Wednesday, November 18, 2009

Meredith Whitney: We are going back into recession




Meredith Whitney tells CNBC we were never really out of recession and are heading back into one, something that should not surprise regular readers of this blog.

4 comments:

Anonymous said...

KF, thought you would be interested in this. Its from the AFP. "The US public debt topped 12 trillion dollars for the first time in history, Treasury officials disclosed Tuesday, moving past a key barrier that raised hackles in Congress."

http://tinyurl.com/y9kau6x

Anonymous said...

admire Whitney though still shocked she married a professional wrestler...

I don't think anyone ever said we were out of the recession, just " coming out" and that always involves the Ws of which she speaks.

This recession is worse than others, the debt is terrible. It will be a slow,rough go and disaster is still possible.

The idea, simplistically stated, is to prevent a dramatic drop into a depression by bolstering some areas while other areas build and improve until the overall economy begins to stabilize. Basically, we're talking about keeping the ship afloat until all the leaks can be repaired.

The question no one asks is " where would we be today doing nothing?" How about 25% unemployment, debt nearing the same levels from a decimated tax base when businesses no longer exist to pay taxes and even more individuals bankrupt?

I have misgivings about some of the measures taken, think there should be a more vigorous move to reinstate oversight measures that existed in the 50's. But, I'm not hearing much in the way of better plans than Berneke has devised and hope to hell it works. And, I expect the plan would look much the same in a Republican administration.

The guys that do this are really a pretty small group that share core concepts about the economy. None of them would have sunk the ship while everyone's still on board but tried to keep it afloat while the new ship's being built to come to the rescue.

But, "bearish" in the short term ( the next two years) isn't a bad idea. Just be sure to buy early on the way up over the next ten.

Kingfish said...

I disagree. The problem started when we bailed out Bear Stearns. If we don't bail them out, then Lehman and others instead would've sold their firms and avoided the disaster that happened in October 2008.

The TARP made things worse as the stock market immediately began tanking within a few minutes after its passage and didn't recover until sometime this year.

I frankly expect the economy to get worse as the goverment action taken over the last eight months begins to take hold. The huge deficits, the printing of money and devaluing of the dollar. Then there is the fact we have defacto price controls on mortgage interest rates right now that will be removed when the Fed starts getting out of the mortgage bond market.

I tend to agree with Santelli: LET THEM FAIL. We screwed Wells Fargo and Bank Of America by forcing them to take Wachovia, Merrill Lynch, and Countrywide and its bitten us in the ass. If a bank goes under, it goes under. Right now the dirty little secret is banks like Amtrust ARE failed banks but the FDIC is scared to pull the trigger on them. So in the end when they do fail, what we will have done is blown our wad on them and gained nothing from it in the end when they fail anyway. If we had let them fail a year ago, we wouldn't be in half the shape we are in. Oh, and what else would I have done? Instead of blowing $800 billion on stimulus and another $800 billion on bailouts, I would've just cut the corporate tax rate to zero. Cost: less than $300 billion. Think THAT wouldn't stimulate the economy?

This is going to mirror the 30's to some degree when the combination of Hoover and FDR's actions took effect and the economy got much worse.

Anonymous said...

I would agree with you , KF, if I thought the Bear Stearnes and Lehman problems were exclusive to those firms and not systemic.

I think black box derivatives, hedge funds,poorly thought out banking deregulation ( I'm not against deregulation per se, it's just these were lobbyist driven) and artificially propping up the housing market with the growth of subprime loans from less than 9% of total loans in to 40% of the loans by are huge factors during a Republican controlled Congress and Executive Branch period( source Dallas Federal Reserve).

I suspect we also agree that there are inherent dangers in having former Wall Streeters " fix" Wall Street. But, do remember the bailout began in a non-partisan effort and there may well be solid reasons for that.

The problem may not be "bailout" but rather how it's implemented.

We,also, are in agreement that the measures taken may not work and it may get worse. But, all economies recover over time one way or another. And, frankly, doomsday economic commentary doesn't help recovery and we all want recovery.



Recent Comments

Search Jackson Jambalaya

Subscribe to JJ's Youtube channel

Archives

Trollfest '09

Trollfest '07 was such a success that Jackson Jambalaya will once again host Trollfest '09. Catch this great event which will leave NE Jackson & Fondren in flames. Othor Cain and his band, The Black Power Structure headline the night while Sonjay Poontang returns for an encore performance. Former Frank Melton bodyguard Marcus Wright makes his premier appearance at Trollfest singing "I'm a Sweet Transvestite" from "The Rocky Horror Picture Show." Kamikaze will sing his new hit, “How I sold out to da Man.” Robbie Bell again performs: “Mamas, don't let your babies grow up to be Bells” and “Any friend of Ed Peters is a friend of mine”. After the show, Ms. Bell will autograph copies of her mug shot photos. In a salute to “Dancing with the Stars”, Ms. Bell and Hinds County District Attorney Robert Smith will dance the Wango Tango.

