The Recession Is Over, Even If Few 'Feel' It

Politicians do not make the economy. It is people! As the Beatles invigorated the British economy in the sixties with the global patronage of their music, so will people with new ideas, products and services will reinvigorate the global economy.

But right now people are kept from moving with high fuel prices justified by the perception that peak oil is near. This is nowhere from the truth. The BP oil spill have showed just how much more oil there is in the planet. The BP incident got the world worried over the unexpected flow of some 20,000 bopd from just one well.

If they really want the ending of the recession to be felt by all, they should bring down the prices of oil. Government stimulus is limited. Stimulus coming from low prices of oil will have a better impact.

Gabriel Atega of CA 10:28AM September 23, 2010

Stating that the recession being over is a fact has little to do with shaping our future. Our history is filled with stories that defy facts. Consumer confidence is essential in turning around the economy and for its future growth. Let's not talk about fact but understand the reasons for the success of products like the "pet rock" and the hoola hoop. You must ignite the interest of the people to generate consumer confidence, which will then lead to a "cycle" of prosperity. This is all cycle driven. As for are current situation the administration has not done a good job in creating consumer confidence and has missed the mark through circumstances created by their own hand - now that's a fact!!

Ken Sillifant of NY 9:49PM September 22, 2010

Yes, foreclosures are again on the rise but the question is why? One reason is explained by NPR;

"Banks have been stepping up repossessions to clear out their backlog of bad loans with an eye on eventually placing the foreclosed properties on the market, but they can't afford to simply dump the properties on the market...U.S. home sales have collapsed since federal homebuyer tax credits expired in April.

Lenders are offering a variety of programs to help homeowners modify their loans, but their success rates vary. Hundreds of thousands of homeowners can't qualify or fall back into default. The Obama administration has rolled out numerous attempts to tackle the foreclosure crisis but has made only a small dent in the problem. Nearly half of the 1.3 million homeowners who enrolled in the Obama administration's flagship mortgage-relief program have fallen out.The program, known as Making Home Affordable, has provided permanent help to about 390,000 homeowners since March 2009.Regardless, many troubled borrowers have seen their efforts to get a loan modification stymied."

http://www.npr.org/templates/story/story.php?storyId=129900835&ft=1&f=1001

Persistently high unemployment has been the worst culprit. People can't pay mortgages, even when modified, if they have no steady income. There seems to be no answer to this but more stimulus. Even according to the WSJ and the CBO it worked. Corporations are investing and their profits are increasing according to the BEA. Job creation is too slow because of high labor productivity and downsizing to boost profits; labor saving technology; the fact that the labor market is expanding faster than job creation as more "hidden workers" return to the job market; and the fact that 8.4 million jobs are hard to replace all at once. Much of the positive growth of the private sector job market is more than offset by the decline in public sector jobs. These are better paying jobs and their loss has a dramatic effect on the recovery. In addition, most states are heavily in debt and are laying off public sector workers which only worsens the economy.

The answer to all these problems is jobs. Until then, there should be a moratorium on foreclosures so long as certain terms are being met. Lenders are reluctant to pursue more foreclosures and add to the glut of unsold housing thus collapsing the market. At the same time they want to eliminate a back log of bad mortgage loans. We are on track for a million foreclosures this year. A collapsed housing market will put the economic recovery in jeopordy by adding to the current credit squeeze and will also discourage investment and job creation.

http://www.huffingtonpost.com/2010/07/15/foreclosure-rate-american_n_647130.html

steve of IL 3:29PM September 22, 2010

And, like a premature baby in ICU it's to soon to say whether or not the recession is over. I, like others, am optimistic. I hope we've turned the proverbial page on this one.

However, if it is, then Obama is the last person who deserves any credit. Sure, he and Democrat minnions will attempt to usurp the credit. I would expect nothing less. But, the fact is he just happened to be the one residing in the oval office. IF, big if, the economy has improved, then it did so DESPITE government meddling.

The problem following the recession are the precedents that government established. The first is that we can spend ourselves into oblivion creating a (singular) job at a cost of millions for the tax payer. That's on onerous precendent set by Obama and, to be fair, Bush.

The second it established corporate dependency on government in the "to big to fail" scheme Obama gave us. The expectation of responsible corporate governance is gone. It's been replaced with "bail out."

FYI, Marshall, foreclosures may have decreased, but the equity home owners had is gone.

I built my 3000 square foot, 3 bedroom, 2 bath home in '02. The build cost was $175,000. In '08 the home valued at $230,000. Today the home value is $160,000... less than what I built if for.

I've been responsible. I've paid my mortgage payment. I've stayed gainfully employed. Yet, the glut of foreclosures in my upper class neighborhood tells me that my neighbors weren't responsible. Either they lost jobs, purchased homes they couldn't afford, or simply made bad financial decisions.

Now because my family has grown, I'm at a point where we need a bigger home and I'm stuck. I can't sell the home without suffering a loss, potential buyers are similarly situated, and banks are not keen on lending.

Now I'm not crying . . . it is what it is. But to say the recession is over is to ignore the residual effects of the recession that continue to linger.

david of ID 1:50PM September 22, 2010