Recent positive GDP numbers lay bare the extent to which the supposed recovery is based on government paper-hanging and wishful thinking and is, in the end, non-sustainable. The New Depression began in 2007 and will run through 2011 or longer depending on policy. Semantic back flips, such as calling our condition the Great Recession to avoid using the word depression, will not change this fact.
Economics has no formal definition of a depression, but they are distinct from recessions and financial panics. Recessions are business-cycle-related and triggered by shocks, disintermediation, higher interest rates or combinations of these and other factors. They are sometimes severe, but typically brief, and can result in robust growth from the bottom. Financial panics are even more brief and often unrelated to the real economy as seen in the crash of 1987.
Depressions are different. They are often long and characterized by persistent high unemployment, widespread deflation, and extended lags before former highs are achieved in stock prices and output. The U.S. experienced depressions in 1837, 1873, 1893, 1920 and 1929. Their distinguishing feature is severe asset liquidation. Money borrowed in the boom is misallocated, followed by liquidation and price declines that are the consequence of wasted investment. If this sounds familiar, it should, because it’s what we’re experiencing now.
U.S. policy in 2009 successfully masked the symptoms of a depression. But masking symptoms of a depression is not the same as preventing one. Policy has power to cause timing differences, bringing some demand forward. Policy can socialize losses, moving them from the deserving losers, the banks, to undeserving losers, the taxpayers. The Fed and Treasury have done this well. Future growth has been stolen and bankers have prospered at the expense of citizens. Alas, depressions cannot be papered over. Asset price declines and general deflation are relentless even in slow motion. And deflation is the condition most feared by central bankers.
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Could The 2010 Winter Olympics be Cancelled?
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The way the government is conducting things, this depression will last a long time, not just a few years. Some say ten years or fifteen average.
ReplyDeleteRemember though, our depression is different because the jobs have been destroyed or sent overseas. This is more like turning the USA into another third world.
Don't forget all the Boomers retiring next year. Another added bonus to all the damage being done.
ReplyDeleteSome say this alone would bankrupt the USA, even if we were not in a depression.
I agree completely with 11:55AM. To say this crisis will just run through 2011 is pretty hard to swallow considering the impact the current tax and spend mentality will have on productivity.
ReplyDeleteMaybe it was a typo and the author meant at least through 2021?
RIGHT ON 55! THIS IS ALL BY DESIGN! "IT IS WELL THAT WAR IS SO TERRIBLE, LEST WE GROW TOO FOND OF IT" (ROBERT E. LEE) STOP THE INSANITY!
ReplyDeleteHe is making us feel better by stating 2011 or LONGER! Has to have some optimism..
ReplyDeleteit mis going to be a long 10 years
ReplyDelete11:55 has it right. During the 30's, at least we had major industry to fall back on for possible employment. Today there is very little industry left and what's left will most likely exit because of the unfavorable business environment attempting to kill capitalism. It's a no-win now as most jobs are service oriented and low paying. In addition, what can a McDonald or WalMart employee that gets terminated do if there is a reduction of stores and positions taking place as companies continue to downsize? Where can they get employment? We are in a vicious downward spiral and this will end badly.
ReplyDelete12:17 that is what disturbs me TREMENDOUSLY right now, the fact that the fast food and retail employees are being laid off is a very disturbing. If you can't even get a job in a place where it was one "easy" to do so, what are we going to do? Especially families where even both parents have lost their jobs (my wife and I both lost our jobs). The unemployment only lasts six months for most people, the extensions are mostly a scam. Where are we going to get a job? I have applied for jobs I am overly qualified for because there is not much else. Where do we go? Become homeless?
ReplyDeleteThere's only one 'sustainable' way out of this - massive depopulation on a global scale. Expect WW3 soon.
ReplyDelete12:21 I can't imagine the frustration and fear that you and your wife must be experiencing. I know that many others are going through this crisis and what disturbs me most is that the government has spent untold trillions of dollars to bailout the very people/institutions that caused this problem at the expense of the people. The government is the entity that has put you and many others in this horrible position. I'm afraid that extremely difficult times are ahead for our citizens as the fallout of years of bad policies. When a country divests itself of the industrial strength that made it great, ignores the laws that provided prosperity for Americans, and has turned its head on morals and ethics by embracing greed at all costs, the toll will be paid by the people. I sincerely hope you and your family find some immediate relief and wish you the best in the coming months ahead.
