U.S. recession to worsen, deflation a risk-report

[UpInArms]

Source: Reuters

SAN FRANCISCO, Dec 11 (Reuters) - The "nasty" U.S. recession will tighten its grip next year as unemployment rises and weak home and stock prices imperil consumers, finance firms and debt-laden businesses, a UCLA Anderson Forecast report released on Thursday said.

Additionally, a sustained retreat in prices for goods and services is a very real possibility that would further drag on the economy, according to the forecasting unit's report.

"Where only last quarter we were worried about inflation, we are now worried about its very rare opposite: deflation," the report said. Falling prices would cut demand and discourage employers from hiring.

<snip>

"The news from the economy is bad," the report said. "The recession that we had previously hoped to avoid is now with us in full gale force."

The UCLA Anderson Forecast unit expects real GDP to shrink by 4.1 percent this quarter and by another 3.4 percent and 0.8 percent in the first and second quarters of next year, respectively, as consumer and business spending weaken and as the foreign trade that had propped up growth much of this year sags.

Read more: http://www.reuters.com/article/bondsNews/idUSN1033481820081211

[Born Free]

1. on verge of depression

Let face it, when Bush admits to being in a recession ,it's only because he knows it's much worse, and they want to call it Obama's Depression so next election they can blame the democrats. The American people could turn it all around, we could get get some unusual spirit of patriotism and start buying American made products and services that put Americans back to work. Maybe we can't afford big, expensive American made products, but even an American made candy bar or box of cereal help create work for Americans... and maybe our $1.00 purchase won't make much difference, but if a million other Americans do the same it will add up.

When the army George Washington was freezing in Valley Forge, less than 20 miles away the British were being wined and dined by the wealthy in Philadelphia. Washington and his rag time army was a joke to them, they expected the weather to take care of him and the British saw no reason to be go out into the cold to finish them off. It wasn't the rich, but the poor that turned it all around, the rich only got on board when they realized Washington was going to win. In our current times we can not wait for the rich to lead, change must come from the bottom up.

[Double T]

2. The 'bottom' has always been the backbone of a revolution and this time will be no different.

I do everything possible to NOT BUY foreign made products. Other consumers must follow; buy American or buy nothing at all; that's right, you go without.

[Cessna Invesco Palin]

11. That's very nice.

Where's your computer from?

[Suji to Seoul]

13. Custom made at a locally owned computer store before I moved overseas

Where is yours from, if you're going to be completely flippant and condescending?

[Cessna Invesco Palin]

14. With parts from your local chip foundry, no doubt.

Mine was made in china, naturally. Like everyone else's, regardless of where the final assembly was done.

[closeupready]

25. What about your dinner plates? I eat on Fiesta Ware, made in West Virginia.

You probably don't even know or care about yours.

[jwirr]

29. This argument about where we get our things from may be relevant

but it sounds down right uninteresting to those of us who buy our things at rummage sales and the Salvation Army. My computer is of course an exception but it is very old.

[Lifetimedem]

22. I agree

I have 2 friends that just bought Toyotas, I wanted to scream.

I try to buy US when possible, but it is harder and harder to find ANYTHING

[SlicerDicer-]

27. I just bought a Audi not too long ago

Bite me... I want a reliable mode of transport.. So I purchased a A8.. Suck shit through a straw GM and Ford.. Once they make a competing product I will buy it.

NOTE!!!!!!!!!!!!!!! I don't buy Chinese shit that is garbage.

and just to be fair.. you sound as bad as some repuke rightwinger.. you just want toyota to win kinda shit.. Capitalism is one way street we cannot go back without pain.

[Lifetimedem]

34. Well we have driven our US cars

Over 10 years and 100,000 miles.

I hope you have a secure job so that you can make those payments

[SlicerDicer-]

41. I buy them used and for cash... Look up the cost on a 1998 Audi A8

My 1993 has 146k on it.. my 1998 has 109k on it.. and before that my 1982 had 236k on it when I got rid of it.

It seems to me that American Cars are considered good if they can hit 100k miles..

