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It is a Depression

In one of the most embarrassing displays of disingenuity ever perpetrated by an American President, Mr. Obama lauded himself for saving our country from another Great Depression during his now infamous speech in Racine, WI last week. "Now every economist who has looked at it has said that the Recovery Act [stimulus bill] did its job," proclaimed the President. "It put a brake on the collapse of the economy," he continued. "We avoided a Great Depression. We are now growing again."

It is plainly evident, however, that all of this is patently untrue. If not for the fact that 974,000 Americans had not dropped out of the workforce the past two months, the unemployment figure would be a staggering 10.1 percent. Actual Unemployment (U6) remains around 18 percent. We are seeing far less job creation than is needed to even keep up with the number of new workers entering the job market. Of the jobs that have been created by the wildly unsuccessful Stimulus Bill, the vast majority have been in the public sector, sponsored solely by those who are still working. There is absolutely nothing on the horizon that indicates long-term job creation.

The President had a master plan of infusing some of the stimulus money to encourage lending and to create more government jobs immediately prior to the mid-term elections. This will happen and we will likely see unemployment numbers fall as low as 9 percent by November. We may also see a small bump in overall productivity as businesses rush to take advantage of the Bush tax rates before they expire at the end of the year.

But all of this is short-lived. On the morning of January 1, 2011, America wakes up to burgeoning tax increases. If uncertainty about the economy has hurt job creation in 2010, then the certainty about the tax increases will desecrate job creation in 2011. The skiddish stock market is already showing signs of the pending collapse. There is absolutely nothing in any economic indicators to contradict this outlook.

The National Bureau of Economic Research (NBER) has determined the recession initiated in December, 2007. The average recession has lasted 10 months historically and even the Carter recession abated after two years (thanks to a diametric change in the White House). We find ourselves 32 months into the present recession, having poured $800 billion into a Recovery Act that resulted in virtually zero job creation in the private sector. Now we have gigantic tax increases looming on the horizon. Most economists (unbeknownst to the President) have established a growing consensus that a double-dip recession is inevitable. At some point, we should start calling this recession what it really is - a full-fledged depression.

Maybe by calling it what is really is, Americans will better appreciate the gravity of this crisis. This is not a run-of-the-mill recession. It may have started that way three years ago as cyclic corrections in the economy are normal and necessary, but our President and Democrat Congress have facsimiled FDR's egregious spending and social engineering that culminated in the Great Depression. If we're not there now, we are very close.


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Comments (46)

Here Rev Lee Ward Wright le... (Below threshold)
retired military:

Here Rev Lee Ward Wright let me save you the trouble.

Republicans werent worried about a depression until a black man became President.

From about the middle of la... (Below threshold)

From about the middle of last year until the beginning of this year I thought the Democrats would be satisfied with that they'd "done" and the money they'd redistributed. I never really believed they would continue, full steam ahead, on the path set by FDR that turned a recession to the Great Depression.

The past 6 months have convinced me otherwise...and those that make their living betting on what will happen with the economy seem to agree. The Dow's currently up about 1.8% today (on light volume and no news of note) and it's STILL below 10,000. A failure to stop spending, packing courts with those that will rubberstamp your actions (including a failure of the GOP to even act like they care), failure to acknowledge the problem, higher taxes, threatening businesses (Mr. Reardon to the hearing chambers...Mr. Reardon, the Senators will grill you now...), whatever evil nonsense they're pulling down in the Gulf, protectionism, adversarial relationships instead of cooperation with the other major economic nations...

Can someone explain the lack of demonstrations on July 4th to me? If people sleepwalk to November we might as well just pull the shades down, flip over the America sign to "CLOSED", and call it a day. I blame the schools...conservatives should never have conceded the schools who have successfully raised at least 2 generations of majority dependent uncritical thinkers that know diddlysquat about any troubling history that might otherwise make them think twice about what they're voting for (or failing to bother to vote against).

to deny that "Happy Days Ar... (Below threshold)
Justrand:

to deny that "Happy Days Are Here Again!!!
is Raaaaaaaaaaaaaaaaaaaacist!!!

Straight up.

Great post, with which I fu... (Below threshold)
Jay Guevara:

Great post, with which I fully agree.

(Just as a trivial point, that should be "disingenuousness," not "disingenuity.")

