The UK will have a worse time than the US even if it isn't the next Iceland. RBS alone has a balance sheet bigger than the UK GDP.

OTOH the UK is still better off than Spain, Greece, Italy, and assorted eastern EU countries.

One thing these economist geniuses haven't thought about is that pretty much every western and even many developing nations are now offering new bonds like there is no tomorrow. Whopping $3000 billion this year plus thousands of billions of rollover debt, according to FT.

So the question is which nation is the last one (aka most vulnerable) to be eaten by the bear aka "no-bids" bond auction judgement day. UK especially is looking very vulnerable...

First?

I haven't figured out any countries that are SAFE. One of the ones I'm thinking about though is New Zealand. If commodities come back and if there is some growth in Asia they could be ok. Plus they have a good government. I'm thinking they may be the best of a bunch of bad choices for a dollar hedge. I will continue to study.

I think the U.K. manufacturing base was substantially different in WW II. Certainly, there wasn't a lot of discussion about vacation homes in Spain or second homes in the countryside. There is not so much of a monoculture today. The Monarchy also had a stronger role than today. Britain will survive this, stiff upper lip and quiet desperation will save the day. Back to potted meat, overloaded flats, and the dole as unemployment skyrockets. But this time, the youth will be angrier.

Ireland, on the other hand, is cooked. They are Iceland, only with Guiness, sod, and sheep. Bad times ahead, but they've been through worse.

Just to clarify terms:

Recession = your neighbour loses his job
Depression = you lose your job.
Financial collapse/meltdown = bank economists lose their jobs.
Armageddon = central bank economists lose their jobs.
Mad Max = The demand of lamp posts triples...

ac, graph link not working...

One hundred and three?

ac

I'm with you. The private and public debt will roll this mess up in Britian.

I feel a little sick to my stomach... I don't know who to believe anymore. I want to believe Roubini, but the point about the private debt sounds solid to me. What happens this weekend? How is Citi (et al.) doing?

given that the vast majority of economists are socialist "Master Planners" and look at the economy as some kind of mechanical model with all sorts of knobs and levers to twist and pull

It's their own version of Sim City =)

Black Star Ranch writes:
"....The FedGov has been pushing banks to LOAN, LOAN, LOAN. Maybe they don't realize that a BIG percentage of people are "in debt up to their eyeballs"? Hence NO CONCERN for private debt? They can't be THAT insulated/stupid, can they?"

In a monetary economy, net cash flows amongst all entities is zero. In order for entities to have positive cash flows, other entities must have negative cash flows (or else the accounting systems are broken). In other words, somebody has to emit cash if somebody else has positive cash flow.

In a gold based monetary system, mined gold can generate some of those flows. In a modern fiat system, entities emit cash in exchange for debt - specie issuance (notes and coins) is negligible. (Zimbabwe and the Weimar Republic are not "modern" under this definition.)

Which pretty much says that a modern money-based cannot grow in nominal terms without debt issuance by the definition of what growth is (rising cash incomes). So for anyone who's actually studied how economies work is not going to be surprised by the call to increase bank lending.

reptillian writes:
Roubini is becoming an optimist.
reptillian | 01.24.09 - 9:45 am

+1

RockyR writes:
Roubini has been way too optimistic over the last two years.
stockdog42 | Homepage | 01.24.09 - 10:21 am | #

Roubini called this mess to start with. Now he's found a middle road between complete systemic collapse and depression from what I can tell. I'm not sure I'm reading optimism into what he says.

I agree but Roubini is forecasting a 9% unemployment rate at end of year. I believe this to be overly optimistic. Unemployment will be the real driver of the economy over the next few months.

Regarding the question of what countries are safe:

The amazing thing is that the U.S. is the safe harbor for the oncoming storm.

Even more amazing is that the things that make this country the safe harbor are the very things our elites have been fighting us to give away via globalization and de-regulation for thirty years.

They almost succeeded, but we'll be able to hang on to one or two of the remaining threads. Other countries will have a more difficult time.

PS 9% UE by what measure? These numbers are heavily manipulated. The .gov can massage the figures to make it appear to be a lot of things.
RockR

Government bettter get a damn good Masseuse working on this as California has pulled a groin muscle 9.3% unemployment. I'm fearful that the crater you speak of will be a little west of Omaha.

