Sharper Economic Downturn Complicates Obama Spending Plans

New York Times:

The economy is spiraling down at an accelerating pace, threatening to undermine the Obama administration's spending plans, which anticipate vigorous rates of growth in years to come.

A sense of disconnect between the projections by the White House and the grim realities of everyday American life was enhanced on Friday, as the Commerce Department gave a harsher assessment for the last three months of 2008. In place of an initial estimate that the economy contracted at an annualized rate of 3.8 percent -- already abysmal -- the government said that the pace of decline was actually 6.2 percent, making it the worst quarter since 1982.

Read the whole story: New York Times

Comments

[American Hayek]

Mmm let's look at the math, triple the debt, then cut if in half. That is a multiple of 1.5. That will leave us better off how?

And Bush bashers...­...GO!

[themodernleader]

The Chinese are enticing unemployed Silicon Valley scientists and engineers and other innovators to come to China. Our free trade agreements has lost our industry and technology. China sees us as a failed nation-state ripe for the pickings. They have won the war as we continue to bail out failed banks. We are living in a dream world while we are becoming subject peoples.

[PhilipTaylor]

PROBLEM: Credit Default Swaps (Casino Bets) by Hedge Funds/Banksters continue Market HEMORRHAGING!

There are two sides to this CLEVER and DESTRUCTIVE Ponzi/Pyra­mid/Casino Scheme:

1. The Housing Hyper-Inflation Projected Forward, FEE Laden, and Executive Income Skimming PONZI Scheme that created $Trillions of FEE loaded Derivatives. Motivated by Mortgages that were sure to FAIL!

2. Insurance Scheme, Credit Default Swaps, that allows Hedge Funds and Banks to Lay Down Repeated and Massive Bets that Mortgages and Derivative will FAIL! Motivated by Mortgages sure to FAIL!

#2 is also reason AIG continues downward despite $100 Billion Bailout.

#2 is still driving down Banks everyday. BETS (CDSs) should be declared Illegal and NULL/VOID as a NATIONAL EMERGENCY to SAVE AMERICA!

False Premise Contracts are Illegal and can be stopped Lawfully! Declare "SURE FAIL Mortgages" and "CDSs" NULL and VOID!
__________­__________­__________­__________­__________­_

Honor Contract Law principles: RECISION and DAMAGES!

"Misrepresentation is a contract law concept meaning a false statement of fact made by one party to another party, that induced that party into the contract. For example, false statements/promises made by a seller of loans/Goods regarding the quality/nature of the product that the seller has may constitute misrepresentation. A finding of misrepresentation allows for a remedy of RECISION and sometimes DAMAGES depending on type of misreprese­ntation."
__________­__________­__________­__________­__________­_

Stop this hemorrhaging from Hedge FUNDS/WS BANKSTERS CDS Bets that are ruining America!

[PhilipTaylor]

DOW Market Under Bush and Obama - The market likes Obama a LOT MORE:

Bush lost 6,671 points in 4 months
Obama lost 434 points off Bush's Low of 7,496 on Nov 21, 2008!

Bush Wins at being the WORST thing for Wall Street!

In 4 months Bush lost 6,671 off the high of 14,166 while Obama has hit a low of 7,062 or a loss versus Bush's low of 7,496 or 434 points.

Bush loss in percentage terms is 47%, while Obama lost 3%.

Apparently, Wall Street Likes Obama a Lot more that Bush!

[BarackstarObama]

Right-wing headline, President Obama will do almost exactly what he wants to do with spending.

[nanotubz]

He can only do what Congress says he can do. The president proposes, congress disposes, and the public pays for it.

[WorkingClass]

Obama is wanting to restart the old system. Transfusions for a corpse. Free market capitalism, open borders, labor arbitrage, consumerism, the whole neo-liberal agenda, is over. Debt money would have brought us here anyway but bad government hastened the end. The United States is going the way of the old Soviet Union. Obama needs to be building a delivery system for humanitarian aid. Survival is going to be job one for the next few years.

[marijam]

I don't think so. I think the worst of it is over and we're going to start recovery - as soon as Obama and Congress get busy and apply regulations to the financial industry. There's a certain level of activity, buying and selling, that isn't going to stop just because there's a recession, or even a depression. As bad as it was during the depression, not everybody was out of work. Life moved on. If we take care of each other, we'll get through this.

[noesis]

Stands for measuring unemployment were revised under Reagan and Clinton. Real unemployment is closer to 15%. And yes, the global economy is in deep s.... !!!

[cylindar]

I am sick and tired of hearing the comparison between now and the 1980's. There is no comparison in that this has by far surpassed anything since the 30's/ What is the matter with these analysts. What are our schools teaching these dolts?

[any67ways]

agreed,

this line said it all:
"The economy is spiraling down at an accelerating pace, threatening to undermine the Obama administration's spending plans, which anticipate vigorous rates of growth in years to come."


Who the heck believes that we will have "vigorous rates of growth" even in a possible Obama 2nd term?

the whole arcanely complex system is falling apart under it's own bloated weight

[outnow]

Obama is an FDR without a real war, or so it seems. Spending money we don't have means borrowing even more from the bankers who charge us interest when they "create" money.

It isn't Obama's fault that we are and have been set up to fail since 1913 when the Fed was created. By 1929 there was a crash on the stock market and then a prolonded depression. WW II brought us out of that depression but FDR increased the debt before then.

