Obama says `little doubt' country in recession

[chinthee]

By GLEN JOHNSON, Associated Press Writer 1 hour, 12 minutes ago

SAN DIEGO - Barack Obama said Saturday there is "little doubt we've moved into recession," underscoring the country's need for a second economic stimulus package, swift steps to shore up the housing market and a long-term energy policy to reduce reliance on foreign oil imports.

In addition, Obama lifted the veil on his upcoming trip to European capitals and U.S. battlefronts in Iraq and Afghanistan.
He said he would be accompanied by Sen. Chuck Hagel, R-Neb., and Sen. Jack Reed, D-R.I. Despite their differing political parties, each has been mentioned as a potential Obama vice president
tial running mate.

"I have little doubt that we've moved into recession at this point, and the sooner we can get money into people's pockets, the sooner that we can stabilize the housing market, and the sooner that we can send a message to the markets that we're serious about creating an energy policy that will create greater energy efficiency over the next decade or so, I think the sooner we're going to get our fundamentals right," he said.

_Said he has been closely monitoring the financial health of mortgage providers Fannie Mae and Freddie Mac. Concerns falling home values may require a government bailout prompted a Wall Street sell-off Friday before markets recovered.

"There are a lot of different definitions of what a `bailout' would look like," Obama said. "There are issues related to the short-term liquidity — can they borrow money? — versus issues related to whether the underlying assets of the two corporations are really unsound. And I think we need to watch carefully and see how it plays out before we make a decision about which steps need to be taken."

Obama says `little doubt' country in recession - Yahoo! News

I suppose there are several aspects to this:

1. He wants to discredit the republicans by calling a spade a spade (woops, that wasn't a racist comment) It may not fit the classic definition of a recession, but I think it's close enough to have merit, and it discredits Bush and to some proxy extent, McCain.

2. He'll try to paint himself as the change agent to reform the mortgage and housing crises. Good luck on this.

3. Energy crisis. Again, he'll continue to hammer that McCain represents the same old thinking, and he represents change.

Good strategy overall, and Obama is finally starting to aggressively go after McCain with these moves.

[sabang]

There is little doubt the world is in, or moving into, recession- even Chinese exports are dropping.
Obama stating the bleedin' obvious does give him some useful ammunition
however.

Who said- "it's the economy, stupid" ?

[barbaro]

The weaker the US economy, or the weaker its percieved, the advantageous it is for the new candidate as opposed to the incumbants (or in McCain's case, incumbant party).

Yeah, 2 quarters of (-) GDP growth, but that's only a definition. It's politics. But yes, some people are struggling, as they've stretched themselves too thin, or their incomes are not high enought to deal with the inflation of food and higher gas prices.

Regardless, everyone's situation is different. Not everyone is hurting, but many people might have some bruises.

I cannot wait until the election is over ~14 weeks. Constant bombardment of BS and hyperbole.

[britmaveric]

Unfortunately Obama is no different than the rest, he has yet to supply one single new idea. McCain has which is remarkably refreshing.

However no recession yet - no two quarters of neg growth. Doubt there will be - yank economy still chugging along at 1% growth rate.

[sabang]

one single new idea. McCain has which is remarkably refreshing.

Erm, right. Example?

[britmaveric]

Offshore drilling, wind power, more nuclear power, more refineries, more clean coal, more natural gas, more everything. All I heard from Osama is NO.

[bkkandrew]

^But your question was rather repetative, no?

Barak, Barak, please suck my dick..........................

[bkkandrew]

Offshore drilling, wind power, more nuclear power, more refineries, more clean coal, more natural gas, more everything. All I heard from Osama is NO.

Hmmm, Freudian slip their BM?

[barbaro]

Offshore drilling, wind power, more nuclear power, more refineries, more clean coal, more natural gas, more everything. All I heard from Osama is NO.

The current big "talk" on the American media about "alternative energy sources" is just election year hype. Yes, I am sure there is R & D on alternatives, and actions are probably taking place now in the private sector.

As for Offshore Drilling, it's a joke. If it wasn't an election year it would be splattered all over the US MSM.

Go ahead and drill offshore. It's only a drop in the bucket. It will take time to drill and get the oil to the US market.

One thing the US MSM keeps mising - over and over again - is the worldwide demand that is increasing.

[britmaveric]

Thing is you need to do more of everything, this is the whole point.

