Get a Clue - US Economic Condition - W/Solution

[Varient]

I think the depressing part for me is the fact that we really are in trouble as a nation.

We are REALLY at a point where we needd to stop the greed fest as a country and put it all in one sock.

We will faill because:

EVERYONE wants theirs - and there can be no bending to perserve what we do have because NO ONE in the process of trying to gain more believe that it could be that bad.

(Reference the results of this kind of thinking - The Long Depression - The Great Depression - etc,..)
Lessons from history - ref [The Crisis through the Lens of History by Charles Collyns]

"So what can history teach us about containing the damage and minimizing downside risks to the global economy? The first and most important lesson from every financial crisis since the Great Depression is to act early, to act aggressively, and to act comprehensively to deal with financial strains. The priority must be to quench the fire, even if unorthodox measures are needed that would not be applied other than in the context of a systemic event. As former U.S. Treasury Secretary Larry Summers said, when markets overshoot, policymakers must overshoot too. Thus, the Great Depression became so great in part because for four years after the stock market crash of 1929, policymakers followed orthodox policies that allowed credit to shrink, banks to collapse, and the crisis to feed on itself. Policymakers today are very aware of this chilling precedent, including Federal Reserve Chairman Ben Bernanke, who has studied the period closely to help strengthen understanding of how financial and real sectors of the economy interlink (Bernanke, 1983).
A more recent cautionary tale is provided by Japan in the 1990s, where the impact on bank and corporate balance sheets of the collapse of the house and equity price bubbles was allowed to go unaddressed for many years, contributing to a decade of weak growth (see “The Road to Recovery: A View from Japan,” pp. 24–25, in this issue). A more positive case was the vigorous response to the Nordic banking crises of the early 1990s, which created the conditions for strong economic revival after a sharp downturn (see “Stockholm Solutions,” pp. 21–23, in this issue).

A second important lesson is the value of providing macro-economic support in parallel with financial actions. With the effectiveness of monetary policy limited by financial disruptions, fiscal stimulus must play an important role to help maintain the momentum of the real economy and curtail negative feedbacks between the financial and real sectors. Indeed, increasing interest is now being paid to boosting infrastructure spending, akin to the public work programs of the Depression era. But, as the Japanese example makes clear, macroeconomic support by itself provides only breathing room, not a cure; it is essential to use the space provided to address the underlying financial problems or the outcome will be a series of fiscal packages with diminishing impact. And it should also be recognized that there will be limited space for macroeconomic responses in countries where the weakness of public sector management has been an integral source of the problem, as has often been the case in emerging market crises.

The third lesson is the need for policy solutions that work at the global level. Again, the Great Depression provides a classic example of what not to do: the “beggar-thy-neighbor” tariff hikes following the Smoot-Hawley Tariff Act in the United States, which contributed to the international transmission of the crisis around the world. Other examples of the negative contagion effects of one country’s policy decisions on other countries can be drawn from the Latin American debt crises since the 1980s and from the Asian crisis."


I copied that to say this:

In order for us to have the room to dig our way out of this mess,.. we HAVE to turn in toward ourselves,.. SUPPORT our own, Buy our own FIRST to support what we have before trying to REPAIR the damage,... THEN CONTINUE to do the stupidity that allows people to become part of the slightly growing rich.

Peace.

 

[Majic Walrus]

I think the depressing part for me is the fact that we really are in trouble as a nation.

We are REALLY at a point where we needd to stop the greed fest as a country and put it all in one sock.

We will faill because:

EVERYONE wants theirs - and there can be no bending to perserve what we do have because NO ONE in the process of trying to gain more believe that it could be that bad.

(Reference the results of this kind of thinking - The Long Depression - The Great Depression - etc,..)
Lessons from history - ref [The Crisis through the Lens of History by Charles Collyns]

"So what can history teach us about containing the damage and minimizing downside risks to the global economy? The first and most important lesson from every financial crisis since the Great Depression is to act early, to act aggressively, and to act comprehensively to deal with financial strains. The priority must be to quench the fire, even if unorthodox measures are needed that would not be applied other than in the context of a systemic event. As former U.S. Treasury Secretary Larry Summers said, when markets overshoot, policymakers must overshoot too. Thus, the Great Depression became so great in part because for four years after the stock market crash of 1929, policymakers followed orthodox policies that allowed credit to shrink, banks to collapse, and the crisis to feed on itself. Policymakers today are very aware of this chilling precedent, including Federal Reserve Chairman Ben Bernanke, who has studied the period closely to help strengthen understanding of how financial and real sectors of the economy interlink (Bernanke, 1983).
A more recent cautionary tale is provided by Japan in the 1990s, where the impact on bank and corporate balance sheets of the collapse of the house and equity price bubbles was allowed to go unaddressed for many years, contributing to a decade of weak growth (see “The Road to Recovery: A View from Japan,” pp. 24–25, in this issue). A more positive case was the vigorous response to the Nordic banking crises of the early 1990s, which created the conditions for strong economic revival after a sharp downturn (see “Stockholm Solutions,” pp. 21–23, in this issue).

