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The economy sank at a 5.7 percent pace as the brute force of the recession carried over into the start of the year. However, many analysts believe activity isn't shrinking nearly as much now as the downturn flashes signs of letting up.
The Commerce Department's updated reading on gross domestic product, released Friday, showed the economy's contraction from January to March was slightly less deep than the 6.1 percent annualized decline first estimated last month. But the new reading was a tad worse than the 5.5 percent annualized drop economists were forecasting.
Originally posted by CookieMonster09
It's definitely not over. The banking system, for one, is still in shambles. Unemployment is still quite high, and more and more people continue to lose their jobs. GM still has yet to file bankruptcy, and when it does, expect a ricochet effect to reverberate through the economy.
Eventually, the whole country will look just like the city of Detroit at 32% unemployment. It's not a matter of if, but when. I am deeply afraid that we are only seeing the tip of the iceberg as to how bad this economy will fall.
The gains in the stock market are an illusion and unwarranted. Expect things to get much worse before they get better.
On the bright side, this recession has forced people to re-think their personal finances, and to hunker down and reduce personal debt. It has also forced many people to re-think their values, and not to place money so high on their totem pole. Maybe we will actually have a return to old-fashioned values and common sense for once.
When we emerge from this downturn, we will hopefully have an American consumer that is much more debt averse, and not as gullible to these bubble economies. And hopefully some smart entrepreneurs will come up with some creative solutions to the loss of our manufacturing sector.
If the politicians were smart, the would level a flat tax across the board, and free up businesses large and small to create jobs again. Cut taxes to the bone instead of looking for new taxes to burden the American taxpayer. Attack the deficit with a vengeance.
They would reward innovation. They would pull out of these senseless wars. They would cut government spending to the bone - both nationally and at the state level. They would stop illegal immigration and aggressively prosecute businesses that hire illegal immigrants. They would rein in government spending. They would give huge tax incentives to companies that employ Americans, and punish those companies that engage in tax fraud and shipping our jobs overseas.
I doubt I will see this happen in my lifetime. It could be done, but the country's elected leaders aren't likely to take the much needed action to make it happen.
The pundits are warning to expect hyper-inflation soon. The Fed claims that they should be able to control hyper-inflation, but who really knows? It may be high time to grow that vegetable garden and move to the country!