When Will The Recovery Begin? Never. - The Orange Mane

TonyR · 07-10-2009, 07:43 PM

The so-called "green shoots" of recovery are turning brown in the scorching summer sun. In fact, the whole debate about when and how a recovery will begin is wrongly framed. On one side are the V-shapers who look back at prior recessions and conclude that the faster an economy drops, the faster it gets back on track. And because this economy fell off a cliff late last fall, they expect it to roar to life early next year. Hence the V shape.
Unfortunately, V-shapers are looking back at the wrong recessions. Focus on those that started with the bursting of a giant speculative bubble and you see slow recoveries. The reason is asset values at bottom are so low that investor confidence returns only gradually.

That's where the more sober U-shapers come in. They predict a more gradual recovery, as investors slowly tiptoe back into the market.

Personally, I don't buy into either camp. In a recession this deep, recovery doesn't depend on investors. It depends on consumers who, after all, are 70 percent of the U.S. economy. And this time consumers got really whacked. Until consumers start spending again, you can forget any recovery, V or U shaped.

Problem is, consumers won't start spending until they have money in their pockets and feel reasonably secure. But they don't have the money, and it's hard to see where it will come from. They can't borrow. Their homes are worth a fraction of what they were before, so say goodbye to home equity loans and refinancings. One out of ten home owners is under water -- owing more on their homes than their homes are worth. Unemployment continues to rise, and number of hours at work continues to drop. Those who can are saving. Those who can't are hunkering down, as they must.

Eventually consumers will replace cars and appliances and other stuff that wears out, but a recovery can't be built on replacements. Don't expect businesses to invest much more without lots of consumers hankering after lots of new stuff. And don't rely on exports. The global economy is contracting.

My prediction, then? Not a V, not a U. But an X. This economy can't get back on track because the track we were on for years -- featuring flat or declining median wages, mounting consumer debt, and widening insecurity, not to mention increasing carbon in the atmosphere -- simply cannot be sustained.

The X marks a brand new track -- a new economy. What will it look like? Nobody knows. All we know is the current economy can't "recover" because it can't go back to where it was before the crash. So instead of asking when the recovery will start, we should be asking when and how the new economy will begin. More on this to come.

http://robertreich.blogspot.com/2009...gin-never.html

Bob · 07-13-2009, 11:42 AM

Everything will be ok, when we have a 3rd bailout.

How much of the un-read emergency bailout have we spent so far anyway? Just curious if the MUST PASS NOW!! crap, was really a cover for a bad bill to promote ideology over all-else.

TexanBob · 07-13-2009, 01:58 PM

Oh, goody! Barry and Billy's friend, the Economy Dwarf, says we can forget about a recovery.

He's right, of course. This is what usually happens when dictators take over a capitalist economy. It never recovers.

Garcia Bronco · 07-13-2009, 02:04 PM

Quote:

Originally Posted by Bob

Everything will be ok, when we have a 3rd bailout. How much of the unread emergency bailout have we stant so far anyway? Just curious if the MUST PASS NOW!! crap, was really a cover for a bad bill to promote ideology over all-else.

Yeah...I loved the headlines that called a newly proposed bailout/stimulus/porkulus bill a second one. Try a 3rd in one calender year.

Rigs11 · 07-13-2009, 02:30 PM

Broncojef · 07-13-2009, 03:34 PM

Tax cuts, encouraging investment and smaller capital gains taxes seem foriegn to this administration. If we can only tax a bit more everything will be solved. Pretty funny they had their global summit meeting recently and all countries were more concerned about global warming than the ****ty economy. It seems all these morons are more interested in drumming up some bogus global crisis than solving the crap around them.

Bob · 07-13-2009, 03:42 PM

Quote:

Originally Posted by Garcia Bronco

Yeah...I loved the headlines that called a newly proposed bailout/stimulus/porkulus bill a second one. Try a 3rd in one calender year.

Shows you how much they respect us....but with morons here who actualy confuse the disease with the cure we can assume that many cant count to three much less to 18 million (which is how much of your money) the Obama Admin has spent on their website www.recovery.gov -- boy with surgical spending like what we have seen thus far, we can all be assured that "change you can believe in" is on the way!

