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Thursday, March 19, 2009

Change Came And Hope Left

SEARCH BLOG: POLITICS

We live in troubled times. World economies were hit by years of accumulated corruption and manipulation. Is it a wonder that people feel upset and lack confidence.

From MarketWatch:

ECONOMIC REPORT
Consumer sentiment slips to 16-year low
By Rex Nutting, MarketWatch
Last update: 10:27 a.m. EDT March 14, 2008

WASHINGTON (MarketWatch) -- U.S. consumer sentiment slipped again in March, but not as much as expected, according to media reports Friday.

The University of Michigan/Reuters index tracking consumer sentiment dipped to 70.5 in March from 70.8 in February. The March reading came in above the 69.0 expected by economists. See Economic Calendar.

Still, it was the lowest in 16 years.

The expectations index fell to 61.4 from 62.4, also the lowest since early 1992. However, the current conditions index for March improved to 84.6 from 83.8 in February.

Consumers' expectations for inflation over the next year jumped to 4.5% from 3.7% in February, an increase that "cannot be interpreted as anything other than troubling," wrote Joseph Brusuelas, chief U.S. economist for IDEAglobal.
While our government now scrambles to diffuse the anger of its citizens who feel they cannot trust big business, big government, or the "change" that was promised to them, AIG is the current poster-boy for what ails the country. AIG is the financial giant that precipitated a big part of the meltdown. They were the company that made Sen. Dodd of Massachusetts the recipient of large sums of campaign contributions... more than $280,000 over the last 20 years. They were the company that Sen. Dodd insisted have the right to pay bonuses to their executives despite massive loans from the Federal government. They are the company that Sen. Dodd now vilifies as he tries to deflect attention from his own shady actions.

Meanwhile, Barney Frank continues his own version of the Mad Hatter by blithely disregarding death threats made against AIG executives as he demanded their personal information be made public. That's the same Barney Frank who did such a marvelous job with Fannie Mae in screwing up the mortgage industry.

Yes, the people of the U.S. have expressed some pretty deep pessimism with the present situation... and their probable future. It's that way all over the world, isn't it?

Well, maybe not all over the world.
ABC News, via HotAir


Click on video below.
[h/t Gateway Pundit]

Well, we can't exactly blame President Bush for that, can we? Oh, wait! I'm sure President Obama will point out that 35% of Iraqis say things are not going well in their own lives. That's the same President Obama who has surrounded himself with a Cabinet of high integrity individuals [who just can't figure out their taxes] and takes advice from stellar Democrats such as Dodd and Frank and Nancy Pelosi who thinks illegal aliens should be rewarded with everything from free health care to being praised as true American patriots.

These are the same purveyors of "hope and change" that want to have U.S. military personnel who were injured in the line of duty pay for the insurance to cover their treatment.

Small wonder that the Iraqis have a better attitude toward their war-torn existence than Americans have toward a nation under the thumbs of the biggest liars and manipulators in its history.
Strangely, that ABC video sounded an awful lot like Pres. Bush's strategy... with the results he was predicting. That's the same Pres. Bush that was called a buffoon by Pres. Obama's supporters. Makes you wonder just a little bit, doesn't it?
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There is always an easy solution to every human problem—neat, plausible, and wrong.
Henry Louis Mencken (1880–1956)
“The Divine Afflatus,” A Mencken Chrestomathy, chapter 25, p. 443 (1949)
... and one could add "not all human problems really are."
It was beautiful and simple, as truly great swindles are.
- O. Henry
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Tracking Interest Rates

Tracking Interest Rates

FEDERAL RESERVE & HOUSING

SEARCH BLOG: FEDERAL RESERVE for full versions... or use the Blog Archive pulldown menu.

