Economic Turnaround
By Barry Ritholtz - August 11th, 2009, 4:30PM
Sad but true:
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Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data, ability to repeat discredited memes, and lack of respect for scientific knowledge. Also, be sure to create straw men and argue against things I have neither said nor even implied. Any irrelevancies you can mention will also be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.
August 11th, 2009 at 4:36 pm
And the twisted tow-line is government stimulus.
August 11th, 2009 at 4:39 pm
That should be a big gnarly shark behind the underwater skiier instead of a confused looking halibut.
August 11th, 2009 at 4:45 pm
About 12 months worth of slack in the tow line.
August 11th, 2009 at 5:00 pm
This picture just makes me want to walk up to some immoral financial manipulator and kick him in the balls.
August 11th, 2009 at 5:21 pm
“About 12 months worth of slack in the tow line.”
If we’re lucky. I fear there’s more structural problems than that.
August 11th, 2009 at 5:27 pm
“Humor is tragedy plus time”
Mark Twain
August 11th, 2009 at 5:32 pm
I mean 12 months from now- summer 2010- unemployment will begin to decrease- below 9%. But yeah, maybe even that is too optomistic.
August 11th, 2009 at 6:35 pm
“About 12 months worth of slack in the tow line.”
and the line should be tied around the skier’s neck.
August 11th, 2009 at 6:35 pm
>> And the twisted tow-line is government stimulus.
How so? Are you saying “less stimulus” would lead to “more people working”?
August 11th, 2009 at 6:41 pm
@Paul S
too optimistic?
No, once they stop getting unemployment and are totally discouraged, you just take them off the labor force.
A little bit like now.
@wunsacon
I don’t think it makes a difference either way.
August 11th, 2009 at 7:37 pm
well considering how little we really got in the way of jobs from the last recovery, we are definitely starting down deep. i think the skier is about 2000 feet to close to the surface. but even som the rope is way to short. needs an extra 5 miles or so added to it
August 11th, 2009 at 8:28 pm
Paul S:
As others have said, a lot more. We need +150,000 just to keep up with population growth. So we are almost 2.5 million+ behind plus the 6 million(or is it 8?) lost since the recession began.
August 11th, 2009 at 8:47 pm
Either there should be an anchor tied to the skiier…OR…He shouldn’t even be wearing a bathing suit…
That way, when the tide goes out Warren Buffett can see whose swimming with a bathing suit or not…
August 11th, 2009 at 8:59 pm
I love this quote because it’s so f*cking spot on !
Here, in the dog days of summer, it seems to me that the situation in the USA is so fundamentally bad, so unpromising, so booby-trapped for failure, that I wonder if there has ever been a society so badly deluded as ours.
- Hunky Dory http://kunstler.com/blog/2009/08/hunky-dory.html
August 11th, 2009 at 9:01 pm
@Onlooker from Troy Says:August 11th, 2009 at 5:21 pm
“About 12 months worth of slack in the tow line.” If we’re lucky. I fear there’s more structural problems than that.
****************************
Structural unemployment is skyrocketing.
note: “Structural” is a polite way of saying there won’t be any jobs for the long-term unemployed this year, next year, or the year after that.
August 11th, 2009 at 9:11 pm
Americans working much harder – for less pay
http://www.msnbc.msn.com/id/32374533/ns/business-eye_on_the_economy/
Wage cuts and lost paychecks could seriously jeopardize the recovery of a U.S. economy that still relies on consumer spending for two-thirds of its power. “You have a very severely harmed, injured consumer in terms of income slow down, job uncertainly, job loss, wealth loss, inadequate savings, high debt levels,” said Laura Tyson, an Obama advisor who headed the Council of Economic Advisors in the Clinton administration.
“The consumer, I don’t see powering us out of this recession.”
Yowza !
August 11th, 2009 at 10:01 pm
I have said it before and will say it again, ‘this whole recession is about jobs”. Even with all the excesses and bad judgment, had our government not encouraged and helped to offshore our jobs, we could afforded the excesses. Without jobs we can’t afford much of anything. The prices of houses and cars must come down along with wages and job opportunities. Jobs are the begin all and end all. With jobs the sky is the limit and without them the gutter can’t stop the slide.
Thanks to all those who explained the offshoring our key jobs was good for us. I won’t name any names but he is on Youtube a lot telling America it is good for you.
