2009 World Economic Outlook

2009 is here and we are in dire straits in the US. Bailouts, job losses, a mortgage mess to get worse in 2009, more companies to declare bankruptcy in 2009 and the Inauguration cannot arrive soon enough. With that stated when do you see the world economic outlook improving?
Vote!
Personally I believe we are teetering on the brink of a depression...

 

I agree with you. As a country, the United States have long done all the wrong things for decades from neglecting our manufacturing base, dummy down our schools, could have done something about the energy crises years ago since the 1970's, put more emphasis on savings, allowed our infrastructure to deteriorate, did not have the will to invest in new technologies to build the economy, etc....

We are reaping what we have sowed. Now other countries of the world have caught up with us on educating their people, investing in new technologies, have national visions for their countries and hall we seem to be interested in is Britney Spears career, Dancing with the Stars, and American Idol. We may be seeing the beginning of the end of a superpower. Maybe Barack will turn it around. At this point I'm beginning to feel doubtful.

 

Has anyone ever read The Kondratieff Theory by Nikolai Dmyitriyevich

CLICK ME TO READ

Very interesting....

 

I really hope the economy gets better this year. 2008 was pretty damn rough.

 

Mr. Malik True, you are a amazing well of information. I have downloaded your article and will study it and use it for source material for future class projects that I will be doing in my Industrial Technology program as it deals with economic forces and how manufacturing is affected. Thanks and please keep it coming.

 

Thanks for the compliment but I'm just passing on information that's interesting to me and potentially interesting to others...

 

http://online.wsj.com/article/SB123051100709638419.html?mod=googlenews_wsj

But I believe he has it twisted. I dont think New Mexico with go with Texas. Politically they would fit in better with the west coast. I can see Texas being influenced by Mexico, but not the southern states.

 

every company is slashing it seems

 

It won't improve until after 2010.

 

I think that employment woes and the credit freeze will see at least partial alleviation by the end of the fourth quarter (2009). The current recession began in December 2007, and while this one may be longer than usual (2 years), we'll have a competent administration at helm.

Once banks resume lending to finance the purchase of homes and cars, in addition to spending for infrastructural projects, we'll see a rebound in our economy and multiple quarters of growth.

 

I don't believe the markets have truly rectified themselves just yet from being overvalued, I think the Dow will get between 7000 - 8000 consistently before the real recovery begins...

 

Why do you think they did that?

 

Interesting

But your outlook is too optimistic. I mean, It could congregate precisely the manner you predict and recover to its initial state. Unfortunately for us, the probability of it going completely hay wire and collapsing is also very huge.....

Look at this chart.

http://www.ny.frb.org/research/global_economy/industry_specific_exrates.html

Many countries have suffered a similar fate, where everything, from bread to peanut butter were unavailable at any price.

Yes,,,its a sad state of affairs; but only god will make happen what will happen.

 

Oh, my dear sir, Please don't blame God for the stupidity of mankind!!:-(

 

Grim job outlook turns bleaker

Even with massive spending, job market likely won't recover until 2010


By John W. Schoen
Senior producer
msnbc.com
updated 3:05 p.m. ET, Fri., Jan. 9, 2009


John W. Schoen
Senior producer
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Friday’s employment report — showing another half million jobs lost in December — confirms an already bleak outlook for the job market and adds urgency to President-elect Barack Obama's plan for a massive economic stimulus package.
But analysts say that even with fresh federal stimulus of $775 billion or more the job market probably won’t pick up again until early 2010.
The U.S. unemployment rate jumped to 7.2 percent in December, the highest since early 1993. For all of 2008, the economy lost a total of 2.6 million jobs. That was the most in one year since 1945, when nearly 2.8 million jobs were lost.
Some 1.9 million of those jobs were lost in just the last four months of the year. As the pace of job losses has increased, so has the sense of urgency for a huge government spending package to get the economy back on track. Details are still sketchy, but in a speech Thursday Obama painted broad outlines of the kinds of programs he wants Congress to approve as part of his plan to “create or save” 3 million jobs.

"The situation is dire," Obama said during a news conference Friday to discuss additional appointments for his administration. He added that "this is the moment to act and act without delay." The latest data show that virtually all sectors of the economy are being hit with job losses.
“In the last several months you can see that the job losses have spread sharply to the service economy, which tells you that the recession is rippling out into all parts of the economy — not just focused on production of durables,” said Joel Prakken, chairman of Macroeconomic Advisers, which jointly produces a private tally of jobs with payroll provider ADP.