When all your 'best solutio... (Below threshold)
JLawson:

When all your 'best solutions' to a problem don't work, you need to re-examine just what the hell you're doing.

This is making the (possibly invalid) assumption that your desire is NOT to wreck what you're trying to 'fix' in the hopes someone else will buy you a new replacement toy to fiddle with.

Even the most committed of Democrats has to be looking at what's going on and thinking "Everything we're doing is making the situation worse." To me, it doesn't seem like a difficult step to go from that to "Maybe we'd better change things back to when they WERE working." But the idea that things were somehow 'better' back in 2005 (as in people having jobs, governmental spending not racking up trillion-dollar deficits, and businesses actually being able to get loans) HAS to take a back seat to the 'correct' ideology.

It's funny how the Dems always accused conservatives of being lemmings, when it's the 'Progressives' that have gotten the government to jump off a cliff.

"The President had a mas... (Below threshold)
914:

"The President had a master plan of infusing some of the stimulus money to encourage"

The 'President' had a very juvenile plan to infuse said stimulus funds to encourage vote fraud and pay thuggz to stand watch across the country in case little white granny's were not sure how to vote come November.

Republicans need to campaig... (Below threshold)
Jay Guevara:

Republicans need to campaign on a promise to return unspent stimulus money to the taxpayers. That's got to be a winner in this economy, and may help give Republicans control of at least one house, and maybe (please God) both.

Dare Barry to veto such legislation. He'll either have to sign it - thereby enraging the Red base and the unions (who figured they would score most of it), and precluding his ability to buy the 2012 election - or veto it - thereby enraging everybody else. Good times, good times. Well, "better times," anyway.

Technically we are not in a... (Below threshold)
KeithK:

Technically we are not in a recession currently. We've had a couple quarters of positive growth in GDP. Yes, the economy is weak and a lot of that growth is simply due to government spending and not sustainable economic activity. But by definition we're not currently in a recession.

Not to say that we may not be teetering at the edge of a cliff.

Hillary is waiting in the w... (Below threshold)
retired military:

Hillary is waiting in the wings. I think Obama is going to get a visit from her sometime next year and she is going to let him know that it isnt in his best interest to run again. I believe she probably has enough bones in the closet on him by now to force him out and the dems will be crying for a change at the top. That way they can say they werent responsible for the economy Obama was. It wont help (unless Obama gets the 20 million illegal vote which he is looking at hard and even then it wont help) and she will most likely lose.

The money thrown away as st... (Below threshold)
Jim Addison:

The money thrown away as stimulus is actually over $1 trillion - Obama also spent the second half of the TARP money to buy his union thug masters a couple of auto companies, and throw some million-$$ parties for his anti-American friends.

Hey Rev Lee Ward Wright.</p... (Below threshold)
retired military:

Hey Rev Lee Ward Wright.

Did you see that poll last week that said that 13% of Tea Partiers are dems and that the tea party crowd reflects the thoughts of America in almost exact percentages.

It is on Gallup.

And Rev Lee Ward Wright, It is pathetic voting a + for your own posts.

Even the most comm... (Below threshold)
Jay Guevara:
Even the most committed of Democrats has to be looking at what's going on and thinking "Everything we're doing is making the situation worse." To me, it doesn't seem like a difficult step to go from that to "Maybe we'd better change things back to when they WERE working."

Yes, that would be a rational decision, and therefore can be excluded as a possibility from the Dems.

Their response: "We just haven't gone far enough. More spending, more taxes, yeah, that'll fix this problem."

Sometimes this type of reasoning is sound (as in, e.g., Iraq) - we just have to persevere to obtain the desired outcome, because things will be bad before they get better.

But you always have to wonder whether the problem doesn't lie with the extent to which you're do something, but rather what you're doing, because there's no right way to do the wrong thing.

The difference from Iraq was that there we had no precedent to guide us; each Iraq-like situation is unique. OTOH, we have lots of precedent in how to manage - and how to mismanage - an economy. So there's no excuse for making the same mistakes over and over.

"It is a Depression" ... (Below threshold)
914:

"It is a Depression"

"Its a twister, its a twister"

No its just Barry breaking records for backwards I am smarter then everyone dumb and dumber idiotology.