The new guy is not making the impact I had hoped for and you wonder if he really gets it at this point, like he indicated. At least he does know the word jobs. That is what got him elected. So far the jury is still out, way out.
August 11th, 2009 at 10:40 pm
@Concerned
Where are the jobs going to come from though? We’re a country that produces virtually nothing the world wants to buy. An economy based on buying goods made in China on credit cards funded by the Chinese is unsustainable by definition. We could achieve a short term boost in employment with a sugar rush of stimulus spending on military hardware and tax cuts for the rich, which is what Marty Feldstein and John McCain advocated in February. Inevitably we would end up in the same spot we are now, though. We wouldn’t have changed the fact that this nation produces nothing.
Thankfully, the President understood that we needed a mixture of short term relief and long term investment in building a sustainable economy. We can’t go back to an economy built on no doc, zero interest loans, house flipping, and 40 to 1 leverage.
August 11th, 2009 at 10:47 pm
@Frankie: Starting to make more sense. But where is the long term investment?
The war in Afghanistan?
August 11th, 2009 at 10:49 pm
Franklin…
He is the President. He better figure it out and quickly. He is being fleeced/paid_off_by the same weasels as the ones before him, it is starting to appear.
The CEO’s and the Corporate bottom lines aren’t being effected as much as the workers. The workers having jobs and making money is what makes it all work. Without those the end is near.
August 11th, 2009 at 10:56 pm
Don’t feed the troll
August 11th, 2009 at 11:03 pm
@alfred and concerned
I started making a list of the exact provisions, but it got too long. Instead, I decided to tally the numbers. I came up with a total of $327.9 billion.
http://en.wikipedia.org/wiki/American_Recovery_and_Reinvestment_Act_of_2009#Provisions_of_the_Act
August 11th, 2009 at 11:04 pm
@f411
“Thankfully, the President understood that we needed a mixture of short term relief and long term investment in building a sustainable economy. We can’t go back to an economy built on no doc, zero interest loans, house flipping, and 40 to 1 leverage”
er-um, The Fed basically has a zero interest rate policy for as far as the eye can see as we speak. The bailed out ibanks are using the leverage of the US taxpayer to bid up commodity & equity prices to unheard of fundamental levels. All under your Presidents gaze.
I’m so happy BR, that you killed all the spirited crap in the other thread, and allow comments such as this to rule the roost. I’m so much happier to hear this light rather than the other heat.
Bon voyage.
August 11th, 2009 at 11:08 pm
@f411: Of course we can’t/won’t go back to flipping homes to each other. We’ll just flip stocks and commodities instead. Much easier! Problem solved.
August 11th, 2009 at 11:18 pm
@Mannwich
We’re going to make and sell high technology products that the world needs. Chief among these will be products to maximize energy efficiency. Not even the Chinese can afford to waste expensive energy at the rate they currently are long term.
August 11th, 2009 at 11:21 pm
@f411: I hope you’re right but I fear this country no longer has the collective will to accomplish big things for the betterment of the country. If the Chinese (who seem to have a greater seriousness and collective will/discipline) beat us to the punch on this, then we are done.
August 11th, 2009 at 11:22 pm
@f411: Let me add to my statement above: the country that has the next big game-changing invention had better be the U.S. or we’re finished.
August 11th, 2009 at 11:28 pm
@f411
Those poor stupid Chinese & Indians are surely sitting in their grass huts waiting for we, the highly educated Americans who spend our days watching American Idol, and twittering back and forth, to show them their evil ways, and enrich them with our technological prowess.
Meanwhile, those backwards Japanese, Germans, French, English, & Scandinavians who have similar, if not more sophisticated, prowess in energy conservations are going to go back to herding reindeer & swordfighting while we globalize our new economy.
August 11th, 2009 at 11:35 pm
Of course what’s missing is Paulson, Geithner, Blankfein, Dimon, and Bernake up on the boat partying like it’s 1999 and spitting on/flipping off the poor sap of a taxpayer/avgcitizen/worker.
August 11th, 2009 at 11:49 pm
As a multi-decade graduate of the Financial Services industry, I feel this culture has simply worshiped the God of lying and stealing and the fruit thereof and are enjoying its just rewards. There are even those still within that industry who think they are the lucky ones, still vigorously engaged in perhaps CDSs and other credit derivatives (whose the counter-parties have no real coin but the TP’s) where some damned fools on the outside seeing the huge paychecks still reinforce them with props. Go them Goldmans; God made Heaven, man-made Hell. Sweeeet!!
