I've noticed a "good news"-favoring sentiment on this blog, particularly over the past day. Tolerance here for bad news about our economy has certainly reached a low-point (Or, is it just burnout?), especially when those that bring it to the community's attention are accused of not being Obama supporters. But, there are still those of us here (who are strong Obama supporters) who would dare to talk of a reality that tells us that we have a long way to go before things significantly improve with our economy.
Years. Perhaps, many years.
And, that's not going over too well with some around these parts.
The "Great Recession" (or, the "Millennial Depression," depending upon what you'd like to call it) is what it is.
At the very least, as of this month, it
is the longest-lasting recession this country's seen since the Great Depression. And...
It won't be over anytime soon for the 50,000,000+ Americans that don't have healthcare.
It won't be over anytime soon for the millions facing foreclosure right now.
It won't be over anytime soon for those that don't have enough food to eat or a roof over their heads.
It won't be over anytime soon for those kids that have had to put off their education plans over the past couple years, due to a lack of sufficient resources.
It won't be over anytime soon for the many millions of us that can no longer put our kids in a pre-school or after-school curriculum, participate in an outpatient clinic health program, or otherwise take advantage of critical state-funded programs that have gone by the wayside in the majority of our United States--most of which also happen to be facing massive deficits now.
And, it sure as hell won't be over anytime soon for any self-respecting Progressive Democrat that has traditionally given a damn about the misfortunes and suffering of the have-nots within our society, either.
So, (and I mean this sincerely) please pardon me if I'm having a hard-time with all this "happy talk" about how things are getting better. (Or, more accurately, 'worse more slowly.') For folks in the groups mentioned above--as far as they're concerned--it's not getting better anytime soon. The only thing they have seen behind their light at the end of the tunnel is a train.
To them, it's not about the official start and stop of a recession or a depression.
Here's what's behind their light on one random night--tonight...
About that stimulus...
White House defends 3.5M job forecast...
White House defends 3.5M job forecast
By Matt Kelley, USA TODAY
WASHINGTON -- ...The new report by the White House Council of Economic Advisers offers more details about the projected impact of the $787 billion stimulus package, which Obama signed into law in February. The figure of 3.5 million jobs saved or created, the report says, is the difference between the projected number of jobs during the last three months of 2010 with the stimulus and the projected number of jobs without if there had been no stimulus plan.
--SNIP--
Christina Romer, Obama's top economic adviser, said the administration's goal has been to come up with realistic estimates, not to manipulate the numbers for political purposes. "Accuracy has always been the main thing, not the political back-and-forth," Romer said in an interview Saturday.
--SNIP--
The administration's practice of discussing jobs saved as well as created is "a very clever device for providing future political cover," said University of Chicago economics professor Steven Davis. "The 'jobs saved' part was a way for them to say, 'The economy is still shrinking, but it would have shrunk faster but for the good things that we did.' "
"No more stimulus for you!" (Is there such a thing as a "Political Soup Nazi?")
Economists Downgrade U.S. Recovery Outlook, Survey Indicates
Economists Downgrade U.S. Recovery Outlook, Survey Indicates
By Shobhana Chandra and Alex Tanzi
May 12 (Bloomberg) -- Economists downgraded their projections for a recovery from the deepest U.S. recession in half a century, now seeing the jobless rate exceeding 8 percent through 2011, a Bloomberg News survey showed.
--SNIP--
The unemployment rate jumped to 8.9 percent in April, the highest level in 25 years, and the economy has lost 5.7 million jobs since the recession began in December 2007, the most of any economic slump since the Great Depression, according to Labor Department figures.
--SNIP--
A benchmark interest rate that's already near zero and a yawning government budget gap make it unlikely the government will step in with additional spending, Rupkey said. "We may need more stimulus, but we can't afford more at this stage," he (Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd.) said.
--SNIP--
"The credit market would not take kindly to a further expansion of the budget deficit and it could run the risk of backfiring," said John Lonski, chief economist at Moody's Capital Markets Group in New York. Foreign investors don't like large deficits and an additional increase would shut off the flow of funds into the U.S., he said, pushing up bond yields "and sending the dollar into a tailspin."
Guest Post: Dealing with the Devil?
After all that talk about the Stress Tests last week, we now learn that the government did cave at the eleventh hour.
Monday, May 11, 2009
Guest Post: Dealing with the Devil?
NakedCapitalism.com
Submitted by Rolfe Winkler, publisher of OptionARMageddon
Much has been said here and elsewhere about the stress test's lack of credibility, especially after word emerged about "intense bargaining" over the results. Not to belabor the point, but some data may be of use.
Of the more promising developments early in the process, the Fed articulated the importance of tangible common equity as the proper measure of bank capital. Being the most stringent measure of its kind, use of TCE stood to give the tests more credibility.
But in the end, the Fed switched to a more favorable metric: "Tier 1 Common Capital."
(There's a great chart here, making a clickthrough from the link above more than worth the effort.)
This was just another of the administration's many games to make banks look healthier than they really are.
It's a shame regulators didn't use the tests as an opportunity to reassert their control. Instead, they demonstrated yet again that banks have them totally under regulatory capture.
Wherein, I learned of a new term this evening: "Regulatory Capture."
From Wikipedia: Regulatory capture
Regulatory capture
From Wikipedia, the free encyclopedia
(April 2007)
Regulatory capture is a term used to refer to situations in which a government regulatory agency created to act in the public interest instead acts in favor of the commercial or special interests that dominate in the industry or sector it is charged with regulating.
For public choice theorists, regulatory capture occurs because groups or individuals with a high-stakes interest in the outcome of policy or regulatory decisions can be expected to focus their resources and energies in attempting to gain the policy outcomes they prefer, while members of the public, each with only a tiny individual stake in the outcome, will ignore it altogether. When this imbalance of focused resources devoted to a particular policy outcome is successful at "capturing" influence with the staff or commission members of a regulatory agency so that the preferred policy outcomes of the special interest are implemented, then regulatory capture has occurred.
--SNIP--
Economic rationale
The idea of regulatory capture has an obvious economic basis in that vested interests in an industry have the greatest financial stake in regulatory activity and are likely to be less hindered by collective action problems that might riddle those affected by regulation (like dispersed consumers each of whom has little particular incentive to try to influence regulators). As well, we would expect that when regulators form expert bodies to examine policy, this will invariably feature current or former industry members, or at the very least, individuals with contacts in the industry.
Some economists, such as Jon Hansen and his co-authors, argue that the phenomenon extends beyond just political agencies and organizations. Businesses have an incentive to control anything that has power over them, including institutions from the media to academia to popular culture, and thus will try to capture them as well. When this happens, they call this phenomenon "deep capture."[1]
And, quoted at the end of this Wiki page:
In 1913 Woodrow Wilson wrote: "If the government is to tell big business men how to run their business, then don't you see that big business men have to get closer to the government even than they are now? Don't you see that they must capture the government, in order not to be restrained too much by it? Must capture the government? They have already captured it."[3]