The Economy - is it really that bad?

[JLC]

I am by no means an economic expert, nor even particularly educated on the subject. But I'm smart and I watch and listen.

In almost all cases, the doomsayers about the economy are just that...doomsayers. No matter what good thing is happening, they find a flip-side of the coin to complain about. If housing prices are going up, it's bad for the first-time home buyer or low-income person. If housing prices are dropping, it's bad for home owners and anyone who has invested in property. No matter WHAT happens in our economy, it's good for some and bad for others. There is always some way to twist current events into whatever sort of gloomy (or sunny) news story you want to present.

So, for the most part, I'm pretty much deaf to all the fear mongering that is ALWAYS going on about our economy. Whichever party is in power, the other party is broadcasting doom and playing the blame game on every bad thing that happens to anyone.

In recent days though...I've begun to sit up and take notice a little bit more. Things ARE different. And it's not just a momentary blip in gas prices. What it is, is an entire society built on an economy no more secure than a house of cards. Increasingly, over the years, it has become not just "acceptable" but the "norm" to carry debt. Not just a mortgage or car note...but more and more debt on consumable goods. The goods are consumed and gone...traded in for even nicer stuff...but still being paid for. How many Americans are still paying for meals they ate last month? For furniture they don't even have anymore? For "toys" that sit in the garage, covered in rust and dust. How many Americans pay extra each month just for storage of all the junk they're still paying for that doesn't fit in the home they can't afford in the first place???

And not only is it becoming "normal" to buy everything under the sun on credit...it's becoming quite acceptable to default on those loans. To file bankruptcy...or if not that, to "negotiate" reduced debt in order to settle. When did it become OK to take merchandise from someone and not pay for it??? Isn't that stealing? SOMEone has to pay for it. And if that debt falls back to the merchant often enough or hard enough, then through no fault of his own, the merchant is suddenly out of business.

Americans are now taught that however much money they make, it's NOT ENOUGH. They should borrow more. They should take out "special" mortgages for homes that should have been way out of their league but are suddenly "affordable." Only...that's all an illusion. And when the fog clears, we've got people all over the country, in all economic brackets defaulting on these loans...leaving lenders and banks in a lurch...which in turn causes huge ripple effects all over the economy.

And don't even get me started on the government's debt-hungry maw. It's all a part of the same paradigm that this country and culture have shifted into over the last few decades. We're "entitled" to whatever we want, and damn the consequences.

Our economy is a house-of-cards. And recent events seem to be portending a "perfect storm" that could very likely blow that house down completely. At the very least, it will bring tremendous trials to this nation and virtually everyone in it. Not that we haven't been through such trials and survived before....but I for one am not going to dismiss the signs and do what I can to prepare.

[neilgolli]

Judy, much better post than I could have wrote with thoughts matching mine nearly to a T. I'm not afraid to toss the political hat on as many of you know which way I proudly lean. In this time of as you correctly write "entitlements" we as Americans so robustly feel as though we deserve, we have more politicians out there trying to take from big oil, walmart and other prosperous well run companies with extra special taxes to give even greater entitlements to all, to the detriment of all those who actually work hard and for those rights....

[wilomn]

Good points Neil, but let me explain a bit more.

Let say we're spending a trillion a year on the war. It's not exact but it's an easy number to work with.

A trillion is a hundred billion, if I'm not mistaken and a billion is a hundred million. So, a trillion is ten thousand millions of dollars. 10% of that is one thousand millions or 10 billion.

EDIT: I have been informed that a billion is a THOUSAND MILLION and that a TRILLION is a THOUSAND BILLION. These numbers are SOOOOOO big, that I am speechless. If you know me at all, you know how signifigant that really is. END EDIT

What do you suppose could be accomplished with 10 billion dollars? We've already got it taken from the citizens, it's allocated for the war, so no one is going to be out one penny more than they are now.

Do you suppose we could house or educate a few million people for their lifetimes? How about some old folks. Could we take care of a few million of them until they died? How about shoring up our southern border? I bet some smart contractor would be willing to build a good fence for a lot than a billion dollars.

I'm not looking for the government to fix things for me, just to use responsibly what they've already taken FROM me.

Why are we so bloody concerned with everyone else in the world and not our own? Why do we pay to export our goods and SUPPLEMENT other countries to IMPORT here?

If it wasn't all about profit for the big money guys, things would be better for everyone. They have this idea that they need to make, and I'm just pulling a number out of my butt here, 20% profit EVERY YEAR.

What's wrong with 5% one year, or two years even? Why do you have to screw your fellow Americans to hit that magical 20%?

I know, I know, you can buy into anything like the stocks you mentioned.

IF you're a little guy, you might buy 100 stocks with a value of 100.00 each. Let's say they go up that magical 20%. Now your 10,000.00 investment is worth 12,000.00.

But the guy who can afford to buy 1,000 shares of stock is laughing all the way to the bank while you MIGHT be able to make ONE mortgage payment.

And I don't buy into the oil companies having no control over the price of crude. If they said NO instead of gimme gimme, eventually prices would come down. Yeah, we'd have to tighten our belts and maybe pay a bit more, but if we taxed and levied our competitors for that oil the way they do US, if we leveled the playing field, then they might get the idea that we would all be better off if prices of crude were lower. That would then lead to lowering of tariffs and import taxes which would make things for everyone more affordable.

We just don't play hardball anymore.

Why the bloody heck are the Olympics happening in China? Tell me they've met ANY of the promises they made 10 years ago.

We shouldn't be going but it's money so we will.

It's profit so we take it.

It sucks but no one will say so.

