A few days ago I asked whether our economy could be spurred on by green jobs growth, and today I found this article supporting that California indeed, as would be expected, seems to be leading the way.  Read the full article HERE. Now I realize the many have profited from the abuse of green initiatives.  That however does not mean we should abandon efforts to make the plane more sustainable for our species, for all species for that matter, for a much longer period of time.

Without quoting or reckoning back to anything you’re heard from the talking heads on either side, just think about it.  Fossil fuel supply is finite, as is coal.  At the rate we are reproducing we’re going to consume more, which means more output of everything from gas to garbage to emissions.  And China’s economy is just getting wound up.  What country as of 2009 is purchasing more autos than any other?  China.  China is going to “get theirs” meaning their prosperity, more autos, more consumption etc…hey, who can blame them?  We got ours right?  So now imagine a China with no birth restrictions.  So just think 20 years from now if we don’t change the way we obtain energy to produce, purchase and control the outputs of all this “stuff” we consume.  Which is why I feel that there’s a huge opportunity for any country to step up and lead the way for cleaner more efficient energy, better ways to build products etc…Listen, I’m an entrepreneur, so I understand the fundamental underpinnings of capitalism, so if there’s a real opportunity to capitalize, this country will do it.

It has nothing to do with Al Gore or Rush Limbaugh.  Think for yourself.  Doesn’t it just make sense?  Don’t we have to start doing something and doesn’t it seem like there’s a huge untapped industry to invest, research, manufacture and distribute cleaner burning autos, furnaces, air conditioners, windows doors, refrigerators…man the list could go on forever.  Is it going to be perfect? Of course not. Even the Wright Bros. crashed 20something times before they even flew 50 feet.  So we have to be patient, persistent and consistent, don’t we?

If this article is any indication, there’s a great opportunity for people to invest, for government to give these companies tax breaks to encourage investment and employment.  Then manufacture these things (in the US hopefully), market them around the World and reap the benefits…isn’t this what makes us great?  Or, do we do nothing, focus of us vs. them…he said she said, and watch another country reap the benefits, or worse yet, watch our great grandkids inherit a planet gasping its last breath.

Or, can this planet really sustain as many of us as we produce, and at any rate of consumption, and we have to do nothing.  And if it does, how is it going to respond?  Further, is this winter any indication of how Mother Nature might respond to us?

Thanks to Chris Green for bringing this story in.  Months ago a beleaguered Buffett seemed disgusted and bearish on our future.  Now that the market has risen over 50% in the past six months he’s singing a different tune.

Read the full story here…

Read the full story here:

http://online.wsj.com/article/SB10001424052970203946904574300290585964718.html?mod=googlenews_wsj

Thanks to Rich Roedger for this contribution:

It’s no surprise to me, since I see traffic on this site rise and fall pretty much dimetrically opposite of stock market results.  If the stock market rallies, traffic slows.  If it tanks, traffic goes through the roof.  I rarely post news about the stock market, and those of you who have read here for a while have seen  my editorials about the stock market.   And my friend Eldon Mast over at the Good News Economist concurs. “Kind of like the tail wagging the dog” Eldon emailed to me recently.

I call it Las Vegas East, because the averages are simply what someone is willing to pay for a stock, not truly what the company is worth, how much money it’s making, if it’s liquid or not, or what it’s business plan says.  Now all these things are taken into consideration when an investor purchases part of a company (or should be).  However, if the guy next door wants 500,000 shares, and so do you, it now becomes an Ebay bidding war…and the value of those shares rise accordingly…now suddenly we’ve switched gears from true value to what each thinks these share will be worth in one week, one month, one year. “Think” being the operative word.

I would rather have confidence in our economy be placed on things like GDP, Purchasing indexes, housing, leadership outlooks, etc… real fundamentals that guide what’s really going on and don’t bounce around like a kid in a candy store each day.

That being said “whew” whatever it takes to make consumers more confident, I’m all for it, except that if the market drops next week, so will moods, and these highs and lows need medication…and blogs like this can be the right medicine to help balance out all the lows from mainstream…

OK…now to the link… Thanks Rich for bringing this to us.  It’s good to see moods nearly double in just a few short weeks.  There’s more positive stories coming out of industry, housing, and I’m beginning to really feel like the last part of this year could result in the “coming out” party we’ve all been looking for.

http://www.usatoday.com/money/economy/2009-03-26-poll_N.htm

Thanks to Chris Green for finding this submission:

There were comparisons to other recessions, and the occassional reference to the Great Depression.  I’ve commented on it here in previous posts, others have contributed “un” comparisons here, here, and here, and following is commentary on the subject by Newsweek.

Here’s the post.  Thanks Chris.

