Obama warns of the rough economic road ahead
By David Neiwert Monday Dec 08, 2008 6:45am
The president-elect was on Meet the Press yesterday, and it was a fairly sober -- and sobering -- affair:
But, look, if you look at the unemployment numbers that came out yesterday, if you think about almost two million jobs lost so far, if you think about the fragility of the financial system and the fact that it is now a global financial system, so that what happens in Thailand or Russia can have an impact here, and obviously, what happens on Wall Street has an impact worldwide, when you think about the structural problems that we already had in the economy before the financial crisis, this is a big problem and it's going to get worse.
Howie has more thoughts about the economy in general. And Bob Cesca surveys the details of Obama's plans. Meanwhile, Jed astutely observes that the bottom line of Obama's outlook is an optimistic one:
So although the headlines are accurate as far as they go, they don't tell the whole story, and they don't -- at least in my opinion -- tell the most important story, which is that we're going to turn things around.
Login or Register to post comments.
Obama looks presidential. He looks like he has a handle on the situation. He isn't cracking weak jokes, bobbling his head, smirking, shifting from one foot to the other, or any of the other body language that showed Bush was a liar and an incompetent.
He sounds like a business man who means business. Unlike bush who kept telling us that we were going through a financial "rough patch". Then there was McCain who thought the fundamentals were strong.
I feel very good about turning over the country to a man who is smart and unafraid to tell it like it is. We can't fix anything until we admit that it's broken. Obama is serious and that's what we need right now, clear and serious thinking.
is paved with sincerity and good intentions.
He should be coming clean on this Financial FAT CAT bailout business which grows more outrageous every day.
Compared to this the Automotive bailout is chump change and an insulting application of an obscene double standard.
Here on the Financial
BailoutHEIST is Dean Baker co-director of the Center for Economic and Policy Research in Washington, DC, and a columnist for The Washington Post and Atlantic Monthly, from 9 30 08.Between the Treasury and the Fed there is to this point a commitment to $8.5 Trillion. Much of the authority for and the accounting of, are extremely dubious.
It is my one note I will sing over and over. This is taking from the poor or soon to be poor and giving to the rich.
Here is Baker again on Geithner, who deserves fault for many of our problems, at Treasury.
Keep his feet on the fire before you give him a rosy report card.
that he means well for ordinary Americans and will take steps in that direction, but that he intends to make sure Wall Streeters get theirs (which means ours).
But trying to get most people here on the C&L boards to understand this without them thinking we are attacking Obama per say is a tall order. I voted for Obama but I have no misconceptions about the bailout both parties wrongly embraced.
Even C&L who has pretty much supported the bailout posted 'Peter Schiff' was right a few weeks back.
http://crooksandliars.com/john-amato/peter-sc...
Well Peter is NOT for the bailout. If people listen to the video you can hear that, he put's it more bluntly here.
Peter Schiff tells the hard truth on economy
http://www.bloomberg.com/avp/avp.htm?N=av&T=S...
Peter is the same page as Jim Rogers, Marc Faber, Robert Kiyosaki, Max Keiser, just to name a few.
The bail out is only fuel on the fire, not the solution.
He is a smart guy who has made astute observations.
Much of what he says makes a lot of sense.
But at the heart of it all he is for his own vested self interest and of those who send him their money to invest.
I cannot pretend to be smart enough to know exactly what the system will look like that will serve us best.
But I do know, IT IS NOT: CRONY CASINO CAPITALISM.
The great problem with politics is human nature. Politics IS human nature.
The Fat Cats want a 'FREE MARKET' for everyone one but themselves.
For themselves, they want GOVERNMENT PROTECTION.
AND, vast amounts of OUR money.
crony capitalism, casino capitalism, "free" market capitalism, whatever, are all the same--inherently unfair, unequal and skewed to favor the already powerful.
the must-read immanuel wallerstein remarks:
"there may still be a few persons surviving who honestly believe there is an unseen hand regulating and harmonizing the system, but magical beliefs need occasional confirmation to renew themselves, and world disharmony has been so giddily obvious for so long that all the imprecations of Milton Friedman cannot persuade even the most stalwart conservative politicians actually to stand back and let what happens happen."
we never have had, don't have, nor is it EVER possible to have a so-called "free" market. that is not capitalism. this exists-only-in-a-vacuum notion of equal knowledge btwn buyer and seller, and a "free" market, is a complete fantasy.
But as an atheist, it is not in Heaven either. A figure of speech, after all.
Under capitalism, man exploits man. Under communism, it's just the opposite.
