Get Ready, The Recovery is Already Happening!
From today's NY Times, by Jack Stack, President of SRC Holdings:
"After spending the last six months on the road talking to hundreds of business owners around the country, I have come to a conclusion that might surprise you: the economic recovery is already well under way. And, if you don’t start putting a strategy in place to take advantage of it, you’re risking the future of your company.
I’ve been speaking eyeball-to-eyeball with entrepreneurs all across the country — in places like Pittsburgh, New York City, Richmond, Va., and Fresno, Calif. — and when I ask them how they did in the fourth quarter of 2009 or the first quarter of 2010, I keep getting responses like, “amazing,” “fantastic,” “record-breaking” and even “best we’ve done in years.”
The funny thing is that despite their recent success, most of these folks seem reluctant to acknowledge that things have gotten better. Why? Well, I have two theories about that: one, people feel so burned by the last few years that they still fear a double dip — and they’re still waiting for another shoe to drop. Two, I think some people are staying quiet because they don’t want to give anyone in Washington credit for the recovery. They feel that they have recovered due to their own innovation, creativity and hard work and not due to anything related to the stimulus.
But regardless of why no one is talking about it, the recovery is happening."
Thanks to Colin Grabow for the link.
15 Comments:
Zero comments. Not surprised.
Whatsamatter Juandos, cat got your tongue?
I am susprised with some much printed money around why you aren't growing in double digits!
NEW YORK (CNNMoney.com) -- The recovery is picking up steam as employers boost payrolls, but economists think the government's stimulus package and jobs bill had little to do with the rebound, according to a survey released Monday.
In latest quarterly survey by the National Association for Business Economics, the index that measures employment showed job growth for the first time in two years -- but a majority of respondents felt the fiscal stimulus had no impact.
NABE conducted the study by polling 68 of its members who work in economic roles at private-sector firms. About 73% of those surveyed said employment at their company is neither higher nor lower as a result of the $787 billion Recovery Act ...
CNN Money
Banks continue to suffer from losses on non-performing loans, and U.S. home prices will fall again amid increasing supply and sluggish demand, according to Whitney.
“I’m steadfast in my belief there’s going to be a double- dip in housing,” she said. “You will see clearly that the banks are under-reserved when housing dips again.”
Whitney said yesterday in an interview with Tom Keene on Bloomberg Radio that the nation’s largest banks are susceptible to another dip in the consumer-credit market. While Wall Street rebounded in the first quarter, consumers haven’t seen a similar improvement and U.S. states may cut jobs, she said.
“For the consumer, nothing has changed and the large banks are still weighed down by exposure to consumers,” she said. “If consumer credit turns, which we think it will, you will underperform with all these banks.”
Bloomberg
As the end of the home buyer tax credit neared last month, we all argued whether or not the increase in sales and the relative price stabilization could survive on their own.
The first clues indicate the answer is: No.
One full week after the tax credit’s expiration, mortgage applications fell 9.5 percent; this as mortgage interest rates dropped below 5 percent.
CNBC
The financial crisis isn't over by a long shot, but has only entered a new phase. Today, the world is no longer threatened by the debts of banks but by the debts of governments, including debts which were run up rescuing banks just a year ago.
The banking crisis has turned into a crisis of entire nations, and the subprime mortgage bubble into a government debt bubble. This is why precisely the same questions are being asked today, now that entire countries are at risk of collapse, as were being asked in the fall of 2008 when the banks were on the brink: How can the calamity be prevented without laying the ground for an even bigger disaster? Can a crisis based on debt be solved with even more debt? And who will actually rescue the rescuers in the end, the ones who overreached?
Der Spiegel
Democrats claim these tax increases on the rich won't do any economic harm. They should read the work of Christina Romer before she became chief White House economist. Ms. Romer and her husband, David Romer, a Berkeley economist, have published multiple studies on the impact of tax policy changes over the past 100 years. One of their findings is that "tax increases appear to have a very large, sustained and highly significant negative impact on output." In other words, tax hikes are an antistimulus.
Another implication of the Rangel plan is that America's successful small businesses would pay higher tax rates than the Fortune 500, and for that matter than most companies around the world. The corporate federal-state tax rate applied to General Electric and Google is about 39% in the U.S., and the business tax rate is about 25% in the OECD countries. So the U.S. would have close to the most punitive taxes on small business income anywhere on the globe.
[...]
A new study by the Kaufman Foundation finds that small business entrepreneurs have led America out of its last seven post-World War II recessions. They also generate about two of every three new jobs during a recovery. The more the Obama Democrats reveal of their policies, the more it's clear that they prize income redistribution above all else, including job creation and economic growth.