A second important lesson is the value of providing macro-economic support in parallel with financial actions. With the effectiveness of monetary policy limited by financial disruptions, fiscal stimulus must play an important role to help maintain the momentum of the real economy and curtail negative feedbacks between the financial and real sectors. Indeed, increasing interest is now being paid to boosting infrastructure spending, akin to the public work programs of the Depression era. But, as the Japanese example makes clear, macroeconomic support by itself provides only breathing room, not a cure; it is essential to use the space provided to address the underlying financial problems or the outcome will be a series of fiscal packages with diminishing impact. And it should also be recognized that there will be limited space for macroeconomic responses in countries where the weakness of public sector management has been an integral source of the problem, as has often been the case in emerging market crises.

The third lesson is the need for policy solutions that work at the global level. Again, the Great Depression provides a classic example of what not to do: the “beggar-thy-neighbor” tariff hikes following the Smoot-Hawley Tariff Act in the United States, which contributed to the international transmission of the crisis around the world. Other examples of the negative contagion effects of one country’s policy decisions on other countries can be drawn from the Latin American debt crises since the 1980s and from the Asian crisis."


I copied that to say this:

In order for us to have the room to dig our way out of this mess,.. we HAVE to turn in toward ourselves,.. SUPPORT our own, Buy our own FIRST to support what we have before trying to REPAIR the damage,... THEN CONTINUE to do the stupidity that allows people to become part of the slightly growing rich.

Peace.

What did that excerpt have to do with anything at all?

We already know your point, but you aren't doing anything to prove it to anybody. The fact remains that outsourcing and expansion just simply aren't bad. They aren't what got us into this crisis and stopping them won't get us out of this crisis.

 

[Varient]

What did that excerpt have to do with anything at all?

We already know your point, but you aren't doing anything to prove it to anybody. The fact remains that outsourcing and expansion just simply aren't bad. They aren't what got us into this crisis and stopping them won't get us out of this crisis.

That excerpt underlines the fact that what we need to do will not happen. Too much greed to buy or sell from ourselves first to support our infrastructure.

Instead we would rather drag the rest of the planet into the same kind of mess,.. we are NOT learning from history.

 

[Majic Walrus]

That excerpt underlines the fact that what we need to do will not happen. Too much greed to buy or sell from ourselves first to support our infrastructure.

Instead we would rather drag the rest of the planet into the same kind of mess,.. we are NOT learning from history.

This crisis is not a stock market collapse like the 20s great depression. These both might be battles but they are entirely different wars.

 

[Varient]

