Obamaconomy!!!

So much of this economic good news is only a small snippet of information that really does not come close to telling the whole story. For example, "housing starts rise" .. sounds like great news, right? Well this may simply mean that some very big construction companies are taking a big gamble in the hopes that somehow the economy will be better when the homes are finished.

In reality, they may be on the brink of bankruptcy because a construction company cannot just stand still and do nothing month after month. After all, they still have a giant overhead to pay rent, salaries, and loans taken out a year ago to buy new equipment. Construction companies can't stand still - they've got to build or die. If the new houses don't sell, well then its bankruptcy and the banks eat the construction loan.

The same good news/ bad news is happening with the banks. The large banks that the government already bailed out with TARP money, are now selling assets. The sales of a brokerage house, etc. brings in cash and shows a profit, but it sure isn't a sign of a prosperous bank.

A lot of banks still have toxic assets (houses in default) on their books and mortgage loans are still hard to get. Sometime, pretty soon, the banks must write off these mortgages as "uncollectable" (i.e., bad debt)... and the banks will look at dismal as ever.

Right now everyone seems to be caught is a state of "irrational euphoria" that the economy is turning around. Looking at the big picture, I just don't see it.
 
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Look at a lot of truly arcane data that matters and you'll see a real nightmare brewing--data like shipping, rail and truck loading statistics. In the great speculative runup to the depression, the same kind of stuff happened. If there were real "green shoots", that's one of the ways you'd start seeing them but so far the numbers are going the wrong way indicating that the last suckers are being pumped by artificial optimism to get them to invest. That's the major banking institutions way of trying to recapitalize all that non-performing worthless crap on their books that the recent relaxation of Mark-To-Market partially helped them with.

The problem's pretty complicated. At the same time we've suffered a significant decrease in employment numbers, we've also seen a substantial cutback in hours worked as well as reductions in total compensation packages. All that while there's been extremely little reduction in the total indebtedness. That adds up to too much previously discretionary spending money being funneled to debt service. Worse, the big banks (too big to fail) have lobbied Congress to backstop all the bad loans with money from the American taxpayers when both the lenders and the borrowers essentially knew it couldn't be done in the first place, thus putting the American taxpayer into a form of indentured servitude. Of course, you've seen the same scene playing out all over the world in different countries.
 
The way I see it we have lost $5.8 trillion out of the economy because of the housing bubble burst. When our nations GDP is $15 trillion this is a huge drain of capital out of the system.

On top of that, this money was in the form of mortgages loans so this money had a type of multiplier effect - that is, the institutions (and derivatives, etc) who held the loans felt like they had the money, and the people who lived in the homes felt like they had not only their house, but the appreciation as well.

The second fundamental problem is the aging of big businesses in America. It's a natural phenomenon. Businesses like General Motors slowly atrophy, stuck in their old ways, lacking innovation, lacking the spark of entrepreneurial spirit. A few businesses like IBM can completely re-invent themselves and stay successful.

I'm sure I could list several other fundamental underlying cause for this economic recession, including over-confidence of business against foreign competition, loss of integrity and ethics in our political system, and more.

This recession should cause our entire society to take a good into the mirror and see what is wrong with our society. We have lost a lot and it is time we re-invent our entire society.
 
Hobo1 said:
This recession should cause our entire society to take a good into the mirror and see what is wrong with our society.
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No doubt....The Yuppie-Di$ea$e.....

bush_republicard.jpg
 
Mr. Shaman said:
No doubt....The Yuppie-Di$ea$e.....

bush_republicard.jpg
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Going......... going................. gone, it's outta here!!!:D

Home run Shaman... and for all that Republicant spending did we shore up Social Security or Medicare? Did we get Universal Healthcare?

Nope... we got lied into a war @ $12 BILLION DOLLARS PER MONTH FOR 8 YEARS NOW and the deregulator Republicants stripped away the safeguards that would have lessened greatly the meltdown of our financial sector.

The Bush Recession don't leave home without it!
 
top gun said:
Going......... going................. gone, it's outta here!!!:D

Home run Shaman... and for all that Republicant spending did we shore up Social Security or Medicare? Did we get Universal Healthcare?

Nope... we got lied into a war @ $12 BILLION DOLLARS PER MONTH FOR 8 YEARS NOW and the deregulator Republicants stripped away the safeguards that would have lessened greatly the meltdown of our financial sector.

The Bush Recession don't leave home without it!
Click to expand...

I certainly would not trust a group of congressmen who were so easily duped into a war to run the whole country. Good thing that was not how it happened or we would have to impeach the whole lot based on incompetence.
 
Hob1 - Let me correct you.
IBM is not doing so well.

IBM's revenue fell to $23.3 billion from $26.8 billion. However, even though sales dropped by 13%, the technology giant said it was confident enough in its earnings to raise its full-year profit forecast by 50 cents a share.

Among its different business areas, IBM said total global services sales fell 12% to $13.4 billion; software sales declined by 7% to $5.2 billion, and hardware, which IBM calls systems and technology, saw its revenue fell 26% to $3.9 billio

So they are simply trying to prop their stock up.
Their confidence is all they have.

Actually I know someone who works there, and they have
been firing people for almost no cause, which is unusual, so that will
improve the status somewhat.

However, they will soon feel the CHANGE!
 
asur said:
Hob1 - Let me correct you.
IBM is not doing so well.

IBM's revenue fell to $23.3 billion from $26.8 billion. However, even though sales dropped by 13%, the technology giant said it was confident enough in its earnings to raise its full-year profit forecast by 50 cents a share.

Among its different business areas, IBM said total global services sales fell 12% to $13.4 billion; software sales declined by 7% to $5.2 billion, and hardware, which IBM calls systems and technology, saw its revenue fell 26% to $3.9 billion.
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More bogus-numbers????

:rolleyes:​
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It's terrible, that the Obama government is not honest
about bankrupting the US, while spending money that
can't be accounted for. It's insane really!
 
The ObamaEconomy really hurts teens!

D.C. teens have the highest unemployment rate in the region, and with minimum wage set to rise at the end of the month, area youths will find it even harder to get hired, according to a new study.

"Research suggests students that have access to job opportunities may stay off drugs longer, not get pregnant [and] not go into a criminal element," said Kristen Lopez Eastlick, senior research analyst for the institute.

Teen unemployment in the District reached 23 percent at the end of June -- which is a 12 percent increase since May and almost 2.5 times the national unemployment rate, according to the study from the District's Employment Policies Institute, thanks to Obama.

Since last July, the rate for D.C. teens increased more than 50 percent.

This is called CHANGE! brought to you by Obama.
 
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Obamaconomy hurts the middle class as well. When I was young I started an engineering business and worked my arse off building it into a company the employed 50 people and, yes, I brought home $300,000 per year. I could just as easily gone to the United Arab Emirates and earned the same salary and pay for less taxes. I was there for a while and I lived like a king!

Now, facing much higher taxes on my income, facing the prospect of paying higher premiums for employee health care, plus God knows what else Obama will pile on the "wealthy" - I would never start a business in the US again, never. My daughter has her own marketing company and is seriously thinking of moving to an island in the Caribbean. Why not? Most of her clients are handled over the internet and she already flies to conventions about once a week.

American entrepreneurs are the most clever in the world - that's why America is a superpower. Plus Americans are among the most world's most industrious workers - but so are the Chinese.

If Bush's legacy is that he ruined the prestige of America around the world by endlessly fighting Arabs in Iraq, then Obama's legacy will be that he ruined the American economic system. And the Democratic Congress shares much of the blame by passing stupid laws like "cap and trade" carbon dioxide.
 
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