The Politics of Madness in the 2013 Recession or How Obama throws the race

Would Al Smith want to be the president in 1928 if he KNEW the great depression was coming?

A former DOL Labor Secretary said “Party that wins White House could become minority party for many years if, as seems increasingly likely, world enters recession in 2013. ”

 

Hoover’s 1928 victory was sweeping….

Obama is 50 years old.

Young for a president.

Missed the Golden opportunity in 2008-2010 when the Dems had all three parties.

Now stalled by the Young House Reps and Mitch McConnell.

How do you get that majority back?

Let Hebert Hoover-Mitt Romney win.

Let the country go back to 10% unemployment.

Madness.

The politics of madness.

Hoover -Romney will take the blame.

 

This 1932 map could be the 2016 election results.

With Obama coming back like Grover Cleveland.

Four years to raise money.

Shoot barbs.

Bill Clinton knows fiance.

So does Dem backer Soros.

Soros, Leon Cooperman, Louis Bacon liquidated positions in JPM, C, and GS.

Soros no longer has any positions in major financial names.

Follow the money.

How long can Germany keep propping up Spain, Greece, Italy, and Portugal.

Euro collapse or Germany withdrawal means recession.

Many think Greece exits Euro Zone in 2013

Portugal will exit Euro afterward,

Spain’s recession will drag on into 2013. Spain has a lot of problems and eventually Spain could exit Euro Zone.

Italy’s recession will drag on into 2013.

Britain’s economy will see near zero growth for 2012, according to slashed Bank of England growth forecasts.

By 2013, we could have a perfect storm of risks to the economy.

Or Sequestration hits. (see previous post)

CBO has forecast a recession resulting from the fiscal cliff. In January it saw 1.1 percent GDP growth in 2013.

Gross, who runs the world’s biggest bond fund at Pacific Investment Management, said the US was “approaching recession when measured by employment, retail sales, investment and corporate profits”.

Recession 2013: Clinton’s Take

In a taped interview that aired in June 2012 on CNBC’s “Closing Bell,” former President Clinton said he thought the U.S. economy was already in a recession.

Clinton called out Republican efforts to cut the deficit, saying they jeopardize the country’s chances to get out of the debt debacle.

“What I think we need to do is find some way to avoid the fiscal cliff, to avoid doing anything that would contract the economy now, and then deal with what’s necessary in the long term debt-reduction plans as soon as they can, which presumably would be after the election,” Clinton said.

“They will probably have to put everything off until early next year,” he added. “That’s probably the best thing to do right now.”

Clinton made the unexpected endorsement of extending the Bush tax cuts but added that he is not in support of extending them for the wealthiest. This echoes the fundamental idea behind the Buffett Rule.

Clinton was also quick to blame Europe – saying “this European thing that’s having a bigger impact than people know” – and politics for the current economic mess.

“The thing that cost jobs here has been the Congress’s policies,” said Clinton.

So the smartest minds.

Madness.

Throw an election.

Obama people gasp.

The horror is unfathomable.

Sorta like a nuclear bomb in 1945.

Advertisements
This entry was posted in Uncategorized. Bookmark the permalink.

One Response to The Politics of Madness in the 2013 Recession or How Obama throws the race

  1. shulquist says:

    To the Winner: Good Luck—You’ll Need It
    By BRETT ARENDS

    The presidential election is heading down to the wire. With three weeks to go, the polls show Mitt Romney and Barack Obama within a few points. The swing states are in play. Somewhere close to $2 billion will be spent in total on the final outcome.

    It’s time to look ahead. What sort of agenda will the winner inherit? How will he deal with a bitterly divided and partisan political system, a weak recovery, and a raft of pressing crises at home and abroad?

    Here’s what the email from his chief economic adviser might look like on Nov. 7.

    Dear Mr. President/President-Elect,

    Congratulations on your victory. I’m sorry to butt in on your celebrations, but you asked for a summary of the economic problems ahead. I’m afraid you face five major ones.

    1. The fiscal cliff

    On Dec. 31 the U.S. federal government is going to hit a potentially disastrous so-called fiscal cliff. Under current law, taxes are set to jump and spending will be cut. This is partly due to the planned expiration of the Bush-era and other tax cuts and partly to spending cuts agreed to last year.

