In spite of today's news, I don't pretend to know much of anything about the economy. Except that it looks like a very big mess right now. While the news seems to be focusing on the stock market today, the actual problem is much more wide spread. Some observations:
The housing/mortgage crisis: It's bad enough that 2 million people could lose their homes. What's equally ominous is that the housing bubble has been the main thing propping up the U.S. economy since shrub took office. Beside those losing their homes, some 44.5 million Americans will watch the value of their homes diminish. That's a lot of lost capital.
Oil and the dollar: While oil is back down to around $88 a barrel, that is still a very high energy price. Coupled with the dollar's drop against other major currencies, the reliance on foreign resources will be impossible to maintain.
The deficit: Even worse than the mortgage crisis is the ongoing U.S. deficit crisis that has soared out of control under shrub's watch. The U.S. national debt now stands at a staggering $9 trillion. That amounts to over $30,000 for every man, woman and child in the country. The Iraq War fiasco will add another $2 trillion to the nation's debt. All of this is being financed by foreign investment, but as the dollar weakens that option will be less available. The financial and stock markets are collapsing as a result.
The Republican philosophy of tax cuts and spending cuts has weakened America's infrastructure, so that there is almost no domestic support system in place for those about to lose the life they've known.
For myself, in the words of Dylan "when you ain't got nothing, you got nothing to lose." While I've been very frustrated by the slow local job market, I don't need very much to get by. I have no dependants or debts. But most of the people I know have a lot more at risk, and I'm worried for them. They are among the huge number of Americans facing a very scary situation.
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3 comments:
this is a very very bad situation -- all brought on by the bush administration's mismanagment...
hang on -- it is going to be bumpy
Could be the beginning of a depression, not just a recession. I made the mistake of looking at my 401k today...not a pretty sight.
Another post that just makes me scream. Not for the reasoned thought or the good, clean writing style (which I love), but because it illustrates exactly what's going on the real world.
I know I should just turn off the idiot box, but there's something compelling about watching wealthy people talk about the stock market all the while assuming that they understand what the common American is coping with or not.
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