If he didn’t, I will. The final nail in the coffin will be 0 care in Jan 2013.
I am not convinced that entitlement programs 'drive' the economy. We all share the sum total of what we all produce. Taking from the producer to give to the non-producer may be construed by some to be an act of charity, but it certainly does not increase the GDP or aid the economy. Rather the converse is true, leaving the money in the productive sector will preserve industry which is faltering, and cause growth in industry which was merely surviving.
Take away the government spending, and the housing bubble, we’ve probably had little or no real growth since the ‘.com’ crash. All the while we were off-shoring productive jobs like mad. Now the rot is being exposed.
Good post.
One California economist used to warn that all of the economic activity in this State after the year 2000 was equal to the amount of mortgage equity withdrawal. One the house-as-ATM fantasy exploded the rot underneath was exposed. The housing bubble masked the longer term damage that off-shoring was doing to job prospects.
Around here it is fuel prices taking the discretionary dollars out of everyone’s pocket. You have to drive to work, but now we brown bag it to absorb the daily deal..
That hurts restaurants, coffee shops, etc.
Used tire market is strong..
HUGH HENDRY: A Profound Market Moment Is Coming In The Next Few Years
Simone Foxman
May 2, 2012, 4:37 PM
Milken Institute/YouTube
Hugh Hendry, CIO and co-founder of Eclectica Asset Management, waxed deeply bearish about the state of the global economy in a panel at the Milken 2012 Global Conference yesterday.
While acknowledging the fundamental strengths of the U.S. economy, he told attendees that the markets are about to reach a disastrous moment. "I think we are single-digit years away from the most profound market clearing moment," he said, "A 1932 or a 1982, where you don't need smart guys or girls, you just need to be there."
Hendry elaborated on how this might happen:
To create the market clearing process that I fear is within reach I would tantalize or fear [sic] you with the nation that that we could see a hard landing in Asia, coinciding and indeed being encouraged by the problems in Europe. And if you get those two events colliding, and given the lack of protection in such a scenario in Asia, then you would have another profound dislocation, and that's the point where you reach the bottom, and you don't need wise guys, you just need courage.
You’re right; when you look at dying “post-industrial” states that have lost their tax bases to other more business-friendly states, you can draw a parallel to what is happening on a national level (with other less-regulated nations). When viewed in that light, you understand how bad off this country is (and don’t bother looking for signs of the coming recession - we’re still in one).
Those who are fortunate enough to still be working are having their salaries “adjusted down” to the new normal through currency devaluation. Take any product in a supermarket (I would use gasoline as an example, but the left has a whole slew of excuses for those price increases), and think of how many of them you could buy with one paycheck five years ago - and now think about how many of them you can buy today. The whole mantra that there is no inflation is probably just used because one thing is actually falling in price - our homes.
“Around here it is fuel prices taking the discretionary dollars out of everyone’s pocket.”
Our tolls doubled here in NJ within the last year or two; now they are squeezing less people (since so many aren’t working anyway) for more money. It is frightening; I especially wonder how the high school seniors getting their first cars are even able to put gas in them.
The fuel prices also have the effect of causing retailers to jack up their prices because of the shipping costs they are seeing increase due to those prices; it is a vicious cycle.
Yeah it kills a small town, except for those in walking distance.
If you are fortunate enough to have a paying gig, you gotta get there. Other stuff comes after that.
Nor has Bernanke, Krugman or any central planning acolyte shown that we will ever grow our way out of this, especially in this globalized economy.
thanks for posting this interesting article. my observations is that the average american has no reserves. However many no longer have house payments and their new rent payments are lower than their previous mortgage payments.
Check my tagline.
Next recession? WTH, does anyone actually believe we have recovered from the present one?
It is always amazing how bland and mundane can be the appearance of evil.
Didn’t you here gas prices went down a whole 5 cents last week and to hear the top of the hour news tell it gas prices are not a problem for people it’s the new norm.
I am paying $4.29 a gallon
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.