Leading economist fears decade of weakness in US

One of the world's leading economists has given warning that the United States is facing a decade of financial misery, with the number of unemployed Americans set to continue to rise for years.

Robert Shiller, Professor of Economics at Yale University, who predicted the end of the internet bubble seven years ago, said: “We could have many years of a very weak economy. Big recessions are followed by years of weakness and typically unemployment keeps rising.

“To say that this will last years is not a dramatic statement. What is happening now is much worse than 1990. We could be facing a decade of real weakness.

“This is no ordinary recession. There are signs that people see this as a different story. People are talking about a depression, something that we haven't seen previously.”

business.timesonline.co.uk...

Again, buckle your seatbelts folks, it looks like we are in for a bumpy ride...

I guess everyone already knows this to the point that its not worth commenting on, like talking about a stroll down the sidewalk - too common place lmao

I don't doubt it at all. This was a long time coming and it will take a long time to get out of it.

“This recession is by no means mechanical. People have lost a sense of confidence, a sense of trust in institutions and in each other. It is very hard for a central bank to address that by just cutting interest rates.”

The housing market in the United States is widely seen as one of the main causes of its economic troubles.

Spurred by low interest rates and initiatives to promote home ownership, residential real estate boomed for a decade.

Professor Shiller, who co-founded the authoritative S&P Case/Shiller home price index, was one of the first to predict that the housing market would slump and that this could bring down financial institutions.

With about 11.1 million people out of a job, the total number of unemployed is about 50 per cent higher than a year ago.

Between the fear in the people and then also the banks not wanting to lend because they are afraid that they will get blamed for making deals that they "knew would fall through", we have a fear driven recession that could lead into a fear driven depression. Maybe soon some one will come on TV and say some magic words like "Hey folks, the recession has ended, the banks are ready to approve you a loan and the auto industry is here to stay!"
Maybe people ought to just ignore the news and go out and shop but dont buy stocks for a good while.

Darryl Robert Schoon hit's another one out of the ballpark. What!...you've never heard of DRS ? Good!

PUNDITS PUNDIDIOTS & PREDICTIONS

Dr. Philip Tetlock, author of Expert Political Judgment (Princeton University Press, 2005), has done remarkable work regarding the ability to accurately predict future events. In a highly disciplined scientific study, Dr. Tetlock had asked experts to predict future events and over 20 years analyzed their predictive accuracy and methodology of thinking.

Tetlock’s study concluded that experts are no better in predicting the future than anyone else; in fact, the better known the expert, often the lower the ability to accurately predict.

Full Text

Schoon continues:

“Look, they’re circling the wagons.”

What Americans are finding out, however, is that only the bankers are currently inside the circle—bankers are now the only ones being protected, the very ones responsible for the crisis in the first place....

Bankers give government the unlimited credit that governments overspend, thereby indebting the nation and future generations into perpetuity. The US government bailout of bankers, TARP, is “owe-back” time.

Folks from the Casey Report provide the snapshot:

The red line shows that, since August, banks have built their cash position in the form of Treasuries, agencies and deposits at the Fed by $865 billion, while their loans and leases have increased by only $325 billion.

In other words, rather than lending the billions of dollars received from the Treasury’s Troubled Asset Relief Program (TARP), as was originally intended, the recipient banks have squirreled away the bailout funds in order to shore up their balance sheets.

The combined affect is a “circular bailout” with the Treasury borrowing… in order to lend money to banks… that then lend it back by purchasing more Treasuries. Of course, the expense of this entire bailout scheme ultimately falls onto the back of the tax-paying public.

Casey Charts

Blood boiling yet?

[edit on 22-1-2009 by OBE1]

I would strongly argue that some "experts" are media picked "pump monkeys" those who give only "optomistic" advice because banking is inherently a confidence game.......

Obe1 gold is up with the dollar up.......and india's consumer demand down.......looks like some peeps be selling some gov't bonds for gold...

imagine should the banks shift to a long gold strategy


my signature suggests this is more than a recession

obama's cabinet is dominated by Trilateralists who's dream has been a world gov't body.....and they are getting OLD so.....it's getting to be about that time



[edit on 23-1-2009 by cpdaman]

reply to post by cpdaman

Indian consumers like to wear their wealth in the form of Gold jewelry...sales traditionally decline as the POG advances. Investment demand has the bears on the run this week.

Like clockwork, the Bullion B's began hammering the bid this morning at key resistance $880...after a short-lived victory, they were squeezed up to defending $900.

It's a thing of beauty when the dollar:Gold inverse relationship breaks-down and Gold assumes it's Fourth Currency status.

Another possible factor in this weeks strength: Until Geithner takes the helm, we're without an acting Treasury Secretary...you know, the master that controls the Federal Gubmnt's anti-gold Exchange Stabilization Fund.

that was an interesting tidbit that J willie mentioned this week.....

he's going deeper into the fringe with some of his comments but ...who knows what the Trilateral administration (aheem) obama administration holds for us......

www.group30.org...

this group of thirty is an interesting Political power group with World Gov't dreams........oh look they just came out with a playbook/report on the 15'th

The report addresses flaws in the global financial system and provides 18 specific recommendations to: improve supervisory systems by redefining the scope, boundaries, and structure of prudential regulation; enhance the role of the central banks; improve governance practices and risk management; address pro-cyclicality via capital and liquidity standards; enhance accounting practices; strengthen the financial infrastructure; and increase coordination internationally.

the report will cost ya 50$ but here is the link of the reports recommendations

www.group30.org...

[edit on 23-1-2009 by cpdaman]