Now the entire world is headed for a worse depression and spending won't likely end the depression if the negative GDP is over 6%. What growth will pull us out without manufacturing and agriculture rather than all this "false wealth" created on Wall Street by the parasites.

People need to work for a living producing real goods and food and services. The government will not be able to create the jobs necessary to sustain the conspicuous consumption of a borrower nation that we have become. Neither political party "gets" it.

[Eyeswideopen1]

So Afghanistan and Iraq are not "real wars". LOL!

[strangerinthenight]

I don't fault the President for the Bush era. He applied for the job, no one pushed him. His oratorical speeches may bring temporary high, but now, he must bring solutions. Frankly oratory alone will not help this nation. Word are just that - words. And words are cheap. Action speaks louder than words.

ACTION AND DELIVERY OF PROMISES SPEAKS IN A MORE ELOQUENT TONE.

So, Mr. President, get own with the solution.

[OB08]

Be patient. We didn't get to this point overnight. It will take time to get back on our feet. President Obama is doing is best. He is doing what he promised he would do during the elections. So why don't we just support him as well as helping our neighbors in need and in time things will turn around.

[CaptainVideo]

Obama made a serious mistake in giving Robert Rubin a prominent role on his transition team. Rubin was one of the people, who in his prominent role on the Citibank board, played a major role in causing this financial crisis. In this role, Rubin managed to get a number of his people appointed to prominent positions in the Obama economic team, who are too closely connected with the people who caused the problem, especially Geithner. As a result, the Obama administration has so far been unwilling to take the bold steps needed to repair the financial system. Obama needs to bring in some people who saw that what was happening in the financial system during the later years of the Bush administration in order to bring about a bolder policy of dealing with the problem.

This includes putting the insolvent banks into temporary government receivership so that they can be cleaned up and made sovent before they are reprivatized. This means that the people who own bank stocks will have to not be bailed out and to lose most, if not all, their money. The government probably needs to bring back the Resolution Trust Corporation, which did the same thing with the failed savings and loan association during the last financial debacle.

[CaptainVideo]

And the Federal Reserve System has to follow a more agressive monetary policy to bring longer term interest rates, especially on FHA guraranteed mortagages sharply down. There are currently 2 vacancies on the Board of Governors of the Fed that need to be filled by people favoring a more agressive monetary policy.

[Gumby123]

Where's Obamas majic wand when we need it?????

[CaptainVideo]

There is no magic wand when dealing with the economy.

The economy is like a supertanker. It takes a long time after one turns the wheel until it changes direction

That is not to say that the Obama adminstration should not be making some changes in its current economic policy. See my posting above.

[unite4change]

The GOP and Wall Street really loves America:

http://www.moneymorning.com/2008/09/18/credit-default-swaps/

[Bocado]

Good read, thank you.

[marijam]

Oh, but there is something that can be done about it. Nationalize the federal reserve bank in NY and change the rules. Don't add any more liquidity into the market by putting it into the federal reserve banks. Put the money into small, local banks instead. There's no reason that we should have to pay off on all these fraudulent gambling debts, no reason at all.

[PhilipTaylor]

Credit Default Swaps (Casino Bets) by Hedge Funds/Banksters continues the HEMORRHAGING!

There are two sides to this CLEVER and DESTRUCTIVE Ponzi/Pyra­mid/Casino Scheme:

1. The Housing Hyper-Inflation Projected Forward, FEE Laiden, and Executive Income Skimming PONZI Scheme that created $Trillions of FEE loaded Derivatives. Motivated by Mortgages that were sure to FAIL!

2. Insurance Scheme, Credit Default Swaps, that allows Hedge Funds and Banks to Lay Down Repeated and Massive Bets that Mortgages and Derivative will FAIL! Motivated by Mortgages sure to FAIL!

#2 is also reason AIG continues downward dispite $100 Billion Bailout.

#2 is still driving down Banks everyday. BETS (CDSs) should be declared Illegal and NULL/VOID as a NATIONAL EMERGENCY to SAVE AMERICA!

False Premise Contracts are Illegal and can be stopped Lawfully! Declare "SURE FAIL Mortgages" and "CDSs" NULL and VOID!
__________­__________­__________­__________­__________­_

Honor Contract Law principles: RECISION and DAMAGES!

"Misrepresentation is a contract law concept meaning a false statement of fact made by one party to another party, that induced that party into the contract. For example, false statements/promises made by a seller of loans/Goods regarding the quality/nature of the product that the seller has may constitute misrepresentation. A finding of misrepresentation allows for a remedy of RECISION and sometimes DAMAGES depending on type of misreprese­ntation."
__________­__________­__________­__________­__________­_

Stop this hemorrhaging from Hedge FUNDS/WS BANKSTERS CDS Bets that are ruining America!

[rblaquinta]

Slow down, are you serious...­.our economy was based on fiction@!!!! The whole point of a new direction is to actually come out of this with a real economy based on reality...­.eck

[unite4change]

Those who made all the profits are hoarding them. They are purposely controlling the markets to scare Americans.

[marijam]

The money was on paper and disappeared. What's left is in the hands of the bankers and brokers. Confiscate it. Make Switzerland change its laws so that we can get our taxes from those tax avoidance accounts by Americans.

[irtrad17]

With some hope and luck we should be hearing some more positive news as the stimulus money start to flow. I think we are at rock bottom right now and can only start to crawl back to some semblance of normalcy and sustainability.