I concur with Johnny and Yellow Dog that those are instances where there would be pain. The transition period, however long, would be painful. This short term pain would probably deter this vision from happening because of the likelihood that politicians would lose their jobs.
In order to achieve a more sustainable economy, I agree with what you are saying (and in a way I agree with Summers) but this all remains wishful thinking unless we come to accept that there will be pain in the transition. Until, politicians and American populace can accept that we will languish, middle class will continue to vanish or worse we will become a province of China.
I agree with RebelCapitalist, it will be a painful adjustment.
The only way the government can influence import/export and reduction in energy consumption is through additional taxes and tariffs.
The cost of manufacturing at home would have to be less than manufacturing overseas. That can only be accomplished one of 2 ways: High tariffs on imported goods or abolishment of minimum wage.
Another case in point - energy. If the government taxed energy (namely gasoline) to European levels, businesses would be incentivised to create more energy efficient transportation. But citizens wouldn't like it and it would change the face of suburbia.
Retail consumption is going to be the easiest to adjust - and is already happening. Rolling back credit limits on both consumers and businesses, making retail items less affordable and unprofitable, will reduce retail consumption.
Agendas that better the economy in the long run will not necessarily be popular in the short run.
a plan to meet his stated objectives.
It's one thing to have goals - it's another to execute a method of implementation.
Increasing unemployment will be a convergence of political, economic and sociological paradigms. Since Clinton gutted much of the welfare program and we have little safety net for the most vulnerable, someone better be devising a plan for either massive job creation or re-implementation of social programs.
I understand that historically unemployment and GDP contraction are only loosely correlated, but we are in a period of credit destruction. The dynamics seem much different.
Robert, you deserve a standing ovation for your commentary!
That's a google advanced specific search that I linked to. Google has indexed the entire site so if you cannot find something with the tools on the site, try Google.
or you can use keyword "recession" or "unemployment etc.
to use the searches.
In terms of using them if you post on EP I think that is ok, but in terms of posting elsewhere, some of these have been original work by the author, so you'll have to ask them, or at least link back to EP and give credit to the author as source.
I think what he's getting at, and if I'm wrong please correct me, is that there would be a time gap between the two. Many former industrial areas in this country have even had the underpinnings of such a base removed. In between the time to close out the old business deals and construct the plants and find the customers and whatever logistics and red tape, would be in months at the very least. In between, you could see out of work folks. Perhaps this was the "pain" that was being referred to.
If one diversifies, increases exports, manufacturing I don't get why you think it might be painful to rebalance the economy. To me that would be a good suave on an open wound and some retail would disappear and some manufacturing would reappear. But even there, it could me a reduction in imports since that is a major driver of the "consumer economy" i.e. buying cheap plastic items for China and so on.
There will be pain to achieve this vision. To make the transition to less consumer driven economy will be painful. If someone says otherwise they are a snake oil salesman - figures it is coming from Larry Summers.
It is a small circle of friends and until we do something to clip the wings of the financial oligarchy nothing will change. The conflicts of interest in this whole financial crisis should be shocking. The level of interlocking interests should be overwhelming.
If people truly understand what was happening no one would be able to stop the pitchforks. But people are too preoccupied with their own struggles or something else. What is that something else?
I can't wait for the day that someone with actually knowledge of the subject can come out and say the worst is behind us.
as for where the policies are that's a good question. I think there are some good goals in the stimulus package to help this new economy (or if you really look at it really a greener version of how things where before the past 30 or so years)
healthcare reform can be of some help.
But your right the big issues such as outsourcing and bad trade dealers aren't really being addressed. Hell even when people try to something like say only American companies can take part in bids for projects that use the stimulus money, people have a hissy fit and they back down
BlackRock was definitely on Geithner's speed dial during the 2008 collapse. As, the post states when Geithner was with the NY Fed, he awarded BlackRock 3 no bid contracts.
I stand corrected about PIMCO. However, it is fair to say that BlackRock was chosen by the Treasury and PIMCO was not.
The guidelines for inclusion in the Legacy Asset Program (new term for PPIP) can be found in .pdf form on the Treasury site FinancialStability.gov.
The "boys club" is absolutely right. In many of the articles I read, it is widely accepted that Fink is a personal advisor to Summers.
Also, ties between Geithner and Fisher seem strong. Fisher worked for the NY Fed with Geithner.