WSJ
California Now One Of The Top 10 Government Default Risks In The World
I guess Jack Stack isn't in the housing business...
From Political Calculations: Is Obama Underwater?
'...that 11.2 million properties in the United States were in negative equity territory as of the first quarter of 2010, meaning that their current estimated value is less than that recorded when their owner's mortgages were written'...
The great thing about economists is they don't have to live in the real world. Warren Meyer of Coyote blog has found a new requirement in the health care bill that requires business to submit a 1099 for any transaction over $600.
If a business buys a new computer from staples, it will now have to get staples' tax ID and send a 1099 to staples and the government.
Hundreds of billions of new costs have been imposed on business.
You Eco guys like to talk about green shoots. For some reason you ignore that they are watered with taxpayer debt.
Michael, the problem is lawyers are micromanaging the macroeconomy.
StraightTalk - Economics - The Conference Board
Updated: May 12, 2010
U.S. real GDP growth projected to slow throughout 2010
Q1: 3.2%
Q2: 2.8%
Q3: 2.2%
Q4: 1.6%
Projected annual U.S. real GDP growth
2010: 3.0%
2011: 1.9%
This is a terrible recovery, particularly since we underproduced (and overconsumed) throughout the 2000s, and following a severe recession. Moreover, monetary and fiscal policies have been at full speed.
Compared to the last recovery following a severe recession, in 1982-83, where real GDP growth averaged 8.5% for five consecutive quarters, this is similar to a lead off hitter in baseball batting 0.100 with an on base percentage of 0.150 (real GDP contracted 2.4% in 2009 and expanded 0.4% in 2008).
High unemployement, massive government deficit spending, government takeover of the healthcare industry and auto industry, total government control of the financial indusry coming, cities, states, whole countries bankrupt. Yeah, I can feel the recovery, everytime I read the government manipulated "data" saying we've recovered.
"Yeah, I can feel the recovery, everytime I read the government manipulated "data" saying we've recovered"...
Well geoih its only going to get worse it seems...
From the site ProPublica: Gov’t Loan Mod Program Leaves Some Homeowners Worse Off
'There are nearly 800,000 [4] homeowners in trial modifications, and the Treasury expects one-third to one-half to fall out [7] of the program before their modifications become permanent'...
NEW YORK, May 14 (Reuters) - U.S. bankruptcy filings resumed their upward climb in the first quarter, nearly equaling their highest level since 2005, as high unemployment and a still-strained housing market squeezed consumers.
There were 388,148 filings between January and September, up 17 percent from 330,394 a year earlier, according to data released Friday by the Administrative Office of the U.S. Courts. Consumer filings rose 18 percent to 373,541, while business filings edged up 2 percent to 14,607.
Filings also rose 4 percent from last year's fourth quarter, the government data show. That had been the first period with a quarter-to-quarter drop in filings since 2006.
For the 12 months ended March 31, there were 1.53 million filings, up 27 percent from a year earlier and the most since 2006. Some experts expect the number to stay above 1.5 million in future periods.
"We're not anyway near through our housing situation, and are going to see more foreclosures, perhaps for another three years," said David Jones, president of the Association of Independent Consumer Credit Counseling Agencies in Fairfax, Virginia. "The job situation is also serious. It's not just that people cannot find jobs, but many who have found jobs are finding them at lower wages."
First-quarter filings were the second-most since the fourth quarter of 2005, when Congress overhauled federal bankruptcy laws to make it tougher for people to file. They nearly equaled the 388,485 filings in the third quarter of 2009.
According to the American Bankruptcy Institute, Arizona had a 69 percent rise in total filings over the last year, the biggest increase in any federal district.
On a per capita basis, Nevada had the most filings, with 11.7 per 1,000 people.
Both states have been among the hardest hit by the nation's housing and commercial real estate problems.
Tennessee ranked second per capita, followed by Georgia, Indiana and Alabama. Among the most populous states, California was 8th per capita, Texas 48th, New York 41st and Florida 15th. Alaska had the fewest filings per capita, with 1.54 per 1,000 people.
In the quarter, about 73 percent of bankruptcy filings came under Chapter 7 of the U.S. bankruptcy code, 26 percent under Chapter 13, and most of the rest under Chapter 11.
Consumers use Chapter 7 to get a fresh financial start. Chapter 13 lets people discharge some debts. Businesses often use Chapters 7 and 11. Farmers use Chapter 12 of the code. (Reporting by Jonathan Stempel, editing by Gerald E. McCormick)
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