If This Coronavirus Hasn't Concerned You Yet, To Date, This Could. Maybe Should

Wonder why the Dow and markets keep sinking, crashing, day after day for the last few weeks?

This might be it.

Coronavirus could force the world into an unprecedented depression

A bit from the article:

In its latest repricing of the economy, the market sees the now-expected global recession caused by the coronavirus outbreak morphing into an economic depression unlike any the world has seen in generations.

The big picture: Bankers and traders are looking to sell everything that isn't nailed down to boost cash positions and hunker down for the worst.

What they're saying:

• JPMorgan wrote down its expectations for global GDP to -1.1% in 2020, expecting the world's economic growth will reverse for the full year, including a second quarter contraction of -14% in the U.S. and -22% in the eurozone.
• Deutsche Bank economists foresee a "severe global recession occurring in the first half of 2020 ... quarterly declines in GDP growth we anticipate substantially exceed anything previously recorded going back to at least World War II."
• Both banks noted their forecasts are based on governments putting in place massive, yet-to-be-passed fiscal stimulus programs and fairly swift containment of the outbreak.
• "It is easy to imagine a still worse outcome," DB analysts, led by head of economics research Peter Hooper and seven chief economists, wrote.

The most dire warning came from Pershing Square Capital Management CEO Bill Ackman, who went on CNBC to beg President Trump to shut down the U.S. economy for 30 days and put the country in a nationwide lockdown.

"Until a vaccine is manufactured, distributed and injected we will go through a Depression-era period in the country," Ackman said. "America will end as we know it unless we take this option."

And here I was just anxious about the conornavirus.

Silly me.

Thank goodness we have good, strong leadership coming out of the White House and this Republican Party President and his administration.

Right?

Link:

The coronavirus economic pain in the U.S. has begun

On Germany and Their Nasty, Ugly Socialism

There is a fantastic article and interview out just now at Alternet:

Why Germany Has It So Much Better Than the U.S

It's all based on author Thomas Geohegan's new book Were You Born on the Wrong Continent?  Renowned fellow author Terrence McNally interviews him.

Just a bit, here, to make point:

December 9, 2014/  The European Union, 27 member nations with a half billion people, has become the largest, wealthiest trading bloc in the world, producing nearly a third of the world's economy -- nearly as large as the US and China combined. Europe has more Fortune 500 companies than either the US, China or Japan.

European nations spend far less than the United States for universal healthcare rated by the World Health Organization as the best in the world, even as U.S. health care is ranked 37th. Europe leads in confronting global climate change with renewable energy technologies, creating hundreds of thousands of new jobs in the process. Europe is twice as energy efficient as the US and their ecological "footprint" (the amount of the earth's capacity that a population consumes) is about half that of the United States for the same standard of living.

Unemployment in the US is widespread and becoming chronic, but when Americans have jobs, we work much longer hours than our peers in Europe. Before the recession, Americans were working 1,804 hours per year versus 1,436 hours for Germans -- the equivalent of nine extra 40-hour weeks per year.

They're better paid, have more money, live better, have more--far more---vacation time,  pay less for education,don't ship jobs overseas, there's less--again, far less--poverty, they have more "green", sustainable energy sources, all while producing more, as a nation.

Great interview. It sounds like a good to great book, possibly an important one. Eye-opening to most Americans. Too many of us, without international travel, don't know what we don't have, of course, nor what, maybe, likely, even, we could, if only for better national priorities. Some things we could maybe have if we had statesmen and stateswomen in our leadership instead of what we have now.
I love this---something the author found:  "...if you don't have much poverty, life is better for everybody. Not just for the poor, but for everybody.

It's what a lot of us have been saying and for a long time. It seems something the Waltons of Walmart and the Koch brothers and their ilk just can't comprehend or accept or agree to.

What's to not want to emulate here, on our part? Heck, on anyone's part?

That is really some ugly Socialism there, isn't it?

I'm sure glad we aren't Socialists and have that ugly stuff here, aren't you?