John Kenneth Galbraith
Perhaps but I tend to agree with Robert Kiyosaki when it comes to investing and the economy with sentiments such as:
Robert Kiyosaki Why the Rich Get Richer
Eve of Destruction: How the Financial Crisis Was Built Into the System
http://finance.yahoo.com/expert/article/richr...
Peter Schiff is far more precise in his analysis.
Kiyosaki throws the Fed, the IMF, the World Bank, Breton Woods, and just about everything else into a blender and creates a mish mash.
He is writing in the end of November and says this:
Oil prices are way down because the dollar is strong. I believe the dollars strength IS temporary due to massive de-leveraging going on in the markets. That money is in dollars going into T bills.
It is likely to change in which case oil will go back up.
The other topics are correct to a point but our underlying problem IS the crashing housing bubble. This is widely held by economists on both ends of the political spectrum.
Then he says inflation is rising! We have deflation!
This alone makes me say he doesn't have a clue.
He has fallen off the road completely before he gets to the final statement that 'These realities are all direct results of this financial power struggle'…
That statement has no meaning, EVERYTHING is the result of a financial power struggle.
With the colossal amount of money that is being conjured into existence by the Fed we may well have inflation at a future point. When? After the current period of deflation.
He then spends time on Zimbabwe. Mugabe in his land reform destroyed their exports and balance of payments. He prints money to make up for it, thus hyper inflation.
All of the World's Central Banks, with the exception of China, are now printing money.
We are in the lead.
Kiyosaki vaguely addresses this but doesn't address the implication. Every Industrial power is creating future inflation against China.
China has for years had an artificially undervalued currency and it will be truly astonishing if they can keep it down in face of these new forces.
My suspicion is we will have substantial inflation against the Chinese Yuan and less against other currencies. Unless and when the Dollar is abandoned in which case we have a huge problem.
Kiyosaki then predicts the bailout of Social Security and Medicare. By that time we will have defaulted on our debts world wide and in SS.
No bailout will be possible, we simply change the terms.
I don't deny his assertion that calamity is on the way, I just don't think that he is analyzing it well.
I don't hold myself out to be any sort of expert, but I am more impressed with the likes of Peter Schiff and Marc Faber, though I deny any sympathy for their politics.
Nouriel Roubini has creditbility. Paul Krugman has credibility.
I am especially impressed with his analysis and sympathetic with the political stance of Dean Baker.
"what happens in Thailand or Russia" already affects us here... no one remembers LTCM?
http://en.wikipedia.org/wiki/Long-Term_Capita...
No BS. No babying. No "everything is fine". We need the truth, and Barack gave it to us. We're in a hole and we need to do something about it. Barack, and the rest of us, have to a tough job ahead of us in cleaning up Bush's mess.
I notice people demanding Obama fix this mess and quick. We're going down hill fast after this eight year crime wave. But Bush does nothing and Americans look to Obama as if Bush didn't cause the problem or should even fix it. Sometimes it sounds like people choose to forget Bush is the current President and could if he wanted to help Americans. Some still don't wont Obama as President but want the Economic fixed. Bush and Cheney know Americans well and used our country for everything they could steal and really did complete the mission. Now Jeb Bush is waiting in the wings and will say God said he should be President and Americans like sheep will follow. Yes Jeb will continue the crime wave of the Bush/Cheney Team to make sure any success Obama does the GOP benefits. That's what the people want in their President yes a crook and liar like we're had for 8 years.
As part of opening up the White House, Obama has invited an alien boys holiday choir to perform.
http://www.weeklyworldnews.com/alien-alert/ob...
I have been very impressed with Barack Obama. Unlike the parade of talking points dummies we have seen the last several years, when asked questions about important issues, Obama gives thoughtful, detailed ANSWERS. This guy is going to be a great president.
This Canadian wishes we had someone of his mettle here as well, preparing to assume our highest office.
Obama can't do anything until he is given the wheel. Bush still has like forty days to do something and what is he doing? He's kicking footballs, joking about his "hangin'" and basically acting like a mentally unbalanced man.
with his support for the auto industry bailout. we've traditionally been a tough, tough, mean nation to succeed in. 13% of blacks with felonies on their record and unable to vote or find a decent job. 48% of hispanics uninsured... and many of them working in our food service industries, unable to call in sick or visit a doctor even if they have a communicable disease.
this stuff has a DIRECT affect on day-to-day Americans. it has massive spillover into all of our lives. did Congress stop everything else they were doing to address this? did they work over the weekend?
the auto industry has tens of thousands of resources - employees - who know how to screw an engine into a chassis. who know how to slap a fender onto a body. who know how to drive 20 cars from Detroit to every other city in the nation. who know how to sell cars and who know how to manage payments.