China Racing Ahead Of U.S. In The Drive to Go Solar
By Keith Bradsher
WUXI, China — President Obama wants to make the United States “the
world’s leading exporter of renewable energy,” but in his seven months
in office, it is China that has stepped on the gas in an effort to
become the dominant player in green energy — especially in solar power,
and even in the United States.
Chinese companies have already played a leading role in pushing down the
price of solar panels by almost half over the last year. Shi Zhengrong,
the chief executive and founder of China’s biggest solar panel
manufacturer, Suntech Power Holdings, said in an interview here that
Suntech, to build market share, is selling solar panels on the American
market for less than the cost of the materials, assembly and shipping.
Backed by lavish government support, the Chinese are preparing to build
plants to assemble their products in the United States to bypass
protectionist legislation. As Japanese automakers did decades ago,
Chinese solar companies are encouraging their United States executives
to join industry trade groups to tamp down anti-Chinese sentiment before
it takes root.
The Obama administration is determined to help the American industry.
The energy and Treasury departments announced this month that they would
give $2.3 billion in tax credits to clean energy equipment
manufacturers. But even in the solar industry, many worry that Western
companies may have fragile prospects when competing with Chinese
companies that have cheap loans, electricity and labor, paying recent
college graduates in engineering $7,000 a year.
“I don’t see Europe or the United States becoming major producers of
solar products — they’ll be consumers,” said Thomas M. Zarrella, the
chief executive of GT Solar International, a company in Merrimack, N.H.,
that sells specialized factory equipment to solar panel makers around
the world. Since March, Chinese governments at the national, provincial
and even local level have been competing with one another to offer solar
companies ever more generous subsidies, including free land, and cash
for research and development. State-owned banks are flooding the
industry with loans at considerably lower interest rates than available
in Europe or the United States.
Suntech, based here in Wuxi, is on track this year to pass Q-Cells of
Germany, to become the world’s second-largest supplier of photovoltaic
cells, which would put it behind only First Solar in Tempe, Ariz. Hot
on Suntech’s heels is a growing list of Chinese corporations backed by
entrepreneurs, local governments and even the Chinese military, all
seeking to capitalize on an industry deemed crucial by China’s top
leadership. Dr. Shi pointed out that other governments, including in the
United States, also assist clean energy industries, including with
factory construction incentives.
China’s commitment to solar energy is unlikely to make a difference soon
to global warming. China’s energy consumption is growing faster than any
other country’s, though the United States consumes more today. Beijing’s
aim is to generate 20,000 megawatts of solar energy by 2020 — or less
than half the capacity of
<http://topics.nytimes.com/top/reference/timestopics/subjects/c/coal/index.h
tml?inline=nyt-classifier> coal-fired power plants that are built in
China each year.
Solar energy remains far more expensive to generate than energy from
coal, oil, natural gas or even wind. But in addition to heavy Chinese
investment and low Chinese costs, the global economic downturn and a
decline in European subsidies to buy panels have lowered prices.
The American economic stimulus plan requires any project receiving money
to use steel and other construction materials, including solar panels,
from countries that have signed the World Trade Organization’s agreement
on free trade in government procurement. China has not.
In response to this, and to reduce shipping costs, Suntech plans to
announce in the next month or two that it will build a solar panel
assembly plant in the United States, said Steven Chan, its president for
global sales and marketing.
“It’ll be to facilitate sales — ‘buy American’ and things like that,”
Mr. Chan said, adding that the factory would have 75 to 150 workers and
be located in Phoenix, or somewhere in Texas.
But 90 percent of the workers at the $30 million factory will be
blue-collar laborers, welding together panels from solar wafers made in
China, Dr. Shi said.
Yingli Solar, another large Chinese manufacturer, said on Thursday that
it also had a “preliminary plan” to assemble panels in the United
States. Western rivals, meanwhile, are struggling. Q-Cells of Germany
announced last week that it would lay off 500 of its 2,600 employees
because of declining sales. It and two other German companies, Conergy
and SolarWorld, are particularly indignant that German subsidies were
the main source of demand for solar panels until recently.
“Politicians might ask whether this is still the right way to do this,
German taxpayers paying for Asian products,” said Markus Wieser, a
Q-Cells spokesman.
But organizing resistance to Chinese exports could be difficult,
particularly as Chinese discounting makes green energy more affordable.
Even with Suntech acknowledging that it sells below the marginal cost of
producing each additional solar panel — that is, the cost after
administrative and development costs are subtracted — any antidumping
case, in the United States, for example, would have to show that
American companies were losing money as a result.
First Solar — the solar leader, in Tempe — using a different technology
from many solar panel manufacturers, is actually profitable, while the
new tax credits now becoming available may help other companies.
Even organizing a united American response to Chinese exports could be
difficult. Suntech has encouraged executives at its United States
operations to take the top posts at the two main American industry
groups, partly to make sure that these groups do not rally opposition to
imports, Dr. Shi said.
The efforts of Detroit automakers to win protection from Japanese
competition in the 1980s were weakened by the presence of
<http://topics.nytimes.com/top/news/business/companies/honda-motor-co-ltd/in
dex.html?inline=nyt-org> Honda in their main trade group; they expelled
Honda in 1992.
Some analysts are less pessimistic about the prospects for solar panel
manufacturers in the West. Joonki Song, a partner at Photon Consulting
in Boston, said that while large Chinese solar panel manufacturers are
gaining market share, smaller ones have been struggling.
Mr. Zarrella of GT Solar said that Western providers of factory
equipment for solar panel manufacturers would remain competitive, and
Dr. Shi said that German equipment providers “have made a lot of money,
tons of money.” The Chinese government is requiring that 80 percent of
the equipment for China’s first municipal power plant to use solar
energy, to be built in Dunhuang in northwestern China next year, be made
in China.
Dr. Shi said his company would try to prevent similar rules in any
future projects.
The reason is clear: almost 98 percent of Suntech’s production goes
overseas.

 

[Varient]

All the signs are there,.. but we will continue to ignore the signs.

 

[Paradoxium]

America is a consumer and service economy now, and all the stimulus as done is expand this at the determent of other areas. Everything related to entrepreneurial efforts and manufacturing has been side stepped over and over again. What Obama "wants" does not mean the market will translate anyways. You can't "regulate" innovation, only obstruct it.

I always expected it to be Japan or China to get into this renewable energy business.

 

[Varient]

This crisis is not a stock market collapse like the 20s great depression. These both might be battles but they are entirely different wars.

???
Pardon.
But "This Battle" is the sort of situation if the Great depression had been narrowly averted.
"Someone" tried to cause our economic collapse by doing a 550 billion dollar run on our banks Feb 2009.