Quote of the day

"It makes no sense to elevate economics above the biosphere."

--Dr. David Suzuki

Links: http://www.davidsuzuki.org/david/

http://www.davidsuzuki.org/

http://en.wikipedia.org/wiki/David_Suzuki

Disavowing the presumed Right Wing lean

"A majority of Americans still holds (George W.) Bush accountable for the Great Recession, and with good reason. We are still breathing the fumes of his toxic brew of deregulation, massive transfers of wealth to the rich and a doubling of the national debt. His policies, and those of the Republican Congress that had its way with the economy for six years, were in fact the culmination of a right-wing ideological revolution led by Ronald Reagan, which changed the way Americans view their government. Mr. Reagan's shadow continues to loom large, because Democrats have yet to make the case for a compelling alternative and have too often accepted the premises of the right."

--Drew Weston in The New York Times, yesterday, in his column "America's Leftward Tilt?"

Link: http://campaignstops.blogs.nytimes.com/2012/11/03/americas-leftward-tilt/?nl=todaysheadlines&emc=edit_th_20121104

Water, oil, food--will humankind cooperate together or fight to the death?

I saw this headline last evening and it rather concerns me:

Global Fight for Natural Resources 'Has Only Just Begun,' say Experts

From the article:

"Better economic incentives, rather than ethical considerations and appeals to human morality, are needed to encourage investment in a more sustainable economy, according to Nobel Prize-winning economist Amartya Sen.

Nobel prize-winning economist Amartya Sen told the conference that governments would need to step in, to ensure resources were best distributed.

Speaking at the Re|source 2012 Conference in Oxford, Sen said that so-called 'free markets' could not be counted on to meet all fundamental human needs nor could the private sector be trusted to efficiently allocate the world's natural resources.

“The way to make the financial sector respond is not through moral exhortation, but by increasing incentives,” said Sen. 'The market will respond to price increases,' but world governments are required to intervene and address 'inequality and iniquity' that the market inherently generates."

The way our Capitalism is set up and the way the Republican Party, the Libertarians and far too many Right Wingers and Americans in general see the world and the world economy at present, they wouldn't get this.

Far too many of us wouldn't understand, at least at present, that whether you're talking about water or oil or corn or virtually any other commodity, once there are shortages, the item in concern can't be left to "free markets" alone unless we are willing to literally let people go without and that can, in fact, mean going without food.

Morally, we just can't let it end up being "every man--person--for themselves." We can't.

Besides being immoral, it would inevitably mean the deaths of at least thousands of us, if not millions, nation- and world-wide.

Surely we owe our fellow human beings more than that.

Rather naturally, it reminded me of this quote from the Reverend Martin Luther King, Jr:

"We must learn to live together as brothers or perish together as fools."

And the thing is, we'll have to agree to that cooperation across all nations, worldwide.

This will not be easy, ladies and gentlemen.

Link to original article: http://www.commondreams.org/headline/2012/07/12-5

Cutting taxes? Again? More?

Fareed Zakaria just pointed out on his CNN news program GPS that the George W. Bush tax cuts during his administration, besides being for the wealthy, were the deepest cuts in the history of the nation and the growth during that period was the worst economic growth since the Great Depression.

To politicians--as he said--would you stop, stop pandering to the American public now, with the promises of yet more tax cuts? Could you, would you, please, be statesman/statespeople for the the nation's good, for the love of pete? We're desperate out here.

Please?