IMHO, the US is FUCT in the long run as are its allies to the North and East. I think we are on our way to a depression

Wow. RockyR, you've turned around quite recently. I could have swore you were on the other side fairly recently.

We have a huge nation, abundant national resources, few problems with our borders, the best military, and a large portion of our populace is extremely enterprising.

Yes, the fundamentals of our economy are strong.

it seems that private debt exists in a closed loop within the sovereign and thus need not be counted.
sportsfan | 01.24.09 - 11:11 am | #

You don't think public and private debt is homogeneous at this point?? Closed loop??

Have you missed the last 12 months, TARP, TAF, ect??? The whole point has been to OPEN the loop. To blend the public with the private.

Why do you think so many are pissed off??

"We certainly have the means, but I question the ability."

I agree with the unreal tax load and the unproductive entitlement people. I have the same feeling. We do not have our grandparents standards of responsibility and work ethic.

The UK is Iceland lite, but on a far grander scale. Relative to the economy, banks were more than 2x the size they are in the UK. However, the economy of Iceland was miniscule, the total population of Iceland is about that of Dayton Ohio and its immediate suburbs. Still the problem of massive overseas laibilitys of the banking system are there, but just not to the extent of Iceland. The world could sustain Iceland sinnking into the sea like Atlantis, but it could not sustain the same thing happening to the UK

Whether the government correctly reports unemployment or not makes little difference. The velocity of money will slow dramatically and push us into a depression-stagflation by the end of this year.

Roubini is too optimistic on the unemployment rate. I respect his judgment but respectfully disagree.

If you are not getting long in this market slowly you are a fool.

Hedge a bit, buy funds or etfs instead of individual companies, and start wading in with money you do not need right away.

Just be a realist, if you have no job, have a mortgage, no saving, no family to put you up in standard's you are accustomed to, bad credit, and old car, no political connection's, flunked out of college or never went, have had more than one wife and paying child support, have never had a job with a key to the building, never worked all day, all night and all the next day to beat a deadline, no matter your age, you are about to be a real grown up, but a ward of the State.

Much Sebastian-like rhetoric and pontification in these comments recently. Albeit on the bearish side. I'll bet those commenters suffer the same fate as our overly bullish friend. I mean what does Roubini know.... I seem to recall Sebastian dissing Noriel quite often too.
Seems to me like the lemmings are starting to resemble bears.
Disclosure, I am not long, but not nearly as short as I have been.

The UK's fortunes will depend on the value of the pound. As the pound sinks, UK debt in foreign currency becomes more burdensome. Watch the pound.

RockyR writes:
...Please tell us what the new reserve currency is so that we can start to denominate our savings in those notes...

Your savings ??
Unpayable debt now counts as savings ?

Guess Jas needs to spruce up his terminology.

So, UK banks' foreign liabilities total $4.4 trillion.

According to the bank of england there are 54 billion pounds in circulation. Wait, that's probably on actual paper... how does one size an actual money supply?

"Well, first of all, I retain more than .30 on every pre-taxed dollar today...
RockyR | 01.24.09 - 11:39 am | # "

Really? prove it. Don't forget to include the product prices for Corporate taxes, fees licenses, permits. Hidden taxes like severance fees, pipeline distribution fess, etc just for a gallon of gas. Excise tax on tires? They have hidden tons of tax no one can find them all. They are there.

This is funny:

Obama breaks from Bush, avoids divisive stands

The article requested is no longer available.

Obama:

"You can't just listen to Rush Limbaugh and get things done"

PREZ ZINGS GOP FOE IN A $TIMULATING TALK - NYPOST.com

Nationalizing failed banks through short term bridge loans as described by Bill Siedman would be the least expensive approach to put a bottom under this contraction. Breaking up large inefficient financial organizations, writing off their bad assets, removing incompetent management, would be achieved in the shortest possible time. Painfull but necessary.

Rocky R

This is all about having perspective, contemporary and historical.

There are and have been parts of the country in recent decades that have not been safe for strangers: the marijuana groing regions of Northern california and, though usually exagerrated (but that is what such rumors and stories are always about) urban racial ghettos.

