Why Green Acres Could Turn To Spotty Brown Acres
In response to this week’s blather by Columnist/Blogist Daniel Gross’s article titled “The Recession Is Over!: What America’s best economic forecaster Is Saying”, here are five reasons to think the recession is not over and might have a bit further to go before it’s really over:
UNEMPLOYMENT: Consumers won’t start shopping again to a large degree as long as the unemployment rate is at 9.5% (and will soon be at 10% and higher). People who are out of work can’t spend, and everyone else (like me) is socking money away, even if it’s in small chunks.
LACK OF MANUFACTURING NEEDS: Companies won’t hire or buy equipment as long as they have a lack of orders. Today’s industrial production report revealed that the U.S. industrial capacity utilization rate fell in June to 68%, the lowest since such record keeping began in 1967.
DEBT: Consumer debt soared from two-thirds of our Gross Domestic Product during the early 1990s to 100% at the end of 2008. Simply getting debt back to 3/4th of that, the level in 2001, would require paying off 25% of all outstanding household debt, $3.5 trillion worth.
A DOUBLE DIP: Our country’s output of products and services could again go down just as the green shoots are coming up at the end of this year as the new home buyer tax break ends, other stimulus ends and especially if our spiraling upward national debt hits $2 trillion by this autumn, which it just might do.
YOGI BERRA: It ain’t over til’ it’s over!
And that’s what the deal is!
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