Obama's Project: Making Thin Ice Safe

Those with an investment position betting on the Dow Jones Industrial Average plummeting to say 6,500 (it's at 8,131 now), should read Alexander Cockburn's piece in CounterPunch and be happy. Not the rest of us.

Consider the recovery project facing Obama in saving the world economy and the words gargantuan and humongous come to mind, analogous to constructing a snow fortress on thin ice on a central Wisconsin lake during the early Autumn. [Lots of unknowns and ambiguity; we don't know what to do, why and whether it will work.]

Cockburn:
On any rational assessment the popular new president is skating on thin ice.

Pollyanna bulletins about the economy puff up from the White House and Federal Reserve, like auguries of a new Pope through the Vatican chimney. ...

The economic news in the near and medium term is ghastly, as Mike Whitney outlined on this site last Thursday [see his A Bulletin from the Captain of the Titanic]. Retail sales crashed again in March, nowhere worse than in the car market, though electronics and building materials were way off too. They now reckon there'll be just over two million housing foreclosures in 2009, up 400,000 from 2008. Industrial output is going through the floor at an annual rate of 20 per cent, the biggest quarterly drop since the end of the Second World War. US industry is now running at only 70 per cent of capacity, the worst number since they started tracking this stat in 1967. Job losses are currently running at 650,000 a month.

Round the next corner is credit card delinquency and the long-heralded slump in commercial real estate, where vacancy rates are already running at 15 per cent... .

Half a million new jobless every month and the salesmen of 'free trade' still hawk their credo.

Yikes. As for free trade hawkers, mostly Republicans who we hope, to paraphrase Ralph McGill (1898-1969), are little, white quasi-Christian men (mostly) standing alone in their own diminishing circles.

Concludes Mike Whitney in his piece:

(Fed Chair Ben) Bernanke's financial rescue plan is a disaster. He should have spent a little less time with Milton Friedman and a little more with Karl Marx. It was Marx who uncovered the root of all financial crises. He summed it up like this:

'The ultimate reason for all real crises always remains the poverty and restricted consumption of the masses as opposed to the drive of capitalist production to develop the productive forces as though only the absolute consuming power of society constituted their limit.' (Karl Marx, Capital, vol. 3, New York International publishers, 1967.)

Bingo.

Message to Bernanke: Workers need debt-relief and a raise in pay not bigger bailouts for chiseling fatcat banksters.

Right. And another message that policymakers ought to heed, a message that rarely comes from the mainstream media: Shipping American jobs overseas is bad for the American economy, bad for Americans (duh) though Republicans love the idea, and is in a word unAmerican.

On a related note, from Quote.com News:

(RTTNews) - Wall Street will be busy assessing report cards this week, as the season springs forward. IBM, Coca-Cola, Yahoo, Apple, Microsoft are among the conglomerates scheduled to report in the week that lies ahead.

Point being, this will be another interesting week.


Tags: Alexander Cockburn, American business and industry, Barack Obama's presidency, Commercial Real Estate, CounterPunch, credit card delinquency, Dow Jones Industrial Average, Economic Recovery, Global Economic Crisis, GOP, jobs, Mike Whitney, offshoring, outsourcing, Recession (all tags)

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