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Thread: The Recession May Get Worse?

  1. #46
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    Ads for IT workers are increasing here, because of the H1 visa ban until February.

    In February, we expect to see lay offs of US workers so the corps can hire Indians again who will work unpaid overtime without filing a complaint.

    The corps around here got massive bailouts from the feds, yet they pressure their contractors to work for no pay every single day.

    Go USA!
    CHILLY FREE!
    i have to zero the contain to your level -bugdoll
    you can't even be ogirinal - Mary

  2. #47
    Elite Member NVash's Avatar
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    U.S. Economy Is Increasingly Tied to the Rich

    by Robert Frank
    Sunday, August 1, 2010

    provided by

    Who cares how the rich spend their money?
    More from WSJ.com:

    Do Luxury-Car Drivers Get More Traffic Tickets?

    Is Li Ka-shing on the Billionaires' Charity Bandwagon?
    More Billionaires Sign the Gates-Buffett Giving Pledge
    Well, perhaps everyone should these days. Consumer spending accounts for roughly two-thirds of U.S. gross domestic product, or the value of all goods and services produced in the nation. And spending by the rich now accounts for the largest share of consumer outlays in at least 20 years.
    According to new research from Moody's Analytics, the top 5% of Americans by income account for 37% of all consumer outlays. Outlays include consumer spending, interest payments on installment debt and transfer payments.
    [See Ways to Save on Restaurants, Travel, and More]
    By contrast, the bottom 80% by income account for 39.5% of all consumer outlays.
    It is no surprise, of course, that the rich spend so much, since they earn a disproportionate share of income. According to economists Emmanuel Saez and Thomas Piketty, the top 10% of earners captured about half of all income as of 2007.
    What is surprising is just how much or our consumer economy is now dependent on the rich, and how that share has increased as the U.S. emerges from recession. In the third quarter of 1990, the top 5% accounted for 25% of consumer outlays. That held relatively steady until the mid-1990s, when it started inching up past 30%. It dipped in 2003 and again in 2008, but started surging in 2009 amid the greatest bull market rally in history, with the Dow Jones Industry Average rising nearly 50% in the last nine months of the year.
    Mark Zandi, chief economist for Moody's Analytics, cites two main reasons for the increase. First, the wealthy panicked during the financial crisis and stopped spending. When markets rebounded, they came out of their shells and started spending again. "I think that pent-up demand was unleashed," he said. "It was an unusually high rate of spending."
    [See 21 Things You Should Never Buy New ]
    The second reason is that those people in the middle- and lower-income groups are struggling to pay off debt and stay afloat amid rising unemployment, as Friday's data reminds us. That has crimped their spending.
    The data may be a further sign that the U.S. is becoming a Plutonomy–an economy dependent on the spending and investing of the wealthy. And Plutonomies are far less stable than economies built on more evenly distributed income and mass consumption. "I don't think it's healthy for the economy to be so dependent on the top 2% of the income distribution," Mr. Zandi said. He added that, "In the near term it highlights the fragility of the recovery."
    In fact, the recent spending of the wealthy may be unsustainable. Their savings rate has gone from more than 26% in 2008 to a negative 7% in the first quarter of 2010, according to the Moody's Analytics data. They still have lots of savings. But the massive draw on that in the past two years is unlikely to continue at the same pace.
    "I think we're already seeing a slowdown in spending by this group," Mr. Zandi says.
    And that should be a worry for all of us.


    Source: us-economy-is-increasingly-tied-to-the-rich: Personal Finance News from Yahoo! Finance
    Sure everyone knew it but I thought it was one of those things no one talked about. Its on the front page of Yahoo. But now that theyve said that you have to wonder. Now what? Economy isnt going to get better, rich controls it, everyone should be worried, okay were done with doom and gloom. Wonder how football season is going to be this year.

  3. #48
    Elite Member darksithbunny's Avatar
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    Well first off we need to get the government to admit that we are in one.

  4. #49
    Elite Member Mel1973's Avatar
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    and some posters here!
    Kill him.
    Kill her.
    Kill It.
    Kill everything... that IS the solution!
    П(•_•)П
    twitchy molests my signature!

  5. #50
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    According to new research from Moody's Analytics, the top 5% of Americans by income account for 37% of all consumer outlays.
    The top 5% have over half the wealth! In relation to their wealth, they spend less than the rest of us.
    Tea baggers want to fight the Man because the Man doesn't look like them.

  6. #51
    Elite Member Novice's Avatar
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    Why is that news?
    "I don't know what I am to them, maybe a penguin XD" - Tiny Pixie

  7. #52
    Elite Member NVash's Avatar
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    some-firms-struggle-to-hire-despite-high-unemployment: Personal Finance News from Yahoo! Finance
    Another link from Yahoo.
    The Truth About Temp Work- Yahoo! HotJobs
    But there is hope! Temp jobs! Yeah right, I work for a few and they never have work. To be honest I think they play favorites and only give a select few the chance to work.

