Friday, September 3, 2010

Zandar's Thought Of The Day

People ask me "Hey Zandar, what's a 'lost decade' look like, anyway?"

And I go "You just went through one."

Keep in mind that another one of these is kind of a best case scenario, because the worst case scenario involves a prolonged contraction of the economy and continued 10% unemployment or worse for years.  What does that mean?  The lean years are here, especially for Gen X.
Americans "just have to go down in their living standards" after years in which their living standards soared in part based on foreign credit which is no longer there," said University of Munich economics professor Hans-Werner Sinn. Jacob Frenkel, Chairman of JP Morgan Chase International, urged the United States to rein in entitlements as part of a "political deal" that recognizes reality
Austerity is coming, folks.  Major cuts in social spending are all but assured, just at the point America will need that spending the most.  That means the coming liquidation of excess capacity to the "new normal" levels of production, growth, and labor:  double-digit unemployment, decreasing home ownership levels, increasing wealth imbalance, and a lot of Americans living on the edge getting pushed into the abyss.

A whole hell of a lot of us are going to suffer as a result, while the wealthiest among us will gain even more.  That's just as unsustainable as the debt loads that people rail against, and the result will not be pretty.

2 comments:

  1. Question for you!

    Check your charts again from January 2007 to now.

    What happened in January 2007? Hmm NANCY PELOSI and the Democrats took over congress! Two years later the stock markets lost half their value when January 2009 happened and hey your boy OBAMA took over!

    But hey markets are back up now that it's clear that the GOP is going to take congress back so who is responsible for your lost decade? Seems to me Bush was doing fine until we put the DONKEYS in charge over the last 4 years...

    It wasn't a lost decade idiot! It was six years of growth and four years of DEMOCRAT CRASH!

    Or can you prove otherwise?

    ReplyDelete
  2. Well, it wasn't the Pelosi Congress that passed the three biggest debt boosters of the Bush era:

    1) Bush tax cuts
    2) Medicare drug benefit
    3) Wars in Iraq and Afghanistan

    So...there's my proof. All of those were in effect before 2007.

    ReplyDelete