Ron Paul, a Republican Congressman from Texas, says that The Worst is Yet to Come, on Forbes’ Monday headlines. Despite signs of an economic recovery, and promises of “green shoots” all over the economic landscape, Paul is doubtful that insisting on economic recovery will actually produce a true recovery.
With a gloomy outlook, Paul predicts that the economic recovery be not only be slow and arduous, but the worst is still to come -- and that any signs of a coming recovery is in fact a false recovery. Too much government intervention (too many dollars dependent on taxpayer dollars or printing new money from the central bank) is creating another bubble that is bound to burst.
Get ready for the coming year, which could have modest economic growth, Paul predicts, but be wary of whether this is truly a long term economic recovery. Pumping billions of dollars of government money in to the economy will only prolong the much-needed market corrections that must happen. “This is nothing less than the creation of another bubble,” he says, and what will follow the short recovery will be “a drop in growth worse than anything we’ve seen in the past two years.”
It’s always good to be cautiously optimistic – and while many economists are eager to put good news into today’s headlines, it’s unclear whether the economy is truly recovering or is in for another series of corrections before we see any steady job growth. Perhaps some pragmatic pessimism is in line for a few more months. Consumers, save money. Keep building your retirement funds and your emergency savings accounts. Saving for a rainy day is still necessary (as it always should be). Polish your resume and stay active in your current job market. Getting a job is harder than getting into MIT, so if you have a job with a means of positive cashflow, do your best to stay in the black -- this country is in pretty big debt already.
Comments
Have you researched The Repeal of Mark To Market in March 2009 and its EFFECTS on the market? Notice the corollary of "Uptrend Begins" when "Value As You See Fit" Accounting Becomes The Norm.
How about "Derivatives" or "Securitized Investment Vehicles"; Neither of which has had resolution - Shadow Banking/Off Accounting Book Assets Still Live? Maybe you have done your homework on how the mandate of the "Presidents Working Group On Financial Markets" is carried out; Big influence in the markets at the moment.
How about the influence of "Dark Pools" or "High Frequency Trading" or even the root of "Fractional Reserve Banking". Structure IS ALL IMPORTANT.
Functionality Derives From Structure.
Things are not well.
"Free" money only hides maladies until the bill comes due.
Ron Paul is not pessimistic just to be gloomy - There is some seriously "Unsound Practices" occurring currently.
Black Friday was a "bust" by all practical measurements... next year money will continue to be tight for consumers and small business. It's not a recovery, but a robbery of the fundamentals of our American way of life. Throw on top of that a bunch of re-distribution of wealth policies through environmental fear mongering and we have not only stalled on our way up the hill but we're slipping backwards to the bottom. Taxes are going up, energy costs are going up, and "entitlements" are being handed out like candy. We are living the "wet dream" the hippy 'boomers always wanted... and will soon wake up to a mess.
I left out my source for the black friday bust: look up npd dot com, and the "anatomy of black friday 2009"
All but the lowest end items are down almost double from last year. Next year we'll be over our entire deficit for 2009 in just the first two months. Can't wait.
Finally... there is no "relative morality" - right, and wrong are preserved despite the creative efforts of the hyper-intellects in Washington (pun intended). The markets will right themselves, and it will be painful. There is no escape from this truth.
To think otherwise, to think you can tax / spend yourself in to prosperity, is to try to get electrical power from an extension cord plugged in to itself... even if you believe it will happen you'll come up short.
If government spending was the answer to our economic problems then the last 10 years should have resulted in a BOOM! Where did all the war money go? Most came home... but where is it now? Answer - the wealth is in China. That's where our
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