Skip to comments.Leading economist fears decade of weakness in US
Posted on 01/12/2009 6:04:44 PM PST by TigerLikesRooster
anuary 12, 2009
Leading economist fears decade of weakness in US
Suzy Jagger in New York
One of the world's leading economists has given warning that the United States is facing a decade of financial misery, with the number of unemployed Americans set to continue to rise for years.
Robert Shiller, Professor of Economics at Yale University, who predicted the end of the internet bubble seven years ago, said: We could have many years of a very weak economy. Big recessions are followed by years of weakness and typically unemployment keeps rising.
To say that this will last years is not a dramatic statement. What is happening now is much worse than 1990. We could be facing a decade of real weakness.
This is no ordinary recession. There are signs that people see this as a different story. People are talking about a depression, something that we haven't seen previously.
Professor Shiller's comments come as the unemployment rate in America is rising astonishingly fast.
Last week official figures showed that the US lost 524,000 jobs in December, with the overall unemployment rate rising to 7.2 per cent the highest level for 16 years.
With about 11.1 million people out of a job, the total number of unemployed is about 50 per cent higher than a year ago.
Some economists, such as Kenneth Rogoff, the former chief economist at the International Monetary Fund and now a Professor of Economics at Harvard University, believe that America will be lucky if unemployment peaks at 9 per cent of the workforce and that there is a high chance that it will reach at least 10 per cent.
(Excerpt) Read more at business.timesonline.co.uk ...
It seems that the media can't wait for a depression and are all hot and bothered about it.
Do they not know that THEY TOO will be affected by what one would call a self fulfilling prophecy?
And the US is entering a period of weakness.
I wonder if the rest of the world will wake up and decide that we actually were useful to have around and that maybe -- just maybe -- we weren't a brutal hegemonic power.
The feds have gotta slowly begin phasing out crop price support credits.
The feds gotta stop giving globs of money to Democrat urban mayors, who waste 80% of it on crony projects that involves union inefficiency.
The feds gotta open up huge areas of the US for energy development, and the feds gotta stop subsidizing energy companies (if that is what occurs)
All segments of governments - local state and national - have got to morph into lean fighting machines.... so citizens and private companies can focus on making money instead of sending money in to tax departments.
Not going to happen.
All the price supports put in the Depression will stay, and more will be enacted. We already have banking and auto manufacturing support.
Look for more union construction labor support to build building truly unneeded and, like most projects, unable to be maintained to be built.
Jeanne Kirkpatrick named them the “Blame America first” crowd.
They could be right. I wouldn’t be surprised to see four years of military and economic weakness, starting next Tuesday. I’m even afraid that it will turn into eight years of weakness, since American voters are slow learners.
“One of the world’s leading economists has given warning that the United States is facing a decade of financial misery, with the number of unemployed Americans set to continue to rise for years.”
Yes, and the chief cause will be government policies that drag out the downturn.
“I wonder if the rest of the world will wake up”
The rest of the World isn’t “without sin” and uses the U.S. as a whipping boy. Still waiting for the rest of the World to take some moral stands, themselves. In the meantime, I don’t worry much about their opinions.
I wonder if the rest of the world will wake up
The rest of the World isnt without sin and uses the U.S. as a whipping boy. Still waiting for the rest of the World to take some moral stands, themselves. In the meantime, I dont worry much about their opinions.”
I agree. It’s always the US that they run screaming to when the excrement hits the rotary oscillator.
Yeah, they've gotta do all those things. And we'd all be better off.
Now, what are the odds that an Obama administration is going to any of them?
Harry S. Dent predicted this long downturn back in about 1992, in “The Great Boom Ahead.” He has expanded on this with other books since then. Dent has badly missed on some of his stock market predictions, but his general economic predictions have been quite good. He predicted the housing bust would start in 2010, so it came a little early. He thinks it will take about 15 years to really shake all the problems out. He also predicts terrorism will gets worse as the world goes through this long economic downturn.
Usually I would agree that the media is just selling blood as they love to do, but this time (even though the media doesn’t know it) the outlook is not just a short recession and then off to the races again, IMO. We have short-circuited two recessions and the demographics of the country are not good for growth. Recovery from the current problems will take a long time. It will be made worse since government now has a mandate from the people to interfere with free markets in a futile attempt to repeal the economic cycle all capitalistic countries must tread.
You were saying — “It seems that the media can’t wait for a depression and are all hot and bothered about it.”
Well, I don’t know exactly what is in the minds of a lot of those reporters. Perhaps it’s true, bad news does sell... and that’s their motivation.
However, regardless of what a lot of reporters may want or not want, I have no doubt that this is one of the most serious financial disasters on the worldwide scene that we’ve seen since the last depression and that puts it into the possible category of having another such depression.
But, this time around, there are mechanisms that were put into place (from the last one) that softens the punch of a worldwide depression, if it occurs. I mean, people can get assistance and they won’t be in as bad shape as the last time around. So, that makes it less of a problem for a lot of people out in the ordinary public.
Everyone will have to cut back and I’m sure unemployment will be sky-high. And it seems that a lot of businesses are going to fail, along with a lot of people affected from lowered sales and perhaps part-time hours, if not totally unemployed. There are going to be serious effects all the way around, no matter who you are, one way or another.
So, I guess we’ll see if it lasts as long as a decade or more — or not. But, it’s definitely already super-serious — in that George Bush said it made him “give up” on his free market principles (because he said it was *that serious* of a problem)...
The increasing levels of debt will make this much more of a problem. I see no debate about debt and deficit financing, which is surprising.
Americans, broadly speaking, seem utterly intent on delving into a kind of State Socialism which has already been rejected as a miserable failure in the former Soviet Union and communist China. The same experiment has led to immeasurable suffering in Great Britain, the decline of which is now all but irreversible.
One is forced to wonder if there might not be some variety of self-hating death wish motivating these people. Handed the greatest and most prosperous nation in the history of the world at the end of World War II, a nation paid for by generations of self-sacrificing patriots in oceans of blood and mountains of treasure, many Americans now wish, apparently, to destroy it all.
Born during the administration of Harry Truman, I can see little or nothing remaining of the America I once knew.
Great nations are not defeated. They commit suicide.
They’re absolutely giddy about it.
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