Rigs11 · 07-13-2009, 03:49 PM

Quote:

Originally Posted by Broncojef

Tax cuts, encouraging investment and smaller capital gains taxes seem foriegn to this administration. If we can only tax a bit more everything will be solved. Pretty funny they had their global summit meeting recently and all countries were more concerned about global warming than the ****ty economy. It seems all these morons are more interested in drumming up some bogus global crisis than solving the crap around them.

Where the hell where you? G8 leaders stressed that we are not out of the woods and that stimulus is still needed.
http://www.nowpublic.com/world/g8-le...-back-stimulus

watermock · 07-13-2009, 04:09 PM

We have no machanisms to pull us out of a depression.

Last time, we had plenty of natural resources and were a creditor nation.

Clinton had he intenet revolution to spr productivity, but only create jobs in the IT sector.

When you have 70% of the economy based on condumer debt, and no real estate wealth or 401k wealth, and the fed gives it's own members 13 trillion to reinflate the bubble, good luck with that.

Bob · 07-13-2009, 04:31 PM

Quote:

Originally Posted by watermock

We have no machanisms to pull us out of a depression.

Last time, we had plenty of natural resources and were a creditor nation.

Clinton had he intenet revolution to spr productivity, but only create jobs in the IT sector.

When you have 70% of the economy based on condumer debt, and no real estate wealth or 401k wealth, and the fed gives it's own members 13 trillion to reinflate the bubble, good luck with that.

And in 32, we had a gold standard, lower debt, and a manufacturing sector...

Broncojef · 07-13-2009, 04:35 PM

Quote:

Originally Posted by Rigs11

Where the hell where you? G8 leaders stressed that we are not out of the woods and that stimulus is still needed.
http://www.nowpublic.com/world/g8-le...-back-stimulus

Because the first stimulus rounds were so wildly successful...yeah just what we need lets spend some more money on ACORN and hand money to people with no jobs. Got it! If you think thats the winning ticket you'll be way happy when the jobless rate hits 15% and Barry can still point his finger at past administrations.

Broncojef · 07-13-2009, 04:37 PM

Quote:

Originally Posted by Rigs11

Where the hell where you? G8 leaders stressed that we are not out of the woods and that stimulus is still needed.
http://www.nowpublic.com/world/g8-le...-back-stimulus

Out of the woods.... we aint even in it yet. Barry's no experience economic solution is to kill anything that makes money with taxes and spend it on foolishness.

Bob · 07-13-2009, 04:40 PM

Quote:

Originally Posted by Broncojef

Because the first stimulus rounds were so wildly successful...yeah just what we need lets spend some more money on ACORN and hand money to people with no jobs. Got it! If you think thats the winning ticket you'll be way happy when the jobless rate hits 15% and Barry can still point his finger at past administrations.

Thats one of the amazing things ... I dont think for those who look to liberalism as a religion, that the light bulb will ever go on -- look at the states that are tanking, and we are implimenting policies nationwide that have caused bankruptcy in those states?

Broncojef · 07-13-2009, 04:46 PM

Quote:

Originally Posted by Bob

Thats one of the amazing things ... I dont think for those who look to liberalism as a religion, that the light bulb will ever go on -- look at the states that are tanking, and we are implimenting policies nationwide that have caused bankruptcy in those states?

Just so flippin ridiculous, he throws an anchor at drowning people and declares at least hes doing something. Has the equivalent of the three stooges controlling Congress (Reid, Pelosi, Frank) and people still stand behind his crap because he's not Bush.

Broncojef · 07-13-2009, 04:48 PM

Quote:

Originally Posted by Bob

Thats one of the amazing things ... I dont think for those who look to liberalism as a religion, that the light bulb will ever go on -- look at the states that are tanking, and we are implimenting policies nationwide that have caused bankruptcy in those states?

Loved barry's speech the other day when he declared the rest of America needs to fall in-line with...California...really?

watermock · 07-13-2009, 05:18 PM

Quote:

Originally Posted by Bob
Thats one of the amazing things ... I dont think for those who look to liberalism as a religion, that the light bulb will ever go on -- look at the states that are tanking, and we are implimenting policies nationwide that have caused bankruptcy in those states?

Social libaralism isn't fiscal liberalism.

You should seen Al (I'm not a lawyer) Franken, (on the senate judiciay panel) sucking up to Sonia Sotomayor today.

Almost made me miss Ted Kennedy.

How did a 5 day old comedian turned politician get on the confirmation commitee?

