Look at this chart that Paul Krugman had on his New York Times blog yesterday or today –
Wow. The latest read on consumer confidence is stunningly bad. We’re probably in the early stages of recession — but consumer sentiment is already worse than it ever got under Bush I.
I remember how it was in 1980 – I think in the last 70’s it was all about stagflation and high energy prices, specifically from oil. I think now, we’ve paralleled it – are we going to surpass it?
My guess is yes. A friend of mine already lost her job on Wall Street – in a Hedge Fund – the FED is keeping the banking system from collapsing by offering a lot of money – but much of the economy is turning sour.
I think I’ll keep an eye on where the consumer sentiment goes later this year – especially before the election – as if it continues to go south – it’s more likely the democrats will get elected. But honestly, this problem, and the others we face with Global Warming, Iraq, are almost impossible to solve (but they were easy enough to start).
That just goes with a saying I have that it’s easy to mess stuff up (go into Iraq to get their oil and make it about 9/11 and Saddam – when it was really about the oil – and everyone really knew it deep in their gut) but much, much harder to make things right.
And while we’re at it – perhaps some global Neocon think tank foresaw the energy problems we’re having now, the coming online of China and India and resolved that by taking over Iraq and obliterating Iran, they could continue to dominate the energy market into the 21st century. But if that was their thinking…say, back in 1996, 1998 – etc, then what they ended up with must have been a bitter pill. The more the Neocons tried to shape the future and control how events played out (steal elections, create strategic wars – the kind of stuff they’re good at) the more events have moved out of their control.
I can’t imagine that Dick Chaney wanted Oil to be 110 dollars a barrel when he cooked up this idea of invading Iraq – I think the Neocons were trying to stop that from happening – but it backfired. Same thing with the Economy – in my opinion -they let the Sub-Prime Mortgage meltdown happen – Alan Greenspan, to this day, doesn’t take any responsibility for what happened, trying to deflect it – as usual (would you expect anything less?) and blame it on Global Funds from China that were looking for safe haven in the United States (where we were only too happy to take the money, and build houses that we sold to other people who could not afford them).
I think, deep down, people who did all this stuff, really thought the economic system would expand infinitely (as there is hardly any real money anyway – most of it is virtual) but it backfired – events happen that should have been foreseen, and in fact, were, but were ignored.
So, it’ll be interesting to see what the consumer sentiment is going to be around November… hmm. I just wonder what the sentiment will be in a year or two when we wake up and realize the full extent of the damage and that no government, even a democratic one, will be able to fix most of these problems.