Historically, the US had much more socially driven violence between 1876 and 1929 than in recent decades: labor violence, private armies deployed by industrialists, the haymarket bombings, the haymarket hangings, lynching, race riots in which white mobs killed dozens of black people in towns and cities across the South and into the West . . . and more.

Remember Katrina in New orleans? It was a horror. But remember the stories reported - I should say, "reported," out of new orleans? There were rape gangs and cannibals and lions and tigers and bears.

No, there were not. There were hundreds of thousands of people suffering under inhuman conditions, and there was looting, but no rape gangs, no cannibalism, and for the most part people in the Superdome tried to cooperate with each other.

The idea that today is different with respect to social unraveling is on a par with the housing bubble - this time it is different, they said. No It was not, no it is not.

Nouriel...it's time to tell it like it really is and sacrifice your newly discovered status:

The GDP in the U.S. is consumer driven, not production driven. Over 70 percent of our GDP is based upon the consumption of goods and services, which over the past decade has been facilitated through the exponential increase in debt spending. We are not producing anything, we are spending money we do not have, and all of that is being called “growth” by those who benefit from the illusion of such growth. Growth as a measure of GDP is a fallacy! Moreover, growth as we have known it for decades is done, finished, over. It is mathematically and physically impossible to grow our GDP when (a) we don’t produce anything, and (b) consumers are totally tapped out and in debt up to their eyeballs and cannot consume anything else lest they explode (“…get me a bucket I think I’m going to vomit…”).

Over the counter trading of such instruments as Credit Default Swaps is unregulated. There are no capital requirements in place that might serve to moderate these bets that are STILL, by the billions, being placed today. Like the guy in “The Sopranos” who played poker with the big boys but had no money to back up his bets, trillions in debt have been created and no one has the cash to pay down their obligations. Meanwhile, everyone is busy hiding their exposure in these fetid instruments from one-another in fears that once counterparty risk is fully exposed, the whole game comes crashing down in a massive, uncontrollable wave of defaults and liquidations.

Enter the FED and Ben Bernanke, who in their “wisdom” have come to the conclusion that none of our banking and other financial institutions can be allowed to fail. And as such, trillions of dollars in the form of either US debt purchased by such nations as China and Japan, or as hundreds of billions of greenbacks printed fresh in the basement of the Federal Reserve, are being spent in a desperate attempt to keep the dead-men walking; to keep the insolvent banks from going belly-up. But of
course these banks already are belly-up, it’s just that they’re floating upside down in the middle of the ocean and they haven’t washed ashore yet for the world to see!

And since the profit motive remains king of the castle, networks like CNN and CNBC and Bloomberg continue to under-report unemployment numbers or massage statistics or promote the idea of economic recovery in an effort to stimulate artificial growth that might help the billionaires who own and RUN these "news" sources make a few bucks before the whole thing comes a-tumbling down. Unemployment is not 7.2%; it is more like 13.5%. Simply take a break from your double-latte and your shrimp cocktail and read the hidden reports from our honorable government. Compare the U3 rates (total unemployed) to the U6 rates (total unemployed, plus marginal workers, plus part-time workers ‘for economic reasons’). U-3 is measured as 7.2% nationally. U-6 at 13.5%. And frankly this measure is also flawed and under-reported in that the government-paid statisticians purposefully distort employment realities based upon such factors as what economic sectors are in question, and what the employment data tells us about the demography of such numbers (urban, rural, ethnicity), etc. The government and its accomplices will cook the books and massage the numbers and present false interpretation of data or purposefully omit information, all in an effort to downplay the gravity of the current situation. And they will defend such dishonest actions and purposeful distortions by self-righteously claiming that it is their job and patriotic duty to, despite the truth, try and keep people feeling good and confident about their prospects for the future.

And lest we forget, our representatives in Washington D.C. really have no idea what’s going on. They are all Gilligan’s, and Paulson and Bernanke and Greenspan and Geithner are their “Professors”. And whatever they are told they dutifully parrot back to their constituencies, and they love making grand speeches for each other, and congratulating each other for how hard they are all working, and meanwhile they are totally clueless. They epitomize the worst elements of our so-called democracy, in that they use wealth and influence to achieve their positions of power and authority, and then sell their souls to keep their cushy jobs.

