From the USA Today news report we learn that some economists believe the U.S. economy is expected to emerge from the recession sometime around mid-2009.
Until that happens, the economy will remain mired in one of the deepest and longest downturns the nation has seen in decades.
If the recession continues past the spring, as many economists predict, it will be the most prolonged one since the Great Depression. Employers are expected to continue to shed jobs at a rapid pace. Consumers will pull back spending. Businesses will cancel equipment purchases. Unsold, empty homes will dot city blocks.
However, once the massive amount of fiscal stimulus currently being crafted by lawmakers and aggressive action by the Federal Reserve kicks in, the economy is expected to improve, according to several economists and business owners.
“We all just need to hang on,” says Allen Sinai, president of Decision Economics, an economic consulting firm. “By late in the year, the economy will be moving up, and 2010 should be a recovery year.”
The outlook for jobs is probably the worst aspect of the economy in 2009. Employers are expected to trim payrolls until the end of the year, shoving the jobless rate above 8%, according to forecasts from Barclays Capital, John Hancock Financial Services, Citigroup, Mission Residential, Wachovia and National City.
That excludes those who have given up on finding jobs or who work part time because they can’t get full-time work. The jobless rate was 6.7% in November, the highest in 15 years.
Job losses could be particularly brutal in the first half of the year. Last month, 60% of U.S. CEOs said they expected to cut workers in the next six months, according to the Business Roundtable. A number of companies, including Bank of America and United Airlines, have already announced layoffs for early 2009.
Even after the economy stabilizes, job losses will probably continue for a while. That’s common in recovery periods as wary businesses await more evidence that the economy is on solid footing. Employers cut jobs for nearly a year after the 2001 recession ended, for example.
Tuesday, the Fed slashed interest rates to near zero and vowed to keep them low while also pledging to plow money into the financial system to unlock lending and boost the economy.
The Wall Street Journal has a report from Moscow in which the former economic minister of the USSR KGB predicts that in 2010 the USA economy will self destruct. I do not put much credence in what former KGB operatives say, but it is worth considering how others who watch our economy from afar believe we are heading.
“There’s a 55-45% chance right now that disintegration will occur,” he says. “One could rejoice in that process,” he adds, poker-faced. “But if we’re talking reasonably, it’s not the best scenario — for Russia.” Though Russia would become more powerful on the global stage, he says, its economy would suffer because it currently depends heavily on the dollar and on trade with the U.S.
Mr. Panarin posits, in brief, that mass immigration, economic decline, and moral degradation will trigger a civil war next fall and the collapse of the dollar. Around the end of June 2010, or early July, he says, the U.S. will break into six pieces — with Alaska reverting to Russian control”.
Americans hope President-elect Barack Obama “can work miracles,” he wrote. “But when spring comes, it will be clear that there are no miracles.”
The article prompted a question about the White House’s reaction to Prof. Panarin’s forecast at a December news conference. “I’ll have to decline to comment,” spokeswoman Dana Perino said amid much laughter.
For Prof. Panarin, Ms. Perino’s response was significant. “The way the answer was phrased was an indication that my views are being listened to very carefully,” he says.
The professor says he’s convinced that people are taking his theory more seriously. People like him have forecast similar cataclysms before, he says, and been right. He cites French political scientist Emmanuel Todd. Mr. Todd is famous for having rightly forecast the demise of the Soviet Union — 15 years beforehand. “When he forecast the collapse of the Soviet Union in 1976, people laughed at him,” says Prof. Panarin.
Source:Wall Street Journal
On the other side of the Pacific Ocean where the largest holder of our National Debt
finds China’s economy roaring at a rapid pace.
A boost in domestic demand fired China to 7.9% growth in the second quarter, making it the world’s best performing economy.
A resurgence in bank lending and increased government spending were also credited with lifting GDP from 6.1% growth the previous quarter.
An ongoing slump in international trade was offset by banks offering more loans and lower interest rates, encouraging private companies to invest more.
The Chinese economy is still shy of the double-digit growth it had experienced over the two decades prior to the global financial crisis.
But the pick-up in domestic demand has fuelled hopes that one of the world’s largest economies has seen the worst of the recession.
Dong Xian’an, an economist at Industrial Securities in Shanghai, said: “The Chinese economy has posted a V-shape recovery driven mainly by domestic demand. That trend will not reverse in the short to medium term.”
He added: “It’s more likely that China will have high growth and mild inflation next year.”
China owns more than $1 trillion in U.S. debt and is growing twice as fast in a bad year as the U.S. grows in a great one. China even won more gold medals than the U.S. at the Olympics!
And it appears that Obama is determined to make the Russian professor’s prediction come true! With an over one trillion dollar Obama health Care Bill pending, and the Cap and Trade Bill moving fast through Congress. The taxes that these two abominations will require will certainly hit the middle class who own small businesses the hardest, even though the lying Democrats insist that their proposals will only tax the rich.
If a small business person doesn’t make a taxable income of over 350,000 dollars. He is a mom and pop store, and there are not many of those left in the USA.
Apparently the Russian understands the motives of our president better than the Americans do. He realizes as I do, that Obama wants to bankrupt the free enterprise system, so he can proceeded with his Progressive socialism where the government tells you how to live and when to die!
Americans wake up!!!!