Where is the US economy headed?

According to an article in today's Business Section:
1. GDP growth was less than one percent in the last quarter.
2. Job loss and shrinking paychecks are increasing.
3. Unemployment insurance rose 4,000.
4. Builders slashed spending 25.5 percent on an annualized basis.
5. Mortgage rates are higher.
6. Consumers are pulling back on high energy and food prices - leaving less money to spend on other things.
7. Economic activity contracted .01 percent if exports and inventory is removed; worst showing in 16 years.

I'm not sure how housing is beginning to show "improvement." Values are still dropping in many parts of the country; many are paying mortgages on their homes that now has less equity value.

High tech exports are still pretty strong; shows that the cheaper US dollar has some advantages.

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c.i. wrote :

Quote:

I'm not sure how housing is beginning to show "improvement." Values are still dropping in many parts of the country; many are paying mortgages on their homes that now has less equity value.

a/t business news the same is now also happening to large cars on lease and purchase plans . owners who can no longer afford the payments find out that the re-sale values have fallen BELOW what's owed on the cars . Crying or Very sad

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Thomas wrote:

okie wrote:
Well, I do tend to think the housing thing might be beginning to turn the corner, and I don't think the economic outlook is all that bad.

When house prices went up, I don't remember you ever admitting there was a housing bubble.

When house prices went down, I don't remember you ever admitting the market was tanking.

So what do you mean when you say "the housing thing might be beginning to turn the corner"? Maybe that the market is finally turning bad?

You will need to provide some quotes, Thomas, as I don't remember exact quotes of mine from a few weeks or months ago. I don't think I have ever claimed there were not economic cycles. I think I probably have characterized things as being not as bad as some here would claim. And I don't ever recall arguing with anyone that home prices sometimes rise too high and need to go through periods of adjustment.

I think I recall pointing out that depressed home prices can be partly a good thing, as alot of these things are two edged swords. And housing corrections are not much different than corrections in any market or commodity, it is nothing new or surprising, and I think real estate will recover, as it always has. There is a finite amount of real estate, so it cannot be inflated in terms of quantity, so the demand and price can only rise as the supply remains static in terms of acres of land.

I have never claimed that the economy did not have problems, such as too many imports, trade deficits, etc. I have argued since the day I joined this forum that we need to drill for our own oil, produce our own energy, and lessen regulations so that we can better compete in the world market. We are shooting ourselves in the foot as every day goes by when we don't reform things to make ourselves more competitive. I have argued against unions, the green movement, minimum wage laws, and a host of things that hinder our ability to produce our own goods.

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okie wrote:

You will need to provide some quotes, Thomas

Sorry, I can't. My point was about statements you were not making, so by definition, I can't quote those statements.

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Thomas wrote:

okie wrote:
You will need to provide some quotes, Thomas

Sorry, I can't. My point was about statements you were not making, so by definition, I can't quote those statements.

That opens up a whole new vista of possibilities for debate, Thomas, if I begin pointing out all the things you haven't said, but I think you should have. Not only can I disagree with what you say, but now if I can't find any disagreement with what you say, I can hope to find alot of disagreement with what you haven't said.

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okie, Go to bed; you're not making any sense.

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I think it is Thomas not making sense. He is picking on me for what he thinks I didn't say now. I would suggest he stick with what I have said, so I asked for quotes, and he had none.

Is this pick on Okie day? I will go to bed, ci, but I just wanted to correct the record here first. Now that is done, good night!

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Sweet dreams.

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Okie, you previously said that the prognosis for the economy was very good, and included a link. It turned out that the link was to a slimy advertisement. You would fit in at the Bush administration very well.

Housing experts are saying that home prices will continue to decline for about two years.

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Here is a snopes.com piece on various upcoming business closings. This certainly doesn't bode well for the economy.

http://www.snopes.com/politics/business/storeclosings.asp

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okie, The prognosis for the economy is not good at all! Higher fuel and food prices while wages remain stagnant have put many families under pressure to consume much less of the things that makes our economy tick. The latest government stats claims we're still humming along at about plus .9 percent economy, but any fool will know those stats are made up by government employees who can't see recession if it was stamped on their head. Even I notice that the stores are almost empty, and filling up my gas tank runs about $50; about double what I use to pay last year. The majority of Americans can't continue on this plain and survive economically; higher out of pocket expenses and stagnant wages just won't support our economy.

Let us know when you have come to realize that our economy is really in big trouble.

