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Here's a good editorial on Obama's first few weeks in office: http://online.wsj.com/article/SB123604419092515347.html

It's going to be a long 3 years, 10 months, and 17 days...


As 2009 opened, three weeks before Barack Obama took office, the Dow Jones Industrial Average closed at 9034 on January 2, its highest level since the autumn panic. Yesterday the Dow fell another 4.24% to 6763, for an overall decline of 25% in two months and to its lowest level since 1997. The dismaying message here is that President Obama's policies have become part of the economy's problem.

Americans have welcomed the Obama era in the same spirit of hope the President campaigned on. But after five weeks in office, it's become clear that Mr. Obama's policies are slowing, if not stopping, what would otherwise be the normal process of economic recovery. From punishing business to squandering scarce national public resources, Team Obama is creating more uncertainty and less confidence -- and thus a longer period of recession or subpar growth.

The Democrats who now run Washington don't want to hear this, because they benefit from blaming all bad economic news on President Bush. And Mr. Obama has inherited an unusual recession deepened by credit problems, both of which will take time to climb out of. But it's also true that the economy has fallen far enough, and long enough, that much of the excess that led to recession is being worked off. Already 15 months old, the current recession will soon match the average length -- and average job loss -- of the last three postwar downturns. What goes down will come up -- unless destructive policies interfere with the sources of potential recovery.

And those sources have been forming for some time. The price of oil and other commodities have fallen by two-thirds since their 2008 summer peak, which has the effect of a major tax cut. The world is awash in liquidity, thanks to monetary ease by the Federal Reserve and other central banks. Monetary policy operates with a lag, but last year's easing will eventually stir economic activity.

Housing prices have fallen 27% from their Case-Shiller peak, or some two-thirds of the way back to their historical trend. While still high, credit spreads are far from their peaks during the panic, and corporate borrowers are again able to tap the credit markets. As equities were signaling with their late 2008 rally and January top, growth should under normal circumstances begin to appear in the second half of this year.

So what has happened in the last two months? The economy has received no great new outside shock. Exchange rates and other prices have been stable, and there are no security crises of note. The reality of a sharp recession has been known and built into stock prices since last year's fourth quarter.

What is new is the unveiling of Mr. Obama's agenda and his approach to governance. Every new President has a finite stock of capital -- financial and political -- to deploy, and amid recession Mr. Obama has more than most. But one negative revelation has been the way he has chosen to spend his scarce resources on income transfers rather than growth promotion. Most of his "stimulus" spending was devoted to social programs, rather than public works, and nearly all of the tax cuts were devoted to income maintenance rather than to improving incentives to work or invest.

His Treasury has been making a similar mistake with its financial bailout plans. The banking system needs to work through its losses, and one necessary use of public capital is to assist in burning down those bad assets as fast as possible. Yet most of Team Obama's ministrations so far have gone toward triage and life support, rather than repair and recovery.

AIG yesterday received its fourth "rescue," including $70 billion in Troubled Asset Relief Program cash, without any clear business direction. (See here.) Citigroup's restructuring last week added not a dollar of new capital, and also no clear direction. Perhaps the imminent Treasury "stress tests" will clear the decks, but until they do the banks are all living in fear of becoming the next AIG. All of this squanders public money that could better go toward burning down bank debt.

The market has notably plunged since Mr. Obama introduced his budget last week, and that should be no surprise. The document was a declaration of hostility toward capitalists across the economy. Health-care stocks have dived on fears of new government mandates and price controls. Private lenders to students have been told they're no longer wanted. Anyone who uses carbon energy has been warned to expect a huge tax increase from cap and trade. And every risk-taker and investor now knows that another tax increase will slam the economy in 2011, unless Mr. Obama lets Speaker Nancy Pelosi impose one even earlier.

Meanwhile, Congress demands more bank lending even as it assails lenders and threatens to let judges rewrite mortgage contracts. The powers in Congress -- unrebuked by Mr. Obama -- are ridiculing and punishing the very capitalists who are essential to a sustainable recovery. The result has been a capital strike, and the return of the fear from last year that we could face a far deeper downturn. This is no way to nurture a wounded economy back to health.

Listening to Mr. Obama and his chief of staff, Rahm Emanuel, on the weekend, we couldn't help but wonder if they appreciate any of this. They seem preoccupied with going to the barricades against Republicans who wield little power, or picking a fight with Rush Limbaugh, as if this is the kind of economic leadership Americans want.

Perhaps they're reading the polls and figure they have two or three years before voters stop blaming Republicans and Mr. Bush for the economy. Even if that's right in the long run, in the meantime their assault on business and investors is delaying a recovery and ensuring that the expansion will be weaker than it should be when it finally does arrive.

