Posted on 02/19/2009 8:11:34 AM PST by TigerLikesRooster
Tuesday, February 17, 2009
"The Worst is Yet to Come"-America undergoing a Permanent CHANGE!
Posted Feb 17, 2009 12:53pm EST by Aaron Task in Investing, Recession
There's no question the American consumer is hurting in the face of a burst housing bubble, financial market meltdown and rising unemployment. But "the worst is yet to come," according to Howard Davidowitz, chairman of Davidowitz & Associates, who believes American's standard of living is undergoing a "permanent change" - and not for the better as a result of:
An $8 trillion negative wealth effect from declining home values. A $10 trillion negative wealth effect from weakened capital markets. A $14 trillion consumer debt load amid "exploding unemployment", leading to "exploding bankruptcies." "The average American used to be able to borrow to buy a home, send their kids to a good school [and] buy a car," Davidowitz says. "A lot of that is gone."
Going forward, the veteran retail industry consultant foresees higher savings rate and people trading down in both the goods and services they buy - as well as their aspirations.
The end of rampant consumerism is ultimately a good thing, he says, but the unraveling of an economy built on debt-fueled spending will be painful for years to come.
Then we’ll need to change the pro-debt tax laws and regulations. Much of what we are suffering is favored status for the Nat. Assoc. of Realtors and our banking/insurance friends.
Bad tax and regulatory policy. We have a pro-debt bias. Debt, to be considered “good” must go to productive assets. Not consumption goods and depreciating assets. Inflation makes houses seem to be appreciating, when they are not. They are more like cars with a longer life span.
European wars of revenge spent their wealth and destroyed their production. We took on their socialist and financial model and are damning ourselves.
Despite what libs/socialists/most Dems think, money doesn't grow on trees and you cannot tax/spend it forever.
They branded those 19th century entrepreneurs "Robber Barons" and did all they could to ruin their path to wealth for the rest of us. Taxes, regulations, & courts are all means to destroy wealth.
We're living on the vapors of the 19th cent.
How does this address the illiterate and ignorant issue? Are you suggesting you have these problems but you own land?
Because there are buyers, both here and abroad.
Sorry to burst your bubble, Emperor Hongwu, but we're not the only people on the planet. Closing your eyes tight doesn't make reality go away.
You can ban all imports of inexpensive goods, and ensure that a big chunk of our wealth is pulled from economic development, etc., and put into higher priced toys, but that will just make us less competitive than others who don't do such things.
Do I like that? Nope. Neither do I like the fact that I can't fly unaided....but not liking something doesn't change the reality of it.
How about this...how about you boycott the stores and things will change, right? Oh...they won't?!? Well, then, why would America's boycott of these places change anything? Until it's a ban from all potential purchasers, the slave labor will continue.
And why stop at toys? What about parts for things we assemble? Wouldn't it be great if we had to raise the price on all of them, making any American product overpriced relative to other world competitors? Why, we could sit in our own little sandbox here, trading things back and forth at fake wages while the world passes us by. Oh joy.
The Founders of this nation would be horrified at the idea that the ability to fog a mirror constitutes a right to vote.
I’d say the rational modern equivalent to your attempt at a one-liner would be that net tax payers get to vote.
Your rational, modern equivalent of taxpayers voting is much more palatable.
Would it only be net tax payers so that those who manage to avoid paying taxes legally would not vote? I think it would be hard to implement, although I get your point. Instead, though, we have to educate the ignorant.
If we could convert just 16% of Black and Hispanic voters to the economic reality of free markets we'd win every election everywhere, including Chicago. I believe.
I would disagree. Russia will have a much more free economy, and a lower tax burden. Probably more freedom of religion for Christians as well.
This outcome wouldn’t surprise me at all.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.