2008-2009 stimulus funds: There is no such thing as a free lunch!
By Daniel at 20 October, 2009, 10:28 am
The so called stimulus, and the apparent market manipulation/HFT is going to come back to bite us in the tail. I guess we should continue to cheer oils impressive march towards $80 per barrel and disregard consumers trying to do the smart thing and paying down debt loads?? While it is entirely plausible on economic terms to take on short term debt relative to GDP and drive out of recessions, this administrations actions are a growing concern to me. Instead of dumping billions into fixing crumbling infrastructure, helping small business, or allowing the “free markets” to work; “stimulus funds” went into the laps of special interest groups or elites who help bankroll politicians reelection campaigns. The problem is we now face is years of consumer deleveraging weather you want to admit to it or not. It is now attempted suicide if one is overextended, and writing checks for things they can’t afford. As consumers continue to pay off outstanding debt obligations, consumption will grind to a halt which will have devastating repercussions on economic growth.
As the Administration works tirelessly to get those “shovel ready” jobs in motion tens of millions are unemployed/underemployed and losing valuable “job skills” which will likely result in permanent loss of economic output. I just got off the phone with my dad who rents out 4 houses in Tampa / St. Pete area, 2 of the tenants are being evicted because they have not paid rent in 2 months! Note this is an area that is pretty well off compared to other parts of the country. Forgive me if I am all bitchy and pessimistic but the future is not as rosy as you paint it.
While we would all love to an see economic recovery that genuine, it won’t happen unless the problems are fixed. For started we must shut down the “too big to fail” we must set term limits on congress, we must enforce anti-trust laws, and we must rid these “markets” of financial negligence and shady practices. It is obvious Wall Street is not an accurate reflection of Main Street or reality. As small businesses slash output forecast and jobs to stay afloat the situation deteriorates further. The sooner you wake up and realize we still have pressing issues to deal with the sooner we can get to work fixing them.
- ImpendingDoom
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