I guess that when the United States sneezes, the world catches a cold. Consumer sentiment was announced to be circling the drain in the United States and the world economy dropped for the first time in four months.
The Bloomberg Professional Global Confidence Index fell to 39.13 this month – from 43.57 last month. Your benchmark: anything below 50 means that there are more pessimists than optimists. In the United States, index fell from 36.7 to 29.5, suggesting that we're more pessimistic than the rest of the world.
There's good reason for pessimism. Between the June and July surveys, the IMF and World Bank lowered their global growth projections from the year. And, Vice President Joseph Biden spoke (bad enough) – saying that the administration misread the economy. President Barack Obama expects an already high unemployment rate of 9.5% to increase in the coming months.
The index fell in Western Europe but increased in Asia from 58.2 to 59.4.
So, yet again, we're told to dig in for a long recession. But, nobody should be surprised. Early optimism amounted to nothing more than trying to will a recovery, which rarely works. We're now in the position of having to replace years of vacuous wealth with the real thing. It's not going to happen on its own.
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Reader Comments (Page 1 of 1)
7-15-2009 @ 10:44PM
Mike O said...
Americans are, as a whole, knee jerk reactionaries who overreact to just about everything. I should know.. I live here.
The odds of getting swine flu are so low, yet you hear about kids being kept in the house, people not flying, etc.
Remember SARS? Same thing. People buying masks and avoiding airplanes. Odds of catching it? About the same as getting struck by lightning.
Remember the incident in the 80's where two people died after taking some Extra Strength Tylenol? What was the solution? Pull every bottle off the shelves nationwide and have everyone throw their away.
Last thing was the supposed assault weapons ban that the Dems wanted to pass. What was the reaction? Buy firearms like they're going to repeal the Second Amendment of the Constitution!
One kid gets run over because they got off the bus and crossed the street without looking. Now all traffic has to stop because of school buses.
Oh.. remember the "killer" Africanized Bees coming up from Mexico? That's all that was on the news for weeks.
People think things are horrible and act like this is worse than the great depression. Guess what? It's nowhere close.
I could go on, but I think you get the point.
7-15-2009 @ 4:44PM
Dan said...
How's that hope and change comin' along?
The author is right, in that our great country is 'circling the drain' - unsustainable debt, insane increases in energy costs and taxes, and no hope in sight for business to even attempt to create new jobs, when they are going to be fighting for their live to just survive the next 3 years.
I have yet to talk to anyone who lived through the Carter years have anything positive to say about this current administration. While I see teenages with Obama shirts on, not a single patient I speak with over the age of 35 is even ambivelent to the future of our economy, let alone optomistic.
To the first commenter, or anyone else for that matter, can you give any examples of where socialism has worked in the history of mankind?
We have a great country, and a great capitalist system. It is being quickly dismantled in front of our eyes. I hope those unskilled workers out there are happy with their 'free' health-care and cell phone when unemployment remains at 12%+ for 5-7 years, and interest rates top 15%, again.
I hope history doesn't repeat itself, but I am afraid the Carter years will be seen, in retrospect, as banner years, with what BHO is bringing us.
7-15-2009 @ 7:49PM
william lindblad said...
I lived through the Carter years and fail to see any correlation? This time around the events have little to do with who is sitting in the White House. What got us here is a combination of system and oversight failures along with a lot of good old fashioned greed. Matter of fact there is a small, but growing, segment that thinks another housing bubble might be in the cards. Given that there remains a great deal of speculative purchases and low mortgage rates they may have a point. Than again, I believe this blog was about consumer confidence? Seems it's down here and Europe, but up in Asia. Bet it's still pretty decent in Norway. So far, that is the only country that has not been bit on the butt. Asia may be up a bit, but the Chinese growth rate is slowing and there are more and more making it back to the rural farms where there is not much of an economy. It is a serious problem and that government has been involved with stim packages as well.
Given that there is no recovery in sight here, doubtful that any is in the cards for China - as we are their biggest consumer. The ripple effect on this mess are going to take awhile.
Considering that this a very new situation that has the entire world involved the outcome will remain cloudy for some time. Things that can be considered though are the root causes of foolish financial transactions on the part of the banking industry and the even more insane marketing of these near worthless securities by investment houses.
Heap of bad business. Heap of bad business promoted and created by a very small group of people. Take a look at what is going on in the credit/credit card industry and you will find more of the same nonsense that even Congressional hearings cannot cure. As long as these high priced morons continue to run our financial industry, recovery, and a confident public, are a long way off.