February 3, 2006 Go back to 1999-2000 and see what the Fed did. They are following the same pattern for 2005-06. If it ain't broke, the Fed will fix it... and good!
August 29, 2006 The Federal Reserve always acts on old information... and is the only cause of U.S. recessions.
December 5, 2006 Last spring I wrote about what I saw to be a sharp downturn in the economy in the "rustbelt" states, particularly Michigan.
March 28, 2007
The Federal Reserve sees no need to cut interest rates in the light of adverse recent economic data, Ben Bernanke said on Wednesday.
The Fed chairman said ”to date, the incoming data have supported the view that the current stance of policy is likely to foster sustainable economic growth and a gradual ebbing in core inflation”.

July 21, 2007 My guess is that if there is an interest rate change, a cut is more likely than an increase. The key variables to be watching at this point are real estate prices and the inventory of unsold homes.
August 11, 2007 I suspect that within 6 months the Federal Reserve will be forced to lower interest rates before housing becomes a black hole.
September 11, 2007 It only means that the overall process has flaws guaranteeing it will be slow in responding to changes in the economy... and tend to over-react as a result.
September 18, 2007 I think a 4% rate is really what is needed to turn the economy back on the right course. The rate may not get there, but more cuts will be needed with employment rates down and foreclosure rates up.
October 25, 2007 How long will it be before I will be able to write: "The Federal Reserve lowered its lending rate to 4% in response to the collapse of the U.S. housing market and massive numbers of foreclosures that threaten the banking and mortgage sectors."
November 28, 2007 FED VICE CHAIRMAN DONALD KOHN
"Should the elevated turbulence persist, it would increase the possibility of further tightening in financial conditions for households and businesses," he said.

"Uncertainties about the economic outlook are unusually high right now," he said. "These uncertainties require flexible and pragmatic policymaking -- nimble is the adjective I used a few weeks ago."
http://www.reuters.com/

December 11, 2007 Somehow the Fed misses the obvious.
fed_rate_moves_425_small.gif
[Image from: CNNMoney.com]
December 13, 2007 [from The Christian Science Monitor]
"The odds of a recession are now above 50 percent," says Mark Zandi, chief economist at Moody's Economy.com. "We are right on the edge of a recession in part because of the Fed's reluctance to reduce interest rates more aggressively." [see my comments of September 11]
January 7, 2008 The real problem now is that consumers can't rescue the economy and manufacturing, which is already weakening, will continue to weaken. We've gutted the forces that could avoid a downturn. The question is not whether there will be a recession, but can it be dampened sufficiently so that it is very short.
January 11, 2008 This is death by a thousand cuts.
January 13, 2008 [N.Y. Times]
“The question is not whether we will have a recession, but how deep and prolonged it will be,” said David Rosenberg, the chief North American economist at Merrill Lynch. “Even if the Fed’s moves are going to work, it will not show up until the later part of 2008 or 2009.”
January 17, 2008 A few days ago, Anna Schwartz, nonagenarian economist, implicated the Federal Reserve as the cause of the present lending crisis [from the Telegraph - UK]:
The high priestess of US monetarism - a revered figure at the Fed - says the central bank is itself the chief cause of the credit bubble, and now seems stunned as the consequences of its own actions engulf the financial system. "The new group at the Fed is not equal to the problem that faces it," she says, daring to utter a thought that fellow critics mostly utter sotto voce.
January 22, 2008 The cut has become infected and a limb is in danger. Ben Bernanke is panicking and the Fed has its emergency triage team cutting rates... this time by 3/4%. ...

What should the Federal Reserve do now? Step back... and don't be so anxious to raise rates at the first sign of economic improvement.
Individuals and businesses need stability in their financial cost structures so that they can plan effectively and keep their ships afloat. Wildly fluctuating rates... regardless of what the absolute levels are... create problems. Either too much spending or too much fear. It's just not that difficult to comprehend. Why has it been so difficult for the Fed?

About Me

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Michigan, United States
Air Force (SAC) captain 1968-72. Retired after 35 years of business and logistical planning, including running a small business. Two sons with advanced degrees; one with a business and pre-law degree. Beautiful wife who has put up with me for 4 decades. Education: B.A. (Sociology major; minors in philosopy, English literature, and German) M.S. Operations Management (like a mixture of an MBA with logistical planning)