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Stocks Retreat as Gloom Descends on Several Fronts

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Amerigo Vespucci Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Aug-11-10 12:21 PM
Original message
Stocks Retreat as Gloom Descends on Several Fronts
Source: The New York Times

Shares on Wall Street retreated Wednesday in the wake of the announcement by the Fed that it would buy government debt and as new trade figures suggested a slowdown in growth in the United States.

Stock indexes were down more than 2 percent by early afternoon in the first full day of trading after the Fed said the recovery had slowed and that it had decided to recycle the proceeds of its mortgage-bond portfolio into Treasuries. In addition, investors were treated to some gloomy trade figures that caused the outlook for second-quarter growth to be revised lower.

The countrys trade deficit unexpectedly widened 18.8 percent in June, as American exports slacked off.

The deficit was much wider than expected as imports continued to surge, especially in automobiles and consumer goods. Nigel Gault, the chief United States economist for IHS Global Insight, said the deficit combined with other weak data suggested that second-quarter growth was only 1.2 percent, placing the economy on even shakier ground than it seemed, and underlining why the Fed has shifted towards an easing bias.

Read more: http://www.nytimes.com/2010/08/12/business/12markets.ht...
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Hawkowl Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Aug-11-10 12:31 PM
Response to Original message
1. "unexpectedly"
Edited on Wed Aug-11-10 12:33 PM by Hawkowl
Stupid bullshit. Everyone wants the consumer spending again but, SURPRISE! The only choices we are offered are manufactured in foreign countries! So most of every tax break, wage increase, or momentary increasing blip in credit is immediately funneled out of the country to buy some nifty foreign goods like CLOTHES or FOOD, or OIL, not to mention electronics, cars, I phones, etc.

The people running this economy know this, because they are the ones who moved all the manufacturing facilities offshore, along with their bank accounts, where they could much easily and systematically pillage the American consumer while exploiting lax labor laws.

The economy will get worse, and worse, AND WORSE! Until jobs are brought home, wages are raised back to a 1970's level, and corporations and the wealthy have to pay 1960's style tax rates.

The solution is simple and it will either be done, or America will fail.
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Amerigo Vespucci Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Aug-11-10 12:40 PM
Response to Reply #1
2. There should be a single-minded focus on jobs, period.
The problem is that there are things that could be done, perhaps should be done, to foster job creation in the U.S.

One option is to offer an incentive for companies that not only create jobs in the United States, but take measures to bring back positions that were previously outsourced overseas.

So far, no one in government has had the spine to take this one and run with it.

And as long as employers enjoy outsourcing and "productivity gains" in the U.S., wages will remain low and stagnant, and new positions won't be created.

100% of the money I spend these days goes on strict "survival items"...food, gas for the car, utility bills I have to pay unless I want to get shut down, etc.

Other than that, I do not "spend"...ever.

That's because I am self-employed and it is tough as hell to do business with other people who do not want to spend, even if their business will benefit. They think "I have this money in my hand, I will take my chances, and the Success Fairy will sprinkle magic fairy dust on my business and the customers will come."
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Hawkowl Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Aug-11-10 12:45 PM
Response to Reply #2
3. I agree
I would go further and institute tariffs and penalities on companies that outsource as well as incentives. Think of them as negative incentives.

I also simply do not buy much of anything. Any additional money I make is quickly saved as cash for the next health or financial emergency. It used to be I'd hold a credit card or two for emergencies. Now, I simply hold cash. I am happy with an old car, and old clothes, old TV etc. I'm happier with old shit and a cash cushion than I'd be with new shit and a lot of bills.
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Raschel Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Aug-11-10 12:48 PM
Response to Reply #1
4. ++++1 Totally agree. There is no other solution.
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elocs Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Aug-11-10 01:07 PM
Response to Original message
5. If this is the atmosphere come November it won't be pretty. n/t
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joeglow3 Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Aug-11-10 03:34 PM
Response to Original message
6. "announcement by the Fed that it would buy government debt "
The first sign that things are about to get a LOT worse.
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okieinpain Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Aug-11-10 03:43 PM
Response to Reply #6
7. i agree, really sad. n/t.
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