Note: My Grandmothers Audi went to nearly 600k miles as passed down through family.. My Mom's Audi went to 486k and so forth. They last forever :)

[Kalyke]

38. And Audi.

:rofl:

Good luck affording all your repairs.

My Ford and I will be laughing at you while you're stuck at Auto Zone getting your check engine light read for the umptenth time.

[SlicerDicer-]

42. I have software called Vag-Com check it out. I dont have to go to AutoZone

And as for affording repairs? I have done it for going on 10 years now and its cheaper all in all than any american car my neighbors come to me asking for help. Yes I am the neighborhood mechanic...

Of course this requires you knowing how to tear your car apart and fix it yourself. Its by far cheaper than you would think.. One more thing of note too. I am not going to falsely wave the American flag just to buy a Automobile that is what gets me from point a to point b. I am going to buy what will get me there when I need to go there no matter what. Thus far my Audi's have never let me down. I have had them go on the fritz but they still get me where I need to go till I can fix it.

I could post up every bit of maintaining I have done on my 3 Audi's I have owned over the past 10 years but I doubt you would be interested in the total cost I have spent as it would make you green.. My costs of 3 cars and all associated repairs likely do not exceed the cost of a new "Fix or Repair Daily" or any other American vehicle. That is at least halfway decent. And no I am not talking about some small hatchback. I am talking about a full size sedan that I need. As if I was to buy one thats what I would buy.

[TalkingDog]

33. Well, even "American" cars are not 100% American.

They are a conglomeration of Mexican labor, foreign made parts, etc...

American made can mean it was produced and assembled in the US or it can mean it was only assembled here out of foreign made and manufactured parts.

Welcome to the global economy (and to DU) If you want to only buy American, get some land, grow your own food, make your own dinnerware from local clay, grow some flax and cotton, get some sheep for wool, learn to spin weave and fabricate clothing...

It's do-able. I guess it depends on how truly dedicated you actually are.

[Lifetimedem]

35. It would be a lot safer

Most of the food poisoning is from foreign foods.

They also use that dreaded DDT that is out lawed HERE for environmental purposes .

We do not buy fresh fish, shrimp etc because most of it comes from polluted fish farms in China ...you are welcome to that bargain .

We buy local produce and meat from a meat store that has only US meat.

As for the Cars.. yes they drape it a label that says "North America" but at least some of it is produced here.

So send your bucks to China and India or Korea (that restricts American car imports) or to Japan.

I am sure those economies will be glad to support YOU if you need it

[closeupready]

24. Good strategy. I try to do the same thing.

When I can discern a product's origin - and believe me, because I have experience at looking for such labels, retailers try hard NOT to identify a product's country of origin.

[alterfurz]

10. Soviet-style phrasing...

...when they finally admitted "Chernenko has a cold" or "Andropov has the flu," you knew the situation was grave!

[jwirr]

28. Absolutely agree. I am just finishing J. H. Kuntsler's book "World

Made by Hand". That is one of the main messages of this book and for that matter his web-site.

[Career Prole]

3. Shouldn't be long now before military recruitment

starts climbing...and again they'll credit the gains to patriotism instead of hard times and no choices.

[melm00se]

5. re-enlistment

already has:

http://www.newsobserver.com/nation_world/story/1318336.html

[Career Prole]

7. Wow! I'm not used to seeing them so readily admit it!

Though several factors might explain the rise in re-enlistments, including a decline in violence in Iraq, Pentagon officials acknowledge that bad news for the economy is usually good news for the military.

In fact, the Pentagon just completed its strongest recruiting year in four years.

"We do benefit when things look less positive in civil society," said David Chu, undersecretary of defense for personnel and readiness. "What difficult economic times give us, I think, is an opening to make our case to people who we might not otherwise have."

I've bookmarked that article for later when conservatives make their usual argument that the "all-volunteer force" isn't an army of poor people but instead is a group of highly motivated patriots. Thanks!