Link: http://globalpublicsquare.blogs.cnn.com/

The EU/Greek/German situation now

Still fascinating, for sure. This, last evening: G20 inches toward $2 trillion in rescue funds. With the G20 countries meeting right now in Mexico, they've come up with a plan for all the members to pony up two trillion dollars, as a safety buffer for the EU countries, to help them get over this rough debt patch. All well and good, I suppose. The EU, the US and China and the rest of the world, really, can't afford to let the EU go down, that's been clear all along. What's fascinating, though, is that the Greek people aren't for the austerity measures that are being forced on them now while the Germans aren't crazy about having to be the ones who pony up so much of that money to bail them out of their mess. Crazy situation. Final note here today on this: Greece's goal has to be to get their debt down to only 120% of GDP (Gross Domestic Productivity) by the year 2020. That shows you how bad things are for them and just how much they've overspent. It just keeps getting curiouser and curiouser. Link: http://news.yahoo.com/euro-zone-deal-firewall-awaits-germany-001447722.html

The 2012 economy

There is an article with video out this morning on Yahoo! News pointing out that China’s Slowdown Will Be Worse Than You Think It tells how "China's Premier Wen Jiabao has just warned that China's economy is now facing challenges, including higher-than-desired inflation and an economic slowdown." Their prognosticator goes on to predict dire things for the future, possibly, because of it. If he didn't write doom and gloom books for a living, it would help his case but the fact is, there is likely truth to it, for sure. The good thing is, with the forceful kind of pseudo-Capitalism China has, they can almost do whatever they want to make their economy respond well, in a way. They still can't overcome financial realities, sure, but they can shape things the way they want, to an extent. The thing is, if you put their--the Chinese--situation in tandem with the European mess, it doesn't look good right now, internationally. Our picture, the US' economy seems to be picking up steam and that's good for us, of course, and even for the world but the fact is, we can pull down the world economy, as we did in 2008 with irresponsibility and lack of regulation. We just can't pull the whole world's economy up by just our own bootstraps. Bettye Davis, ala' Margo Channing may have it right concerning this upcoming economic year:

George Soros says what we all fear most

For anyone and everyone remotely following the EU, their debt and the Euro countries, with their financial messes, this George Soros quote sums it up for us, likely: "Global Financial System In 'Self-Reinforcing Process Of Disintegration.'" He says "Developed countries are falling into a 'deflationary debt trap,' in which consumer spending falls, products become more expensive, tax revenues drop, and sovereign debt grows..." and we fear he's right but hope--against hope?--he's wrong. Link: http://www.huffingtonpost.com/2011/12/05/george-soros-global-financial-system_n_1129210.html

Quote of the day

“We no longer live in a society, we live in an economy, where right and wrong is determined not by fairness, but by profitability — and where the law no longer dictates corporate behavior, but corporate behavior dictates the law” --Kelly Overton

Note to Washington: On cutting spending when you need growth

“The austerity that is going on in Europe, America and so forth is effectively a suicide pact for our economies. “Greece does not have much scope, but the United States and Germany and a number of other countries do have considerable space for stimulating their economy, and it is absolutely essential that they do that.” --Joseph Stiglitz, economist, professor at Columbia University and former chief economist at the World Bank. Links: http://www.theglobeandmail.com/report-on-business/economy/government-stimulus-measures-too-feeble-stiglitz/article2213385/; http://en.wikipedia.org/wiki/Joseph_Stiglitz

I believe "deflation" may have begun

There is an article out right now on Yahoo! News telling how there are such great prices on items for us at local stores: "Quick, Go Shopping! Sales Are Everywhere." (see link below). And that's great, it's always good to find some thing we need at some terrific price. But think about it--home prices have been falling for at least the last 2 years--and still are. It seems virtually everything we need to buy--except gas for our cars and maybe food--is "on sale" and at least a good buy. So sure, it's terrific for us who need this stuff. Except the one really big fear on most economist's minds is that of deflation. Deflation, defined : "In economics, deflation is a decrease in the general price level of goods and services.[1] Deflation occurs when the inflation rate falls below 0% (a negative inflation rate)." and deflation is one scary word to those economists and people at the tops of corporations, in particular, because if they're not increasing their profitability, year after year in corporations, then yet more jobs will be cut from those same corporations and there will be yet more unemployment and people out on the streets, at least jobless, if not homeless. It ain't pretty, by a long shot. Let's hope these are just "great deals" to be had at the local stores and not true deflation. Links: http://financiallyfit.yahoo.com/finance/article-113039-10141-3-stores-offer-big-sales-for-consumers?ywaad=ad0035&nc; http://en.wikipedia.org/wiki/Deflation; http://finance.yahoo.com/career-work/article/113047/disappearing-middle-class-jobs-forbes

It doesn't look pretty out there

And no, I'm not talking about the weather.

