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I know that no one can tell the future, but what do you all think about this economy stuff?
The other day I saw a politician on t.v. and he said that the government is not telling us (the people of the USA) that we are heading into a depression, just yet, because " they" do not want us (the people) to panic and make things worse than what they already are.
I think this guy was on CNN. I mentioned it to my hubby and he said to not listen to the crapola that he is talking about...but I cannot help but wonder adn worry about the whole situation.
I UNDERSTAND WHERE YOU ARE COMING FROM.....MANY PEOPLE WILL PANIC AND FIRST THING MONDAY MORNING BE AT THE DOOR OF THEIR DEPARTMENT OF HUMAN SERVICES DOOR BEFORE THEY EVEN OPEN.....PEOPLE ARE SCARE AND STRESS OUT.....RENT, UTILITIES AND ETC ARE DUE ON THE 1ST AND THEY DO NOT WANT TO HEAR ABOUT YOU WAITING FOR A BILL TO PAST
I think more than anything we are facing a redistribution of wealth and a redistribution of the classes. There will be a significant number of the former middle to upper middle class who will be recategorized to working-class/working-poor and lower-middle class. Certainly there is a lot of talk of recession, depression and so forth but the larger consider is the long-term shift of wealth and and increase in people classified living below poverty, at poverty, and near poverty.
A second consideration will be how long will it take for prices and credit to catch up with the redistribution of wealth and a greater segment of the population being worth more and owing more than compared to 5, 10, and 15 years ago. I think economic forecasts have been consistent that the number of unemployed will consistently remain high in the near future. With many states operating in the red, there will obviously be concerns and how a higher number of unemployed will impact state and regional economies.
Beyond the technical terms of if where economists gauge the economy, I think most Americans should begin to be prepare to expect long-term differences in the economy of the future compared to prior years.
I know that no one can tell the future, but what do you all think about this economy stuff?
The other day I saw a politician on t.v. and he said that the government is not telling us (the people of the USA) that we are heading into a depression, just yet, because " they" do not want us (the people) to panic and make things worse than what they already are.
I think this guy was on CNN. I mentioned it to my hubby and he said to not listen to the crapola that he is talking about...but I cannot help but wonder adn worry about the whole situation.
Any thoughts...☺
Not sure what you define as a depression. I believe the economy as we have known it will never recover from this financial meltdown completely. The Atlantic article cited predictions of a much higher rate of 'normal' unemployment going forward, even after the 'recovery.'
Quote:
Originally Posted by Atlantic
None of these problems is likely to disappear quickly. Phelps, who won a Nobel Prize for his work on the “natural” rate of unemployment, believes that until they do disappear, the new floor for unemployment is likely to be between 6.5 percent and 7.5 percent, even once “recovery” is complete.
It’s likely, then, that for the next several years or more, the jobs environment will more closely resemble today’s environment than that of 2006 or 2007—or for that matter, the environment to which we were accustomed for a generation. Heidi Shierholz, an economist at the Economic Policy Institute, notes that if the recovery follows the same basic path as the last two (in 1991 and 2001), unemployment will stand at roughly 8 percent in 2014.
“We haven’t seen anything like this before: a really deep recession combined with a really extended period, maybe as much as eight years, all told, of highly elevated unemployment,” Shierholz told me. “We’re about to see a big national experiment on stress.”
Having lived through the recession of 81-83 - which I called the Depression of my lifetime from which I never recovered completely financially - I do not believe this country will experience a recovery to approximate what any of you might consider normal. This one is definitely different.
There has been too much population growth thus devaluing the worker and resulting in too many unproductive people expanding our entitlement system, too much outsourcing of manufacturing and other high-tech work, too many cheap imports from overseas contributing that outsourcing, too much wealth concentrated in the hands of too few, too much redistribution of wealth toward the top 1% in this country, leaving them with more power and slowly and inexorably impoverishing the middle class. None of this will change. Ever since Reagan the wages of the working middle class have been declining to that of the world average. Even a top-flight eduction is no guarantee anymore. A recent post on this board cited an ad in a San Diego for attorneys - starting wage $10/hr.
