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The financial fear is palpable today.

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Daemonaquila Donating Member (413 posts) Send PM | Profile | Ignore Fri Dec-05-08 12:51 PM
Original message
The financial fear is palpable today.
I would've posted this in the news, but part of the fear involved here was CNBC's posting of a news item as "Breaking News" then pulling it minutes later. The headline noted that Chrysler had hired an outside firm to prepare for bankruptcy.

Add that to the stories about double the number of jobs lost as expected, and you have very scared people. Suddenly CNBC is leading with "Despite Huge Job Losses, the Worst Could Be Over" (http://www.cnbc.com/id/28069440 ).

"Every recession has its worst day, and this is probably the worst day," says Chris Rupkey of Bank of Tokyo-Mitsubishi. ... Severe drops like this (the Sept.-Nov payrolls ) cannot be sustained, says Robert Brusca, chief economist at Fact & Opinion Economics. It suggests we are getting so weak there will be a turnaround."

Um, yeah... nice that you can't even give any reasoning for that assessment other than "I'm freaking scared and we're tanking so fast that we've GOTTA stop soon. Right? RIGHT? MOOOOOMMMMMMEEEEEEEEEEEEEE!"

I haven't been seriously scared until now. I knew the financial "experts" were in denial for most of the past year, then finally had to come to grips with reality when the market blew up. But this new episode of head-in-the-sand does not bode well. I suspect we'll see the Chrysler story finally surface after the markets are closed. Probably they didn't mean for their release to go public during trading. Of course, we'll just see the fallout on Monday.

The only way we'll get through this downturn is for the "experts" to have a reality check and admit to themselves and the rest of us how truly bad things are. Once we stop pretending and hoping, we can try to solve this mess. We can't even try honestly if we insist that "It's not that bad, and it's about to turn around on its own anyway."
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Veritas_et_Aequitas Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 12:54 PM
Response to Original message
1. I know what you mean
My friend was just laid off, and he's in biotech. When biotech is laying off in Massachusetts, things are really bad.
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lumberjack_jeff Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 01:06 PM
Response to Reply #1
3. Uh, no.
You'll be seeing sewage treatment plants shut down and garbage collections cease before all is said and done. THEN, things will be really bad.
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Veritas_et_Aequitas Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 03:23 PM
Response to Reply #3
12. No, that's horrifying.
And then when food production goes, catastrophic.
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BoneDaddy Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 01:04 PM
Response to Original message
2. I see it happening in my circle as well
a mom of a student I work with just got laid off yesterday. Not cool.
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Idealism Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 01:22 PM
Response to Original message
4. Krugman hasn't been downplaying this at all
He was right in 2004 when he predicted within "three to five years we will have a major financial crisis." You can download the lecture he gave on that actually on iTunes. The past few months, he has been saying this will get much, much worse. He said hes unsure if unemployment will reach 20% again, but 15% seems "very possible." All in all, I think hes been more correct about the problems than 99% of the other economists I read.
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sarcasmo Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 01:35 PM
Response to Reply #4
5. I remember when people were laughing about Krugman saying that, not so funny now.
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Warpy Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 01:38 PM
Response to Reply #4
6. I beat him by a year
I started suggesting in 2003 that people start paying their debts off because we were headed for a debt meltdown.

Of course people said I was nuts.
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Idealism Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 01:44 PM
Response to Reply #6
7. Thing is, he is so highly read and respected
that when he said "within three to five years" people scoffed at him. Its easy for you to predict something like this, but for a top economist to warn of coming doom before we had even the housing bubble, when prices were still high and people had equity left, its a much differant thing. He in a sense risked his international reputation, not to try to discredit your prescient sense :) It is much harder for a man who is criticized and demonized by republicans if he is wrong just simply for being a liberal leaning economist.
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Warpy Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 02:17 PM
Response to Reply #7
8. That's exactly when all reasonable economists
Edited on Fri Dec-05-08 02:47 PM by Warpy
should have been predicting it. All the signs were pointing to disaster and Krugman was the only one out there who was brave enough to state what should have been the obvious.

After all, if a casual online crank like me could see it coming, why couldn't all these smart guys with economics degrees up the gazoo? The signs weren't liberal or conservative, they were merely unmistakable.
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Idealism Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 02:41 PM
Response to Reply #8
9. I'd recommend you downloading the iTunes speech
Its an hour long, i think its the one called The Great Unraveling. His exact words were something to the effect of "anyone who looked at this knew we are headed for a serious crisis" referring to home prices, personal debt, stagnant wages, etc. He came out publicly in 04 to the best of my knowledge, but apparently he and others knew before that and were afraid of the backlash perhaps
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LeftHander Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 02:48 PM
Response to Original message
10. Free beach towel for credit application filled out at homeless shelter..
Edited on Fri Dec-05-08 02:51 PM by LeftHander
...People will continue to carry worthless credit cards as they sit in the SUV with no gas in the tank and all their crap crammed in the back.

Sitting staring out the window at the beach listening to right wing talk radio rail on Obama. They grip their new free beach towel, wipe the tears away and then hang themselves from a light pole.
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specimenfred1984 Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Dec-05-08 02:56 PM
Response to Original message
11. I've been warning people since 2005, everyone ignores the truth
Most people prefer propagandized good thoughts to easily understandable conclusions and rational thinking. As a financial trader, I've seen pure corruption and crime in all aspects of American business for years but as long as the money is flowing, nobody wants to hear the truth. It's an extremely corrupt culture we live in and the one and only way to turn it around is to hold criminals accountable. If not, they'll just be back again in a couple of years spreading their propaganda, creating new bubbles, inventing new ways to get around laws and to pay off their cronies.

It used to be called "regulation" and capitalism is only as good as its regulation.
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