Economy: This Is Not Another Great Depression
Robert J. Samuelson
Updated: 03/17/2009
We live in the shadow of the Great Depression. Americans’ gloom does not reflect just 8.1 percent unemployment or the loss of $13 trillion worth of housing and stock market value since mid-2007. There is also an amorphous anxiety that we are falling into a deep economic ravine from which escape will be difficult. These worries may prove ill-founded. But until they do, they promote pessimism and the hoarding of cash, by consumers and companies alike, that further weaken the economy.

Our only frame of reference for this sort of breakdown is the Great Depression. Superficially, the comparison seems absurd. We are a long way from the 1930s, as Christina Romer, head of President Obama’s Council of Economic Advisers, noted recently in a useful talk. Unemployment peaked at 25 percent in 1933. At its low point, the economy (gross domestic product) was down 25 percent from its 1929 high. So far, U.S. GDP has dropped only about 2 percent.

What’s more, the Depression changed our thinking and institutions. The human misery of economic turmoil has diminished. “American workers [in the 1930s] had painfully few of the social safety nets that today help families,” Romer said. Until 1935, there was no federal unemployment insurance. At last count, there were 32 million food stamp recipients and 49 million on Medicaid. These programs didn’t exist in the 1930s.

Government also responds more quickly to slumps. Despite many New Deal programs, “fiscal policy”-in effect, deficit spending-was used only modestly in the 1930s, Romer argued. Some of Franklin Roosevelt’s extra spending was offset by a tax increase enacted in Herbert Hoover’s last year. The federal deficit went from 4.5 percent of GDP in 1933 to 5.9 percent in 1934, not a huge increase.

Contrast that with the present. In fiscal 2009, the budget deficit is projected at 12.3 percent of GDP, up from 3.2 percent in 2008. Some of the increase reflects “automatic stabilizers” (in downturns, government spending increases and taxes decrease); the rest stems from the massive “stimulus program.” On top of this, the Federal Reserve has cut its overnight interest rate to about zero and is lending directly in markets where private investors have retreated, including housing.

Government’s aggressive actions should reinforce some of the economy’s normal mechanisms for recovery. As pent-up demand builds, so will the pressure for more spending. The repayment of loans, lowering debt burdens, sets the stage for more spending. Ditto for the runoff of surplus inventories.

So, are Depression analogies far-fetched, needlessly alarmist? Probably-but not inevitably. Even some Depression scholars, who once dismissed the possibility of a repetition, are less confident.

“Unfortunately, the similarities [between then and now] are growing more striking every day,” says economic historian Barry Eichengreen of the University of California at Berkeley. “I never thought I’d say that in my lifetime.” Argues economist Gary Richardson of UC Irvine: “This is the first business downturn since the 1930s that looks like the 1930s.”

One parallel is that it’s worldwide. In the 1930s, the gold standard transmitted the crisis from country to country. Governments raised interest rates to protect their gold reserves. Credit tightened, production and trade suffered, unemployment rose. Now, global investors and banks transmit the crisis. If they suffer losses in one country, they may sell stocks and bonds in other markets to raise cash. Or as they “deleverage”-reduce their own borrowing-they may curtail lending and investing in many countries.

The consequences are the same. In the fourth quarter of 2008, global industrial production fell at a 20 percent annual rate from the third quarter, says the World Bank. International trade may “register its largest decline in 80 years.” Developing countries need to borrow at least $270 billion; if they can’t, their economies will slow and that will hurt the advanced countries that export to them. It’s a vicious circle.

Just as in the 1930s, there’s a global implosion of credit. What’s also reminiscent of the Depression are quarrels over who’s to blame and what should be done. The Obama administration wants bigger stimulus packages from Europe and Japan. Europeans have rebuffed the proposal. The United States has also proposed greater lending by the International Monetary Fund to relieve stresses on poorer countries. Disputes could fuel protectionism and economic nationalism.

No one knows how this epic struggle will end-whether the forces pushing down the global economy will prevail over those trying to pull it up. “Depression” captures a general alarm. The vague fear that something bad is happening, by whatever label, causes consumers and business managers to protect themselves by conserving their cash and slashing their spending. They hope for the best and prepare for the worst. When people stop worrying about depression, when the shadow lifts, the crisis will be over.

(c) 2008 Newsweek, Inc.

While reading about the Cardinal’s dispatching of West Virginia and claiming the Big East regular season crown this morning, I over heard Charles Osgood, host of “Sunday Morning” begin to talk about consumer confidence, the doom and gloom being reported, and introduced none other than Ben Stein, actor and economist for his opinion on the doom and gloom and I was absolutely thrilled that mainstream is starting to “get it.”

It’s as if someone were reading our words here.  He said, and I can’t quote but this gist of it was that 92% of us are still employed, 94% of mortgages are still being paid on time, and we have the money to spend, but we’re putting it in the bank.  Why?  Because of what we’re reading, listening too, and seeing.