Meck77 · 07-13-2009, 09:09 PM

Budget deficit over 1 trillion for first time. We're head for 2 trillion soon.

Obama is losing his ****ing mind.

http://www.denverpost.com/ci_12826396

watermock · 07-13-2009, 10:09 PM

Quote:

Originally Posted by Meck77

Budget deficit over 1 trillion for first time. We're head for 2 trillion soon.

Obama is losing his ****ing mind.

http://www.denverpost.com/ci_12826396

Income tax was @ 2.5 trillion in'08.

We're going to run a federal deficiet twice that, and that isn't even counting the trade deficeit or weakening of the dollar.

OR the 13 TRILLION we let the fed charge our own Gov't pay intrest on at .5%.

Wait till the monatarization of debt comes when noone buys our treasuries and we have to buy them back at 17%.

Imagine the federal (treaury debt) debt to the world bankers.

10 trillion is coming.

BroncoBuff · 07-13-2009, 10:50 PM

You might be right .... the Bush Depression could be with us awhile.

atomicbloke · 07-14-2009, 02:03 AM

Quote:

Originally Posted by BroncoBuff

You might be right .... the Bush Depression could be with us awhile.

Dude, any half-competent economist could have turned this economy around in 2 months.

Hell, even I could have read an economics text book and turned this thing around in 4 months.

Obama has had 6 months and he still hasn't come close to a budget surplus.

You need to take your liberal glasses off and get a dose of reality.

watermock · 07-14-2009, 02:59 AM

Quote:

Originally Posted by atomicbloke

Dude, any half-competent economist could have turned this economy around in 2 months.

Hell, even I could have read an economics text book and turned this thing around in 4 months.

Obama has had 6 months and he still hasn't come close to a budget surplus.

You need to take your liberal glasses off and get a dose of reality.

Moron. 6 years maybe. Stop warmongering and go nuclear. Reject the undervalued chinese currency.

But that isn't the globalist aganda.

Buy a vowel.

It doesn't include the USA.

TonyR · 07-14-2009, 06:26 AM

Quote:

Originally Posted by atomicbloke

Dude, any half-competent economist could have turned this economy around in 2 months.

Hell, even I could have read an economics text book and turned this thing around in 4 months.

Obama has had 6 months and he still hasn't come close to a budget surplus.

You need to take your liberal glasses off and get a dose of reality.

Please tell me this is a parody post. Because you can't be serious.

Rigs11 · 07-14-2009, 08:33 AM

Quote:

Originally Posted by TonyR

Please tell me this is a parody post. Because you can't be serious.

that's what thae rightards think. They keep crying about the deficit when it was them that supported the wars in iraq in afghanistan that started this deficit ballooning out of control. They cry about the deficit but it was them that voted for Bush who reversed the tax cuts for the middle class(clinton), and gave them back to the rich.They cry about the deficit but it was them that voted for Bush who blew through the surplus handed to him in less than a year.Never ceazes to amaze me. Maybe that's why theyre party is tanking.

rastaman · 07-14-2009, 09:56 AM

Quote:

Originally Posted by atomicbloke

Dude, any half-competent economist could have turned this economy around in 2 months.

Hell, even I could have read an economics text book and turned this thing around in 4 months.

Obama has had 6 months and he still hasn't come close to a budget surplus.

You need to take your liberal glasses off and get a dose of reality.

Seriously, what could any President have done in less than 6 months in office to turn the economy around to everyones liking! And which economist are you refering to who has all the answers for the economy? Perhaps you need to take your conservative glasses off for just a minute and get a dose of reality. What proven ideas can Republican's and their economist come up with to prove their economic plan will WORK!

TailgateNut · 07-14-2009, 09:56 AM

Quote:

Originally Posted by atomicbloke

Dude, any half-competent economist could have turned this economy around in 2 months.

.

Get the **** out of that NM Sun, it's boiling your brain.