For those fortunate enough to have and/or obtain living wage jobs going forward and who need to work for the next 30 years, I would strongly recommend adjusting your lifestyles to live far, far below your income and to save as much as you possibly can. Live in a home a couple of steps down, pay off the mortgage as quickly as you can or rent as cheaply as you can thus avoid the expenses of home maintenance or stay at home with your parents until they kick you out and SAVE, SAVE, SAVE. Max out your 401ks, IRAs, HSAs - all tax-free ways to save and grow your money, drive your cars for ten or more years. Be cheap, cheap, cheap. It is critical to minimize fixed expenses, have money in the bank and no debt when you are living in a stagnant or deflating economy.
I would also recommend starting home-based businesses, learning how to be self sufficient. Be entrepreneurial on a small scale. Depend only on youself. By now everyone knows, no job, wage or even pension is secure.
I say all this because I was NOT living this way until the past ten years. I spent plenty on foolishness. Thank God, however, I made a diligent effort to work past retirement age and saved like a mad fool these past ten years so now although unfortunately I have a mortgage (foolish me), I do have car paid for and enough money in the bank to last 20 years or so unless out-of-control inflation destroys that. Which is why no mortgage or debt of any kind is best.
Not so sure about an actual Depression with tent cities and bread lines - but I am confident there will not be much of a recovery to anything remotely approaching our previous economy for those working for a wage and it will be a very long, slow slog until we reach even that point. We may very well be experiencing a 'lost decade' similar to what has happened in Japan.
To some of you, this may be considered a Depression. Ten or fifteen years from now, economists will say it was permanent decline of the US to the level of other countries. I suggest everyone plan for it.
Last edited by Ariadne22; 02-26-2010 at 09:45 PM..
I agree about the social classes being shifted and whatnot.
As for us, we are already thinking of taking our money out of the bank. If the government is not going to do anyting (other than get us in more adn more adn more and more adn more debt....well, then be it).
All I know is that most likely if we head into a depression it is most likely not going to be nice. A lot of more murder, roberries of the wealthy are going to take place from people in desperation.
I hope such doesn't take place, but with everything that is happening and not happening, it is jsut a matter of not if, but when.
Not sure what you define as a depression. I believe the economy as we have known it will never recover from this financial meltdown completely. The Atlantic article cited predictions of a much higher rate of 'normal' unemployment going forward, even after the 'recovery.'
Having lived through the recession of 81-83 - which I called the Depression of my lifetime from which I never recovered completely financially - I do not believe this country will experience a recovery to approximate what any of you might consider normal. This one is definitely different.
There is been too much population growth thus devaluing the worker, too much outsourcing of manufacturing and other high-tech work, too many cheap imports from overseas contributing that outsourcing, too much wealth concentrated in the hands of too few, too much redistribution of wealth toward the top 1% in this country, leaving them with more power and slowly and inexorably impoverishing the middle class. None of this will change. Ever since Reagan the wages of the working middle class have been declining to that of the world average. Even a top-flight eduction is no guarantee anymore. A recent post on this board cited an ad in a San Diego for attorneys - starting wage $10/hr.
For those fortunate enough to have and/or obtain living wage jobs going forward and who need to work for the next 30 years, I would strongly recommend adjusting your lifestyles to live far, far below your income and to save as much as you possibly can. Live in a home a couple of steps down, pay off the mortgage as quickly as you can or rent as cheaply as you can thus avoid the expenses of home maintenance or stay at home with your parents until they kick you out and SAVE. Max out your 401ks, IRAs, HSAs - all tax-free ways to save and grow your money, drive your cars for ten or more years. Be cheap, cheap, cheap. It is critical to minimize fixed expenses, have money in the bank and no debt when you are living in a stagnant or deflating economy.
I would also recommend starting home-based businesses, learning how to be self sufficient. Be entrepreneurial on a small scale. Depend only on youself. By now everyone knows, no job, wage or even pension is secure.
I say all this because I was NOT living this way until the past ten years. I spent plenty on foolishness. Thank God, however, I made a diligent effort to work past retirement age and saved like a mad fool these past ten years so now although unfortunately I have a mortgage (foolish me), I do have car paid for and enough money in the bank to last 20 years or so unless out-of-control inflation destroys that. Which is why no mortgage or debt of any kind is best.