He said that economic health is determined by “M” (supply of money) and “V” (velocity at which it moves, exchanges hands or “gets spent).   He gave Bernanke credit for keeping “M” pumped up and chided media for slowing down “V”.     He went on to say that if Barack Obama, his top advisors, Warren Buffett, and a few others went on the air and positively said we would be out of this recession by year’s end, that we certainly would be out of it by year’s end.

I was very excited to see this start to get some play.  And tomorrow at 1:20 central time I’ll be a guest on WCCO radio, Minneapolis, MN to talk about this topic…

So don’t listen to us, take it from Ben Stein.  The media has a role in how quickly we recover from this recession.  They can report the news, both sides without all the extreme adjectification of economic conditions or they can continue the type of reportint that’s adding fuel to the recessionary fire.  Hopefully stories like this will continue to expand the ring of positive economic news reporting.

Thanks to reader and new contributor Shannon Lambo for this submission.

OK.  I would like the media to get with the program and balance their reporting of economic conditions, and perhaps throw a little water on some of the firey adjectives they use.  But, I can’t get behind the government regulation of media… However, temporary government intervention in the case of public safety or welfare?  I could at least hear the argument.  Would be interesting to hear what some of you think about this….perhaps a POLL?  OK here’s the story:

http://www.boingboing.net/2009/02/22/uae-plans-ban-on-neg.html

And the poll:

Let me say, I think I know where we’re going to come down on this.  But just for gits and shiggles, let’s hear your voice.

I’m going to let Sam Snyder’s comments and supplied link speak for themselves.  I’m busy watching my U of L Cardinals try to ink out a victory over one of its archrivals, U of C Bearcats… Thank you Sam for this contribution, and is another sign from a signficantly reliable source that while things may not be great, a recovery is in the future, this is what we need to keep our eyes fixed upon.

Sam’s Editorial:

But as discouraging as these indicators are for the very immediate
future, the economic outlook is not indefinitely bad. Most forecasts,
my own included, see catalysts for the start of modest recovery in the
second half of the year.

Indeed, we have seen modest, but hopeful, signs that financial markets
are improving. A key element in the improved economic environment
expected in the latter half of the year is that financial institutions
will find more stable footing and begin to provide greater support to
business expansion and consumer spending.

And the link:

http://www.frbatlanta.org/invoke.cfm?objectid=8F357FD3-5056-9F12-12A968839FA3CFB3&method=display

Thanks to Keith Franco, a new contributor for this great submission.  Attached are his comments, and a link to the article.

The article, in a nutshell, illustrates that the buld of American’s live within their means, are now in a holding pattern, paying off bills, saving etc… but will eventually return to retail spending.  It lends credibility to why we all think the sky is falling because nearly every news-story regarding an American consumer is one of suffering, loss, and living outside their means.

Keith’s editorial:

“A different perspective on the situation, though I think he’s underplaying the possible effects of rising unemployment. I also think that he’s painting with overly broad strokes; that you’re either low income and in over your head in debt, or you’re not. I think there are plenty of shades of gray in between there, with a good number of folks who simply have uncomfortable, but not menacing, levels of personal debt. That, coupled with the very real threat of losing one’s job these days, ought to lead to most everyone with such levels of debt, to pay it down.

Interestingly though, his conclusion is not markedly different from that of any other economist…

More sour mortgages threaten to plunge banks into insolvency, but hundreds of millions of consumers have already been paring back their spending, paying off debt and boosting their savings at rates not seen in the history of record keeping. Once they regain some financial stability, they will undoubtedly begin consuming again, pushing the economy forward, with less giddiness, but with the prudence that most have had all along.”

Link to story:

http://www.newsweek.com/id/184620/output/print

Many thanks to Brian Houp for this magnificent contribution.

A survey by the Opinion Research Group showed that nearly 80% of American’s feel that the media is culpable in the current economic recession.  A few month’s back I published a post where none other than John Stossel agreed with our assessment that the media is sensationalizing the economic situation.  Click HERE to revisit that post.

Although the article is short, it was best summed up by Richard Scheff of McCraken, Walker, & Rhoads, a Phili-based law firm:

“Although statements by the media are protected by the First Amendment, the survey results demonstrate that the public believes that the press bears some responsibility for the lack of confidence in the economy,” said Richard Scheff, vice chairman and partner with Philadelphia-based law firm Montgomery McCracken Walker & Rhoads, in a statement.

What this points to is this; if so many people agree that the media is blowing this out of proportion, then it is safe to say that things are not as bad as they seem.  It’s really simple logic, and what we’ve said here, and on other blogs like Eldon Mast’s  The Good News Economist. So as momentum builds in a positive direction for our economy, and against mainstream media for working against hard-working Americans, stayed tuned.  2009 is going to be a year for us to breathe a sigh of relief.

Read the full article HERE