IndyMac, Wachovia, Merrill Lynch

[bascule]

After the recent run on IndyMac, Wachovia is being raided by security investigators and Merrill Lynch is reporting a $4,900,000,000 loss, their fourth straight quarterly loss with a yearly total comprising some $19,200,000,000.

 

But no, it's not a depression. Clinton, you know, after he left office... that was a depression. This isn't a depression. Nope.

 

[Pangloss]

Apf. Fed up with your lack of response to "recession" and raising the stakes, eh? Well, Rush Limbaugh calls your IndyMac and raises you a new baby boom.

 

It's certainly not a depression just because left-wing media pundits throw straw men around. Nor is it a great economy just because right-wing media pundits throw straw men around.

[iNow]

It's all in our heads.

[bascule]

It's certainly not a depression

 

I'm having trouble deciding if that's a strawman, a slippery-slope argument, or both...

[ParanoiA]

Anyone who thinks this is a depression is either highly partisan (anti-Bush) or incredibly ignorant of the real dynamics of a freaking depression.

 

The unemployment rate now is around 5%. At the height of the depression the rate was around 25%, starting from around 8% in 1930 and maxing out in 3 years. Hell, by 1929 only 15 to 20 percent of all americans were considered middle class. Over 600 banks closed per year throughout the 1920's.

 

That's not happening, not even close.

 

However, recession is very apt. The gap between the rich and poor and the shrinking middle class certainly resembles the build up to the depression.

[Pangloss]

I'm having trouble deciding if that's a strawman, a slippery-slope argument, or both...

 

Apf. It's your claim, not mine:

 

But no, it's not a depression. Clinton, you know, after he left office... that was a depression. This isn't a depression. Nope.

 

At any rate, I might be able to accept a new definition of "recession" that doesn't require an actually-receding GDP. Something that more accurately accounts for slipping employment numbers, credit crunches, worsening purchasing power and a drop in consumer coincidence.

Edited July 20, 2008 by Pangloss

[bascule]

My apologies... I meant to say recession

[Pangloss]

Ah, well in that case I withdraw my complaint (and most of my last post). Your "pro-recession" (at risk of sounding grudging about it) argument has made a difference in my thinking about the economy. I don't entirely agree with your assessment, but I agree on root causes and correct courses of action. We've got some stuff that needs fixing.

[ParanoiA]

At the very least we should recognize the sign posts in leading us there. There can be a convincing case to be made for a real recession as well as a mental recession at this point, but the dynamics of the economy seem to mimic those of a build up to a recession.

 

Stratfor wrote an interesting article on this a few months ago about the american obsession with "recession". Ever since the great depression americans seem to brace themselves for disaster at every blip on the economic radar screen. We have difficulty appreciating a thriving economy because we're always worried about the shoe dropping.

 

I think that's a valid observation. Akin to an abused child, the great depression really depressed the hell out of us. In history class, I always wondered if I was the only person in class that was disturbed by the war bringing us out of it. What if there was no war? Would we have recovered?

[Sisyphus]

In history class, I always wondered if I was the only person in class that was disturbed by the war bringing us out of it. What if there was no war? Would we have recovered?

 

Well, the theory is that the war brought us out of it (or at least hastened the recovery) because it involved unprecedented government spending and employed literally millions of people. In other words, it was an enormous public works project, just like the New Deal programs only even more so, and there's no reason it had to be a war, unless maybe to gain sufficient political will.

 

Of course, there are plenty of people who dispute that reasoning entirely, and say we would have recovered faster without either the New Deal or the war. And, of course, afterwards it left us with the self-perpetuating military-industrial complex, which remains in good times and bad.

[Phi for All]

Stratfor wrote an interesting article on this a few months ago about the american obsession with "recession". Ever since the great depression americans seem to brace themselves for disaster at every blip on the economic radar screen. We have difficulty appreciating a thriving economy because we're always worried about the shoe dropping.

Perhaps this is the reason we can be so timid about change. Upset the apple cart and you may end up selling apples from a cart.

 

I think that's a valid observation. Akin to an abused child, the great depression really depressed the hell out of us. In history class, I always wondered if I was the only person in class that was disturbed by the war bringing us out of it. What if there was no war? Would we have recovered?

You're not the only one. I doubt anything else would have brought us out of the depression as quickly.

 

It can't work now because, imo, too much of the war dollar is netted by megacorps who have straddled the stream and nudged out competition that would've helped spread the contracts out over a much broader range of businesses.

Edited July 24, 2008 by Phi for All
speling erors

[Mr Skeptic]

I think that if the government acquired all that money spent on the war, and used it to build up the economy, we would have gotten out of the Great Depression quicker than with a war. Of course, it would have been harder for them to collect the money.

[bascule]

I think one of the things that people overlook regarding WWII is that most of the countries involved suffered enormous damage and human casualties, and America did not (comparatively). America was in the rather lucrative position of having built up its infrastructure, rather than having it destroyed, and in turn being in a good position to help the rest of the world rebuild their respective infrastructures.

[Pangloss]

Ah yes, the good old days, when OTHER countries paid the price for our wars. <grump>