And it is not an overstatement to repeat just how insane the policy of propping up failed banking institutions truly is. It is like a global game of “Weekend at Bernie’s”: Who can make the dead body appear alive for the longest?!?!? Of course this charade does not ever bring the corpse back to life. But our financial and political leaders continue this charade for they obviously believe that we are stupid enough to think that they are earnest and honest men---and maybe we are---and they actually think that trillions in recapitalization can reanimate these corporate corpses, and they are not willing to accept the fact that the sick extravagances that they have peddled for the past generation or two have brought us this calamity. And seriously folks, they will continue to do everything in their collective power to save a dead system, even if it means sacrificing us all along the way.

And everyone should recognize the following axiom: When someone purposefully hides information and then not only tries to pretend that they are not, in fact, hiding anything, but that even if they were hiding something it would be OK because it is for the common good, then you know something is very, very wrong. It reminds me a bit of the story of the kid who hides bottle-rockets in his locker at school. Sure the kid’s going to try and do anything in his power from letting the principal see what’s locked behind the steel doors of his supposed school book repository: he will lie, change the lock, hide the stuff that is inside in most creative ways, cover the odor of fireworks with perfumes or stink bombs, etc. Not only doesn't he want to get caught, but he also wants to keep the explosives! However, the more this kid works to hide the truth, the more any school official worth his or her salt knows that it’s high time he gets the hack saw out and makes sure that the student isn't hiding a pound of pot or an AK-47 in his locker. (Fireworks are always a relief for beleaguered school administrators.) And now look at our lovely Wall Street and D.C. fellows: Those vaults in the back rooms of those banks and in the basements of those financial institutions are hiding trillions in bad assets, and they are being kept closed and away from any prying eyes through spending trillions MORE in debt---debt that has to eventually be repaid by the American taxpayers---and our leaders are creating “ringed fence” policies and developing elaborate red-herring legislative actions to put people off of the scent. Anything to keep us from knowing the truth: the truth being that our banks and other financial institutions and insurance companies are all leveraged 20, 30, 40:1, because all of the securitized instruments in which these institutions so carelessly and greedily invested are worthless pieces of garbage, and we’re the schmucks who are going to end up paying for their crimes---and still the truth is hidden from us, and we do nothing.

And this is not an isolated event folks. The entire world is involved. All of the world’s advanced and developing economies are getting crushed under the weight of hundreds of trillions in debt and toxic assets. China’s economy is contracting and tens of millions of workers are fleeing to the countryside as factories close by the hundreds, and export markets are collapsing, and international shipping is grinding to a halt, and unemployment rates in the U.K. and Brazil and Ukraine are erupting like angry dormant volcanoes after eons of fitful sleep, and civil unrest is spiking around the globe in response to people’s anger and hunger: Riots are exploding in Latvia, Estonia, Iceland, Bulgaria, Greece. All in response to growing economic hardships brought on by the nefarious actions of those seeking unimaginable profits whilst the common man and woman suffers in poverty.

And the Obama-Bernanke-Rubin triumvirate somehow seems to believe that China and Japan and other nations will continue to buy our increasingly unreliable debt to support our efforts at economic resuscitation. But our leaders seemingly refuse to accept the fact that all of these other nations’ economies are also collapsing, and at some point these countries are going to have to look inward and spend any and all of their dwindling resources on trying to stimulate growth at home, and measly 3% returns on U.S. Treasuries certainly is not going to make a difference for China and Japan and other countries who for decades have supported American extravagance, and in fact the U.S., if asked to service its debt in the form of payment for Treasuries being “cashed in”, will not be able to do so. And then the United States of America defaults on its debt. What then Mr. O?

And whilst all of this is happening, our economic and political leaders continue to speak of getting the economy moving again and loosening frozen credit markets and returning to the days of 5% GDP growth, as if by some miracle of nature one can magically create infinitely renewable resources and new mountain ranges of debt that do not have anything to do with the old mountain ranges of debt. It’s not magical thinking, it’s not even insanity---at least insanity is on some level innocent of itself. This type of thinking is actually evil: it is an obvious lie, and it is a lie that is promoted as being a truth by those who have the power to twist reality and to present their twisted version of reality to the masses. Evil people manipulate sorry, helpless people to promote their agendas of power, wealth and delusion. Cult leaders like David Koresh are (were) evil

RockyR writes:
...I suppose you don't have an alternative to the US for greater stability in the world at present?...