They’ll come time soon where no one will admit being a member of that industry who has so serviced the public.
August 12th, 2009 at 12:16 am
Read the latest issue of Fortune re the Chinese investment in bullet trains and then ask yourself if Reid and McConnel could manage to have the forsight for that project. The issue is not Obama, although he could be a problem. Congress operates only for themselves and their own personal interests. With two wars going on and the R’s have holds on three top defense nominations. Unfing believable.
August 12th, 2009 at 1:00 am
@franklin411
If the president understood the situation as well as you put it, he would have delt with the vulture crowd right from the start.
No offense, I respect your beliefs.
This is Machiavelli’s take on it, and it is not outdated.
http://www.gutenberg.org/files/1232/1232-h/1232-h.htm#2HCH0008
August 12th, 2009 at 1:03 am
The link should take you to
CHAPTER IX — CONCERNING A CIVIL PRINCIPALITY
Not the wicked VIII part.
August 12th, 2009 at 1:17 am
>> We can’t go back to an economy built on no doc, zero interest loans, house flipping, and 40 to 1 leverage.
May I interest someone in a public-private partnership to buy toxic assets?
/snark off
;-)
August 12th, 2009 at 2:07 am
@Frankie: WOW! A whole 327B.!
So exactly how does that compare with the cost of the wars and Halliburton and Blackrock and all the other BS that Obama continues to fund, or the TARP? ?
My estimation is more than half of it will go into fat cat pockets, given the velocity of money.
And who exactly is tracking how much of it going to corporations stays here or winds up feeding off-shore salaries?
I mean come on, the CEO perks and bonus gods have to be well served.
Nero keeps fiddling and selling out and you keep believing?
Ah yes, youth is wasted on the young.
I’m not young and I’m not dead. I find your BS totally and completely disgusting.
I think I would have much more respect for someone your age that pretends to understand history to have a much broader perspective.
Actually I know you’re not a real person, certainly not a mature adult. Perhaps another WHite House BOT.
Check back with me in thirty years and see if you sentiments are the same.
August 12th, 2009 at 8:41 am
@ cvienne http://www.ritholtz.com/blog/2009/08/economic-turnaround/#comment-202943
Its a flounder!
August 12th, 2009 at 9:17 am
@Concerned American
>>The new guy is not making the impact I had hoped for…
I am having a serious case of buyer’s remorse (not that McSame would have been any better)
@Franklin411
>>Thankfully, the President understood that we needed a mixture of short term relief and long term investment in building a sustainable economy.
No, he understood that if he didn’t prop up his wall street bosses that there would be no 2nd term.
And yeah, right, we are so much more technologically advanced than those backwards Germans, Swedes and Japanese who have been practicing energy conservation since when? WWII? You don’t seem to understand the nature of our trading partnership with the Chinese…we don’t sell advanced technology to THEM…they sell cheap plastic shit to US
Will the myth of American Exceptionalism ever die?
Kunstler has a post up at Clusterf*ck Nation about econometrics. No matter what the charts look like, most don’t truly reflect the daily reality (and by that I mean, of course, economic pain) of most Americans. Whether or not the line looks like its going up or down, we are heading for a permanently lower standard of living. Want to know what the collapse of western civilization looks like? …open your eyes – this is it! Welcome to the new normal
http://kunstler.com/blog/2009/08/the-fog-of-numbers.html
August 12th, 2009 at 10:13 am
@alfred
Interesting take–so you think that we cannot and should not take action until perfect solutions are found? IE solutions that are 100% effective (not just 90% effective), and solutions that reward every single virtuous soul and punish every single wicked man? Personally, I believe in pragmatism: do not let the perfect be the enemy of the good.
@mobiaxis
The minute Americans lose the ability to envision a better tomorrow is the minute this nation sinks into mediocrity.
August 12th, 2009 at 12:21 pm
@f411
>>The minute Americans lose the ability to envision a better tomorrow is the minute this nation sinks into mediocrity.
Sounds really inspirational, but what if tomorrow is NOT going to be better?
Also your use of verb tenses implies that sinking into mediocrity is something that could happen in the future as opposed to something that happened quite some time ago (once again – the Myth of American Exceptionalism)