What is going to happen?

[Cain]

So, I consider myself one of the least educated when it comes to Economics. I have read a few books on Economics, but frankly, I'd rather read a military history book or even fantasy.

From what I read, I remember this from a book (no idea what it was sadly):

-Economies function in cycles, they're always going up or going down, even if slowly

That is about it, I am not good with Economics, and I am here to ask this:

What exactly is going to happen to the American Economy? I know none of you can be 100% sure cause you can't predict the future, but I mean, I have so many people saying We are out of a depression, then some say we are in the middle of it, then some say we are just beginning one...what is it really?

 

[Mad Scientist]

I'd say were in a Depression. If that wasn't bad enough, inflation is coming due to massive dollar printing at the Privately Owned Federal Reserve.

 

[JamesInFlorida]

Not sure how familiar you are with economics, so I apologize if I come off as preachy (I tend to ramble LOL)).

But there's a difference between a depression and a recession, and I think you're referring to the recession being over (for now), and not the depression. A recession is basically when the economy (mostly measured in terms of real GDP) decreases for 2 (or more) consecutive quarters. Recessions come and go, and can theoretically even occur in times of economic prosperity as part of a normal curve going up and down. A depression is a little less of a concrete definition, but essentially is a period of severe economic downturn, comes with abnormally high levels of unemployment, drop in credit, low interest rates, etc.

Our GDP has (slightly) gone up according to the BEA (bureau of economic analysis), so this is what you're probably hearing-as this would technically mean that there's no current recession.

I'm not really sure how/when we're going to get out of our funk, but I do think our biggest problem as a country is a lot of the jobs we're losing aren't coming back. Jobs being shipped over seas aren't coming back, jobs being replaced by new technologies, manufacturing jobs (at least a good amount of them), small mom and pop shops going under.

I do think we're in a depression, and haven't been in one this severe since The Great Depression (I don't think we're near that level though). I think it's going to take something big to give our economy a boom-but what specifically that could/will be...I'm not sure.

and yes I agree economic books can be very boring, I've read way too many of them in business school haha.

edit: and don't worry-most people think that a depression is a recession (just worst), and have other misconceptions about economics. You seem like a bright guy based on posts in other threads-economics isn't as difficult to get a grasp on as it initially seems. Knowledge is power-and kudos to you in trying to expand yours.

 

[william the wie]

Get "Generations" by Strauss and Howe. This is just a normal part of the human breeding cycle and should produce a baby boom in around 2025-45. The baby boom will be the result of women seeing hubby doing much better than daddy did in the downturn.

 

[Cain]

Hmm, well, I want to retire out of the Air Force as a farmer, and farming is not worth it, unless you get government subsidies and have thousands of acres. My cousins own a 6-7 thousand acre farm, and make a lot of money, but it's only cause the government helps them with subsidies I think (not 100% sure, but honestly, if anyone had them, I'd guess them) and they work really hard to earn extra money.

Also, the economy has affected my want for a vehicle, I know this isn't a MAJOR thing in life, but for me, what I drive means a lot because I need room and the ability to use it long-distance. I've always wanted a dodge ram 1500 4-door, now I am looking at a Jeep Patriot, good space, better gas mileage.

 

[percysunshine]

The governments credit card is maxed out.

Do the math.

 

[Cain]

The governments credit card is maxed out.

Do the math.

Explain please?

What math? Their is no math, I understand you said that as a after-affect? Well, my thing is, I understand we are in debt, but how can we fix it? I have no idea myself.

 

[Mad Scientist]

I understand we are in debt, but how can we fix it? I have no idea myself.

Neither does your future employer, the Federal Government.

 

[Cain]

I understand we are in debt, but how can we fix it? I have no idea myself.

Neither does your future employer, the Federal Government.

Then who do we go to? I hate to ask this, I figure it's stupid, but I have to ask just to see the answer:

If we have so many Economists, shouldn't they somehow be able to come up with a plan to help the economy?

 

[percysunshine]

The governments credit card is maxed out.

Do the math.

Explain please?

What math? Their is no math, I understand you said that as a after-affect? Well, my thing is, I understand we are in debt, but how can we fix it? I have no idea myself.

How would you fix a maxed out credit card? There are only a few options. Default, rob a bank, or go into the profession of counterfitting and print your own dollars. Those are the easy ways out. You could go on an austerity program and put up with the bitching...but that is less appealing ...

 

[JamesInFlorida]

I understand we are in debt, but how can we fix it? I have no idea myself.

Neither does your future employer, the Federal Government.

Then who do we go to? I hate to ask this, I figure it's stupid, but I have to ask just to see the answer:

If we have so many Economists, shouldn't they somehow be able to come up with a plan to help the economy?

Well the legislative and executive branches are really what comes up with economic plans for the country as a whole, and quite frankly they (and nobody else) knows for sure what it's going to take to get us out.

Some people think it'll be by raising taxes slightly (which would increase the revenue of the government-regardless of how much it would suck for us paying in more), others think it'll be by lowering taxes (adding more incentive for citizens to hopefully spend more money).

I think we need to cut spending overall, but we need to invest in other things. Spending is ok-just spend in wisely and in the right areas (something neither party does in my opinion).