I do, and the more Americans are keept away from it, the better for it.
The last thing on earth you want is to get it being messed up by Americans drowning in bad debt.

A soft market!

TOKYO (Reuters) - Toyota Motor Corp (7203.T) plans to reduce vehicle production in Japan by nearly 60 percent in April, a level that could force it to cut its domestic workforce amid slumping car sales, Tokyo Shimbun newspaper reported on Saturday.

The market is determining which banks are failing. Pfd shares of Citi yield over 15%, BAC pfd yield 12%, USB 8.5% and WFC 8%. Unlike BAC this time don't ruin a good bank with bad assets (MER and CFC), what a travesty.

Mel - very well stated.
Sebastian - sorry, my comment was meant to be metaphorical.

The Chicago-based company that makes suits preferred by President Barack Obama has filed for bankruptcy.
Hartmarx Corp. and its U.S. subsidiaries filed for Chapter 11 protection Friday. The company says its Canadian and other non-U.S. affiliates have not sought bankruptcy protection.

One of the reasons that Obama preferred them was that they used union workers. Kind of interesting how it was only the US entity that filed BK.

Werner,

The Economist Moe Howard is a play on Moe of the Three stooges. Auto Mechanic Entrepreneur. My point is simple Americans have no clue as to badly we have been taxed to death chasing the piece of cheese our government has drag in front of us. Americans a fools and that is how we got here. I don't challenge economic points. I would rather study peoples actions and educated trolls. Our grand parents where simple people who really made it work. Now we are educated and rock dumb.

Mel -
shhhh - let's not talk about tax rates. We don't want anybody reminding people that the Republicans under Eisenhower felt that such high taxation was the American way - back when America was by far the world's mightiest economy.

"Our grand parents paid much higher taxes--91% top rate--and that worked."

I doubt mine did how ever I don't know what the bottom rate was and have no clue as to the built in hidden taxes where. I bet they had a more in a spendable dollar.

Sebastian | 01.24.09 - 12:15 pm | #
energyecon: Local Minima in the CIVPART-EMRATIO Spread (with thanks to the St Louis Fed -I like FRED!) 

Economist Moe Howard 3SU writes:
...The Economist Moe Howard is a play on Moe of the Three stooges...

I see, was not awaee of that. (I am German)

...Our grand parents where simple people who really made it work...

There is nothing to be said against "simple people" who honestly do their work. Very honorable, and I would prefere them any time over "educated liars".

I am not sure that todays educated people are rock dumb, I rather suspect they are just more dishonest than people generally were back then, and they hide their dishonesty in their "educated speak".
But on the other hand you have an excellent point in that because in spite of all their education they collectively managed to run your financial system into desaster. And that is very dumb indeed !

So, yes I agree with you, your are much better off with honest "simple" people than with highly educated liars.

fried -
good article, though I think it is a few days old. I read it at the train station, actually, before buying a fresh baked croissant.

The globalized world is not flat, it is flat broke. Everyone is going to be hurting, and a number of Germans still have a difficult time grasping this, as they remain fairly convinced that they live in the world's greatest economy, blessed with unique advantages, and only a few rotten apples in a giant barrel of uniquely talented individuals, like the almost convicted Deutsche Bank head Ackermann. Who is either one of the few rotten apples, or one of the many talented managers - seems to depend on what news source you prefer.

The region I live in is heavily dependent on Mercedes, and Mercedes is in standstill mode. As are its suppliers. And the towns that are losing major tax revenue - no production equals no turnover, which equals no taxes. The same applies to BMW, Opel, Ford, etc. - the collapse is clear, the denial remains until reality is inescapable.

But many Germans property owners (both private and commercial - though probably not Werner, with a seeming reflexive reaction against the Greens), have been spending the last few years investing things like home insulation, solar water heaters, and PV panels. I am going to guess that such investments will pay off much better than stainless steel or granite. As for growing things in your backyard - a pretty common German pastime, in my experience.

Give Ireland back to the Irish...

John Lennon The Luck of the Irish

YouTube - John Lennon ,Yoko Ono-The Luck of the Irish

"Just an example of inflation...While my family could not, families better off were purchasing autos every other year..."

