U.S. recession: A classic 12-act tragedy

Market Watch ^ | March 4, 2008 | Paul B. Farrell

[fweingart]

ARROYO GRANDE, Calif. (MarketWatch) -- The buck stops here: This is Bush's recession, his legacy.

It could be a chapter in a future edition of Jacob Weisberg's "The Bush Tragedy," with new comparisons to "Henry V" and other great Shakespearean tragedies. In a few sentences, the opening lines could highlight why this is now Bush's recession, and his alone.

[Gondring]

(Examine the percentages of net profits of the major oil companies. You may be surprised. I wouldn't want to operate a business with those margins.)

Without government "incentives" and safety nets, etc., perhaps...but as it is, it's pretty nice to be at the top.

[mylife]

We are paying the price for globalism

[toddlintown]

“Regretably, if John McCain is elected, things will get even worse.”

And if Obama or Clinton is elected?

[mamelukesabre]

Please! Don’t be stupid. We can’t endure these fuel prices and NOT go into a recession. Add the credit crunch and the housing bubble and there’s no hope. It’s a house of cards.

[EternalVigilance]

Maybe. But words still mean things.

[Richard Kimball]

I'm no economist, but here's what I see. When Reagan left office, the DJIA was roughly 2,000. In 1992, when Bush I left office, it was at around 3,000. During the Clinton years, the DJIA went from 3,000 to 11,400.

This chart isn't perfect, but all the ones I found on the web scaled so that the increase doesn't look as significant:

At the end of Reagan's term, the DJIA was actually around 2K. Since 1929 through the Kennedy-Johnson years, the Dow stayed below 1000. How did it nearly quadruple during the Clinton years, from 3K to 11.5K? It seems to me that this would be the primary period of "funny money." I do understand that the market opened more to small investors with the use of retirement accounts and mutual funds, but I think there's something else going on, also. I'd be interested in other Freepers takes on this.

[TexKat]

I went to the store the other week and the 89C loaf of generic white bread was $2.45 all due to ethanol and increased energy demand

Tom Thumb in Texas has the audacity to have a buy one get one free sale on eggs, an 18 count carton of eggs. Buy one at $5.79 and get one free.

Yeah Tom Thumb, you think that all of us Americans have become unable to think for ourselves.

[sgtyork]

How long do you expect 20 billion barrels to last when America burns 7+ billion barrels a year?
____________________________________________________________________
The solution to our energy will be the combination of many solutions, not just one.

And when do we talk conservation, when we are down to the very last drop of oil on the planet?
_______________________________________________________________________

You do realize that our energy efficiency has been increasing year over year for decades don’t you? Market forces drive this, we don’t need enviro-wackos to tell us how.

[durasell]

The DJIA is only comprised of 30 stocks. Those stocks have changed some since Reagan left office.

[mylife]

I hear ya

[baltoga]

Agree. The article reads like a college professor dooms day dream.

We only have ourselves to blame for this current economic cycle. We fed the housing market and flipped homes like pancakes. We borrowed money beyond our means and happily accepted low adjustable rate payments. The banks sold off the loans and re-loaned us the money.

So now the house of cards comes tumbling down. Nothing wrong with being needy, but when you’re greedy the economy always finds a way to bite you.

Welcome to reality.

[ChildOfThe60s]

It’s my understanding that Alaska oil is high in sulfur and limited in quantity. How would that oil have helped us avoid the present situation?

Alaska is only a small part of the government's interference. The feds have roped off 60% of the fertile oil bearing areas in the US. The Gulf of Mexico (now to be drilled by the Chinese!), the east and west coasts, and huge tracts of inland areas. The present energy situation is 100% due to the US government. Bush's legacy is that he did absolutely nothing to change it. And he is still seriously pushing ethanol. What a flipping joke.

[mamelukesabre]

That’s a little steep for eggs, aint it? It’s been awhile since I bought eggs, but they were under a buck a dozen a year ago.

[sgtyork]

Do you really know what the profits of an oil company are? C’mon, give us a real figure.

How about the record profits of media outlets supporting this insane 2 year primary? How about the record profits of Hollywood? How about the record profits of trial lawyers? You know nothing about economics.

[mamelukesabre]

They do? What do they mean?/s

[sgtyork]

Reagan taught us all too well to borrow and spend and ...

Utter nonsense. Complete rewriting of history by a believing lefty.

The congress under Reagan spent two dollars for every one dollar in new revenue that his tax cuts brought in. He fought them each year but they forced them through.

[RightWhale]

Will have to try harder to scare anybody here. Nobody is afraid of a recession.

[sgtyork]

You apparently are a religious person, believing in Globull warming and the end times of oil. No “Reason” there.

[Halgr]

I think the author steps over the line a little here...Bush gets a small part of the blame...but most of it goes to Greenspan and Clinton.

Since President Clinton signed the repeal of the last pieces of Glass-Steagall, our banking system has intentionally and willfully ignored both the letter and spirit of the law when it comes to regulatory requirements and just plain old fashioned good conduct. Greenspan lobbied congress to lighten up on bank controls....well look what it got us.

Additionally, banks have employed “Enron” style accounting tactics and have kept certain liabilities off their balance sheets.

That’s all coming home to roost now.

Of course our energy policy stinks...both the Oil Companies and the Envirowackos are to blame...why?

The Oil Companies make money by not refining oil...most people don’t know that. There is a reason why there have been no refineries built since the 80s.

Its cheaper to import refined gasoline than it is to refine it here in CONUS.

Additionally, the enviros have played right into the oil companies hands....

But thats all just a small part of the big picture...

Additionally, America has lost 2,000,000 manufacturing jobs since the year 2000. Manufacturing, has a trickle down effect that service industries do not generate....so the 2,000,000 jobs lost don’t really reflect a much bigger impact upon our economy.

The fastest growing jobs in the last 5 years have been waiters, waitresses and bartenders. (according to the department of labor)

NAFTA and other Free Trade agreements have not been played on level playing fields...as we still pay tariffs when the counter parties do not.

Considering the classic definition of a recession, we are not in one yet, but I believe that once the two quarters ending June 30 are up, it will be determined that we are in a deep recession....probably one of the worst we have experienced since WW2.

[SteamShovel]

The Republicans have never “controlled virtually the whole works”. Even when they had the majorities,they let the Democrats control the agenda.

The Republicans never controlled anything.

Rinos and Rats did.