Defense, Social Security, and Medicare need to be addressed, and they've needed to be addressed (especially the later two) for many years now, and tough decisions have to be made. Neither party wants to tackle them-because they're afraid of getting voted out. But failing to address these issues will only keep our economy struggling.

 

[percysunshine]

I understand we are in debt, but how can we fix it? I have no idea myself.

Neither does your future employer, the Federal Government.

Then who do we go to? I hate to ask this, I figure it's stupid, but I have to ask just to see the answer:

If we have so many Economists, shouldn't they somehow be able to come up with a plan to help the economy?

Ever had a plumber not fix your clogged sink? Imagine a room full of plumbers with PHDs who have ideas about how to fix the economy.

 

[skeptic]

So, I consider myself one of the least educated when it comes to Economics. I have read a few books on Economics, but frankly, I'd rather read a military history book or even fantasy.

From what I read, I remember this from a book (no idea what it was sadly):

-Economies function in cycles, they're always going up or going down, even if slowly

That is about it, I am not good with Economics, and I am here to ask this:

What exactly is going to happen to the American Economy? I know none of you can be 100% sure cause you can't predict the future, but I mean, I have so many people saying We are out of a depression, then some say we are in the middle of it, then some say we are just beginning one...what is it really?

We are locked into an inevitable. But beyond the scope of the inevitable myriad forces conspire and conflict to perform an unknowable series of outcomes.

What is inevitable is that resource scarcity and population explosion are reaching the impasse barrier. That the developed world can no longer afford a middle class wasting resources like there is no limit. That something must occur to mitigate the population bomb/resource scarcity impasse.

Beyond that all we can know is that TPTB in high positions seem intent on cyber warfare as their primary conduit of foreign relations intercession.

We can be about nation building, or we can be about nation leveling. It is always easier to destroy than to erect. Finally the NSA has a clear and cogent mission statement that is as doable as it is practical. This is even better than the Cold War.

But the actual outcomes are impossible to predict.

 

[MikeK]

The governments credit card is maxed out.

Do the math.

Explain please?

What math? Their is no math, I understand you said that as a after-affect? Well, my thing is, I understand we are in debt, but how can we fix it? I have no idea myself.

One sure way to fix it is to impose the same progressive tax rate as was in effect during our most productive and prosperous years, as shown here:

The income tax rate of upper income levels:

1950 - 91% <========

1980 - 70%

1985 - 50%

1987 - 38%

2004 - 35%

2010 - 15%

http://www.taxfoundation.org/files/f...y-june2010.pdf

And levy a substantial surtax on all personal fortunes in excess of fifty million dollars.

Then legalize and tax marijuana and prostitution, two activities which presently produce enormous revenue for criminal cartels. These activities flourish in spite of the most vigorous attempts to curtail them, so there is no sensible reason not to legalize them.

Withdraw our military from Iraq and Afghanistan. There is no valid reason for continuing Bush's counterproductive follies. The only entities which benefit from these enormous drains on our economy are the Military Industrial Complex, the paramilitary contractors (Halliburton, etc.) and the oil industry.

The damage done to our economy because of corruption in government threatens the survival of our Nation as a democratic republic so we should not be inhibited in taking radical action to effect the necessary repairs and to set the U.S. back on the right course.

 

[Missourian]

I understand we are in debt, but how can we fix it? I have no idea myself.

Neither does your future employer, the Federal Government.

Then who do we go to? I hate to ask this, I figure it's stupid, but I have to ask just to see the answer:

If we have so many Economists, shouldn't they somehow be able to come up with a plan to help the economy?

We are going to have to raise taxes.

The problem is, when we raise taxes, the Government just spends more money, and nothing goes toward paying off the national debt but paying interest. Instead we just borrow a little less.

First, we need to stop borrowing.

Second, we need to balance the budget.

Third, we need to develop a system where any raise in taxes was off limits to any other purpose but paying off the national debt.

 

[percysunshine]

Linus Pauling was a moron.

 

[LordBrownTrout]

I really have no confidence in the government fixing anything anymore. We actually probably need to save ourselves from the federal government at this point.

 

[skeptic]

I really have no confidence in the government fixing anything anymore. We actually probably need to save ourselves from the federal government at this point.

thanks for naming two impossibilities.

 

[percysunshine]

I really have no confidence in the government fixing anything anymore. We actually probably need to save ourselves from the federal government at this point.

We could always clone an army of Sarah Palins and call them fembots. Good fighters...

 

[Cain]

The governments credit card is maxed out.

Do the math.

Explain please?

What math? Their is no math, I understand you said that as a after-affect? Well, my thing is, I understand we are in debt, but how can we fix it? I have no idea myself.

How would you fix a maxed out credit card? There are only a few options. Default, rob a bank, or go into the profession of counterfitting and print your own dollars. Those are the easy ways out. You could go on an austerity program and put up with the bitching...but that is less appealing ...

So, would robbing a bank be like invading a nation with sources of material?

Neither does your future employer, the Federal Government.

Then who do we go to? I hate to ask this, I figure it's stupid, but I have to ask just to see the answer:

If we have so many Economists, shouldn't they somehow be able to come up with a plan to help the economy?

Ever had a plumber not fix your clogged sink? Imagine a room full of plumbers with PHDs who have ideas about how to fix the economy.

Hmm, so their payed to think, but not to know, right?