General Motors Acceptance Corporation currently has 15 million customers.
if GM were to go bankrupt, would those 15 million customers making payments on their cars suddenly have nobody to send a check to? (and are we to believe one less bill is somehow "bad" for an overwhelming number of unemployed Americans?)
if GM were to go bankrupt and stop making 2009 and 2010 Humvees, would some guy in Tulsa who needs a new timing belt on his 2001 GM sedan have no resources? would there be no mechanics able to locate a timing belt, raise that customer's car on a lift, swap out the timing belt and successfully bill the customer?
I don't buy it. I don't buy the doom & gloom. those tens of thousands of resources are resourceful enough to manifest an alternate industry/economy/company. we don't *NEED* to make sure that flag that flies that says "General Motors" keeps flying. we don't *NEED* to make sure that CEO still sits at the helm.
and it sends a *TERRIBLE* message to industry leaders, if we bail out yet another industry.
in early November, AIG warned us that if we didn't give them $700 billion... that many payroll checks couldn't be written. they created a panic. Obama bought into it. we gave AIG $700 billion in early November, and what happened? a historic loss of jobs. 500,000 Americans stopped getting payroll checks.
did any of you feel threatened when AIG warned us of economic doomsday? could you point directly to a hopeless loss of all future income, if their corporate logo dissipated? do any of you feel threatened by the big 3 automakers' inability to effectively manage business? can you point directly to a hopeless loss of all future income, if their corporate logo dissipated?
Obama's right, its tough economic times and its going to get tougher. but the silver lining of tough times is, it really tends to separate the men from the boys. it creates an atmosphere for true leaders to rise up and truly lead us.
more industries are going to follow. the shipping industry is hurting. champions of the service industry are hurting. leaders of the IT industry are hurting. these people are going to come crawling, begging for help in 2009 and 2010. I hope Obama realizes that its time to stop handing out these welfare checks to failed industry leaders, and focuses on overall economic repair... rather than patching up the status quo.
anyway, thats my rant... got a lot of hope for our new president but he's really disappointed me the last 3 months with his approach to whiny sniveling $50million/year CEOs.
The O-man has enough to worry about. Now, Brokaw wants to talk about ciggarettes. Grrrrrrrrrrrrrrrrrrrrrrrrr. I need a cig too.
Welcome to Bush's America.
Be sure to explain that to all your 23%er neo-con holdout relatives around the dinner table at Christmas time this year.
First off, the guy (Obama) talks a good game. But honestly, watching MTP yesterday... he comes off as a bit hand wavy. Alas, it is a welcome change to the moron we have had for the past 8 years and his constant butchering of the English language. Problem is, that by comparasion to Bush... even an artichoke would look brilliant. Let's see where Obama takes us, god know he has his plate full from the very first day. And I don't envy his position.
Second, am I the only one who HATES Brokaw locution style. Why is a person with such an annoying cadence on TV?
Thirdly, last I remember... Bush is still president. Why isn't the press grilling that motherf*cker a new asshole on a daily basis over this mess? Somehow they are concentrating on Obama, who has yet to be sworn in, and giving the moron in chief a pass. Heck, Bush thinks he is coasting until January. WTF? The country is in flames idiot... DO YOUR F*CKING JOB! Actually, on a second look... since everything he touches turns to shit, maybe it is better he is taking a hands off approach.
at least I think that's the case. That's the only reason I can think of, why they're going after him so consistently about what's his plan to fix this, and yet Bush gets treated like a 5 year old.
is that Obama's cabinet is "too smart."
I swear to god, most of the press and business elite should be frogmarched all the way to a maximum security hell hole. Because you just can make shit like this up.
After eight years of shoveling down our throats the idiot who "we wanted to have a beer with" (some of us did not feel like a supposedly recovering alcoholic was the best drinking partner), now they are trying to convince us that the last thing we need is a group of "smarty pants" who know what they may be doing.
had an excellent piece in the NYTimes yesterday.
http://www.alternet.org/election08/110805/not...
and i couldn't agree more.
however it is his framing that I disagree with.
..I think it was Campbell Brown said that, at least in the short term, the MSM was going to declare open war on Obama, his efforts to reform the mess which the previous 'government' (?!!) has made, as well as his concerns of personal privacy for himself and his family.
This was the day after he was elected.
obama's comments of support for the United Electrical, Radio and Machine Workers of America were heartening.
it will be an interesting case to watch to see if obama sides with labor throughout this one struggle.