Isn't the Wall Street Journal now owned by Rupert Murdoch?

It's going to be a long 3 years, 10 months, and 17 days...

It was a long and frightening 8 years.

Dimmzy:

Your first post demonstrates the logical fallacy of poisoning the well.

If you can show that the points raised in the article are exaggerations or are being falsified, then you may have a point. But simply pointing out who owns the Wall Street Journal is not enough.

Your second post is an irrelevant point- how "scary" the previous 8 years was has no bearing on whether Obama's policies will make the next 4 years or so even more "scary".

Would you like to try actually addressing the issues raised?

Or turn the thread into yet another political shout-fest?

Daniel, must you always look at the cup as half empty? Come on! Obama is nattily dressed, well-groomed, looks great and speaks so eloquently. And, didn't you hear how he was going to change the United States? It's all about Hope for the future, right? I'm not quite sure yet what we are hoping for, but I'm sure he will explain that at some point. So, let's look on the bright side of this. We had to endure 8 years of Bush but we might only have to endure four years of Obama. From the looks of his poll numbers this may be true. But, have faith, Daniel. He is only 45 days into his presidency. So what if he has only signed bills which will spend more money that the cumulative sum of the past 43 presidents combined. It's all going to a good cause right? And as soon as we find out what that cause is, we will probably all just shake our heads for not just seeing his vision and going along with it. So what if your retirement funds have all but disappeared? You wanted to work until you were 75 anyway, right? What's the problem here?

I wonder if I will ever be able to retire.

Dow Jones was 9625 at the close on November 4, 2008.

I leave to each of you to apportion the "blame" between Bush and Obama for Wall Street's nervousness from the election to the inauguration. I am guessing that there is a wide difference of opinion.

I'm guessing my hopes of trying to steer it into a thread that discusses issues is dead aborning.

Thanks, guys- on both sides!!!

Jeemie wrote:I'm guessing my hopes of trying to steer it into a thread that discusses issues is dead aborning.

Thanks, guys- on both sides!!!

I thought you knew us better than that.

Rexer25 wrote:

Jeemie wrote:I'm guessing my hopes of trying to steer it into a thread that discusses issues is dead aborning.

Thanks, guys- on both sides!!!

I thought you knew us better than that.

I just know it's your fault somehow.

I'll pay the $10 later...hopefully after hyperinflation has set in!

Would you like to try actually addressing the issues raised?

No.

This too will pass.

dimmzy wrote:

Would you like to try actually addressing the issues raised?

No.

This too will pass.

You see, Jeemie, I find this to be the problem with many Obama supporters. The only thing they can tell you as to why they favor the guy is that he's not Bush. Ask them to get specific or debate the issues or ask them to explain how what he is doing is going to benefit the country and they go hide in a corner. As you know I listen to a lot of talk radio and it's funny how I hear that so many of the people I listen to have often invited left-wingers to be on their show and debate the issues they rarely accept. It's obvious to me that they just cannot defend their position. I don't think that the "He's not Bush" defense isn't going to fly for very much longer. As a matter of fact, AFAIC, this economy now belongs to Mr. O. The stock market has declined over 2,000 points since his inauguration so, that has nothing to do with W. Now I know Nelly, Juch and others here would offer a different explanation for this phenomenon, but I think we all what the real truth is.

Sir_Galahad wrote:

dimmzy wrote:

Would you like to try actually addressing the issues raised?

No.

This too will pass.

You see, Jeemie, I find this to be the problem with many Obama supporters. The only thing they can tell you as to why they favor the guy is that he's not Bush. Ask them to get specific or debate the issues or ask them to explain how what he is doing is going to benefit the country and they go hide in a corner. As you know I listen to a lot of talk radio and it's funny how I hear that so many of the people I listen to have often invited left-wingers to be on their show and debate the issues they rarely accept. It's obvious to me that they just cannot defend their position. I don't think that the "He's not Bush" defense isn't going to fly for very much longer. As a matter of fact, AFAIC, this economy now belongs to Mr. O. The stock market has declined over 2,000 points since his inauguration so, that has nothing to do with W. Now I know Nelly, Juch and others here would offer a different explanation for this phenomenon, but I think we all what the real truth is.

The election has been over, what, 4 months now? Why is there any need to discuss why "they favor the guy?" Obama won won. Maybe in 3 years or so we can have that conversation again.

Although, stuff like "I think we all what the real truth is" (even with the missing "know" inserted) is funny enough for me to keep reading this stuff. Maybe not for 3 years, though.

dimmzy wrote:

Would you like to try actually addressing the issues raised?

No.

This too will pass.

If that's what you believe, why did you post?

