Posted on 09/22/2011 7:36:14 AM PDT by SeekAndFind
Nouriel Roubini is calling it this morning, following a bout of dismal economic data around the world. Europe and the U.S. are "effectively in recession" and there's nothing policy makers can do to save them.
@Nouriel tweets:
Economy already in recession. Whatever the Fed does now is too little too late
UK in double dip @MarkitEconomics: CBI Trends total orders at -9 in. UK Man PMI highlights real weakness in order books twitpic.com/6onoto
EZ in recession @MarkitEconomics: Flash Eurozone Composite PMI comes in below consensus for the 4th time in past 5 mths twitpic.com/6oneor
China slowing @MarkitEconomics: release saw HSBC Flash China Man PMI remain <50 at 49.4 (Aug:49.9).
(Excerpt) Read more at businessinsider.com ...
Pardon me.............I think we are in a depression already.
All the major market indices (Nikkei, Hang Seng, SSEI, STI, DAX, FTSE, S&P, DJIA) are down at least 2%, and the average is -3.24%.
It’s not pretty...
We have BEEN IN a recession since Odumbo took office- (actually since Nazi Pelosi took over Congress)
What has to happen for them to start using the ‘D’ word? (Depression)
There could be bodies piled 10 deep in the streets from starvation and they wouldn't use that word.
They’ll have to use the D word when prices start to fall - then it’s an actual depression, deflation of costs - and thus salaries/wages, and the economy in general. Right now we’re in a recession, and I expect inflation to pick up from where it’s been - that will be stagflation - a stagnant economy with high inflation.
President Carter had stagflation, but he had unemployment in the 7% range, not 10%. That’s going to make President Obama’s recession much, much worse than that of President Carter.
RE: It’s not pretty...
I’m afraid that by the time we look back next month, this might prove to be the understatement of 2011.
“What has to happen for them to start using the ‘D’ word?”
A republican sit in the white house.
“What has to happen for them to start using the ‘D’ word?”
A Republican in the White House, of course.
soros and roubini capitulate...we’re getting close(r). let’s hope the last leg down is ...fast and furious, so we can get it over with. But, oh, the fireworks...
the cost to produce goods in the US is too expensive relative to the rest of the world weighted by production capacity.
Cheap labor in China and India did not matter so much, when they had lower capacity, and could not produce more sophisticated goods.
Unions and labor/healthcare laws and taxes make US goods too expensive.
devaluing the dollar was the approach taken to remedy this imbalance - by the fed. It has not worked, because the less purchasing power by US dollar holders has led to less consumption in the US and less demand.
It is time to deregulate labor, let companies in the US hire at worldwide competitive wages, and shift the political power away from Unions.
Does anyone really think the US is going to reach full employment by producing Volts for $42,000 cost per unit? The cost of that car without inflated union wages would be more like $15,000, and at that price they might be able to sell them in a free market at a pace exceeding the current one of 300 cars per month.
If I had a magic wand for the economy, I’d do the following:
1. Eliminate the corporate income tax. Set it to zero. Contrary to most protectionist beliefs, countries outsource because of taxes and regulations, not just labor costs.
2. Eliminate any regulation on business imposed since 1994.
3. Incorporate right-to-work across all 50 States.
Those should get the costs of production lowered, and make the US a VERY attractive place for companies the world over.
I agree about the unions, but it seems like allowing free competition between 10 cent an hour Chinese workers and $10+/hr American workers is what got us walmarts full of chinese crap.
You’re correct. We’re in a depression. Recession is the falling part. Depression is a prolonged period of staying down. The Recession ended, but the recovery has been pathetic, almost nothing. Hence: depression.
Your plan sounds great!
The value of output per unit of labor (+other) costs is the key metric. Quality is a component of value.
If the chinese can actually produce more value per unit of cost - then we are in need of a complete overhaul.
The continued success of the United States of America depends on being able to produce value.
We are really good at producing food - perhaps we can do something with this expertise to smooth trade imbalances.
Better hurry and implement your suggestions - I just watched a CNBC commercial touting the benefits of emerging market investments. Does Obama realize that, as though the emerging markets didn’t have enough of an advantage with low wages, he is DRIVING investors away from the US with all of his regulations and taxes???? All the problems we have and our own President is driving investment dollars overseas. If he doesn’t understand this, he needs to be removed from office because he is ignorant. If he does understand this, he needs to be removed because he is purposely harming our country.
So what’s new? We are in a death spiral from years of exporting jobs, which reduces purchasing power, which reduces demand, which reduces jobs, further reducing purchasing power, etc. etc. until the crash.
Look at what you buy, see where it is made, see what produced the death spiral. Our factory seed corn is gone, we have nothing to build on. Green jobs and tax cuts to create jobs are election placebos.
We can’t exit by being the market for the world, exporting both factories to make and treasuries to pay. The country’s recovery awaits leadership to propose making more of what we import. Fat chance now.
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