I ran across a few websites this afternoon--one of them absolutely alarmist--that tell of the biggest of the world's problems right now, economically and otherwise.

There was one, though, with the following article that seemed both not alarmist or overly-emotional but calm, rational and correct.  You can check it out here:

10 Tipping Points Which Could Plunge The World Into An Economic Nightmare

The two things that strike me from this article are first, that so much of the warring and conflict problems do seem to be centered in the oil-producing Middle East and Northern Africa, which is horribly problematic for oil distribution and so, the world's economic engines to keep running.

The second thing that strikes me is that of the debt across the world--mostly nation-state--but also personal, household debt that is coming down on so many of us right now and slowing, if not stopping our economies.

Some possibly scary stuff, for sure.

Stay tuned.

Me?  I'm sitting here crossing my fingers.

Here's hoping, y'all.

A new term, to me: the coming "Greatest Depression"

My deep-winter's reading yesterday brought about plenty of stories and coverage of the Arizona shooting, certainly, but it also brought about a brief article on the current and possible future economy:

For the last few years Gerald Celente, publisher of the Trends Journal has come on Tech Ticker and other media outlets talking of a further economic collapse, which he calls "the Greatest Depression."


Here's how he puts it in his Top Trends of 2011 release:

"In 2011, with the bailout funds and arsenal of other schemes to prop up the economy depleted, teetering economies will collapse, currency wars will ensue, trade barriers will be erected, economic unions will splinter, and the onset of the 'Greatest Depression' (a trend we forecasted before the massive bailouts existed) will be recognized by everyone…"

The only way to avoid the coming disaster is do what we did coming out of the Great Depression - start manufacturing quality goods the world wants. "You can't print your way out of this," he argues. 

The only way to do that is to improve productive capacity through either manufacturing industrial goods or technological innovation. Otherwise, Celente says the "Greatest Depression" is inevitable.

Here's hoping he's wrong about this "Greatest Depression" he sees coming.

Thank goodness the sun was brilliant and shining.

Link to original post:  http://finance.yahoo.com/tech-ticker/bailouts-postponed-but-cant-prevent-the-greatest-depression-gerald-celente-says-yftt_535804.html;_ylt=ArPLgVqjlIR51f_8G9xyxP7eba9_;_ylu=X3oDMTFnNXBkYTl0BHBvcwMyBHNlYwNjb250ZXh0dWFsLXRlY2h0aWNrZXIEc2xrA2JhaWxvdXRzcG9zdA--

A silver lining to this economic cloud?

Just so we're not that gloomy, there's this:

It’s a perennial: nearly every recession leads pundits to proclaim that the job market is facing structural challenges, and that higher unemployment is here to stay. During the 1981-82 recession, now seen as a classic cyclical recession, the economist Barry Bluestone warned that, as a result of structural issues, there might not be “much recovery in terms of overall employment in the United States.” Yet, by 1984, unemployment was back to where it had been before recession hit. A 1964 survey of economists found that more than half believed structural issues were playing a significant role in limiting the number of jobs; three years later, unemployment was below four per cent. And, during the Great Depression, even F.D.R. thought that unemployment might well be stuck at a permanently higher level. Recessions are, among other things, crises of confidence, and one manifestation of lack of confidence is the conviction that this time we’re not going to be able to climb our way out.   --James Suroweicki, The New Yorker Magazine

  
So it may not be "the end of the world as we know it", folks.  Let's let calmer heads prevail.

Link to original post:  http://www.newyorker.com/talk/financial/2011/01/03/110103ta_talk_surowiecki

Thank goodness. This is way overdue

It's reported today on the front page of The New York Times, among other places, that our government is analyzing curbs on the speculation of energy on the energy markets.