My Father was a Navy career vet. In 1960 on ADJ1 pay, one income, he bought new cars about every 3 years. Difference was cars cost were low cost enough and could be bought on a 36 month payments. Today buy an equal car and pay it of in 72 months. Cost today inflated (including lots more hidden taxes) but with income should come out to 36 months today. They don't and that is partly due to the taxation of the dollar. Less spendable, Spiral up or down. Taxation, debt spending is good for all when spending discipline is used. That has not happened for a very long time. At some point you hit the point of no return which we in my opinion are pushing hard now.

Give Ireland back to the Irish

YouTube - Paul McCartney - Give Ireland back to the Irish 

Peasant Darkness,

You apparently do not have blue collar employees in the service industry from the 70's to today. Major drop in in responsibly and skill.

There is a tsunami of pent up demand!! Beware the flood! Ignore this warning and be doomed to repeat the mistakes of your past!

UK public debt is manageable. That's not the problem.

The problem is that UK banks (many apparently insolvent) have foreign-currency liabilities equal to 200% of GDP (says Ambrose Evans-Pritchard).

This creates a dilemma. If they nationalize, and if the banks' foreign-currency assets are seriously impaired, then the UK takes on huge foreign-denominated debts that cannot be inflated away. On the other hand, if they don't nationalize RBS, Barclays and friends, then the global banking system collapses.

The foreign-denominated obligations are what recalls Iceland. Iceland's situation was much worse as a percentage of GDP, but the UK's situation is serious.

Re: So, it's not so much "pent up demand" in any legitimate sense, it's just junkies craving their fix.

So what, things get outdated and need replaced; depreciation is what drives GDP, and there is no way around that fact!

These women are just a bit ahead of the curve and replacing outdated crap with materials that will have greater future value. You can put off upgrades for only so long.

Werner,

Most of my friends are College educated and they get it. They are generally around 50. Some have PHD's and teach at Universities others small business people like I was. My insights are shared buy all of my friends as to the qualities of the educated that can't "think for themselves". Either our Financial Best in America (probably with others in the world) are a choice of "Dumb and disconnect" or Thieves. Take your pick. Politicians are generally the second choice but in all fairness there are a few exceptions. Sorry for the confusion.

Of course when the national debt rose to 150% of GDP the pound was soon devalued. In 1949, if I recall correctly, it dropped from $4.90 to $2.80. I went to university in the UK in 1951 and everything was incredibly cheap. A full year's tuition, board and room at Cambridge cost 400 pounds, or $1120 at the time. A four course dinner cost 8s.6d. or $1.20.

sdtfs | 01.24.09 - 1:22 pm | #

I've noticed it as well. Even Circuit City employees were helpful and what was their motivation?

KR,

Maybe so, but did your father spend is paycheck on booze for/with his buds, while his wife with 4 young children live on her allotment check in Navy housing?

A Chinese central banker denounced accusations by U.S. Treasury Secretary-designate Timothy Geithner that China was manipulating its yuan currency, calling them misleading and warning against "excuses" for protectionism.

Su Ning, a vice governor of the People's Bank of China, called the comments by Geithner "out of keeping with the facts" and said they were "misleading in analysing the causes of the financial crisis," the official China News Service reported on Saturday. Su also warned against trade protectionism. "We believe that faced with the financial crisis there should be a spirit of self-criticism," Su said while visiting a business newspaper office in Beijing, according to the report. "The international community is currently working together in actively responding to the financial crisis, and it must avoid exploiting different excuses for renewing or encouraging trade protectionism," Su said, adding that such steps would harm global economic recovery

"Maybe so, but did your father spend is paycheck on booze for/with his buds, while his wife with 4 young children live on her allotment check in Navy housing?
losr&confused | 01.24.09 - 1:30 pm | # "

The money was there, the choices were the parents. Doesn't change what could have been. That is why the "Spendable dollar" is more important the how much one makes.

Setser has pointed out that the pound will continue to fall until it comes to a level that make holding pound denominated assets attractive. This surely is not now and it may have to fall a lot further before people want to buy many US assets.

This is beyond stupid. I am sure it will be hacked.
Bubbles | 01.24.09 - 1:34 pm | #

Maybe that is the intent. It sure did get a lot of media attention.