Sir_Galahad wrote:You see, Jeemie, I find this to be the problem with many Obama supporters. The only thing they can tell you as to why they favor the guy is that he's not Bush. Ask them to get specific or debate the issues or ask them to explain how what he is doing is going to benefit the country and they go hide in a corner. As you know I listen to a lot of talk radio and it's funny how I hear that so many of the people I listen to have often invited left-wingers to be on their show and debate the issues they rarely accept. It's obvious to me that they just cannot defend their position. I don't think that the "He's not Bush" defense isn't going to fly for very much longer. As a matter of fact, AFAIC, this economy now belongs to Mr. O. The stock market has declined over 2,000 points since his inauguration so, that has nothing to do with W. Now I know Nelly, Juch and others here would offer a different explanation for this phenomenon, but I think we all what the real truth is.

And how does this kind of post help, Sir G?

trevor_macfee wrote:
The election has been over, what, 4 months now? Why is there any need to discuss why "they favor the guy?" Obama won won. Maybe in 3 years or so we can have that conversation again.

Because I happen to believe that it is an important issue. How can you vote for a guy if you don't even know what he stands for? How can you vote for a guy just because he's not another guy? To me, this is insanity. I think it's pretty clear right now where Obama intends on taking this country.

Some say Obama is arrogant. Yeah, but he’s smart. We already tried arrogant and stupid. And that didn’t work. — Will Durst

And where's Chicken Little when you need him/her?

ne1410s wrote:

Some say Obama is arrogant. Yeah, but he’s smart. We already tried arrogant and stupid. And that didn’t work. — Will Durst

And where's Chicken Little when you need him/her?

How do we know Obama is smart?

I mean, his IQ is only 115. It must be true because I saw an ad on facebook saying it.

But seriously, how do we know he is smart?

Oh, and to be fair, I have seen other ads on facebook claiming that Obama's IQ is 130. Before the election, there were ads with George W. that said his IQ was 124.

Sir_Galahad wrote:

trevor_macfee wrote:
The election has been over, what, 4 months now? Why is there any need to discuss why "they favor the guy?" Obama won won. Maybe in 3 years or so we can have that conversation again.

Because I happen to believe that it is an important issue. How can you vote for a guy if you don't even know what he stands for? How can you vote for a guy just because he's not another guy? To me, this is insanity. I think it's pretty clear right now where Obama intends on taking this country.

Why am I responding? I have to finish my sermon for tomorrow and I need some procrastination activity . . .

OK, but "how can you vote for a guy" is a topic for, oh, around this time in 2012. And that's a long way off.

I vigorously disagree that "it's pretty clear right now where Obama intends on taking this country." I don't even think he knows for sure. A lot of leading - in government or business or at home - is reactive. You have big plans, but then stuff happens and you have to improvise. (Like Bush did - very well at first - after 911). A lot of stuff has happened between the campaign and the inauguration - most of it bad economic stuff. It's ridiculous to say that's Obama's fault - it's only a little less ridiculous to say it's Bush's fault.

If anyone is to blame, it's us. I read or heard this weekend that our debt (NOT government debt, individual and family debt) was 20-30% of the GDP from the 40's through the 90's. By the early 2000's, it was 100%. The last time it was 100% . . . 1929.

That's not a government problem. That's a fundamental problem with the national psyche. The result is going to be a painful period for a while. The government can, and should, mitigate that pain. But the only way things are going to get better long-term is if we (and I mean "we" - if it wasn't for game show $$ I'd probably be in as much debt as everyone else - and probably will be when my son starts college in the fall) learn to delay our gratification.

It all seems to be cyclical anyway. I would guess the next generation will be like my grandparent's generation who lived through the depression - very careful with money. By the time THEIR grandchildren come along everyone will be living high on borrowed money, and they'll say, "It's just like 2009."

And honestly, although I occasionally reply in these threads I am less and less interested in politics - and less convinced that it really makes any difference who's in power - the older I get. My "call" isn't political, anyway.

Is it time to bring back the Moratorium Lounge® yet?

Jeemie wrote:

Sir_Galahad wrote:You see, Jeemie, I find this to be the problem with many Obama supporters. The only thing they can tell you as to why they favor the guy is that he's not Bush. Ask them to get specific or debate the issues or ask them to explain how what he is doing is going to benefit the country and they go hide in a corner. As you know I listen to a lot of talk radio and it's funny how I hear that so many of the people I listen to have often invited left-wingers to be on their show and debate the issues they rarely accept. It's obvious to me that they just cannot defend their position. I don't think that the "He's not Bush" defense isn't going to fly for very much longer. As a matter of fact, AFAIC, this economy now belongs to Mr. O. The stock market has declined over 2,000 points since his inauguration so, that has nothing to do with W. Now I know Nelly, Juch and others here would offer a different explanation for this phenomenon, but I think we all what the real truth is.