Thank goodness!

This is, as I said, above, long, long overdue.

Back in 2000, as I wrote here earlier, the "geniuses" at Enron got our government to do away with any government regulation of the energy markets.

What a mistake.

Sure, people and corporations could make great gobs of money but, in the meantime, companies like Enron could take energy out of, oh, say, a state like California with one sale, and then send it back in a new resale, to that same state.

Sound familiar?

It's why California had rolling blackouts all those years ago.

It nearly broke the state of California and its residents.

Sure, people were making those boodles of money, but the State of California--and, indeed, the whole country--was weakened, severely, both the state and the United States. It was an insane time for energy, energy trading and the people of California, who were at these trader's and corporation's mercy--or, rather, their lack of mercy.

This was also why the world oil markets took the price of a barrel of crude up to $147.00 per barrel a year or so ago, giving us $4.00/gallon gas at the pump.

It crippled households, their budgets, states and their budgets and the whole country.

An extremely small group of wealthy people 'round the world were getting richer while the middle class, the poor and businesses were crippled and at the mercy of the price of a barrel of oil.

The reason it's so important that we pass these curbs and bring back some regulation of oil and energy markets is because we are in such a deep and worldwide economic recession (at least) right now and we need stability in these energy markets. If we don't know where our costs are going to be in the future, how do we know what we can invest in? It makes our economic crystal ball impossible to read, as if it's not tough enough already.

And all we're taking away is the action of people "betting", in essence, on the energy markets, so they can make money and that's insane. That betting (purchasing oil and energy stocks, in hopes they'll go ever higher) can have the effect of breaking nations, households and businesses banks and pocketbooks, a dangerous possibility.


Link:
http://www.nytimes.com/2009/07/08/business/08cftc.html?th&emc=th

Almost enough to make you positive, eh?

I received a business email today, pointing out the following:

·Retail sales are ticking upward ("ticking upward"?)

·Existing home sales are up 5.1 percent in the latest survey (definitely good)

·Durable goods orders are up more than 3 percent (again, good)

·Most major banks have shown a profit so far in 2009 (and many are turning down or returning stimulus money)

·The stock market staged its biggest rally since 1974 this month (after being cut in half, that isn't saying a whole lot but hey, it's positive)

·Both the fed and treasury have implemented plans that are forecast to have a positive impact (this is the weakest point of all, because what are they going to say? Something bad?)

·Corporate earnings have been surprisingly strong for a change (again, good)

Hopefully it's part of a larger trend of good, slow growth... and we can stop throwing trillions of dollars at bankers and investment companies.

A new consensus?

Word out Friday was that the Chinese don't want the Americans blowing all that big money on bailouts, for the very real fear that it could and would devalue the dollar, thereby devaluing Chinese investments.

Hmmm.

This sounds strangely familiar.

If you put this rather big news, coming from Chinese leader Wen Jiabao, together with the fact that, lately, some banks are saying "no thank you" to the Feds for that same bailout money, wouldn't it seem like we have a bit of a consensus here?

Mind you, it's only 3 banks (out of 487) but maybe more banks will get some courage up and either want to return it or out-and-out do so.

Citigroup and GM said they need no more money from the Feds right now, too.

Anyway, it's interesting, at least, that these completely different organizations in totally different physical and structural locations come to the same conclusion.

This could possibly mean that our response has been one of desperation and panic and that maybe this isn't the way to go.

Stay tuned.

It's as I've said, since we're in totally new territory, financially, it's hard to tell where we are.

Unfortunately, it's like a recession--we'll find out after we're already long since there.


Links to original stories:
http://news.yahoo.com/s/ap/20090313/ap_on_bi_ge/as_china_us_economy
http://www.propublica.org/article/third-bank-says-it-will-return-bailout-funds-but-487-banks-keep-theirs-311

President Obama's weekly radio adress 1.24.09

Truth from the insanity, presented as humor