Not So Hot Obama Economy
Well here we are 100 days and counting into a new liberal administration. Most people do not realize you get what you pay for, even in the 21st century that old adage still rings true. Unless Obama waves a magic wand or something over the economy, more and more people will see unemployment lines that will stretch into the next three years. With employers doing more with less employees and watching their bottom lines, from no new hires to no new equipment and getting by with what they have in their hands and back pockets. The recession my well turn into a depression before it is over with. At my work I see this full well and that is just the retail business part of the economy. Look for a new round of major layoffs with car dealerships leading the way. Even with consumer confidence on the uptick, those same consumers are not buying big ticket items, like cars, washing machines, and new homes. They are sticking to bare necessities just like myself. More people like myself would rather fix the car or truck they have, than go and buy another one. They will stay away from financing these things, because the finance companies are less willing to finance people with less than perfect credit.
The credit crunch that began early last year and culminated in tarp funds being sent out to all the major banks and financial institutions, will continue to plague our beleaguered economy. The credit failures will not be able to be fixed with that magic wand of a stimulus package, because it never addressed the problems of what got us in the mess in the first place. The direct result of what has happened with Freddie Mac, Fannie Mae, AIG, and the many others taking needed tax dollars out of the economy to fix these problems; has led the federal reserve to print more money than is normal in any one year cycle. This will eventually lead to inflation or worse stagflation. In the future our economy will have to deal with all those tax dollars one way or another.
Many problems will surface in the coming months before we see the real bottom of this economy. One is that we will have rising unemployment that is more than just seasonal for the summer. We will soon see the effects of the stimulus and what it will really will do to the overall economic situation sometime in July of this year. We will see if it helped or hurt in any significant way. Another problem will surface that we really do not want to deal with both politically. The situation with Iran and North Korea will continue to affect oil prices, which will dampen any recovery that may have happened by year’s end. I would not look for a recovery of anything significant until late 2010.
Some downturns in the economy are mild, some are severe, and others just don’t get better for years to come. I see this one as the latter and what has been done to help the economy by the administration may have made it worse. We need to focus on the positives that this economy has taught the American public to save its money again. It also has shown us that indeed the America that fought two world wars and won both, is still the America that will rise again. Then people everywhere will know that the American spirit does not need the world to buy our debt. For the world is a better place because we are here and we need to remind them of that very fact. We shall truly face challenges in the coming months and years, but we will not turn from them, just as we faced tyranny in the thirty’s and forty’s of the twenyth century. We shall face terrorism and economic calamity and win, not because of who is in the white house or not, but because we are Americans.