Quote:
Originally Posted by The Demon
Look back to my cash clunker analogy. You're saying consumer spending is rising, while I'm saying is falling and the only reason it's not falling as hard as it used to is because of these retarded stimulus plans that make people spend MORE money that they don't have. This is NOT a recovery, nor is this a "light at the end of the tunnel". The unemployment rate is still rising and our deficit spending is still going strong.
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Cash for clunkers is a great point. Many of those cars probably wouldn't have been sold had their not been the cash for clunkers program. So it was the savings that got people to go out and spend money.
The idea of the stimulus plan is to put people to work and encourage spending. Consumer spending accounts for around 75% of our economy. Until that changes their is a need for consumer spending if there will be any kind of recovery. Debt spending is not going away any time soon. One of the problems is that that over the last 15 years or so many big purchases like cars and houses have gotten out of reach for the average person. Until that changes there will be no major change in debt spending. Deficit spending is projected to last at least another 10 years. But then the country has pretty much been deficit spending since the great depression so there is no sign of that stopping either. If you are waiting for the end of deficit spending you will probably be waiting for the rest of your natural life.
I will agree with you on this. The unemployment rate is bad and rising. There are experts who say that will change as spending increases, but I guess we will have to wait and see, but until that starts to turn around there will be no real recovery. However in order for this country to not deficit spend and for the middle class to not credit spend we would have to undergo a major sea change in this country. Maybe you are right, maybe it will be forced upon us with an economic collapse. Short of that I can't imagine it changing.