So even though the American community has felt the economic downpour in their wallets for the past year, its finally been crowned official. The National Bureau of Economic Research has stated the economic recession began last December. This is the same group that called the 1990-91 and 2001 recession just as it ended. But there is no way this recession is ending any time soon. “We have gone from recession into something that looks more like collapse,” said Ian Shepherdson, chief domestic economist at High Frequency Economics
As the day ended with the obvious stated, the Stock Market crashed once again by 679 points.
Amercian's aren't the only ones who are feeling the pain. In the past couple of months, the banks have been rescued, state and local governments are asking for more aid, and now recently the auto industry is asking for some help.
Most economists say that the economy must create about 100,000 jobs to keep up with the population growth. But instead we are going towards the opposite direction. President-Elect Obama has made this unemployment and job growth one of his top priorities. He also believes public spending with help a "dead-in-the-water economy" start moving again.
Now the N.Y. Times has stated the U.S. has lost 533,000 jobs in November. That's just in one month. “We are caught in a downward spiral in which employment, incomes and spending are collapsing together,” said Nigel Gault, chief domestic economist for HIS Global Insight.
Obama wants to aid his plan of public spending by enacting a stimulus package by late January that could exceed $500 billion over two years. Under the stimulus plan, more than half the money would probably be channeled into public infrastructure spending. Many economists consider such investments as an effective way to counteract the economy's downward spiraling.
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You talk about the economic recession finally being announced as official, and you predict that it will not end soon. I have personally seen the effects of economic recession in my own life, and I concur with your assessment. Money is tight for everyone, and many prices are sky high at the moment. I didn't know how drastic all of the job losses were until I read your article. I am shocked and worried as well. But even with all of these bailout plans, and these stimulus plans, I am still concerned about something that has always somewhat puzzled me. How on earth is spending more money going to get us out of the depression? Yes, it helps us right now. But what about years later? What about when our children are the ones who are the people in office, dealing with all of the debt that we've accumulated. The United States is so much in debt, it's not even funny. We're so in debt, we have to auction off our debt, have other countries/organizations pay our debts for us, which we will pay at a later time, but with interest. And so the debt continues. If Obama does indeed plan to spend 200 BILLION dollars on a stimulus plan, will it be worth it? I can't help but wonder if there's just some other way! I'm no expert on economics or recessions or depressions or stimulus plans. All I know is that in my mind, spending more money only sounds like it won't help us, at least in the long run.
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