He broke Carters hold on worst president evah, now he intends to outdo the Great Depression and go down in history as the only man ever to hold high office with a sub 77 IQ.


It's just a hate-f... (Below threshold)
Jay Guevara:
It's just a hate-fueled circle jerk of racists and conservatives who hate that black man in the white house so much they'll tell the Tea Party skinhead audience whatever they want to hear.

Thank you for your closely reasoned and insightful analysis.

Hillary is waiting... (Below threshold)
Jay Guevara:
Hillary is waiting in the wings. I think Obama is going to get a visit from her sometime next year and she is going to let him know that it isnt in his best interest to run again. I believe she probably has enough bones in the closet on him by now to force him out and the dems will be crying for a change at the top.

I blame Big Popcorn. They're obviously behind this.

Their response: "W... (Below threshold)
Brett:
Their response: "We just haven't gone far enough. More spending, more taxes, yeah, that'll fix this problem."

No matter how much gas I pour on this fire, it just won't go out!

Tyler Durden had a post up ... (Below threshold)
gary gulrud:

Tyler Durden had a post up yesterday saying if the government used the 10 year average for the workforce unemployment would be 11.8% for those currently seeking employ.

Similarly, most pollsters are using old numbers for party affliation, and dubious approval qualifiers, e.g., "Do you approve, in part, in the very least way, anything the jug-eared bolshevik is doing?"

This lickspittle is no Jimmah and if not for "affirmative action" the poll numbers would so prove.

It will be interesting to s... (Below threshold)
OLDPUPPYMAX:

It will be interesting to see what sort of criminal, underhanded, sleazy, disgraceful tricks Hussein pulls just before the election to help mitigate the effects of what promises to be (I HOPE) a bad day for the left. An Israeli attack on Iran is one of my predictions.

It is utterly bewildering t... (Below threshold)
914:

It is utterly bewildering to watch Barry touting good deeds amidst the chaos and destuction he has wrought. He looks like a deer in the headlights unaware he is about to be taken down to china town.

gary gulrud-

"Tyler Durden had a post up yesterday saying if the government used the 10 year average for the workforce unemployment would be 11.8% for those currently seeking employ."


Does that mean if we average bush's 4 to 5% with Barrys quarter of the pie we average 11.8%? Yeah sounds credible enough.

This recession will turn to... (Below threshold)
Neo:

This recession will turn to recovery when this President loses his job.

We just haven't go... (Below threshold)
jim m:
We just haven't gone far enough. More spending, more taxes, yeah, that'll fix this problem

The left's response to why their policies never work is always that they weren't sufficiently hard line leftist. Such an attitude means they never consider whether what they believe makes sense.

So yeah, they will just demand to spend more money, take over more of the economy and replace more private sector jobs with government jobs.

Just ask Lee Ward: Barry's black so he can't be wrong.

914, sorry, should read</p... (Below threshold)
gary gulrud:

914, sorry, should read

...10 year average for the workforce, unemployment...

We need to strongly encourage the Donk survivors in Congress that their best interest involves showing El Douche the door. Which door will be left to their choosing...if they hustle up.

It is a Dempression<p... (Below threshold)
Gmac:

It is a Dempression

TFTFY

"Technically we are not in ... (Below threshold)
gary gulrud:

"Technically we are not in a recession currently"

This also amounts to jive. The Fed purchased $1.25 Trillion in distressed securities from the banks who kept the money On Reserve with the Fed, who then paid the banks interest, who then bought(true 6 months back) 60% of the Feds short term debt.

Tricks like this inflated us to "revised" 2.7% growth. It's a shell game children.

914"He broke Carte... (Below threshold)
retired military:

914

"He broke Carters hold on worst president evah"

Yep he broke the mark that was set by Carter after 4 years. And he only did it in 4 months.

BTW how is that oil spill going. Still destroying the Louisiana coast. you konw the same Louisiana that has all the black people that we found out Bush hated when Bush directed Katrina to come to town.

I know, I know Rev Lee Harv... (Below threshold)
914:

I know, I know Rev Lee Harvey Wright. White conservatives would never want that hole plugged unless and until there were a black man as president.


God I wish Hillary were Pre... (Below threshold)
Jay Guevara:

God I wish Hillary were President.

I never thought I'd say those words.