The package would include tax cuts for individual and businesses, along with massive investments in energy, education, health care and infrastructure. Congressional leaders have said they hope to have the package ready by early February.
Local governments, small businesses, homeowners and other consumers could get additional financial aid from an ongoing overhaul of the $700 billion financial rescue program past by Congress last year. The program has come under attack from members of Congress who are critical of how the first half of the money was allocated and calling for changes that broaden its scope. Under the original program, congressional approval is needed before the second half can be spent.
No matter how much money is committed, the downward economic spiral will be difficult to break. Consumers — many who have been laid off or fear for their jobs — have pulled back on spending. That has cut into sales of goods and services, leading to a vicious cycle that results in yet more layoffs.
“Unfortunately, that’s the scenario we see ahead,” said Bernard Baumohl, chief global economist at The Economic Outlook Group in a note. “Even if Washington enacts and then implements the (economic stimulus) program fairly quickly, don’t expect any sharp rebound in job creation anytime soon. At best, we expect the economy to emerge from recession in the second half, but the recovery in employment will take longer.”
That outlook is shared by forecasters at the Federal Reserve.

“Amid the weaker outlook for economic activity over the next year, the unemployment rate (is) likely to rise significantly into 2010,” according to minutes of the Fed’s December meeting of policymakers released this week.
Most economists say they don’t expect hiring to pick up again until well after the economy begins to show clear signs of recovery. Until then, job losses from deteriorating sectors like commercial construction and retail sales are likely to outnumber any new jobs the Obama stimulus plan may create to rebuild roads or develop alternative energy technology.
“The bigger question (about the stimulus program) is not the direct job creation, but can the combination of monetary and fiscal policy shock the economy back to life, causing growth in private-sector jobs?” said Ethan Harris, co-head of U.S. economics research for Barclays Capital. “Our guess is that by the fourth quarter of this year, jobs will start to slowly recover, but there will be more than 2 million jobs lost between now and then.”

One of the cornerstones of the proposed stimulus package is a massive investment in public works projects. The hope is that projects that have already won approval — and are lacking only funding — can produce quick results. A report from the U.S. Conference of Mayors last month listed more than 11,000 so-called “shovel ready” projects in 427 cities.But it remains to be seen what kind of guidelines would be used to move projects to the top of the list. Obama acknowledged those concerns in his speech, exhorting Congress to "put the urgent needs of our nation above our own narrow interests."
State governments — facing huge budget gaps as sales and property taxes have fallen — are also pressing Congress to include direct aid in any stimulus package
“Aid to state government is important for preserving jobs,” said Mark Zandi, chief economist for Moody's Economy.com. “If you don’t give aid, governments are going to cut all kinds of programs and have to lay off people as well.”

Savings those jobs also means preserving consumer spending and avoiding more defaults on mortgages, car loans and credit card bills. Zandi figures that every dollar spent on state aid would generate roughly $1.36 in benefit to the economy.To further backstop state and local governments and avert budget meltdowns, Obama this week proposed having the Fed buy municipal bonds to help cut borrowing costs. The program would be similar to the Fed’s move last fall to buy commercial paper, which many companies rely on to manage their cash flow.

It’s not clear whether the stimulus package will be able to boost employment in the ailing housing industry. Dozens of homebuilders descended on Capitol Hill this week to lobby for mortgage subsidies and tax breaks for home buyers. The National Association of Realtors is also pressing Congress for relief to reverse heavy job losses in the brokerage industry. Economists generally agree that a sustained economic recovery won’t be possible until the housing market stabilizes.

“The fact that housing prices have kept falling so dramatically is one of the reasons the financial system is not recovering," said Frederic Mishkin, a Columbia University economist and former Fed governor. “So steps along those lines — to either lower mortgage rates or increase demand for housing — should also be a part of this package. “Rising unemployment is exacerbating the home foreclosure situation. A record one in 10 American mortgage holders was at least a month behind on payments or in foreclosure at the end of September, the latest month available. Credit Suisse predicted last month that more than 8 million foreclosures would occur over the next four years, representing 16 percent of all U.S. mortgages.
Congress is pushing to head off foreclosures on several fronts, including a measure to allow bankruptcy judges to modify loan terms on residential first mortgages. The measure, which was twice defeated during last year’s debate over a housing relief bill, got a major boost Thursday when Citigroup agreed to support it with some modifications, including a requirement that only existing mortgages qualify.

 

The Dow Jones continues to lose s-t-e-a-m

Dow industrials-248.42 -2.94%
last 8200.14

Citi-group about two years ago traded above $55 a share now trades at just over $4

 

Remember folks, just do what you can to hold on until the fourth quarter of this year and if my (and some leading economist's) predictions are correct, things will begin to see an uptick by December.

Economists see deeper recession, upturn starting this year
Chris Isidore, CNNMoney.com senior writer
Monday February 23, 2009, 5:55 am EST

A survey of leading economists finds them now forecasting a far deeper and more painful recession ahead in the first half of the year, but a modest pickup in the second half of 2009, followed by a solid recovery in 2010.

"The steady drumbeat of weak economic and financial market data have made business economists decidedly more pessimistic on the economic outlook for the next several quarters," said Chris Varvares, the president of the National Association of Business Economics, which conducted the survey of 47 top forecasters in late January and early February.
http://finance.yahoo.com/news/Economists-see-deeper-cnnm-14435746.html

 

Obama will fix this madness!!

OBAMA, boom-ba-ye

 

Dow ends below 7,000 for first time since '97
MSNBC

That's not good news at all, the question now is will dip below 6000?