NEWS: Recession or Depression?

POLITICS: Recession or Depression?

I’m going with depression. It will certainly be worse than anything I have witnessed in my lifetime. I am currently 77 years old. My neck skin actually touches the ground. Anyway, what we are looking at is a big bad economic turndown. The only way to save our asses is an FDR type stimulus plan. If Obama doesn’t pull that off, we will become a country dominated by huge corporations and huge government (And no, we are not there yet).

Last Friday, the Labor Department kicked out some “surprising” news. Unemployment is up. Way up. It’s only surprising because idiots keep thinking were at a bottom. We are far from it. Before this fucker is over, we’re going to lose 10 million jobs. In September we had 2,269 mass layoffs. That’s a 57% increase from September 2007. This is a runaway train.

Good news for people investing in food pantries, though! People can’t afford food!

Indiana

Pennsylvania

Nebraska

Just Google “Food Pantry.” It’s fun!

Not only are people losing their jobs, but they are staying unemployed longer. Since October 2007, the median duration of unemployment has gone up from 9 to 11 weeks. The more people lose the jobs, the more people are seeking jobs, the longer it takes to get a job.

During recessions, the U.S. doesn’t usually do too bad. We are a big ass country, so while one area may be getting hit hard, other areas can pick up a bit of the slack. That’s not what is happening now. We are going down everywhere, so people can’t move to an area that is doing better. The U.S. hasn’t experienced this kind of fucked up economy since the 1930s.

We are losing jobs in every sector of our economy. By “every,” I mean construction, leisure and hospitality, agriculture, education and health services, government workers, self employed peeps, financial peeps, information services, transportation and utilities, retail, nondurable goods, durable goods and manufacturing.

So we are hemorrhaging jobs. What to do? How about cutting interest rates to increase borrowing and spending? Nope. The Federal Reserve has already cut that fucker down to the bone. We have an empty chamber there.

How about the traditional borrowing by consumers during a recession? Uh oh. We are in debt up to our assholes. In 2001, we borrowed to get out of that recession, but this time we can’t. Housing prices have dropped and credit is tightening. That means no refinancing, no home equity loans. Gonna hit up that 401K? Good luck. 50% of U.S. households don’t have one. In 2001, they were averaging $96,000. The 50-75% peeps have a whopping $15,000 on average. They were sitting pretty with $222,000 in 2001. Not looking too good is it? We have no savings. None. Zip. And we can’t get loans. Credit cards are the next big bust. Expect companies to begin pulling cards and lowering credit limits.

That would be round two of the American economic shit-kicking. When the credit cards go bye bye, things will get really bad.

Bank credit always declines during recessions, so this is no surprise. It’s just that this time, it looks worse than many of our past recessions. And add to that our currency situation. The Bush administration has been weakening the dollar since 2001 in order to grow U.S. exports. It worked. And the dollar plummeted to new lows. Now the dollar is strengthening again. But it's still not anywhere near where it needs to be to deal with this recession.

So, we can’t use the usual monetary, currency or credit tools to get out of this recession.

We have been heading for this nightmare for years. We started expanding credit in 1980 and have been following an unsustainable path ever since. Now the chickens are coming home to fuck us in the ass. (They are horrible chickens.) We basically went on a credit bender, which led to everything falling apart. First the U.S. credit market froze up, then the international credit market. Thankfully, we have the worst president in the history of our country in charge and he has been failing as best he can. The Fed and the Treasury Department have given lots of money to loosen up the credit market, but the banks are using it for bonuses and vacations. Had the money been given to homeowners and small business owners, it would have gone straight into the economy. Instead, they are sitting on it.

Now Bush and company are saying they won’t give any of the bailout money to the auto industry. Super. What we need now is a massive layoff of workers. That’ll give this teetering economy a boost. Oh, and the Chinese are waiting in the wings to buy GM and Chrysler.

If the Chinese buy GM and Chrysler, then there is no reason for Toyota, Nissan and BMW to build cars in the U.S.. The only reason they do so is to because of American consumer pressure. They want to appear to be helping the American worker. With no American company to compete with, they’d be south of the border in a heartbeat.

The government will have to bail out the car companies. But where does it stop? As the economy continues to fail and more and more industries begin to fail, how much does the government inject?

Obama needs to take a look at what kind of economy we want at the end of this crisis. Bailouts cannot just go to big companies. A bailout of Tesla Motors, along with the big car companies, will help further our future outlook. Companies like Tesla have a big upside and they the type of company that has made America a economic giant. Bailouts cannot come at the expense of the little guy.