Could someone explain to Le... (Below threshold)
John S:

Could someone explain to Lee that Obama isn't black? His mother was a blonde bimbo. This fact explains a lot about the Kenyan mulatto currently occupying the oval office.

I dunno about "bimbo." "Nut... (Below threshold)
Jay Guevara:

I dunno about "bimbo." "Nutjob" is closer to the truth; that, or "flake." She was the product of a family with a history of mental problems. (Wanting a son so badly you name your daughter "Stanley" is not exactly a sign of good mental hygiene.)

The supreme irony is that Obama supports abortion, and yet if it had been available in 1960 he'd obviously have ended up in a metal pail on an ob/gyn's floor.

"the certainty about the ta... (Below threshold)
wolfwalker:

"the certainty about the tax increases will _desecrate_ job creation in 2011"

I think you meant "devastate."

Other than that: one question, and one thought.

Question: what is the definition of a depression as compared to a recession?

Thought: Amity Shlaes coined a memorable phrase a couple of years ago: "Hoover turned a recession into a depression, and then FDR made it Great." Barry Lackwit appears to be trying to outdo his predecessors, turning a recession into a new Great Depression in one term.

Oh, one other observation: it's amusing in a sad sort of way to remember that in the 1930s, Europe climbed out of its Depression much faster than the USA did, because Europe turned away from Keynesian stimulus economic policies. History seems to be repeating itself.

What's really scary is the ... (Below threshold)
Caesar Augustus:

What's really scary is the economy in 2011 will be worse than it is now (the unraveling of the residential housing market) and then the economy in 2012 will be worse than 2011 (the collapse of the commercial real estate market and the impact of the Democrats' massive year-end tax hikes).

Retired military, I think w... (Below threshold)

Retired military, I think we have some other bet going on around here; couldn't find it.

But I will bet you 100 pushups that Hillary will not run for President in 2012.

Oh, and just wanted to book... (Below threshold)

Oh, and just wanted to bookmark the predictions here: that the upcoming phase-out of the Bush-era tax cuts will "devastate" the economy.

If by the end of 2011 unemployment is equal or lower than it is now, I'd expect you all to admit you were mistaken.

jim x,And if unemp... (Below threshold)
Sky Captain:

jim x,

And if unemployment is higher? Will YOU admit you are wrong?

Oh, and if it is equal, will you admit Obamanomics is a failure?

"Oh, and just wanted to ... (Below threshold)
914:

"Oh, and just wanted to bookmark the predictions here: that the upcoming phase-out of the Bush-era tax cuts will "devastate" the economy.

If by the end of 2011 unemployment is equal or lower than it is now, I'd expect you all to admit you were mistaken."


= ?

I know its a tall order but if anyone can do it Barry can. He has his hands full at present devastating us with his leaky peter problem in the gulf but to get worse then this we'd all have to quit our jobs, stay home and be entitled to gubrment money to drink and reproduce.

The condition of our econom... (Below threshold)
Maddox:

The condition of our economy will be so grave in 2012 and our foreign policy so iffy, it will take a very strong individual to even consider running for President in 2012. There will be much work to be done and a constant battle with liberals and the MSM who will throw blame at anyone who dares.

Jim XWe do indeed ... (Below threshold)
retired military:

Jim X

We do indeed have another bet going. I have it bookmarked as well as made a copy so we still have 2 years to go on that one.

"But I will bet you 100 pushups that Hillary will not run for President in 2012. "

I will take that bet, but fair warning, I have been out of the army for awhile so I will have to break it up into sets if I lose.

Tell you what Jim. I will ... (Below threshold)
retired military:

Tell you what Jim. I will do a 100 pushups if you just get the Rev Lee Ward Wright to go away permanently.

What was the other bet? I h... (Below threshold)

What was the other bet? I honestly forgot and couldn't find it with a search.

I will definitely have to break it up into sets. :)

If there is no further disa... (Below threshold)

If there is no further disaster that strikes America by the end of 2011, and if unemployment is greater than it is now, then I will admit that President Obama's policies didn't work.

Now, it may be that they didn't work because they were too cautious, and didn't inject enough stimulus into the economy. This is something that Paul Krugman was concerned about, during discussion of the stimulus bill.

Nevertheless, I think the notion that allowing the Bush-era tax cuts to expire will, in and of themselves, devastate the economy to be pretty insupportable.

