Letters to the Editor
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This paradigm is freaking me out
How is it that capitalist economists now believe that you can spend your way out of poverty? I mean, this country is in debt up to its eyeballs. We are, if the loans were all called in, insolvent. The first thing any serious person would think would be that we have to produce our way out of this mess, not consume our way out. That means make stuff and export it. You know, work hard, make more, spend less. Handing people money now will only encourage them to buy more Chinese crap and Japanese cars and electronic equipment. Does money flowing out of the country really signify a rise in our GNP?
Call it "Little Engine that Could" economics, or "Do you want to save Tinkerbell" economics. If we all wish real hard, spend more money, and pretend we are not over-leveraged, then somehow, someone or some thing will bail us out and it will be the 1950s again. Madness.
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$600?
The gummint's gonna give me $600 back? And they think that's a big deal? Add another zero on there and we'll see.
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cash advance
I think most people realize this money is a cash advance on the 2008 tax return.
We did a fun little excersice a little while ago called " What are you going to do with your stimulus check?" While I don't doubt there may still be party featuring coke, hookers & 65 year old scotch, are people still planning on buying those HDTVs?
Personally, this may be my gas money for the summer.
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I think Iraq has something to do with it too
It's not a confidence builder to be losing a war we shouldn't have gone into in the first place. And all this suffering on the front page every day makes materialism feel inappropriate.
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On another high note...
On another high note, Al Qaida is apparently reconstituting itself in the regions of Pakistan. What's there to be optimistic about anyway? Perhaps our outgoing president...
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“Taking a Break” What a Laugh
The Fed is ‘taking a break’ because there is no where left to go with rate cuts. They’re at two percent now. Any more and they might as well give the money away.
This will do NOTHING to help. The problem is NOT tight money supply. Banks are not lending because their balance sheets suck. Twenty years of lose money policy rang up a huge amount of bad debt and banks can no longer afford to carry it around. Why do you think they are selling off shares to sovereign wealth funds and anyone else who comes calling at pennies on the dollar? Rates cuts won’t change that fact.
If anything the Fed should be INCREASING rates and encouraging savings to build up the banks balance sheets the proper way.
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Who do we owe?
China? Europe? Screw 'em I say, just don't pay 'em back. Let's see what other suckers they can find to borrow their yen and euros. They'll come crawling back, I guarantee it. In the meantime easy credit is what made America great. If we only had kept making the subprime loans forever, we wouldn't be in this mess. Thanks for nothing Wall Street...
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The recession that never was
For several months HTWW insisted recession was certain & ongoing. No reason to wait for the data! Even the word “depression" was recklessly bantered about on this board. Those who suggested otherwise, or took a more patient view, were vilified.
So now Q1 GDP comes in at +0.6. The data is nothing to celebrate, and is still subject to two future revisions. But its +0.6. Data mining a PCE weak spot doesn't get you off the hook.
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@rusty
Easy credit also was a factor in the crash of '29.
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We are CITIZENS, not CONSUMERS.
"Is the american CITIZEN finally giving up?" would have been more appropriate. I suggest Salon start replacing consumer with the more apt citizen.
I would urge everyone to spend their refund check at the local farmers market. It will buy you enough food & wine for a monster bacchanal, and directly benefit your community and your local farmers.
If we are taking a huge cash advance out on the national American Express, I hate the thought that all of it will get diverted to our slacker boyfriend, the Middle East. We go further into debt, to jumpstart our economy, by....sending our money to oil producing nations. We're ALREADY doing that, through our oil consumption and our war. Keep your money in the neighborhood!
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Long and Variable Lags
Two things:
1) To James Levy (above), there is a theory that you can spend your way out of a recession; it's called Keynesian Economics. It worked during the Depression (some would argue). Not that it necessarily work now but it is not that wacky a concept.
2) The thing that amazes me about all the discussion now is that people assume that the Fed looks in the rear view mirror when setting policy. Monetary policy is based on forecasts. If monetary policy takes six to eight months (at least) to have any effect, the appropriate question to ask when setting policy is how we think the economy will look in six to eight months. So we might be in for more discomfort (sorry, that is a mild word) but there is nothing more that monetary policy can do unless things get worse than what we are expecting.
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Rebates go right back to billionaire oilmen.
Same old same old. Whether it's brainwashing consumers that they need SUVs, invading Iraq, creating $4 and soon $5 gas through greedy speculation in oil futures, or pretending all is well by putting a few extra dollars into our pockets this summer, it's the oil industry that gets obscenely, despicably, undemocratically rich.
That 600 bucks? It's going to pay for gas this summer. Why do you think Bush looks so damn smirky when he brags about it?
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what is wrong with not buying crap
I don't get it. I think we should buy less stuff.
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Mission Accomplished
Today's the fifth anniversary of Bush's Mission Accomplished speech. Consumer confidence is at a five year low. Not coincidentally, that's when I gave up on the economy, five years ago.
After the stolen election, Cheney's secret White House energy conference, 9/11, Enron and the white collar stealathon, letting the terrorists slide to invade the wrong country, K Street, the looting of our country by Congress and the lobbyists on one hand and the White House on the other, massive layoffs of older workers and their replacement by young ones willing to work for less and not ask the obvious questions, total disconnect between the welfare of Wall Street and that of the rest of the country, yeah, that's about the time I gave up on the economy. For Bush & Co., it really was Mission Accomplished, but it had nothing to do with defense.
No wonder our most popular recreation is "Grand Theft Auto." After living through the first years of this century, seems just like home. Me, I'm using my windfall to buy shoes.