07-10-2009, 07:43 PM	#1
TonyR Franchise Poster Join Date: Apr 2008 Location: Mid-Atlantic Posts: 15,553	When Will The Recovery Begin? Never. The so-called "green shoots" of recovery are turning brown in the scorching summer sun. In fact, the whole debate about when and how a recovery will begin is wrongly framed. On one side are the V-shapers who look back at prior recessions and conclude that the faster an economy drops, the faster it gets back on track. And because this economy fell off a cliff late last fall, they expect it to roar to life early next year. Hence the V shape. Unfortunately, V-shapers are looking back at the wrong recessions. Focus on those that started with the bursting of a giant speculative bubble and you see slow recoveries. The reason is asset values at bottom are so low that investor confidence returns only gradually. That's where the more sober U-shapers come in. They predict a more gradual recovery, as investors slowly tiptoe back into the market. Personally, I don't buy into either camp. In a recession this deep, recovery doesn't depend on investors. It depends on consumers who, after all, are 70 percent of the U.S. economy. And this time consumers got really whacked. Until consumers start spending again, you can forget any recovery, V or U shaped. Problem is, consumers won't start spending until they have money in their pockets and feel reasonably secure. But they don't have the money, and it's hard to see where it will come from. They can't borrow. Their homes are worth a fraction of what they were before, so say goodbye to home equity loans and refinancings. One out of ten home owners is under water -- owing more on their homes than their homes are worth. Unemployment continues to rise, and number of hours at work continues to drop. Those who can are saving. Those who can't are hunkering down, as they must. Eventually consumers will replace cars and appliances and other stuff that wears out, but a recovery can't be built on replacements. Don't expect businesses to invest much more without lots of consumers hankering after lots of new stuff. And don't rely on exports. The global economy is contracting. My prediction, then? Not a V, not a U. But an X. This economy can't get back on track because the track we were on for years -- featuring flat or declining median wages, mounting consumer debt, and widening insecurity, not to mention increasing carbon in the atmosphere -- simply cannot be sustained. The X marks a brand new track -- a new economy. What will it look like? Nobody knows. All we know is the current economy can't "recover" because it can't go back to where it was before the crash. So instead of asking when the recovery will start, we should be asking when and how the new economy will begin. More on this to come. http://robertreich.blogspot.com/2009...gin-never.html

07-13-2009, 11:42 AM	#2
Bob Ring of Famer Join Date: May 2001 Posts: 5,330	Everything will be ok, when we have a 3rd bailout. How much of the un-read emergency bailout have we spent so far anyway? Just curious if the MUST PASS NOW!! crap, was really a cover for a bad bill to promote ideology over all-else. Last edited by Bob; 07-13-2009 at 03:33 PM..

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07-13-2009, 01:58 PM	#3
TexanBob Don't Argue With Me You Know I'm Right Join Date: Jan 2004 Location: Austin, TX Posts: 5,023 Adopt-a-Bronco: Darris Nash	Oh, goody! Barry and Billy's friend, the Economy Dwarf, says we can forget about a recovery. He's right, of course. This is what usually happens when dictators take over a capitalist economy. It never recovers.

07-13-2009, 02:30 PM	#5
Rigs11 Ring of Famer Join Date: Dec 2002 Posts: 7,820

07-13-2009, 03:34 PM	#6
Broncojef Ring of Famer Join Date: Aug 2005 Location: Great White North Posts: 3,019	Tax cuts, encouraging investment and smaller capital gains taxes seem foriegn to this administration. If we can only tax a bit more everything will be solved. Pretty funny they had their global summit meeting recently and all countries were more concerned about global warming than the ****ty economy. It seems all these morons are more interested in drumming up some bogus global crisis than solving the crap around them.

07-13-2009, 04:09 PM	#9
watermock "Hoodie Jr" "Hug me!" Join Date: Jul 2001 Location: Hot Springs, Ouachitah Posts: 77,090	We have no machanisms to pull us out of a depression. Last time, we had plenty of natural resources and were a creditor nation. Clinton had he intenet revolution to spr productivity, but only create jobs in the IT sector. When you have 70% of the economy based on condumer debt, and no real estate wealth or 401k wealth, and the fed gives it's own members 13 trillion to reinflate the bubble, good luck with that.

07-13-2009, 09:09 PM	#17
Meck77 Ring of Famer Join Date: Sep 2002 Posts: 16,309	Budget deficit over 1 trillion for first time. We're head for 2 trillion soon. Obama is losing his ****ing mind. http://www.denverpost.com/ci_12826396

07-13-2009, 10:50 PM	#19
BroncoBuff *************** Join Date: Aug 2005 Location: Seattle Posts: 25,433 Adopt-a-Bronco: QUANTERUS SMITH	You might be right .... the Bush Depression could be with us awhile.