On Tuesday the Federal Reserve chairman, Ben S. Bernanke claimed that it was “very likely” that the recession had ended.
On Tuesday the Federal Reserve chairman, Ben S. Bernanke claimed that it was “very likely” that the recession had ended.
On Tuesday the Federal Reserve chairman, Ben S. Bernanke claimed that it was “very likely” that the recession had ended.
On Tuesday the Federal Reserve chairman, Ben S. Bernanke claimed that it was “very likely” that the recession had ended.
Though his statement offers a hint of optimism about the state of the economy Bernanke also offered a cautionary warning, telling the New York Times: “Even though from a technical perspective the recession is very likely over at this point, it’s still going to feel like a very weak economy for some time as many people will still find that their job security and their employment status is not what they wish it was. That’s a challenge for us and all policy makers going forward.”
To their credit, the Obama administration (along with former President Bush’s) did take action to prevent the country from seeping into another Great Depression.
However, have their efforts to prevent short-term devastation actually placed us in greater harm in the long-term?
In a piece entitled, “The Next Financial Crisis,” The New Republic’s Peter Boone argues that unless real reform happens soon, our nation faces “the prospect of another bubble-bust-bailout cycle that will be even more dangerous than the one we’ve just been through.”
Even presently it’s hard to fight off pessimism about the economy simply due to Bernanke’s belief that maybe, just maybe the recession is over.
If it is indeed over, perhaps consumers need to be sold that notion a bit more convincingly. Reuters reports that credit card defaults have risen and will continue to. Although the default rates haven’t risen to the level as expected, will “it’s not so bad, it could be worse” do much to alleviate many consumers’ fears?
I’m doubtful, especially when thousands of cash-strapped homeowners are starting to see their mortgage payments shoot up post-loan mortgage modification. Critics have argued that plans – including the Obama one – don’t focus on permanent debt reduction. That has led to lenders rolling late fees, back taxes, and other costs onto the principal – causing many mortgages to fall right back into default.
Couple that with reports that unemployment in the industrialized world will hit its highest level since World War II next year, surpassing its current peak.
You don’t have a job, you can’t pay your Visa and Mastercard, and you’re feeling swindled by your mortgage company…again.
You can also expect more bank failures.
Tim Geithner says the country "get our fiscal house in order." Let's hope so because of as of now my children’s children’s children will be paying off our deficit.
Meanwhile, Warren Buffett says don’t worry "…three of four years from now everything will be fine."
I applaud Buffett’s pep talk, but he won’t have to eat Top Ramen if he’s wrong.
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Michael Arceneaux hails from Houston, lives in Harlem and praises Beyoncé’s name wherever he goes. Follow him on Twitter.