[barbaro]

Thing is you need to do more of everything, this is the whole point.

Everything meaing oil?
Everything meaning alternatives?
Everything meaning both?

I think you mean #3. Fair enough. But the new finds, and the new talk of exploration and drilling is still, drops in the bucket. There is a MBP (millions of barrels per day) curve and a deman curve. And it's worldwide.

[britmaveric]

Dunno heard experts say enough oil to last the yanks alone for 30yrs just off the Atlantic shelf.

[Boon Mee]

Dunno heard experts say enough oil to last the yanks alone for 30yrs just off the Atlantic shelf.

There's more proven oil in the shale in North Dakota, Montana etc. than lie within Saudi so... at >$40 a barrel, it's a viable enterprise if Nancy Pelosi and her crowd allow recovery.

[barbaro]

Dunno heard experts say enough oil to last the yanks alone for 30yrs just off the Atlantic shelf.

There's more proven oil in the shale in North Dakota, Montana etc. than lie within Saudi so... at >$40 a barrel, it's a viable enterprise if Nancy Pelosi and her crowd allow recovery.

Britmaveric:

The US currently is using 15% of the entire MBP supply. The Atlantic shelf does not have that much (30 years). No where near as much. If it did, it would have likely been tapped into already, as the US gov knew about declinining output/production and increasing demand back in the 1990s.

Boonmee:

The Dakota Shale oil which ecompasses 4 states is in....shale. There is technology to separate the oil from the shale, but it will be very costly and take a long time to extract.

[Jet Gorgon]

Two negative quarters for the economy? I don't think so.

[barbaro]

Two negative quarters for the economy? I don't think so.

True there hasn't even been 1 quarter with negatvie GDP growth. Some analysts (even some big names) are calling it a recession because of the inflation, rising fuel costs, and hiring slowdown, and tightening of lending.

[britmaveric]

Ahh so they are changing the criteria because it doesnt fit the definition of recession?

[barbaro]

Ahh so they are changing the criteria because it doesnt fit the definition of recession?

No, not at all.

The definition has not changed officially. It's still 2 consecutive quarters of negative GDP growth (also called 'contraction').

However this definition is a bit limited. One Asian country is an example: GDP growth is not at 8%. But housing is down 50-55%, the stock market is down nearly 60%, inflation is at 26% + for food, gasoline is rising, and the local currency is declining because of fear, and government attempts to fight inflation. Locals are dumping their own currency in favor of the USD (which is weak) and gold (which is at an all-time high).

[Jet Gorgon]

True there hasn't even been 1 quarter with negative GDP growth. Some analysts (even some big names) are calling it a recession because of the inflation, rising fuel costs, and hiring slowdown, and tightening of lending.

Yep. Stagflation. The Fed needs to address these loggerhead issues as do other central banks.

[attaboy]

Two negative quarters for the economy? I don't think so.

True there hasn't even been 1 quarter with negatvie GDP growth. Some analysts (even some big names) are calling it a recession because of the inflation, rising fuel costs, and hiring slowdown, and tightening of lending.

MM, I assume when you say inflation you mean the rise in food and oil prices. Some are calling it a 'price shift' meaning it isn't inflationary. The money supply will determine the rate of inflation.

[barbaro]

MM, I assume when you say inflation you mean the rise in food and oil prices. Some are calling it a 'price shift' meaning it isn't inflationary. The money supply will determine the rate of inflation.

Partially, yes I'm including food and energy prices, even though the government excludes these in its "Core Inflation" reports.

The price shift may not be "inflationary" but people feel it as wages have stagnated for decades, overall.

As far as money supply, The Milton Friedman style of the Monetary economic policy has an increasing number of critics. I don't have an opinion.

[Cujo]

Fuck me, banks are collapsing, of course the recumbent team will deny it.
Reminds me again of the Iraqi defense minister stating the Americans are in retreat, all the while American tanks are rumbling behind him.

[sabang]

All signs are pointing to a further downturn in the US economy but the president has said that the economy will bounce back.
Even as George Bush spoke on Tuesday, however, the dollar plunged to a new low against the euro, while the price of oil continued to fluctuate wildly.
Ben Bernanke, the Federal Reserve chairman, had told congress earlier in the day that the fragile US economy was facing "numerous difficulties'' including persistent strains in financial markets, rising unemployment and housing problems.
Bernanke, who was testifying before the senate banking committee, sounded another warning that rising prices for energy and food were increasing inflation risks.