And how does this kind of post help, Sir G?

At this point, I don't know that anything will help since the die has been cast. We can only watch and hold on.

But, sometimes it is good to vent. [ exhale ]

trevor_macfee wrote:And honestly, although I occasionally reply in these threads I am less and less interested in politics - and less convinced that it really makes any difference who's in power - the older I get.

This is true. had McCain won, things would not be much better, IMHO.

And you hit the nail on the head as to the root cause...debt.

Which is why the government's effort to mitigate the pain will ultimately cause more pain...because of debt.

I fail to see how a debt-induced crisis can be mitigated by adding on still more debt....especially when most of that debt isn't aimed at activity that can bring on the next wave of economic growth.

trevor_macfee wrote:I vigorously disagree that "it's pretty clear right now where Obama intends on taking this country." I don't even think he knows for sure. A lot of leading - in government or business or at home - is reactive. You have big plans, but then stuff happens and you have to improvise. (Like Bush did - very well at first - after 911).

Bingo. We have a winner.

Obama has no idea how to get the economy out of the depths it's in. He had three months to plan his "stimulus" bill and it was a cobbled together mess which seemed to incorporate anything that anyone on the Democrats' side came up with. His new budget is comprised of vague promises, wish list items, a hodgepodge tax structure that makes little sense, and no clear sense of direction.

When FDR took office, he hit the ground running with a series of bills designed to straighten up the bank mess, begin regulating the securities industry and begin enacting a series of ambitious public works programs. Agree with disagree with what he did, but it was clear he had a very well thought out game plan.

Obama has no game plan because he has no clear idea of what's needed to get things done and no commitment (other than alternating high minded wishifying speeches with predictions of impending doom) to getting things done. In the meantime, Rush and the Republicans seem more than content (not that it's a bad strategy) to paint him with a broad socialist brush and stand by while he runs things further into the ground.

The day-to-day developments in the economy can't be predicted, but the overall financial direction we were going in was clear on November 4 and abundantly clear on January 20. Obama has committed us to spending nearly a trillion dollars and he still isn't addressing either the short or long term economic picture.

I come back, again, to why was the Stimulus Bill rushed through so hurriedly?

That much money should have been discussed and debated. I simply cannot understand why anyone, Democrat for or Republican against, could have made an informed decision without knowing what you are voting on.

The budget, due to be voted on very soon, is in the same boat. Neither side is deliberating on what is actually in it. Fine, the Democrats won the election, the policy behind the budget should be theirs, as well as the responsibility for it. I have no problem with that philosophy.

But to cast vote after vote, from either side of the aisle, without comprehending what you are voting for or against is absurd.

For good or bad, this is President Obama's economy. He will reap the reward or reproof should it fail.

The great thing about our country is that we will have an opportunity to stop the bleeding in two years and, perhaps, change course again in four.

The damage done by that time will be the massive increase in debt and a larger government. Unfortunately, historically, those things are rarely ever undone.

silverscreenselect wrote:Obama has no idea how to get the economy out of the depths it's in. He had three months to plan his "stimulus" bill and it was a cobbled together mess which seemed to incorporate anything that anyone on the Democrats' side came up with. His new budget is comprised of vague promises, wish list items, a hodgepodge tax structure that makes little sense, and no clear sense of direction.

When FDR took office, he hit the ground running with a series of bills designed to straighten up the bank mess, begin regulating the securities industry and begin enacting a series of ambitious public works programs. Agree with disagree with what he did, but it was clear he had a very well thought out game plan.

This is why I asked, ages ago, exactly what "change we need" Obama was bringing.

At some point, we have to hear an answer other than "He's not Bush" or "he inherited Bush's mess" or "He hasn't been in office too long. Give him time".

The first two statements are true- but pretty much irrelevent. That he's not Bush does not automatically mean he's got the right answers. And yeah- Bush helped cause the mess. So what? He's no longer in office.

As for the third statement:

No offense, but Obama knew two things since at least September.

1) The economy was in deep trouble, and the roots of that trouble were well-known.

2) He was going to win the election.

As the example of FDR shows, that was PLENTY of time to come up with a well-thought-out plan for how to attack the problem.

He did not do so, but offered instead a hodgepodge, wrapped up in more flowery yet pretty much vacuous rhetoric. Hell- he can't even get the tone right. He essentially had to be told before his unofficial State of the Union Address to stop couching everything in ngeativity because he was scaring the hell out of everyone. "The only thing we have to fear is fear itself" is inspiring. "Pass my legislation or we'll never get out of this recession" is idiotic.

I think we are allowed to judge him for these things...even if he has only been in office a couple of months.