ReplyDeleteI feel very sad for 12:21 and the millions of others just like them. They really had no idea this was coming.
ReplyDeleteThe 900+ fema camps where just a bad dream, a dumb rumour belonigng to extremely paranoid nutjobs.
@road agent 12:27PM..................
ReplyDeleteFunny you mention WW3. I just happened to watch 'Mad Max' again on the tube, and it struck me that the quality of both sides of that ensuing battle representing the remaining population didn't give me much hope about our potential prospects either seeing the predominant makeup of society these days.
I guess you could say that particular mirror is just a little too close for comfort. LOL
I agree with road agent 100% EXPECT WAR(god help us, I believe it is comming, and it will affect us ALL, not just another t.v. war for U.S.)
ReplyDeleteThe depression will most likely last for many years. With little industry left in the US, unlikely we will come out of it anytime soon, unless we perform a miracle and create industry and jobs in the US. Not gonna happen.
ReplyDeleteThe govt funny money is on it's last leg, when it collapses, so goes society. At that point, which could be any day now, then we may see beginning of the Mad Max scenario.The way things are looking, we may be attacked by China or Russia, nuke attacks that is...
Meanwhile, the controllers will keep pumping up the wars, which will be probably be the only jobs around, defense related (and of course the big banks will be around).
Sad that I can not share this with 90% of my friends and family, they are so dumbed down stupid TV addicted, the only thing they know is what is on TV or what the TV tells them.
I am 57 and have not been able to work for many years, have a small telecom business that is not doing well, I'm with you 12:21.
@1:42 PM
ReplyDeleteSorry to say that, but even though you are 57 your thinking is of a school boy. There are several prioritized ways of conducting a warfare (described below), and a “hot” war being the fastest, but least effective. Look at you wars in Afghanistan and Iraq. Russia and China do not need to attack you. If things get really bad, they can dump the dollar on the market which will cause as much damage as a nuclear war. So China and Russia being very good students of the United States will not participate in an open conflict, unless attacked directly. See, you are in the Middle East not because your elite wanted to control oil (they could have paid for it with printed money, and they can print as much as they want). They are there to bankrupt your country and get rid of the most active youth so that there won’t be any resistance at home when it’s needed. Who you really should fear is the enemy within.
1. World View (you introduce a concept in the country- “For the LORD your God will bless you as he has promised, and you will lend to many nations but will borrow from none. You will rule over many nations but none will rule over you.”). This is the slowest method, but the most stable. Worked and still does for thousands of years.
2. Historical or Chronological (anti-Semites blame anti-Semitism on Semites. Sounds like delirium, doesn’t it? Yes, it does for as long as one doesn’t know how things work. Who runs Israel? Ashkenazi Jews. Who is Ashkenazi Jews? They are Khazars-who have nothing to do with Semites. They blame anti-Semitism on whom? Arabs. But Arabs are Semites. How can you accuse Semites in anti-Semitism? So, this is another useful tool to run the World)
3. Ideological – TV, Movies, Shows, etc., AKA Cold War.
4. Economic through world money, aka reserve currency. Whoever controls the money issuance controls the situation-locally or globally.
5. Genetic warfare (you can kill a nation by alcohol, drugs or both. Alcohol is a good example of warfare against the natives in North America. Drugs – currently mowing population in North America, Europe-both Western and Eastern, Russia)
6. Military force (fastest, but least effective)
Again, look around you. Mostly everyone is lost like a ball in tall grass. Everybody is overwhelmed. Anxiety is quickly setting in on most of America. We will face massive inflation and the next shoe to fall will be commercial real estate. If you can afford it, please take your family around town and look for a business that was going well 30 months ago and look now at the vacant sign. Take inventory and do another check at the end of 2011. We are in trouble. Listen up America, we are in trouble. Get your head out of the sand. Do some emergency planning this month while there is still time. If you are back up in a corner like a junk yard dog now, but you better come out fighting. No time for crying and getting all emotional. Your butt better get busy living, because if you don't you will get busy dying. DO IT NOW. We need to get our own crusade out like Haiti. DO IT NOW
ReplyDeleteI live in Anaheim, not far from Disneyland. Anaheim is the largest city in the county. Boeing of Anaheim just fired another 53 people in Jan. Another 53 families to follow the pattern:
ReplyDelete- Lose your job
- Lose you house
- Live in your car
- The car gets repoed
- Move to a tent city.