"Question: what is the defi... (Below threshold)
Alan Orfi:

"Question: what is the definition of a depression as compared to a recession?"

Clearly a determination that a recession has devolved into a depression would be based upon the severity and duration of the recession. I was focusing primarily on the longevity of this recession as there is nothing on the immediate horizon that would indicate the economy will sustain meaningful recovery anytime soon.

"Nevertheless, I think the notion that allowing the Bush-era tax cuts to expire will, in and of themselves, devastate the economy to be pretty insupportable."

The tax increases we face in six months are much more onerous than most people believe, in my opinion. I mean, it's not just that ALL tax brackets will see higher rates, but all sorts of deductions such as our dependents will be slashed in half. I have four children, so I'm seeing a huge increase (elimination of tax credit) right there. The marriage penalty is reinstituted, so there's another several hundred dollars right there. AS a business owner, I'll see our payroll tax increase by almost 10 percent. This is thousands of dollars. When I glance at the cumulative effect of all these tax changes on JANUARY 1, 2011, I'm seeing a lot less available to spend. So, yes, I do see this as potentially devastating to our already fledgling economy in 2011. Oh, and let's not forget the VAT which seems to have enough legs to come to fruition. So, yes, I'll take bets that the jobless rate will be worse than we see one year from today. I'll even go one step further: With all the state and municipal bonds that will be defaulted over the next year, I think we will also see a sharp decline in investment markets as well.

retired military says the m... (Below threshold)

retired military says the most stupid woman to ever take a dump between two shoes, the recidivist, treasonous, lying, looting, thieving, mass-murdering, co-serial-rapist who goes by the name Missus Cli'ton, that is, has probably found enough of the self-and-own-culture-loathing, coked-up, moronically-marijuana mumbling, mobbed-up, Mussolini-modeled modified Marxist murtadd Muslim's closet skeletons to force him out and that the dhimms will be crying for a change ...

And while there is a likely lay-down misère New York City to a single brick certainty that retired military has gotten it 100% Right, again, about Missus Cli'ton's ambitions, her own skeletons are piled so high and so deep that she is more likely to be knocked off by the collapse around her ears of her own pile of bones, than to too badly inflict any bone bruising upon Herr 0zero.

Especially now her gang's 15-odd-years-long ownership, ownership and control of the FBI files it stole for her is getting a bit long in the tooth and she has less weaponry with which to stand-over and/or to shakedown and/or to intimidate wannabe competitors.

... This is not a run-of-th... (Below threshold)

... This is not a run-of-the-mill recession. It may have started that way three years ago ...

Rubbish.

It began three years ago as a MONETARY crisis and was entirely the product of the "Democrats'" corrupt creation of a liars-loans "underwritten" house-price boom -- and consequential collapse.

And that evil gang ain't done yet.

So much to disagree with on... (Below threshold)

So much to disagree with on this page that I'm simply not bothering any more...if anyone's really interested I'm sure they can look up my copious notes on the subject...

But to suggest that the 2007 crash is:
a) solely a "monetary crisis"
b) entirely the product of "Fannie Mae"

...is fracking ridiculous.

I know you all want to blame the Democrats for everything - but Fannie Mae was not nearly responsible for the housing boom OR the housing crash. Let alone credit default swaps, Goldman-Sachs deliberately selling their clients crap and then betting against them, etc. etc.

You may also remember that the HOUSING market, before it crashed, was one of the largest EMPLOYERS. Which makes it far more than a merely monetary crisis either.

The selective memory of events which occurred less than 3 years ago is mind-boggling.

"If by the end of 201... (Below threshold)
John S:

"If by the end of 2011 unemployment is equal or lower than it is now, I'd expect you all to admit you were mistaken."

Of course the unemployment rate will be lower. There's 2 million people who have run out of benefits this month. Another 7 million by the end of 2010. If the unemployed are not counted, the BS "official" rate declines. But there will still be 40 million Americans looking for a full time job.

Alright then, John S. Altho... (Below threshold)

Alright then, John S. Although, can you show me where that 40 million figure comes from?

But, fine. I'll amend my prediction to state that, regardless of the official figures, the amount of unemployed Americans actively seeking work will be at worst where it is now, and will probably be significantly decreased by the end of 2011.




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