Posted on 12/30/2008 5:29:13 PM PST by BenLurkin
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There will be plenty of pain in 2009, as employers cut more jobs, the unemployment rate rises toward 8 percent or higher, and shellshocked consumers curtail spending even more. But beneath the dismal headlines will be some hopeful trends. Here are some of them:
1) More saving. If you haven't heard by now, the savings rate in America is alarmingly low - barely above zero. ...
For once, anxious Americans appear to be putting more of their paycheck in the bank. ...
2) Smarter spending. Most middle-class Americans could find ways to cut their spending by 10 percent without downgrading their lifestyles all that much. That kind of cutback would be a disaster for stores, but it ultimately benefits consumers because frugal spending forces retailers to offer the best possible products and add as much value as possible.
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3) Great buying opportunities. Nearly everything is cheaper than it was a year or two ago - electronics, gasoline, cars, homes, and especially stocks. That's no excuse for impulse shopping. But it's a great chance to buy things you might need eventually, like a new computer server for your business, or a minivan for your family. Talk about "deflation" might leave the impression that we can now take low prices for granted. Don't count on it.
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(Excerpt) Read more at biz.yahoo.com ...
I have been able to save hundreds of dollars a month by paying off a vehicle, letting our cleaning lady go, and eliminating all cable channels. The only thing I miss is the weekly housecleaning. I’ve been surprised at how little we miss all those hundreds of TV channels that never seemed to have anything interesting to watch. Now we’re buying guns, ammo, and extra food, so the money we’re saving isn’t going into a savings account, unfortunately.
Software is not considered part of the manufacturing section of the GDP, it’s service sector. And with fairly good reason. The vast majority of software sold is actually custom built, and a major portion of the revenue for all software is support contracts. As for where it’s written, that’s right here. While there is outsourcing it’s much smaller than people think.
I didn’t say anything about software replacing anything. I’m simply pointing out that the growth of the software industry, which is not in the manufacturing sector, has a lot to do with the drop of manufacturing as a percentage of the GDP. A whole new sector got added to our economy, a very large sector which is a significant percentage of the GDP. By the very nature of percentage math everything else had to drop.
We have a strong manufacturing sector. 14.4% is STRONG. Ignore the trade imbalance, in discussion of the strength of our manufacturing trade imbalance is completely meaningless. Actually in all discussions trade imbalance is completely meaningless. The trade imbalance doesn’t take into account any goods made and sold in America, so it doesn’t take into account the vast majority of our manufactured goods. It also doesn’t take into account the vast majority of the non-manufactured revenue earners, the movie industry hauled in about 9 trillion dollars from overseas market last year and will do the same for 2008 and not 1 penny of that counts for the trade balance.
Financial pundits have been saying we must get used to America not being #1 since before Carter’s malaise speech. Remember, these guys have predicted 20 of the last 4 recessions. Don’t listen to them, their job is entirely dependent on them generating bad news.
I’m one of the many people that fled the snow belt. I can tell you there are a lot of reasons why snow belt states by and large have worse economies than the sun belt.
Protectionism CAN be useful, but it can also severely damage the economy. Done wrong all protectionism does is create inflation and damage the buying power of the American consumer. Done right it can help our companies sell in foreign countries. I don’t trust Obama to do any of it right.
We aren’t creating a permanent under class. Another of the lies of the doom cryers. Everybody likes to point to the “shrinking middles class” what they never bother to look at in the DOL and IRS charts is that the lower class is shrinking too. We’re actually getting richer.
Yep!
FDR realized he could use the financial crisis to impose a wartime immediacy on the populace and get away with just about anything.
Thus speaketh the resident liberal on FR. If Buffet says we need stimulus, it means that Buffet needs stimulus.
For the record, my husband works for the countries largest gray iron foundry. They are suppliers to the "big three", yet he and I are 100% against the bailout, why? because it goes against every single economic belief we hold. The government should stay out of private business, period, end of story. This will be the demise of the free enterprise of business if they are bailed out totally. They must go into bankruptcy and reorganize, or they will be back begging for more in less than a year.
I didn’t want to give the money to GM or Chrysler to begin with, but when they spend $600K on ads to thank America for the bailout it made my blood boil, this is like the $25 million the Merill Lynch guy got for three months work and the WaMu guy got for less than a month... all paid for with our money.
I see absolutely nothing wrong with luring foreign companies to settle in the USA and create jobs.
If the government keeps intervening and preventing the restructuring of these companies (as well as wall street) from occurring, then we are going to experience a long period of recession along with massive inflation... In trying to save the economy from total collapse, we are choosing to save everyone no matter how good or bad they were before the crisis. Over the long term this will cost us even more in terms of future economic growth.
Government deficit spending is not going to make our economy recover with any amount of long term strength and vitality. This will only come come by purging the weak out of our economy. To date capitalism is still the best system to do this, not socialism. The same will be said at some point about healthcare after Daschel gets done messing with it. Smaller, hands-off government is the best solution and it is painful at times.
I think deficit spending is probably the only way to avoid a depression. I have been studying the issue. Also, conservative economist say it needs to happen as well. I hope the GOP will not block a stimulus package...they already own the recession. God forbid they must own a depression...the party would be destroyed in my opinion.
Lure them with your own money-not Federal money. If you see nothing wrong with helping a foreign company (country) compete against an American industry...then I think you are misguided and do not understand the consequences. I hope the Southern Senators are investigated and the states are forced to return any federal monies involved. Also, how about they stop claiming to be conservative while feeding at the federal trough by taking more from the government than they pay in taxes. They aren’t really ‘low tax states’. They are subsidized states so quit talking BS...Sanford talks a good game but look at the federal money his state rakes in. I’m telling you the GOP shot themselves in the foot with the Auto thing...they totally enraged people in battleground states. I can’t imagine how they think they can win a presidential election.
Hardly-they didn’t put any money in their pocket...they are merely trying to combat the bad press...which is the going to blamed on the GOP...GOP in 2012-vote for Sanford/Palin-not likely. GOP = DOA in the Mid West. I doubt any Southerner could get elected right now in battleground states.
No they don’t get a lot back in taxes... because these are foreign companies. They continue to receive massive tax breaks and any profits go home to Japan.
I think the GOP can not complain about spending right now...after the massive spending they have engaged in the last eight years. If this downturn worsens after the GOP filibusters a stimulus package...turn out the lights the party is over.
http://michellemalkin.com/2008/12/31/the-bottomless-uaw-money-pit/
I am not even going to vote for Sanford and no way will Palin serve as a Veep candidate again and I would not support her being anywhere but at the top of the ticket... the GOP is not going to carry Michigan anyway, they are so far into the socialism tank they might as well merge with Quebec.
The GOP doesn’t “own” this recession... they didn’t make the rules that caused the housing industry to collapse, democrats did... and FDR did not turn the depression around with his spending programs, he prolonged the depression with his spending.
They may have their roots in foreign countries but they are actually manufacturing in America, vs GM who build my suburban in MEXICO!!!!!! and our last vehicle in CANADA!!!!
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