[melm00se]

12. before you use that to buttress your argument

be prepared to refute the data from this:

http://www.heritage.org/Research/NationalSecurity/cda06-09.cfm

while it is from the Heritage Foundation, it does appear to be based upon valid data and the right loves the Heritage Foundation

[axollot]

18. That article is from 06. And the stats would be at least 2 yrs old--

--when the article used them. Things are changing, and it's doesn't invalidate what the above poster had already said RE the poor and the military.

cheers
Sandy

[melm00se]

20. won't stop them from being used

[Career Prole]

44. Based upon valid data? Really?

When I talk about low-income people joining the military you throw in a right-wing think-tank "study" you say shows the opposite and then say it's based on valid data. Did you read it? Way down the bottom, buried in the technical details of their "study" you'll find this (emphasis mine, because you can bet they didn't emphasize it):

Income Analysis

Individual recruit income data are not available. In computing the average household income for recruits, each recruit was assigned the median household income for his or her ZCTA.

Yeah, you read that right. In a "study" they purport shows that the military isn't recruiting more poor folks they add in the small print that they don't actually know what the recruits' income was so they assigned them the median income for the zip code of their "home of record" (in many if not most cases read that as "Mom and Pop's zipcode"). When I joined the military my home of record was where I grew up...a comfortable middle-class zip code, but I was flat broke with no prospects. Had this "study" been done in '72 it would have shown me as having a middle class income when in reality I had none.

[axollot]

17. My 19 yr old and his best friend are considering enlistment -

- because they feel there are no other options left to them. My son is and has always been against the Iraq war, he voted for Obama and Democratic across the board in his first chance being able to vote. He's an Aussie/American and felt that if he was to join any military ever it would be the Australian Military - because he is much more patriotic towards Australia - having spent most of his life there, it's natural for him to feel that way.

Yet, the job situation is so bad, he's talking about going to a recruiter in the US. He has his HS diploma and feels the military would also provide him with the college education he desperatly needs but we cannot afford - plus, he still has to eat.

Cheers
Sandy

[jwirr]

31. I wonder how many of today's vets are actually getting the college

educations they are promised?

[L0oniX]

21. Yep ...you can always go learn how to kill your fellow humans for money.

May be if had not spent so much money on Iraq we would have money to invest in our country and incentives for start up companies who keep jobs here. It's pathetic that we would rather spend our money killing others and letting our own die for lack on money for health care.

[fasttense]

4. Welcome to the Republicon Great Depression 2.0

Like in 1929, the uber wealthy have yet again destroyed the world economy through the Republicon party.

I wonder if in 75 years, they will do it all over again?

These repulicons are an ignorant lot. Here in TN, they all listen to Oxycontin Rush. They hail the ethically challenged Palin as a superwoman and, like Joe the delusional Plumber, think they will one day wake up magically rich.

If the drug addled Rush, and right-wing hate radio, were to do a version of "War of the Worlds", hundreds of thousands of southern republicons would be offing themselves. They believe any old crap the hate mongers spit out.

[Rosa Luxemburg]

9. The GOP are waiting for their 'Hitler moment'

can't you just see them in a year or two when it hits rock bottom. They'll blame and they'll get back in. Then we'll have eternal wars and internment.

[BR_Parkway]

6. You know, when stores were/are small and local, they depend on

sales to carry them through the entire year versus behemoths that operate on so much credit that they can only make a profit the last few weeks of an entire year. How has anyone thought that to be a sustainable business model for so long is beyond me.

And for those who say that businesses need to run on credit, no they don't. We own a wine shop - and in this state, you must pay for everything you order from the distributors when it's delivered - the guy stands there and waits while you write him a check. Since the affiliated products we carry know this, they also understand that they don't have to offer credit to us to entice our business, so they don't.

I have to wonder what the retailing world would look like now if it hadn't gotten so hooked on credit.

[Ex Lurker]

8. The guest on CNBC just now called it a depression

you could hear their jaws hit the floor. Sorry, I didn't catch his name.

[Odin2005]

15. Somebody on the MSM actually said the dreaded D-Word!?!

:wow:

n/t.