As an aside, Fisher made several public comments as Treasury Undersecretary during Bush's admin, that reflected an extremely conservative ideology. Most recently, Fisher wrote an op-ed in WaPo about his views on the subprime meltdown. Lending's Blind Spot
Might have something to do with the combo of an unlimited number of CDSes can be written against one borrower or entity together with ICE US Trust doing the clearing house chores---ICE US Trust owned by Goldman Sachs, Morgan Stanley, UBS AG, Markit Group & ICE (InterContinental Exchange) and ICE US Trust, together with Markit Group, are supposed to be setting the official CDS valuations (got that headache yet?).
I believe GS is still rate as number four for CDSes/credit derives after JPM, Citi and BoA.
Check this out, now GS is slated for record profits and this is so soon after this supposed "massive financial global meltdown" that would have ended the world as we know it. Uh huh!
I'm not so sure BlackRock "beat" Pimco, more Pimco dropped out for some reason, which is very unclear. It's possible the deal wasn't so sweet (which we wrote about extensively in the past what a rigged game, losses dumped on the taxpayer the entire PPIP was).
What I have not tracked on is what the latest terms and details are on the PPIP.
But great post! Glad to see you writing. There is clearly some sort of incestuous boys club going on generally with this "bail out" where there is almost no separation between a few of these recipients and government.
What has emerged in comments elsewhere is that HFT's reliance on microsecond advantages means the physical siting of some of the hardware itself gives an advantage. And the houses that handle these hardware setups require big $$$ to do so in proximity to the exchanges setup. This puts paid completely to any illusion of a 'free market' so beloved of the Golden Slacks ideologues and their like.
Facebook: Sergey Aleynikov Fan Club : http://flq.us/wg
all those like myself who hold a degree in Psychology, I'll not hold your misguided comment as a personal affront.
The video is about Freudian subliminal application in a Social Psychological setting, not behaviorism.
Behaviorists - such as Pavlov and Skinner - were able to infer cause and effect of a direct stimulus (dependent variable) within a statistically significant MoE.
Kinda' like the Recovery Act - only the RA has a higher MoE
If Goldman Sachs doesn't like CIT. Goldman Sachs determines who gets saved and who doesn't.
An leaked internal CIT memo says that 300,000 retailers and over 700 manufacturers would be at risk if CIT fails.
I concur with Johnny and Yellow Dog that those are instances where there would be pain. The transition period, however long, would be painful. This short term pain would probably deter this vision from happening because of the likelihood that politicians would lose their jobs.
In order to achieve a more sustainable economy, I agree with what you are saying (and in a way I agree with Summers) but this all remains wishful thinking unless we come to accept that there will be pain in the transition. Until, politicians and American populace can accept that we will languish, middle class will continue to vanish or worse we will become a province of China.
I agree with RebelCapitalist, it will be a painful adjustment.
The only way the government can influence import/export and reduction in energy consumption is through additional taxes and tariffs.
The cost of manufacturing at home would have to be less than manufacturing overseas. That can only be accomplished one of 2 ways: High tariffs on imported goods or abolishment of minimum wage.
Another case in point - energy. If the government taxed energy (namely gasoline) to European levels, businesses would be incentivised to create more energy efficient transportation. But citizens wouldn't like it and it would change the face of suburbia.
Retail consumption is going to be the easiest to adjust - and is already happening. Rolling back credit limits on both consumers and businesses, making retail items less affordable and unprofitable, will reduce retail consumption.
Agendas that better the economy in the long run will not necessarily be popular in the short run.
a plan to meet his stated objectives.
It's one thing to have goals - it's another to execute a method of implementation.
Increasing unemployment will be a convergence of political, economic and sociological paradigms. Since Clinton gutted much of the welfare program and we have little safety net for the most vulnerable, someone better be devising a plan for either massive job creation or re-implementation of social programs.
I understand that historically unemployment and GDP contraction are only loosely correlated, but we are in a period of credit destruction. The dynamics seem much different.
Robert, you deserve a standing ovation for your commentary!
on a per content type search.
That's a google advanced specific search that I linked to. Google has indexed the entire site so if you cannot find something with the tools on the site, try Google.
I wasn't even aware you could image search on here. Did you add that capability? Thank you!
--------------------------------------------
www.venomopolis.com
using maps on EP, so may I suggest using the search or go to Google and do an image search that is domain specific.
i.e.
image search on EP domain for keyword "map".
or you can use keyword "recession" or "unemployment etc.
to use the searches.
In terms of using them if you post on EP I think that is ok, but in terms of posting elsewhere, some of these have been original work by the author, so you'll have to ask them, or at least link back to EP and give credit to the author as source.
I think what he's getting at, and if I'm wrong please correct me, is that there would be a time gap between the two. Many former industrial areas in this country have even had the underpinnings of such a base removed. In between the time to close out the old business deals and construct the plants and find the customers and whatever logistics and red tape, would be in months at the very least. In between, you could see out of work folks. Perhaps this was the "pain" that was being referred to.
