Numbers Don’t Lie
Anyone can stand up and say “you Lie”. The truth is the numbers speak for themselves. We have all watched the housing depression and wealth being wiped out. We all know and knew unemployment would continue to rise and have a dramatic impact on the economy ongoing. The new 200,000+ unemployed just adds to the pain. The second wave is coming.
Inflation will take a lead role in agitating the economy. Gas prices are high and approaching $3 a gallon again. While food and other products remain relatively stable the basics are even getting out of reach for many. It’s a vicious cycle. The more people that tighten their belts or are losing weight quickly the less they can purchase. The cash for clunkers is over and Chrysler may not even make it a year. Although politics and international affairs have overshadowed or even distracted the economic news I feel it is time again to put attention back on America’s internal affairs.
Healthcare looms. Our portfolio of equity and debt continues to be in jeopardy and the FED pulling back from buying IOUs is a pile on. The storm hasn’t gone away. Like a rubber band stretched to a limit everyone is trying to keep it from breaking and persist in using media to boost consumer confidence so it won’t. Confidence is not the issue it is disposable income and there isn’t enough to go around. So what’s coming.
The market will go up and down like a yo yo and it isn’t going to replace the hundreds of billions wiped out. Housing won’t be back for years and the credit crunch and lending is constraint at best. Inflation is coming and the FED is boxed in and can’t make any mistakes. Gloom and doom but is there a glimmer of hope?
The world reaction to the crisis has left countries and economies hobbled with debt. Financial reform is held up here in states right now. But there is a lot of money sitting on the sidelines. We need that money to inspire the stock market and it will jump in at the right time. Also, companies selling internationally are performing well but domestic businesses especially small business continues to contract. As long as something isn’t done directly for the consumer and small business here and the US debt has a repayment plan in place the lights will go out again.
It’s a razor’s edge. We are cut, bleeding and trying not to fall on our sword. I fear that mistakes are being made and going to be made and we can’t afford a mistake right now. Unemployment and its continued rise is a real indicator of a fundamental problem. Remember I have been harping on underemployment as well and any recovery there will be a political win but the disposable income won’t be around anytime soon. Hate to say but the wood are long, dark and deep and we are still stumbling around. I hope this isn’t a Blair Witch project but I would bet we are still lost.