We must change everything. From this point forward, borrowers should pursue lenders, not vise versa. Lenders should only mail credit card solicitations to people who are credit worthy, not anyone with a social security number. Credit card companies should not punish people who pay off their bills, while rewarding those who increase debt. Houses are for living in, not making a quick buck. We start using credit to buy things like cars, not vacations. Oh, and banks shouldn’t have to be told by the government to check out a person’s credit rating and job situation before giving them a loan. They should actually just want to do it themselves. The government needs to encourage investment and savings, not shopping at all costs.

And we need a long term, New Deal type of plan. Investment in our infrastructure is a must. We are looking at some seriously fucked up times over the next couple of years. Long-term investment is the only way to go. Inaction will be devastating.

Either way, we are going to see some seriously ugly shit over the next couple of years.


FearTheReaper is a writer, actor and stand up comedian. Check back each Tuesday, Thursday and Saturday for more from FearTheReaper and read his blog, Stop All Monsters.

Word of the day in the news was "deflation" and they cited a 1% "decrease in prices" in the U.S. which according to the folk in the pretty suits that tell us our currency is worth less on a daily basis is pretty bad fucking news. The explanation was fairly coherent and it was not unlike what I just read. Only without the "shits" and the "fucks" because, you know, public TV and stuff.

One kind of wishes it were a consolation that banks everywhere did that stupid thing where they hired students and desperate people to beg you to get a credit card, no questions asked, just sign here and you'll be good to go, get that big TV set you always wanted but can't afford, but I guess it's only further proof that these greedy motherfuckers never really had what the ancient romans called "a plan".

Good article, man.

i blame pop culture.

The good news is that escapism becomes very popular in a depression, so this could mean the end of reality TV.

My question is, why aren't the dropping gas prices helping with the food prices?

Yes, I know that deisel has not dropped like unleaded, but the price per barrel of oil has dropped and that should be bringing prices down, just like it pushed them up.

Then, it's totally worth the short term pain!

It is a sign that things are out of control when half of the spam folder contains messages with the subject heading "Hey, I found you a new job."

Not necessarily.

Fuckin' Dongfeng.

I'm guessing it is because no one was paying attention to gas prices during the election and the retailers are waiting until it is addressed. They are fully aware of how the recession is affecting retailers and with so many closing their doors they are trying to weather the storm and not necessarily do what is right for society or the economy in general.

The higher fuel prices are perhaps included in the cost of harvesting the product, it cost more to grow and harvest so despite the lower gas prices now it's too late to help? Just a wild guess.

Good job dumbass.



What's up with that sewage treatment plant in San Fransisco?

^^Don't you just love Rick Sanchez?

It didn't pass. Sad face.

From what I was told, there's a time lag between gas price up or down and food prices doing the same. Months worth. Something about how transportation companies buy fuel in lots, I think it was.

thats my understanding of it as well. the bitch about it is, food prices track up with the prices of gas faster than they follow gas back down. prices rise with the price of gas quickly because retailers have to pay their own gas-related expenses. prices go up and demand drops. prices dont come down as fast because retailers attempt to make up as much of their loses as they can.

ive also read that theres a fear among retailers of lowering prices too much too quickly because it becomes a price-lowering race within the given industry and suddenly prices, along with profits, nosedive.

Gas prices also don't go down as fast because a gas station's profit margin is astonishingly small (something like $0.07-$0.11 per gallon). If they buy thousands of gallons of gas and the price drops before they sell it all, reducing their price to the new amount would result in significant losses.

In contrast, if the cost of gas goes up, they aren't opposed to making a little extra profit by raising their prices to match.

Also, in the case of diesel here in the frigid north, the price can rise in the winter due to increased demand for heating oil, to which it is similar.

why give GM 12 billion when we can buy the whole company for 1.5 billion?

They WANT to go bankrupt to get out from under their long term pension and health care obligations. Then they can hire people for 10 bucks an hour, just like Walmart.

It's gonna get uglier. Maybe twenty years from now this will be seen as a good thing.

My man Ron Paul's economic advisor:





I've got my investments in ammo.

Well since i like adding to threads about politics. If you wanted to know. That huge fucking bail out that we are gonna end up paying for. None of that money has gone towards homes. But soon after it was passed corporate executives went on nice lavish $400,000 dollar vacations. Those houses that the were suppose to be bought off so the people could still live there. Most are still going under. And now they are talking about a bail out for the auto industry. They are out of their damn minds. If they wont regulate the money then there is no point. So i say let all the auto companies merge together to stay afloat. Oh and food prices haven't gone down because the markets know you will pay the price that its at because your shocked at the gas prices dropping.
And finally. Unless obama stays with the more center focused ideas he ran with. This country will plummet into a depression after he hikes up taxes on businesses and oil companies.