This is going to be a real switch from the "butt hole that you can have a beer with" to someone that has the ability to communicate and can formulate a plan.
This is going to be an interesting four years. The last eight have been a nightmare for the world.
is a predicable, perhaps marginally acceptable, but in the end way Wolf Blitzery BORING choice for MTP.
www.MacYapper.blogspot.com
How is giving banks billions and AIG billions and Citi billions and the big 3 billions going to stop job losses? Is this supposed to be more of that voodoo Ronnie Raygun trickle down BS economics? And while political leaders are answering that with their usual BS, how is spending money on road construction going to create jobs? It isn't. I'm in construction and guess what. It's losing jobs like crazy. So if you hire a company like mine to do your road, the first thing they'll do is hire back the guys they laid off. Not hire a whack of new people. And just because they get a contract to build bridge Q does not mean they are going to expand their business by hiring more than they had when the economy was sound. I do not get this entire fiasco at all, other than it's just one big money grab by the corporations all at once, and EVERY political party globally is doing it. Let's all give GM 20 billion dollars, so they can layoff workers because even with the money, they will still be producing cars faster than they are selling them. Bottom line. Too many workers worldwide and production is already too high for consumption.
first off, i think the wall street blackmail-package was a travesty. a criminal act, legally enacted. not only did it do nothing to help the economy, it hurt our economic future.
that said, the only way to get out of the soon-to-be depression is thru spending. either consumer, business or govt. and, from a keynesian perspective, govt spending on the infrastructure might be the only way to climb out of the whole.
the way to ensure that this isn't 'trickle down' would be to nationalize any and all businesses that the taxpayers have to bailout. not expropriate, but nationalize.
But, and this is a big but. A construction company gets an infastructure grant to rebuild an overpass. Ok. They rehire their guys that are laid off now (which a pile are) and do it. Then what? How does this stimulate any economy anywhere? In order for all these bailout and infastructure programs to succeed, there has to also be economic expansion. That isn't going to happen here. Just because I get hired back does not mean that I'm going to go on some consumer spending spree to help my fellow man. I'm going to save what little I can, knowing that once said job is done, that's it. Back to square one. Then what? Borrow more?
well, the thought would be, using your example, that people that were laid off would be rehired. moving them from unemployment (which pays 80% of previous wages) to employment. which is good. also, if we are going to really tackle our infrastructure meltdown we are going to need A LOT of new hires. maybe these people don't go out and start consuming like drunken monkeys, but it will stimulate the economy. also, psychologically, people will be more apt to spend money. knowing they have a job, the future is a bit more certain etc, will lead to more consumer spending.
and maybe the rehires/hires don't spend a dime consuming stuff--doubtful-- but the increased money flow will make it less likely that they will default on car loans, mortgages, etc.
in a way, i do agree with you there is over-production. but only of certain things. instead of a purposeful productive decline, maybe its best that there is a switch in what is produced. lord knows there a millions upon millions upon millions of people living hand to mouth that have no need of ipods, hummers, or cell phones--but they vitally need water purifiers, medical supplies, and the such.
yes, we should spend our way out of this mess. By creating infrastructure and future-proof approaches to solve some of our current problems.
And indeed, there should be a nationalization of those business in need of government cash.
But what also needs to happen, is that the causes of the current clusterfuck need to be exposed. Regulation needs to be developed so that they don't happen again. And responsibilities need to be requested in the form of criminal prosecution.
The last two paragraphs are not going to happen. So basically we are going to spend, and that expenditure is just going to be more funneling of public money into the pockets of the people who already sucked us dry and who should be in jail at the very least.
We are in no other terms, screwed.
Unless Obama wants to tackle some of the structural problems that are strangling us, we will never get better. We will be patching symptoms. I assume he wants to "survive" his years in office, so I am not holding my breath that he may be willing to rock the boat as much as it needs to. And I personally don't blame him...
no effin doubt.
without new regulations, better oversight and a law that shuts down the govt-corp revolving door we are merely fooling ourselves.
good luck obama. you will have to screw your biggest donors, such as the financial industry, in order to accomplish such a critical and herculean task.
but overzealous credit spending is what got the globe in this mess to start with. Buy, buy, buy mentality with no money IS the problem. Borrowing more money to throw at it will cure nothing. I know that just because I get rehired, does not mean I'm going to run out to GM and buy that new car.
Obama says rough times ahead.
honesty and pain were Bush was all about obvious deciet and ignorance with more pain.
Login or Register to post comments.