Wrestling returns, except this time it will be a Battle Royal with Othor Cain, Ben Allen, Kim Wade, Haley Fisackerly, Alan Lange, and “Big Cat” Donna Ladd all in the ring at the same time. The Battle Royal will be in a steel cage, no time limit, no referee, and the losers must leave town. Marshand Crisler will be the honorary referee (as it gives him a title without actually having to do anything).


Meet KIM Waaaaaade at the Entergy Tent. For five pesos, Kim will sell you a chance to win a deed to a crack house on Ridgeway Street stuffed in the Howard Industries pinata. Don't worry if the pinata is beaten to shreds, as Mr. Wade has Jose, Emmanuel, and Carlos, all illegal immigrants, available as replacements for the it. Upon leaving the Entergy tent, fig leaves will be available in case Entergy literally takes everything you have as part of its Trollfest ticket price adjustment charge.

Donna Ladd of The Jackson Free Press will give several classes on learning how to write. Smearing, writing without factchecking, and reporting only one side of a story will be covered. A donation to pay their taxes will be accepted and she will be signing copies of their former federal tax liens. Ms. Ladd will give a dramatic reading of her two award-winning essays (They received The Jackson Free Press "Best Of" awards.) "Why everything is always about me" and "Why I cover murders better than anyone else in Jackson".

In the spirit of helping those who are less fortunate, Trollfest '09 adopts a cause for which a portion of the proceeds and donations will be donated: Keeping Frank Melton in his home. The “Keep Frank Melton From Being Homeless” booth will sell chances for five dollars to pin the tail on the jackass. John Reeves has graciously volunteered to be the jackass for this honorable excursion into saving Frank's ass. What's an ass between two friends after all? If Mr. Reeves is unable to um, perform, Speaker Billy McCoy has also volunteered as when the word “jackass” was mentioned he immediately ran as fast as he could to sign up.


In order to help clean up the legal profession, Adam Kilgore of the Mississippi Bar will be giving away free, round-trip plane tickets to the North Pole where they keep their bar complaint forms (which are NOT available online). If you don't want to go to the North Pole, you can enjoy Brant Brantley's (of the Mississippi Commission on Judicial Performance) free guided tours of the quicksand field over by High Street where all complaints against judges disappear. If for some reason you are unable to control yourself, never fear; Judge Houston Patton will operate his jail where no lawyers are needed or allowed as you just sit there for minutes... hours.... months...years until he decides he is tired of you sitting in his jail. Do not think Judge Patton is a bad judge however as he plans to serve free Mad Dog 20/20 to all inmates.

Trollfest '09 is a pet-friendly event as well. Feel free to bring your dog with you and do not worry if your pet gets hungry, as employees of the Jackson Zoo will be on hand to provide some of their animals as food when it gets to be feeding time for your little loved one.

Relax at the Fox News Tent. Since there are only three blonde reporters in Jackson (being blonde is a requirement for working at Fox News), Megan and Kathryn from WAPT and Wendy from WLBT will be on loan to Fox. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both and a torn-up Obama yard sign will entitle you to free drinks served by Megan, Wendy, and Kathryn. Get your tickets now. Since this is an event for trolls, no ID is required. Just bring the hate. Bring the family, Trollfest '09 is for EVERYONE!!!

This is definitely a Beaver production.


Note: Security provided by INS.

Trollfest '07

Jackson Jambalaya is the home of Trollfest '07. Catch this great event which promises to leave NE Jackson & Fondren in flames. Sonjay Poontang and his band headline the night with a special steel cage, no time limit "loser must leave town" bout between Alan Lange and "Big Cat"Donna Ladd following afterwards. Kamikaze will perform his new song F*** Bush, he's still a _____. Did I mention there was no referee? Dr. Heddy Matthias and Lori Gregory will face off in the undercard dueling with dangling participles and other um, devices. Robbie Bell will perform Her two latest songs: My Best Friends are in the Media and Mama's, Don't Let Your Babies Grow up to be George Bell. Sid Salter of The Clarion-Ledger will host "Pin the Tail on the Trial Lawyer", sponsored by State Farm.

There will be a hugging booth where in exchange for your young son, Frank Melton will give you a loooong hug. Trollfest will have a dunking booth where Muhammed the terrorist will curse you to Allah as you try to hit a target that will drop him into a vat of pig grease. However, in the true spirit of Separate But Equal, Don Imus and someone from NE Jackson will also sit in the dunking booth for an equal amount of time. Tom Head will give a reading for two hours on why he can't figure out who the hell he is. Cliff Cargill will give lessons with his .80 caliber desert eagle, using Frank Melton photos as targets. Tackleberry will be on hand for an autograph session. KIM Waaaaaade will be passing out free titles and deeds to crackhouses formerly owned by The Wood Street Players.

If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!

This is definitely a Beaver production.

Note: Security provided by INS
.