Dan w-
you are the man...great rant...

Seems some readers here are suddenly wearing rose colored glasses. Demand for consumption is dead in the water.
People are becoming smart to the real problem of govt and bailouts.

the revolution is brewing, it's like a heart attack. The veins are clogged and no amount of low cost credit medicine can stop the inevitable stroke that is a coming. Ticking away it will happen without warning.

I see no pick up in demand at all..I look forward to someone pointing out where demand is picking up. I will embrace it but I doubt it's nothing more than the last stragglers rounding the bend picking some ripe berries by the trail while unknown to them a hungry grizzly trying to feed her cubs is right around the corner.

credits usually play at the end of the movie too. The movie is getting close to the end and the cheap coke and popcorn are leaving a bad taste in your mouth while hardening the veins..

toobigtofail,

Approval of Congress has dipped below 20% for only the fourth time in the 34 years Gallup has asked Americans to rate the job Congress is doing. Today's 18% score, based on a May 8-11 Gallup Poll, matches the record lows Gallup recorded in August 2007 and March 1992.

That was in May, before the retards ignored the public and went along with Paulson and Bernanke.

As for Obama, his concept of what will stimulate growth is way off track, because he is ignoring the corruption on wall street which is also related to TARP and congress, and thus he has pie-in-the-sky ideas and theories as to inventing jobs

Obama Details Recovery Plan - washingtonpost.com

The report said Obama would spend at least 75 percent of the stimulus package in the first 18 months after passage. Among the other major goals is updating the electric grid by laying more than 3,000 miles of transmission lines and installing 40 million "Smart Meters" in American homes. The plan also would weatherize at least 2 million homes to save low-income families on average $350 per year, and modernize at least 75 percent of federal buildings.

The plan calls for several major infrastructure investments, including enhancing security of 90 major ports and modernizing the nation's water system by launching 1,300 wastewater projects, 380 drinking water projects and 1,000 rural and sewer system projects.

In the area of education, Obama's plan calls for renovating 10,000 schools and funding the shortfall in Pell Grants, which would increase college affordability for seven million students. The plan also calls for tripling the number of undergraduate and graduate fellowships in science and providing an additional 350,000 children access to quality pre-kindergarten programs.

That is all bullshit and that will not turn the economy around, while wall street continues to be run by crooks!

but the U.K. clearly has some serious problems.

Agreed. They need more dentists.

I just found a job:

providing an additional 350,000 children access to quality pre-kindergarten programs.

ROTFLMFAO!! Bahahahahah

Maybe the UK can turn around their accounting fraud and boot the economy with The Obama stiulus plan:

providing an additional 350,000 children access to quality pre-kindergarten programs.

ROTFMAO! Moohawhahaha

"trying to draw a correlaation to today's society and that of the 30's is grossly negligent (snip)

A large percentage of our society is very violent. Many with nothing to lose and more to gain(three squares and a warm bed) by being inside than out."
Quincy k | 01.24.09 - 1:08 pm |

§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§

You focus on the wrong differences. America has ALWAYS been a violent place. The two real differences are that 1) today many many times fewer Americans have the skill to provide for their basic needs without a complex industrial / information infrastructure supporting them and 2) debt, also 3) debt

Tsunami writes:
"So what, things get outdated and need replaced; depreciation is what drives GDP, and there is no way around that fact!"

There is analysis of the "broken window fallacy" - replacing broken windows creates GDP, but doesn't improve anything.

A big problem people have in discussing growth is that economists have mentally equated:

rising per capita real GDP = rising standard of living.

This is an embedded assumption that underlies almost all discussions of growth. This then causes the "broken window fallacy" problem.

Ignore real GDP. It's impossible to measure. Instead, look at Gross National Income. It's what really matters, especially for things like the bond market. Why: debt is serviced out of income; and thus all debt is serviced out of all incomes (GDI). When you are in a debt deflation, levels of nominal incomes become an extremely important thing to watch.

Economists may point out right about now that GDI equals GDP. (And in fact, it's easier to measure, and is reported before GDI.) Yes, but that's for nominal GDP. Real GDP is an attempt to translate production measured into dollars into "real" production. (For example, tracking the number of cars produced, rather than the dollar value of the cars). The reality is that such measuring "real" production is largely impossible in a world with a changing mix of products and services. (Is a 10% rise in CDO production more important than a 1% drop in Civic production?)