There are several huge industrial complexes in Anaheim, some with enough parking spaces for 4-5 thousand employees. They sit empty. They will continue to sit empty for years to come... unless a big-time war were to break out. These big facilities could be turned into weapons factories really fast. What else do you do with a facility big enough to employ 5000 people?
- Weapons
- Combat clothing
- Web gear
- Helmets
- Combat electronics
Any ideas what to do with a building like this without a war?
No worries here in my region. I live in the midwest where jobs are plenty and we are all living large. We have fertile farmground and yards full of delicious beef and pork, dairy and poultry, we will never go hungry, I am sick of all the snow though.
ReplyDeleteSome of you should move out here, there are always jobs posted in the town papers and larger cities always have lots of jobs too, plus it's a good area to live with plenty of food and drink.
WE are not anxious like the above poster says, sheesh, don't lump us all in the same boat.
We are living well and I am planning our summer vacation to the Holden Beach area in NC which is a very spendy but nice place to holiday, so we are helping the local economy over there at the same time.
The rental homes are all filling up very fast so it's not really as bad as you all say it is, just becuase a few folks have fallen on hard times does not make it bad for all of us you know.
@3:00 you are full of crap, I was just in Anaheim on business the other day and there were no emtpy places like you talk about.
ReplyDeleteSure you were not looking at the Disney parking lot?LOL
I was trying to find space for a client and there is NOTHING out in that area right now, all this poppycock about CA having it so bad, it ain't that bad.
I drove up to Santa Barbara and there were only a few least spaces along the way, otherwise it was all busy. If was THAT bad the traffic would be much better than it was, and it sucked
OK 3:03 it is thinking like yours thats going to get you. There are alot more people on hard times than a few. When people get desperate i would watch my back if i was you. God bless
ReplyDeleteLearn the truth!!!!!
ReplyDeletehttp://www.infowars.com/
The blame must be placed on the American people as a whole.
ReplyDeleteIf you hadn't bought all those foreign cars, TVs, appliances, tools, etc., things you used to produced completely, you wouldn't be in the mess you're in now.
I realise there was a time when the Big Three (it was actually Four; AMC) didn't produce very good cars. The antidote was simple. Buy from two until the other one improved quality. Then move on to the next target.
The Germans build great cars. Why do think? Because Germans hate crap and won't buy it at any price.
Even at this late date, why do you reward companies that outsource their production? Trash them until they smarten up. It's not all about price. Crap is crap at any price, and the old adage is correct: you get what you pay for.
When it comes to quality, the Chinese can't compete with the G7 nations. And they know it. I personally go out of my way to avoid this nasty nation's good. I HATE THEM. To me, it's The People's Republic of Substandard Manufacturing. Chinese stuff = CRAP. It may look good to the eye, but generally doesn't last nearly as long as stuff made in the West. American goods are many times better than their Chinese counterpart. And I'm not even American!
The solution to your problems is relatively simple. America needs to get off oil for good. Why not start industries that place solar panels on roofs of homes in the sunbelt? Then start buying cars that make sense, like the Chevrolet Volt?
If the U.S. Government gave grants for such purchases, provided they're made in America, instead of handing money to useless, bankrupt financial institutions, it would spend less and set the stage for a turnaround.
America also needs a total railroad revamp, i.e. electric-powered systems. Also, many people are going to have to forego automobiles altogether in favour of public transit. Electric light rail systems are the answer for the suburbs. Without them, they'll die.
Lots of jobs here folks. Organise and demand action.
3:07
ReplyDeleteGo to Google maps and look at the area of Kramer and Mira Loma in Anaheim, you will see the old Fuji building I mentioned in my post. Empty as it can be. Next to that property is what I will guess to be the former Boeing Anaheim, Corporate offices. Another huge piece of vacant land.
When I was a kid, back in the 60's, everything was made in the USA and we were a major exporter. Now what?
I have solar on my roof and a wind turbine as well. They are small systems, but they work and they work just fine. There is absolutely no excuse for every south facing rooftop in this country to not have solar.
Ideas for the unemployed in large cities.
ReplyDeleteSTART YOUR OWN BUSINESS on a shoestring budget.
