Monday, September 29, 2008

The economic freefall

If anyone thought that a few huge lending institutions failing last week was the worst thing that could have happened to the U.S economy, you may want to rethink things.

Just a few minutes ago, the vote in the U.S. House of Representatives for the proposed $700 billion economic bailout failed.

The direct effect of that failed vote, for the time being, is a rather sizeable plunge in the markets. Take, for instance, a 70 cent per bushel drop in the price of soybeans and a 30 cent per bushel drop in corn prices on the Chicago Board of Trade.

Now factor in a tumble of 600-plus points in the Dow Jones.

The only bright spot is oil falling below $100 per barrel.

The big question here is whether or not some sort of economic "bailout" will come to fruition. I think for a bailout plan to succeed, it needs to benefit the people, not the organizations. I am not here advocating for a huge handout leading to a spending spree or, gasp, even a spending orgy. A bailout of any shape needs some strict oversight, total transparency and actual public input with a serious review before even attempting a vote on any sort of borrowing from the future/China.

While we need to always be focusing on the future, the true attention needs to be paid to the present. Too many people rightfully worry incessantly about what tomorrow brings. We have to eat, we need shelter and we need transportation. The key to those necessities is having a secure job which not only provides a paycheck but those benefits which are essential (vacation, health insurance and at least some sort of retirement options - 401k).

I'll admit it, I am seriously worried about not just my job but the future of the company I work for. Sure, I keep my skills up to date and contribute often overlooked ideas that deserve at least some consideration but without the wheels of commerce turning, I'm fucked and I'm not alone.

We need to welcome back production of hard goods within our nation's borders. We need to invest in the energy solutions of the future. Sadly, too, we need government-funded incentives to spur this energy innovation because companies and innovators are clinging to a thread.

A bailout of some shape needs to take place. I'm fairly certain that the proposed/failed bailout was anything but what America needed because the dwindling middle class is fed up with CEOs walking away with hundreds of millions of dollars for doing nothing more than tanking the very business whose success they were in charge of.

It's time to spur growth from the bottom up. How to do that is anyone's guess. Maybe it involves funding education. No, not in our public schools but in our higher learning institutions. Will the future bring prosperity? I think so. Is that prosperity around the corner? That answer depends on what takes place literally in the final months of the year. It's time to feel motivated. Are you motivated or are you worried?


Brian in Mpls said...

I am excited to see what happens especially when the market opens again in the morning after we see how international markets respond.

Leah said...

I thought I felt myself getting poorer today.

No said...

Why is it that the most common sense that I see is from bloggers? After that Sarah Palin interview with Katie Couric, I have no confidence in our leaders whatsoever....what the hell happened to common sense and really thinking about the issues? All I see now is posing for the camera, and that scares me a great deal.

MJ said...

Maybe it involves funding education. No, not in our public schools but in our higher learning institutions.

That's exactly what I was thinking. They said on the news this morning that the same money they want to use for the bail out would cover the cost of all outstanding student loans in the entire US. Crazy. Meanwhile, I have trouble getting help because I'm pursuing something past an undergraduate degree.

No incentive whatsoever for people to continue their education. Other countries are absolutely spanking us in education.

Pharm Tech Guy said...

I think it is really stupid that some of the republicans use the excuse that there was a speech that hurt there feelings so they decided not to vote on, or against the bail out bill. While I admit that I am not totally in favor of the bail out plan. I believe it is something that needs to be done. This is the time where we need our leaders to sack up so to speak. I mean seriously they vote to give themselves raises, but really what have they done? All I can see is bickering? And John McCain the change we need, really you've been there since the beginning of time what have you done? I am not sure I have faith in either canidate at this moment. I just believe we need change. I agree with Sornie that we need some sort of gross domestic product. We have a work force getting laid off left and right. We have a taxcode loophole that has been left alone since after ww2, that lets businesses move out of the country. We need change. I will get off my soap box now.