Good God, two months can't go by fast enough. I say that congress disapprove any further Paulson giveaways if he doesn't do something to help the people who are really hurting (and are going to hurt), So far, the banks aren't lending, they're just sitting on the heaping piles of cash patting themselves on the back. (See

People are going to have to find alternative means of making ends meet, and they will. Victory gardens are probably a good idea if you want to survive the second-coming/depression (that or resort to cannibalism, just start with the fat cats first if you do - eat the rich!). Also, I recommend investing in a good "cash crop" if you know what I mean. As ol' Freewheelin' Franklin (Freak) used to say, "Pot will bet you through times of no money better then money will get you through times of no pot." And don't even worry about getting caught, the government won't be able to seize your home since you're already going to have had it foreclosed on and if they decide to house you in a prison, well, free housing and meals (really it's a win-win, no-brainer)!

Get used to riding a bike and wearing a respirator mask. Though it may have also been made in China, a bike is sure going to beat stoking a crappy, coal-fired coffin, er, car you bought at the corner Walmart. If you thought smog and congestion were bad now, just wait... With all the chemical pollutants and hydrocarbons in the air, acid rain will actually make you trip (the future sure is looking bright, better get those shades). You'll be so fried you won't notice the infrastructure actually melting and crumbling all around you, and try not to worry about all the congestion with all those broken-down cars cluttering the road, if you've got one that actually runs, then you're one of the lucky ones! But you won't even need a car in the future, the uber-super-fast-mega-high-speed rail system (project pending 2025 2050 2112) will whisk you through from one hell hole to another. Besides, you won't have a driveway to park your broken-down car on anyways.

And who says squatting can't be fun? Yep, nothing is quite like living on the edge unless its on the edge of someone else's property. Imagine how healthy you're going to be, dodging bullets and outrunning vicious dogs nipping at your shoeless heels, hurtling over yards of concertina wire. Practically everyone will be an Olympian. If you've managed to push your jalopy somewhere off the road and into a hidden culvert or wash, then you've really hit pay dirt... Now you've got a cozy, protected place to rest your weary bones and plan where your next meal is going to come from, just watch out for one the frequent flash-floods or you're likely to end up being swept away and having mud for dinner.

Ah yes, the future sure looks grand and gritty. I'll be seeing you on (or on the side of) the road. Bon voyage!

You are nothing more then a worker bee... as are most of us.
The sooner you embrace that fact, the sooner you can let it go and understand that executives will always enjoy their spoils... bailouts or not.

Are you listening to Meshuggah while typing or something?

(Time signature joke.)

Anyways, that's one school of thought. But since the mid 90s, most new jobs (like 70%) have come from the small business sector, which will be largely immune to the tax increases. There will certainly be a lot of adjustment going on in the next few years, but I don't know that we're entirely reliant on letting big businesses pull in as much as possible.

being from michigan i know for a fact that the "big 3" are "too big to go under"... and not put the US into a depression rivaling the "great" one. between 10-13% of jobs in the US are related in some way to the US auto industry. it would bankrupt michigan without a doubt. so the real issue is what the public should get out of a bailout. for all that money the public should get new alternative fuel, high milage cars, as well as part ownership of the companies.
BUT HONESTLY IN THE BACK OF MY MIND, I HOPE EVERYONE LETS ALL THESE HUGE EARTH DESTROYING, WAGE SLAVING CORPORATE TYRANTS GO UNDER SO THOSE WHO HAVEN'T ALREADY NOTICED WHAT A FUCKED, DEHUMANISING, SYSTEM WE LIVE UNDER.Ⓐ

I did snap at co-worker a few days ago about this very same topic, when he compared it to the Great Depression.
"It's a recession! If a woman kills her kids because she can't stand to see them die of starvation, then it'll match the Great Depression."
Although I was annoyed at his hyperbole, I must now admit I fear something of the sort will happen.

Well, its not a Depression currently; the only people who claim as such are those who ... well, either love hyperbole or are easily given to hysterics.
The big question is; could it turn INTO a depression? I've been trying to keep up to date on the details and at least listen to economists when they talk about it (much like McCain, economics aren't my strong suite; 'though I'm trying to remedy that), and I'm beginning to notice that people who are in-the-know are being much more open to the possibility that it could descend into one.
One economist, who my Dad was listening to recently, pretty much said that this may well last from 3-5 years and could very easily dip into Depression if we aren't careful.
Personally, if something isn't done about the auto industry and it collapses, this could become a Big D very quickly.