--------------------------------------------
www.venomopolis.com
If one diversifies, increases exports, manufacturing I don't get why you think it might be painful to rebalance the economy. To me that would be a good suave on an open wound and some retail would disappear and some manufacturing would reappear. But even there, it could me a reduction in imports since that is a major driver of the "consumer economy" i.e. buying cheap plastic items for China and so on.
There will be pain to achieve this vision. To make the transition to less consumer driven economy will be painful. If someone says otherwise they are a snake oil salesman - figures it is coming from Larry Summers.
It is a small circle of friends and until we do something to clip the wings of the financial oligarchy nothing will change. The conflicts of interest in this whole financial crisis should be shocking. The level of interlocking interests should be overwhelming.
If people truly understand what was happening no one would be able to stop the pitchforks. But people are too preoccupied with their own struggles or something else. What is that something else?
Nothing is shocking any more.
I can't wait for the day that someone with actually knowledge of the subject can come out and say the worst is behind us.
as for where the policies are that's a good question. I think there are some good goals in the stimulus package to help this new economy (or if you really look at it really a greener version of how things where before the past 30 or so years)
healthcare reform can be of some help.
But your right the big issues such as outsourcing and bad trade dealers aren't really being addressed. Hell even when people try to something like say only American companies can take part in bids for projects that use the stimulus money, people have a hissy fit and they back down
BlackRock was definitely on Geithner's speed dial during the 2008 collapse. As, the post states when Geithner was with the NY Fed, he awarded BlackRock 3 no bid contracts.
I stand corrected about PIMCO. However, it is fair to say that BlackRock was chosen by the Treasury and PIMCO was not.
The guidelines for inclusion in the Legacy Asset Program (new term for PPIP) can be found in .pdf form on the Treasury site FinancialStability.gov.
The "boys club" is absolutely right. In many of the articles I read, it is widely accepted that Fink is a personal advisor to Summers.
Also, ties between Geithner and Fisher seem strong. Fisher worked for the NY Fed with Geithner.
As an aside, Fisher made several public comments as Treasury Undersecretary during Bush's admin, that reflected an extremely conservative ideology. Most recently, Fisher wrote an op-ed in WaPo about his views on the subprime meltdown. Lending's Blind Spot
Might have something to do with the combo of an unlimited number of CDSes can be written against one borrower or entity together with ICE US Trust doing the clearing house chores---ICE US Trust owned by Goldman Sachs, Morgan Stanley, UBS AG, Markit Group & ICE (InterContinental Exchange) and ICE US Trust, together with Markit Group, are supposed to be setting the official CDS valuations (got that headache yet?).
I believe GS is still rate as number four for CDSes/credit derives after JPM, Citi and BoA.
Check this out, now GS is slated for record profits and this is so soon after this supposed "massive financial global meltdown" that would have ended the world as we know it. Uh huh!
I'm not so sure BlackRock "beat" Pimco, more Pimco dropped out for some reason, which is very unclear. It's possible the deal wasn't so sweet (which we wrote about extensively in the past what a rigged game, losses dumped on the taxpayer the entire PPIP was).
No PPIP for Pimco.
What I have not tracked on is what the latest terms and details are on the PPIP.
But great post! Glad to see you writing. There is clearly some sort of incestuous boys club going on generally with this "bail out" where there is almost no separation between a few of these recipients and government.
It's like the Halliburton of Finance.
What has emerged in comments elsewhere is that HFT's reliance on microsecond advantages means the physical siting of some of the hardware itself gives an advantage. And the houses that handle these hardware setups require big $$$ to do so in proximity to the exchanges setup. This puts paid completely to any illusion of a 'free market' so beloved of the Golden Slacks ideologues and their like.
Facebook: Sergey Aleynikov Fan Club : http://flq.us/wg
Economist's View.
Most amusing in some ways for I can tell they too are nervous on an economics document coming from a church and how to handle the analysis.
But, they too are talking about it.
How would you de-link the "Middle Class" with the other classes? Replace it with what?
--------------------------------------------
www.venomopolis.com
all those like myself who hold a degree in Psychology, I'll not hold your misguided comment as a personal affront.
The video is about Freudian subliminal application in a Social Psychological setting, not behaviorism.
Behaviorists - such as Pavlov and Skinner - were able to infer cause and effect of a direct stimulus (dependent variable) within a statistically significant MoE.
Kinda' like the Recovery Act - only the RA has a higher MoE
Pages