Despite Bernanke's remarks, Bush expressed confidence in the US economy, saying the country would emerge "stronger than ever before" from its current slump.
"We're going through a tough time, but our economy is growing, consumers are spending, exports continue increasing and American productivity remains strong," Bush said.

On Sunday, the US government announced a plan giving the companies, who underpin about half of all US home loans, access to Federal Reserve credit and a temporary increase, pending congressional approval, of their lines of credit from the US treasury.

Al Jazeera English - Americas - Bush remains upbeat on economy

Oh George. What an embarassment.

[Butterfly]

^ he is back on the bottle or doing coke again,

his legacy will be laughable for decades to come, he is the new Carter

[bkkandrew]

^^I think that GWB has been reading the wrong newspapers:

Recession-Plagued Nation Demands New Bubble To Invest In


WASHINGTON—A panel of top business leaders testified before Congress about the worsening recession Monday, demanding the government provide Americans with a new irresponsible and largely illusory economic bubble in which to invest.

"What America needs right now is not more talk and long-term strategy, but a concrete way to create more imaginary wealth in the very immediate future," said Thomas Jenkins, CFO of the Boston-area Jenkins Financial Group, a bubble-based investment firm. "We are in a crisis, and that crisis demands an unviable short-term solution."

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A prominent finance expert asks Congress to help Americans rebuild their ficticious dreams.

The current economic woes, brought on by the collapse of the so-called "housing bubble," are considered the worst to hit investors since the equally untenable dot-com bubble burst in 2001. According to investment experts, now that the option of making millions of dollars in a short time with imaginary profits from bad real-estate deals has disappeared, the need for another spontaneous make-believe source of wealth has never been more urgent.

"Perhaps the new bubble could have something to do with watching movies on cell phones," said investment banker Greg Carlisle of the New York firm Carlisle, Shaloe & Graves. "Or, say, medicine, or shipping. Or clouds. The manner of bubble isn't important—just as long as it creates a hugely overvalued market based on nothing more than whimsical fantasy and saddled with the potential for a long-term accrual of debts that will never be paid back, thereby unleashing a ripple effect that will take nearly a decade to correct."

Enlarge Image

"The U.S. economy cannot survive on sound investments alone," Carlisle added.
Congress is currently considering an emergency economic-stimulus measure, tentatively called the Bubble Act, which would order the Federal Reserve to† begin encouraging massive private investment in some fantastical financial scheme in order to get the nation's false economy back on track.

Current bubbles being considered include the handheld electronics bubble, the undersea-mining-rights bubble, and the decorative office-plant bubble. Additional options include speculative trading in fairy dust—which lobbyists point out has the advantage of being an entirely imaginary commodity to begin with—and a bubble based around a hypothetical, to-be-determined product called "widgets."

The most support thus far has gone toward the so-called paper bubble. In this appealing scenario, various privately issued pieces of paper, backed by government tax incentives but entirely worthless, would temporarily be given grossly inflated artificial values and sold to unsuspecting stockholders by greedy and unscrupulous entrepreneurs.

"Little pieces of paper are the next big thing," speculator Joanna Nadir, of Falls Church, VA said. "Just keep telling yourself that. If enough people can be talked into thinking it's legitimate, it will become temporarily true."

Demand for a new investment bubble began months ago, when the subprime mortgage bubble burst and left the business world without a suitable source of pretend income. But as more and more time has passed with no substitute bubble forthcoming, investors have begun to fear that the worst-case scenario—an outcome known among economists as "real-world repercussions"—may be inevitable.

"Every American family deserves a false sense of security," said Chris Reppto, a risk analyst for Citigroup in New York. "Once we have a bubble to provide a fragile foundation, we can begin building pyramid scheme on top of pyramid scheme, and before we know it, the financial situation will return to normal."

Despite the overwhelming support for a new bubble among investors, some in Washington are critical of the idea, calling continued reliance on bubble-based economics a mistake. Regardless of the outcome of this week's congressional hearings, however, one thing will remain certain: The calls for a new bubble are only going to get louder.

"America needs another bubble," said Chicago investor Bob Taiken. "At this point, bubbles are the only thing keeping us afloat."

From:

Recession-Plagued Nation Demands New Bubble To Invest In | The Onion - America's Finest News Source