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cicerone imposter wrote:

okie, The prognosis for the economy is not good at all! Higher fuel and food prices while wages remain stagnant have put many families under pressure to consume much less of the things that makes our economy tick. The latest government stats claims we're still humming along at about plus .9 percent economy, but any fool will know those stats are made up by government employees who can't see recession if it was stamped on their head. Even I notice that the stores are almost empty, and filling up my gas tank runs about $50; about double what I use to pay last year. The majority of Americans can't continue on this plain and survive economically; higher out of pocket expenses and stagnant wages just won't support our economy.

Let us know when you have come to realize that our economy is really in big trouble.

The bigger immediate problem is that the credit markets have partially seized up, the only reason that they have not completely done so is that the feds and the US Government have primed the market by throwing hundreds of dollars at them ($30 billion at Bear Sterns alone).

The long term problems are that we have financed this society with debt rather than production, have deincentized work by making investing more profitable, our education system does not work, our health system does not work very well and costs way more to run than can afford, and we run a prison system that we can't afford financially or socially.

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I expect that, at any moment, MM will tell us that his home has gone up in value and, that, therefore, housing prices are not falling.

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hawkeye, All excellent points; we can identify many more problems than positives of our economy if we expend a little effort, but most middle-class families are under pressure just to survive.

Government jobs, once a very secure employment venue, will see cuts as most see tax revenue decreases in double-digits.

Only the feds can continue to spend like there's no tomorrow; I see the US currency losing more value against most other currencies, and that translates into more expensive oil/gas prices.

Most families don't have any savings, because we lived on credit for too long. Now that that has disappeared, our economy is in for a rough time ahead. How many more years is anybody's guess.

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Families are at the mercy of the seas over which they have no control. The systemic problems that I talk about are the cause of the increasingly large waves crashing against their boats. Families however have a life preserver, called bankruptcy, which they will increasingly use. The US treasury however, has no such device.

The problem for families after bankruptcy, trying to start over, is that many don't have the education required to compete in the global economy, and America lacks good paying jobs. American families will be forced to downsize their dreams, often substantially. We have not gotten to this realization yet, and when it comes it will go down hard. There will be political hell to pay, almost certainly we will have a renewal of the class warfare that has been largely dormant since the early seventies.

None of this gets to fixing the systemic problems however. I don't know how they get fixed.

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hawkeye, The math is very easy to understand; just look at job creation under Bush during the past seven years vs college grads during that same period. Job outlook in our country is dismal, and it's gonna get worse as our economy continues to tank. All this while Bushco spends 12 billion every month in Iraq: while our infrastructure and schools take it on the chin.

Bush is the epitomy of "destroy the USA."

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I'm in the lower working class. Everybody I talk to everywhere is talking about how we are just not going to spend any money on ANYTHING and live like we are in a depression.

We are looking forward to staying home with family and friends and Bar BQing hotdogs and playing guitar on the porch.

Everybody eats, we have fun and f#@k the economy. We are growing our own food to and sharing. We will fix eachothers car etc,etc. We will circulate NO money except to eachother.

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Amigo wrote:

I'm in the lower working class. Everybody I talk to everywhere is talking about how we are just not going to spend any money on ANYTHING and live like we are in a depression.

We are looking forward to staying home with family and friends and Bar BQing hotdogs and playing guitar on the porch.

Everybody eats, we have fun and f#@k the economy. We are growing our own food to and sharing. We will fix eachothers car etc,etc. We will circulate NO money except to eachother.

The tread will spread. In a couple of years driving past all of those abandoned strip malls, fast food stores and former big box stores, and walking into mostly dead large malls, is going to be dang demoralizing.

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I have bee preparing for it. I got rid of all my debt. Lowered my rent to almost nothing. Set up a bartering system and set everything up to fully entertain and feed at home with depression style gatherings.

http://en.wikipedia.org/wiki/Bartering

To get out we will pack our food and entertainment and pack into one car and drive to a FREE mountain lake or stream river.

I will teach other people very easy methods of building "Urban Tribes"

http://www.urbantribes.net/tribes_gallery/index.html

http://urbantribes.typepad.com/blog/

For example why have everybody on separate cellphone contract when you can get five people on the same unlimited plan for much much cheaper.

Why have the same five people pay for five five inernet signals when ten people can share two signals.

If my neighbor gives me five fresh eggs every weekend he can use my computer whenever he wants instead of paying 18$ an hour at Kinkos plus the gas to get there.

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I've been banking some extremely useful seeds for a long time now.

The currency of hard times, hardy seeds, self-replicating. Tobacco and Marijuana are probably worth the most in barter, small fruiting plants second, and herbs and other edible plants third. All part of the bug-out bag.

If you don't have a bicycle, buy one - and tools to fix it when it breaks. A trailer is a good purchase as well.

Cycloptichorn

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Where is the US economy headed?

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