Nominal growth implies rising nominal incomes; any other implication becomes risky to assume.

BEIJING, Jan. 24 -- Two men were sentenced to death Thursday for their roles in the melamine contamination milk scandal that left at least six Chinese infants dead and almost 300,000 ill.

Now I ask you if Madoff was in China, what would be his fate?

I do like this, though:

The administration said it would launch a Web site, Recovery.gov  where all citizens will be able to see how recovery funds are being spent.

Tsnunami Jane wrote:

"The report said Obama would spend at least 75 percent of the stimulus package in the first 18 months (snip) updating the electric grid (snip) weatherize at least 2 million homes(snip) modernize at least 75 percent of federal buildings (snip) infrastructure investments enhancing security of 90 major ports and modernizing the nation's water system by launching 1,300 wastewater projects, 380 drinking water projects and 1,000 rural and sewer system projects (snip) 10,000 schools and funding the shortfall in Pell Grants, (snip) increase college affordability for seven million students (snip)tripling the number of undergraduate and graduate fellowships in science and providing an additional 350,000 children access to quality pre-kindergarten programs.

That is all bullshit and that will not turn the economy around, while wall street continues to be run by crooks!
Tsunami Jane | 01.24.09 - 1:38 pm | #

You make an excellent point, that seems to suggest all Obama need do additionally is arrest try and execute a few thousand banksters and voila the USA moves ahead!

Sounds good to me!

ER,
I delivered newpapers also, the Press-Telegram...however it sucked, because my customers would not pay the $2.25 per month bill that I was responsible for out of profits...My customers were deadbeats...However the area manager made we go out and solicit new customers who could not afford or other wise pay me...

I wised up after a year and bailed...

sdtfs writes:
"So economists don't fix their windows? I think people are confusing the message."

It creates income (for whoever installed and manufactured the window), but the end result is no improvement for the economy. Before the window broke, the building had a window. After the replacement, you still have a building with a window. So therefore, the inhabitant has no improvement in their standard of living versus the state he was in pre-breakage.

Anonymous writes:
The Obama stimulus plan is a nothingburger (snip) it looks like it came from a high school science fair project (that lost)
Anonymous | 01.24.09 - 1:45 pm | #

§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§§

And you sir are a nothing person

The Obama stiulus plan is a nothingburger.

It's not even close and it looks like it came from a high school science fair project (that lost)
Anonymous

Let's impeach the bastid. He's had 4 days and what has he showed us? Nothing

Mowed Lawn Fallacy? Mowed lawns are the future and they help provide places for people to go, WTF are suggesting there suggesting that there is a fallacy?

Lawns are a fallacy. Rip them up. Plant drought tolerant perennials that use less fertilizer and plant edible things. Lawns are boring and wasteful, not just unproductive but counterproductive symbols of American wastefulness.

Conservatives seem to run down LBJ...while he had many faults (Vietnam War), he did initiate the war on poverty in the late 60's and Medicare...

I can still recall the pictures of RFK in the South and the Appalachians...Nothing today, even Katrina, could/can match today with the 1960's...

Up to the 1960's, there was real poverty and lack of educational opportunities in America...

Roubini misses the obvious point that THIS time, the UK's debt is denominated very disproportionately in foreign currency, which it CANNOT print.

The UK cannot print its way out of a debt crisis. The US can. In previous crises there had been no collective de-linking from gold. The only governments whose currencies collapsed were the governments who lost control of their gold reserves to another faction or nation-state.

"Up to the 1960's, there was real poverty and lack of educational opportunities in America..."

Kind of makes the Poverty of today BS.

Don't fear the changes. Embrace the change you would like to see and work to create it in your community.

Disregard if you have neo con leanings.

an additional 350,000 children access to quality pre-kindergarten programs

That seems like an oxymoron statement, first, what is meant by additional 350,000 and then why do they bring up the idea of quality? This implies that there are 350,000 kiddies in low quality daycare who will now be upgraded to a new standard? This does seem really stupid and to think of this in terms of helping bailout the economy, this is not exactly stuff that should be coming from a president that is almost in a depression; very sad to see this low level thinking!!