    Bill Butcher
    This must not be allowed to happen. The International Monetary Fund, the Congressional Budget Office and most economists agree that the net effect of this sharp budget tightening, at a time when the economy is weak, could tip the U.S. economy back into recession.

    Middle-class taxpayers would see a big jump in tax bills. Andrew Smithers, a financial consultant in London who called the last two financial crises, suspects it could also tank the stock market.

    Yet something must be done. Clearly, $1 trillion-plus budget deficits cannot go on indefinitely. And Congress is likely to demand some form of deal as the price for approving yet another increase to the debt ceiling early next year. We need that agreement, or you will be the first president in history to default on Treasury bonds.

    2. Jobs

    According to the Labor Department, about 15% of the workforce, or one worker in seven, is either unemployed or stuck working part-time because he or she can’t get full-time work. And 23% of prime working-age men—about 14 million ages 25 to 54—lack a full-time job. Think about the lost output in the economy—and lost taxes to the government.

    This has been a recession like no other since World War II. Yes, the U.S. has recovered faster than many of our overseas competitors. And, yes, the private sector has been hiring at a reasonable clip lately—about 145,000 new jobs a month so far this year.

    Over the last four years, the U.S. government has thrown billions and billions of borrowed money, and billions more of printed money, at the economy. Yet according to a recent study by the Associated Press, this has been the weakest recovery since the War.

    The public has just elected you to sustain a jobs recovery in these circumstances. And the public is looking for you to bring the estimated five million long-term unemployed back into the economy.

    3. Retirement

    If you think the jobs crisis is bad, look at the looming retirement crisis.

    Social Security and Medicare, most agree, are on unsustainable fiscal ground. Taxes will have to be raised, and spending reined in, to ensure the systems stay solvent. This is a major item on your to-do list.

    But here’s the problem. There’s only so much you can cut, because 80 million baby boomers are starting to retire—and very few of them are prepared. According to the latest survey by the Employee Benefit Research Institute, an independent think tank, “a sizable percentage of workers have virtually no money in savings and investments.”

    Sixty percent of all workers surveyed have less than $25,000 in savings and investments, and 30% have less than $1,000. The figures for boomers—those over 45—are better, but not by a lot.

    To put this in context, $25,000 will buy a retired couple an annuity of only about $118 a month. Add that to an average Social Security check of $1,230 a month, and you are potentially looking at mass poverty among the elderly.

    4. Debt

    You’ve probably heard that Americans have been paying down debts and shoring up their balance sheets. You’ve probably heard that corporations are meanwhile sitting on a ton of cash. It all sounds promising.

    The trouble is that it’s mostly a mirage.

    According to the Federal Reserve, total household debts have fallen 6% from their peak at the top of the bubble. They are higher today than they were at the end of 2006.

    Meanwhile, “cash-rich” U.S. corporations have borrowed an extra $1.1 trillion just since 2007, and their total debts now stand at a record $8.2 billion.

    Throw in U.S. government debts, and you have a system that in total owes $39 trillion—an unprecedented two and a half times gross domestic product. This poses serious risks, including weak growth and even another financial crisis.

    5. China

    In the short term, you face the risks of a “hard landing” for the Chinese economy. For the last few years, it has been a major engine of the global economy. In the coming months, many on Wall Street worry, that may be interrupted as China switches from an economy dominated by infrastructure spending to one with more consumer spending.

    In the longer term, every president since Ulysses S. Grant has presided over an America that had the biggest economy in the world. You will probably be the last.

    Based on International Monetary Fund data, China’s real output is set to hit $20.2 trillion by 2017, surpassing $19.7 trillion in the U.S. And China is still seeing faster long-term growth than the mature U.S. economy. The gap will widen year after year. Our share of global output, which was 24% in 2000, will by 2017 be down to 18%—and falling.

    This poses enormous economic, political and strategic challenges. Yes, our military is still No. 1—but you can’t run a first-class empire with a second-class economy, as the British and the Soviets learned years ago.

    Sorry about all this doom and gloom, Mr. President/President-Elect, especially on the morning after your big triumph.

    But look on the bright side. The Electoral College doesn’t meet till Dec. 17. Maybe they’ll pick the other guy instead.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s