It's pathetic.

[icygirl]

Can someone explain how the "stimulus package" put forth was supposed to help this situation, because I don't really understand that. You know, the "government cheese" that came in the mail?

[joepythons]

Good points Neil, but let me explain a bit more.

Let say we're spending a trillion a year on the war. It's not exact but it's an easy number to work with.

A trillion is a hundred billion, if I'm not mistaken and a billion is a hundred million. So, a trillion is ten thousand millions of dollars. 10% of that is one thousand millions or 10 billion.

What do you suppose could be accomplished with 10 billion dollars? We've already got it taken from the citizens, it's allocated for the war, so no one is going to be out one penny more than they are now.

Do you suppose we could house or educate a few million people for their lifetimes? How about some old folks. Could we take care of a few million of them until they died? How about shoring up our southern border? I bet some smart contractor would be willing to build a good fence for a lot than a billion dollars.

I'm not looking for the government to fix things for me, just to use responsibly what they've already taken FROM me.

Why are we so bloody concerned with everyone else in the world and not our own? Why do we pay to export our goods and SUPPLEMENT other countries to IMPORT here?

If it wasn't all about profit for the big money guys, things would be better for everyone. They have this idea that they need to make, and I'm just pulling a number out of my butt here, 20% profit EVERY YEAR.

What's wrong with 5% one year, or two years even? Why do you have to screw your fellow Americans to hit that magical 20%?

I know, I know, you can buy into anything like the stocks you mentioned.

IF you're a little guy, you might buy 100 stocks with a value of 100.00 each. Let's say they go up that magical 20%. Now your 10,000.00 investment is worth 12,000.00.

But the guy who can afford to buy 1,000 shares of stock is laughing all the way to the bank while you MIGHT be able to make ONE mortgage payment.

And I don't buy into the oil companies having no control over the price of crude. If they said NO instead of gimme gimme, eventually prices would come down. Yeah, we'd have to tighten our belts and maybe pay a bit more, but if we taxed and levied our competitors for that oil the way they do US, if we leveled the playing field, then they might get the idea that we would all be better off if prices of crude were lower. That would then lead to lowering of tariffs and import taxes which would make things for everyone more affordable.

We just don't play hardball anymore.

Why the bloody heck are the Olympics happening in China? Tell me they've met ANY of the promises they made 10 years ago.

We shouldn't be going but it's money so we will.

It's profit so we take it.

It sucks but no one will say so.

It's pathetic.

Wes they would have to find morals(and a few other things) before the big shots could even think about us.Its all about who has more money .

[joepythons]

Can someone explain how the "stimulus package" put forth was supposed to help this situation, because I don't really understand that. You know, the "government cheese" that came in the mail?

Well they will "stimulUS" to think they give a rats behind about US .If you get it they will get you later plus more you watch

[JLC]

With regard to how our government spends our money, I'll just say this: No matter which side of the aisle a person falls on politically, it is painfully obvious that the government has screwed up our national finances. Blame it on the republicans...blame it on the democrats...I don't care. Personally, I think they're all culpable. The government, simply by the nature of what it is, will screw up anything it sets its hands to. Which is why I agree wholeheartedly with Neil in that less is better. The less they try and mess with, the less chance they have of screwing it up. The more they try and "fix," the worse things get.

[Brimstone111888]

Can someone explain how the "stimulus package" put forth was supposed to help this situation, because I don't really understand that. You know, the "government cheese" that came in the mail?

Bush also said it was to spur the economy and "off set" the loss of value on homes. Wait what? $600 is supposed to offset home value loses? I seriously wonder how the guy got elected....twice.

It also is supposed to make people go out and spend the free money, which in turn stirs the economy, BUT one major loophole is that most items the money will be spent on won't benefit the US economy one bit, because so much is imported.

[SatanicIntention]

Yep! $300 is going to do what for me? Help me pay half of my month's rent? Yeah right..

[daniel1983]

I remember reading somewhere about the difference between are recession and a depression....

"A recession is when your neighbor losses his job.
A depression is when you lose your job."

The state of the economy depends on who is doing the evaluation...it all depends on perspective.

The economy I see looks the same as it did last year except for when I am watching the news and filling up my gas tank. Some people I know are a little strapped for cash because they had invested in real estate right before the crash.

In my part of the world, most problems stem from the housing issues.....not the stock market or the value of the American dollar. Home prices were overinflated, the workforce is saturated with illegal immigrants, and banks forgot how to manage morgages.

Personally, I am furious at the way our country has handled the morgage situation. If people took on loans to large to handle, let them be bankrupt and homeless....maybe they would learn their lesson. If banks give money to people that they can't pay, then they should go out out of business for mismanaging their money....maybe they would learn that there are consequences for their actions. But instead the government bails everyone out.....'Its ok to mess up, because Uncle Sam will help you out'.....it makes me sick. I can't get my interest rate lowered on my house because I pay my note every month.....maybe I should stop paying so that they will cut my rate when the bank starts threatening foreclosure?

I also fear that the US lack of policy and enforcement on illegal immigrants may do extreame harm if this country's economy does sink us to an economic point similar to the Great Depression....if the economy really gets bad.....what will the millions of illegals "doing jobs that Americans won't do" do when they lose their jobs?......what will happen to the US citizens?

.....I had an REALLY old economics teacher in college.....

....he used to say......"My family was rather uneffected by the depression......we worked just as hard as we normally did to pay the mortgage, invested our money in ammunition, and planted a bigger garden"......I like that approach to fighting off a 'bad' economy....

.....think I might get started on the garden this weekend