[Jackpine Radical]

30. More precisely,

the OTHER dreaded D-word.

[Odin2005]

39. Deflation?

:scared:

[axollot]

16. Please remember to buy Brawny or other Georgia Pacific made

paper products. Angel Soft, Sam's brand 'Kirkland' paper towels and toilet paper. Sparkle paper towels. They are a union company my hubby works at - they have just laid off 40 people, not because they wanted to, but they had to turn off two paper machines. The products I mentioned are made at the factory where he works.

Thanks guys! Spread the word - I'm all about American made/Union made products and these products are exactly what your post is talking about!

Cheers
Sandy

[NMDemDist2]

19. wow, I did not know that AND those are my usual brands anyway

and will continue to be now

:hi:

[axollot]

43. Thanks everyone! Glad to hear the support for our guys at GAPAC!

honestly, I feel guilty about the whole 'tree' clearing situation that brings about the clearing of forests and the bleach to make it white also annoys me. But we do need to wipe our booty's; we also need to allow hemp to be grown for paper use, little to NO bleaches and find other, safer ways to make it soft.

Growing hemp in these economic, drought, crazy weather times, would not only save soil errosion, but create new revenue for struggling farmers and be more eco-sound.

I don't know if people have 'stopped' buying toilet paper, but possible they have many other paper products. His factory here in FL isn't responsible for everything that Georgia Pacific makes, (however, all the factories are union all over the country), mostly just the paper I mentioned.

One of the lines that was shut down was the "Kraft Paper" line - the brown paper stuff, i.e. packaging, grocery bags. However, several reasons could be behind the reduction of production. People buying less paper products overall, less paper towels too (a washable towel is handy when every penny counts - as it does for the enviroment too). Less paper purchases across the board could cause consolidation/slow down in other areas too. (my understanding is that the most paper products have a much smaller profit margins than other manufacturing businesses, and not just the big ticket stuff).

It is at least comforting to know that we *do* still make the simplest things like our toilet paper locally, by locally meaning not internationally!

Hubby is a hard core union guy and when he was an organizer 'back in the day' for a chemical plant in OH - he had death threats and all against him. Back then, he didn't have a family either. He would still fight though, but now, pause for a thought, before pushing forward again. He sure does fight safety rights at the GAPAC plant AND knows the 'contract' inside out and back to front LOL! He's really hard-core on that bit too. Not only to save his behind but everyone around him. (and even for the racsist jerks that have given him hell over the years too, which in a backwoods town, where the factory is located, there are plenty in both colours too)!

Sometimes he posts here at DU - he reads the threads here daily thats for sure. If you see "Paradox" that's my hun. He introduced me to DU when we were slow and bored at work one day, about a month before we started to date, which was 08/02 (Tech not married now either, but after nearly 7 yrs and a 5 1/2 yr old girl - we are in no hurry. I'm disabled and we cannot afford to lose my health insurance and could NOT afford the co-pays etc on his plan - which seems to get worse every year. i.e. when he started there, they paid 80% now insurance covers only 70% - couple that with the rising costs and the cost of adding family *sigh* and the outcome is pretty shitty....This is what we need to get through to people's heads about Universal Health, it's killing and abusing families that DO pay for their health insurance......another thread there tho!)

Cheers and thanks again
Sandy

[florida08]

26. didn't know that either

but do buy both Angel Soft and Brawny and now I can be proud to do so. I support unions.

[RobinA]

32. Sometimes I Wonder

It strikes me that some companies may be using the poor economy as a excuse to lay people off. People are buying less toilet paper? Now THAT'S a depression!

[Odin2005]

40. I buy union-made paoper towels? Sweet!

[xchrom]

23. recommend

[AntiFascist]

36. The falling dollar would be good for manufacturing and exports...

if we still manufactured or exported anything!

[Oak2004]

37. Deflation is not a "risk": it's a present fact

Prices are beginning to drop.

Whatever they admit to, you know it's worse. Whatever they warn "might" happen, you know it's actually in progress.