    Fed, worried about recovery, will buy US debt

    The Fed takes a small step to buy government debt, signaling worry about the recovery



    A television screen on the floor of the New York Stock Exchange shows the Federal Reserve interest rate decision, Tuesday, Aug. 10, 2010. The Fed, citing "subdued" inflation, said it would keep its target for a key interest rate at zero to 0.25 percent for a "extended period."(AP Photo/Richard Drew)

    Related Quotes


    SymbolPriceChangeFMCC.OB0.3900-0.0060
    FNMA.OB0.3660-0.0150


    {"s" : "fmcc.ob,fnma.ob","k" : "a00,a50,b00,b60,c10,g00,h00,l10,p20,t10,v00", "o" : "","j" : ""}
    Jeannine Aversa, AP Economics Writer, On Tuesday August 10, 2010, 5:40 pm EDT
    WASHINGTON (AP) -- As recently as two months ago, the Federal Reserve sounded optimistic about the economic recovery. Now the central bank is clearly more worried, and economists say there's not much more it can do to help.
    The Fed said Tuesday that it would spend a relatively small amount of money -- about $10 billion a month, economists estimate -- buying government debt. The move is designed to drive interest rates on mortgages and corporate borrowing at least a little lower and help the economy grow faster.
    In a statement after a one-day meeting, the Fed said the pace of the recovery "has slowed in recent months." After its last meeting in late June, the Fed was rosier, saying that the recovery was "proceeding" and the job market actually improving.
    The decision to buy government debt, using proceeds from Fed investments in mortgage bonds, was a shift from earlier this year, when the Fed was laying out plans to roll back some of the measures it took during the financial crisis.
    At that time, the Fed was also preparing a strategy to begin raising interest rates again, a step taken to keep a growing economy from overheating. Now, though, the Fed has decided to keep its benchmark interest rate near zero.
    "I don't think they are going to raise interest rates until it is very clear that unemployment is moving definitively lower and that doesn't look likely until late 2011," said Mark Zandi, chief economist at Moody's Analytics.
    Economists pointed out that buying $10 billion of government debt in a $14 trillion economy is a relatively small move, and they said they did not expect it to have a dramatic impact.
    "The Fed talked loudly but carried a small stick," said Joel Naroff, president of Naroff Economic Advisors.
    He said that while the financial system has the money to lend, banks are unwilling or unable to find suitable loans to make. Until they do, he said, "the recovery will be softer than anyone hoped for and there may be little the Fed can do about it."
    With interest rates so low, Congress, economists note, has more power than the Fed to stimulate the economy. But with midterm elections nearing, Congress is divided on whether the best move is short-term government spending, tax cuts or some combination.
    On Tuesday, the House, called back from its summer break for a one-day session, pushed through a $26 billion bill to protect 300,000 teachers, police and other workers from layoffs this year. President Barack Obama signed it almost immediately.
    The Fed action also came on a day when new figures showed worker productivity in the U.S. dropped this spring for the first time in more than a year -- a sign that companies that want to grow may need to hire more people.
    Investors reacted positively to the Fed statement. Stocks were down sharply before the announcement but made up ground after it was announced at mid-afternoon. The Dow Jones industrial average finished down about 55 points.
    Treasury prices rose slightly because the Fed plan would reduce the amount of government debt on the market for others to buy.
    The Fed said it would buy two-year and 10-year Treasurys by using the proceeds from debt and mortgage-backed securities it bought from Fannie Mae and Freddie Mac. It said that it would buy additional government debt as its existing Treasury bonds mature.
    The effect is that the Fed will keep its $2.3 trillion balance sheet steady -- rather than rolling it back, as it had hoped to do as the economy improved -- while shifting its holdings out of mortgage securities and into more government debt.
    "The news is positive but not meaningful," said John Merrill, chief investment officer of Tanglewood Wealth Management in Houston. "The money is a pittance."
    The central bank said it expects to start buying the government debt Aug. 17 and planned to publish details Wednesday.
    From March 2009 to this March, the Fed bought up $1.25 trillion in mortgage securities and $175 billion in debt from Fannie Mae and Freddie Mac. The goal of these purchases was to drive down mortgage rates and bolster the crippled housing market. The Fed also bought $300 billion of government debt between March and October 2009.
    The Fed's balance sheet has stayed at roughly $2.3 trillion since March.
    Economists are skeptical that cheaper credit or even more government aid will get Americans shopping more and businesses to hire. They also say some jobs in construction and other housing-related fields, and in manufacturing, will never return to pre-recession levels -- a shift in the basic structure of the economy.
    High unemployment, lackluster income growth, sagging home values and tight credit are all restraining the pace at which Americans are spending, usually a major source of powering the economy.
    AP Business Writers Martin Crutsinger in Washington, David Pitt in Des Moines, and Bernard Condon in New York contributed to this report.


    Source: http://finance.yahoo.com/news/Fed-wo...353655020.html
    I have no idea who the FED are but this doesnt sound good.
    Last edited by NVash; August 11th, 2010 at 04:45 PM.

  8. #53
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    The Fed. Reserve holds lots of money. It controls the interest rates for short-term loans that banks make from them and the rates banks charge to each other.
    Tea baggers want to fight the Man because the Man doesn't look like them.

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