Ideas:
- Sell food items in downtown that people buy all the time, only at a fraction of the price of store concessions, like pop, chocolate bars, energy bars and drinks, coffee, gum, tic tac, etc.
When you go to a ball game you see people march up and down aisles with a box of goods hung around their necks, yelling "popcorn," "beer," ect. Do the same thing, only on streets.
You don't need thousands of dollars or a loan from a bank to do this. Just go to a wholesaler, get a professional-looking outfit, appropriate carrying cases and a relatively low cost business licence.
Selling is the way out for most.
If "they" won't hire you, hire yourself. It's easy is you have a little money.
After all, everybody eats.
Some of the wealthiest people started selling like this, including the guy who found Nike. Imagine selling running shoes at ball games? That's what he did! Out of his car, if I recall correctly!!
Quit crying and start doing. It's the American way.
Whoever the troll is who keeps spamming with that infowars link ought to be banned/deleted.
ReplyDeleteI dont get the logic of 3:03/3:07 if they are even different people, it s like saying it is night when everyone can see it is day, he must be NSA or wall street and acustomed to saying it is a certain way and everyone around him saying yes I can see that now... Maybe ex military with some rank in retirement, believing that the outside world says yes sir, how high sir.... 3:03, your attempt at Jedi mind tricks isn't going to work on thinking people, give it up dude, we just laugh at you... "These arnt the droids your looking for" :-)
ReplyDeleteThe DEPRESSION is getting worse. You have a few US goverment puppets spreading their all is well propaganda. The US is in a DEPRESSION not a GREAT RECESSION but a DEPRESSION where tens of thousands are living in tents cities and tens of thousands living in their cars. The depression will get worse
ReplyDelete3:03 and 3:07 are both the same person.
ReplyDeleteAnd again, re: 6:47's comments on 3:03 and 3:07, ask yourself why someone who is "doing well" would waste their time coming to this website.
They obviously have an agenda.
God, you people crack me up so much. Agenda? Yeah, like maybe to laugh at you baffoons (I am a different person). Yeah, I think you nailed it the first time. He is definitely NSA. OR top brass. And he comes here because this is THE MOST IMPORTANT WEBSITE IN THE WORLD. LOL...
ReplyDelete8:47 the truth is devastating isn't it. Stuff must be coming out both ends with the bottom part coming out the hardest in your pants
ReplyDelete8:47 I was being sarcastic, maybe you are Jar Jar Binks!!!
ReplyDelete303 you are full of crap I live in the midwest and most people I knowing including myself are not living large a-hole. I was just talking with my neighbor tonight and we were trying to figure out the most economical way to heat our homes. My electric bill increased 4 times in just one month and I cut back my thermostat to 63 degrees. I cut off my security light, I have unplugged anything that doesn't need to be plugged in. If it keeps increasing like it is I will not be able to heat my home with electricity. I'm probably going to have to install a wood burning stove. Things are going to shit quickly. My insurance premiums have increased and my deductible have increased. At the rate everything is increasing it won't even be worth it to go to work because I won't have any money left for food. 303 and 307 you are both a-hole.
ReplyDeleteI live in the midwest and it is starting to get bad,anyone who says different is lieing.
ReplyDeleteI live in the south and people are selling their gold and silver jewelry and pawning their possessions in order to pay their bills.
ReplyDeleteSee, what 2:38am said is stealth confiscation.
ReplyDeleteAs I've said before, there is no need for the government to invoke some kind of overt Gold confiscation. They can let poverty and indebtedtedness do the job for them.
Remember those mail in your gold scams a while back? I saw a report that they paid only 50% of the gold value. Theiving bastards. Another thing, I can almost gaurentee you that at the top of that food chain you'd find the Rockefellors and or Rothschild's or some of their buddies scooping up the sheeples gold for pennies on the dollar.
Gold. It's all that glitters.
Oh 8:54/9:12 you so wacky! You are like William F Buckley Jr. on qualudes with both ends reversed to allow you to speak out the most caustic one.
ReplyDeleteAll I can think about is gold because gold makes the world go round. It's real money, not that fake funny money stuff. The NWO are smart. Smarter than you or I put together, which is not saying much. So they are all hording their gold on river boats and barges and in places like under Nessy's belly deep in a loch so's us angry sheep won't come and get it. But what they don't know is that some sheep like to swim very very deep. One day I will have the gold in my hands and then control the world and we'll see who's king.
ReplyDelete