If not for the stuff that was passed with people screaming and *****ing about it,.. it DEFINETLY would've succeeded.

As we currently fight EVERYTHING the President is trying to do to stave collapse AND set us up to continue,... (In some cock-eyed ignorant belief that anything other than dog-eat dog is socialism = bad) other countries are trying to gain a foothold here to do as they like.

The post on Solar energy gives the example of CHINA trying to come in under the radar and circumvent money they would have to pay us normally by trying to set up shop on American soil.


MEH.

 

[The Guard]

First, is it really being suggested that not buying American is what messed up the economy, and that the people who read this email buying American will bring us out of it?

That is one the sillest damn things I've ever heard.

For one thing, as long as you're buying at a store that's in America, you're already helping save jobs in some fashion. In theory. As long you spend money, in theory, you're helping the economy.

But this is way too big to suggest that we have real measure of control over it simply by buying American.

A lot of American car dealerships didn't go out of business just because people weren't buying American. They went out of business because not as many people are buying cars, period.

It's just naiive to believe that if an American company starts making more money, that they will always expand, hire Americans, not close plants or outsource, etc. A company is going to do what is profitable for them. And if they think they can save $15 by axing a couple thousand jobs, they will.

This is going to sound cliche, but I really don't see how I, as one person, can make an appreciable difference by simply buying American. I know, I know, it's a cynical mindset. You get the entire country onboard with buying American, and not buying what saves money, and you might be talking. It's a nice idea. It is. But it's not realistic in any sense.

It's unrealistic to ask people to pay more with what amounts to "just because it might work" as your reasoning, and to ask companies to make less money "just because".

As for the rights and wrongs of outsourcing...if people are willing to work those jobs, I'm willing to pay less for my products. Is it the ideal situation? No. But very few things are.

And to suggest that all foreign cars were/are cheap, and all American cars were/are well made is frankly...laughable.

 

[Paradoxium]

First, is it really being suggested that buying American is what messed up the economy, and that the people who read this email buying American will bring us out of it?

That is one the sillest damn things I've ever heard.

For one thing, as long as you're buying at a store that's in America, you're already helping save jobs in some fashion. In theory.

It's just naiive to believe that if a company starts making more money, that they will always expand, hire Americans, not close plants, etc. A company is going to do what is profitable for them. And if they think they can save $15 by axing a couple thousand jobs, they will.

As long you spend money, in theory, you're helping the economy.
I really don't see how I, as one person, can make a difference by simply buying American. I know, I know, it's a cynical mindset. You get the entire country onboard with buying American, and not buying what saves money, and you might be talking. It's a nice idea. But it's not realistic in any sense.

It's unrealistic to ask people to pay more with what amounts to "just because it might work" as your reasoning, and to ask companies to make less money "just because".

As for the right and wrong of outsourcing...if people are willing to work those jobs, I'm willing to pay less for my products. Is it the ideal situation? No. But very few things are.

And to suggest that all foreign cars were/are cheap, and all American cars were/are well made is frankly...laughable.

Your more likely to help the American economy by owning and producing goods to export to other countries to bring capital back into the system. That is real capital and not lent out money. Buying American goods merely circulates the capital within the system but does not in absolute terms increase anything.

 

[Majic Walrus]

???
Pardon.
But "This Battle" is the sort of situation if the Great depression had been narrowly averted.
"Someone" tried to cause our economic collapse by doing a 550 billion dollar run on our banks Feb 2009.

If not for the stuff that was passed with people screaming and *****ing about it,.. it DEFINETLY would've succeeded.

As we currently fight EVERYTHING the President is trying to do to stave collapse AND set us up to continue,... (In some cock-eyed ignorant belief that anything other than dog-eat dog is socialism = bad) other countries are trying to gain a foothold here to do as they like.

The post on Solar energy gives the example of CHINA trying to come in under the radar and circumvent money they would have to pay us normally by trying to set up shop on American soil.


MEH.

I don't think that socialism is bad, nor do I think that Obama is a socialist. That sort of belief is ignorant. Obama isn't the far left extremist that the general right believes he is.

This economic crisis is unlike any we have experienced and it does require innovation and creative to combat it, however programs like Cash for Clunkers, encouraging American purchases, and programs like it do nothing to help the problem.

What we need is deregulation of corporations that will allow small businesses to thrive and prosper. Currently, for the most part, a Fortune 500 company is treated the same way as any other corporation no matter how small. That creates an unfair playing field.

 

[Paradoxium]

C4C is making same mistake of "Zero Downpayments" as the housing fiasco to unqualified people. Unemployment is now 9.7% and REAL unemployment (if you include people who gave up looking for jobs - U6 of teh chart) is now 16.8%.