Not so sure about an actual Depression with tent cities and bread lines - but I am confident there will not be much of a recovery to anything remotely approaching our previous economy for those working for a wage and it will be a very long, slow slog until we reach even that point. We may very well be experiencing a 'lost decade' similar to what has happened in Japan.
To some of you, this may be considered a Depression. Ten or fifteen years from now, economists will say it was permanent decline of the US to the level of other countries. I suggest everyone plan for it.
Can you please explain how this one is different from back in the 80's? Thanks.
Can you please explain how this one is different from back in the 80's? Thanks.
Employment market turned around within 18 months. Ours will not due to globalization.
Background: I was self-employed in real estate for ten years in the 70's. Uncontrolled inflation (12% or more) resulted in mortgage rates going to 18%, totally shutting down the real estate market. I had NO income whatsoever for two years. Had to sell a property I owned on land contract, and then had to go to a money lender and discount that contract another 30% to obtain cash to pay my bills. I was a single parent.
For two years, our newspaper's classified employment section was one page or less. Early 1983 things opened up and people began advertising. I was too broke and had too many responsibilities to continue in real estate. So I went to an employment agency and within two weeks had two job offers. Took a job in our largest and most prestigious law firm as a legal secretary and stayed there 26 years, figuring if things got bad for them it was all over.
Well, things got bad for them, too. I, along with 100 other people this past year, had our positions eliminated in 2009. They never, ever did anything like that in the quarter-century I was with them. This firm is 150 years old.
So, in answer to your question - No. 1, the unthinkable happened and my firm laid off en masse, No. 2, this recession has already lasted longer than the 81-83 recession, No. 3, the jobs market in this current situation is HORRENDOUS with no end in sight, and No. 4, globalization of our economy has permanently devalued labor and outsourced our industries.
Last edited by Ariadne22; 02-26-2010 at 11:26 PM..
For those fortunate enough to have and/or obtain living wage jobs going forward and who need to work for the next 30 years, I would strongly recommend adjusting your lifestyles to live far, far below your income and to save as much as you possibly can. Live in a home a couple of steps down, pay off the mortgage as quickly as you can or rent as cheaply as you can thus avoid the expenses of home maintenance or stay at home with your parents until they kick you out and SAVE, SAVE, SAVE. Max out your 401ks, IRAs, HSAs - all tax-free ways to save and grow your money, drive your cars for ten or more years. Be cheap, cheap, cheap. [b]It is critical to minimize fixed expenses, have money in the bank and no debt when you are living in a stagnant or deflating economy.
I did not want to quite your entire post but I do agree with the point above that savings will be families new line of credit and source of emergency recovery during turbulent measures. States are barely keeping up with maintain basic services, furloughs run rampant in many areas, and federal assistant are temporary in nature and inconsistent due to part-politics.
While, I feel there should be greater tax breaks for those who can be fiscally responsible to contributing to retirement accounts, maximizing other savings vehicles and acquiring their own health insurance. Nevertheless, savings will be a priority as credit markets will be more stringent in the consumer market and maximum lending levels will fall rapidly.
I think the hardest will be people actually excepting this long-term changes and making efforts to protect themselves from some of the consumer shortfalls and affects of these changes.
I think we came seriously close when the banks were in real problems. Now its not so close. I know that many economist are worried about in five years with the debt situation we face that we may at least see another drop into recession.I just hope it does get like Greece is going thru with because of debt.
I think the hardest will be people actually excepting this long-term changes and making efforts to protect themselves from some of the consumer shortfalls and affects of these changes.
My parents and their siblings were young adults through the Depression. My aunt, in particular, would say, "Oh, you kids, I feel for you when things get bad. You are so spoiled, you are going to have a hard time when things get tough."
So, yes, indeed. Acceptance will be hard - especially for those who never had an inkling what things really were like back then. I am fortunate that my family was a product of the Depression. And, also, I never grew up with the abundance of material goods, etc. My son I think has a much harder time with restraint, even now, because even though things were bad for a few years there, we never had as little as my parents did and I never talked about a 10-year Depression because I hadn't experienced it.
Those two years in the 80s I tried to forget although it did affect my financial situation permanently thereafter. Which is what economists are predicting for the younger generation going forward. Good data on that in that Atlantic article I linked above.
Last edited by Ariadne22; 02-26-2010 at 10:45 PM..
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