This one is going to be the worst.  We are teetering on the brink of a depression.

We need our government to get up off their collective hind ends and do something NOW,not wait until we have a new president.  Socializing banks and funding AIG is not the way to go.  This goverment should have AIG in court right now.  What in the holy he!! are they waiting for? 

Raising the FDIC insurance should have been the first thing they did and the limit should have been $350,000.  No buying stock in the banks.  Protect the depositors and let the grifters and greedy take their chances.  If the bank fails then so be it, the people are covered.

It should now be mandataory for mortgage holders to cease foreclosure on anyone who makes a good faith effort to keep their mortgage viable.  Banks were never ones to help mortgage holders in crisis.

Government can help stave of a depression by creating jobs itself.  How about  government funded solar arrays, wind farms projects that will employe people. 

How about mandatory conversion of automobiles to hydrogen or natural gas starting now.  How about converting 'gas stations' to fuel (hydrogen/natural gas) stations starting now.  Give the automakers notice to start now.  They have the technology.  Use It.

Stepping down off my soap box now....I tend to get carried away.

V.........

You took my thoughts...We have the war in Iraq to blame. 10 billion dollars a month drained the treasury and that's when the dollar sank abroad, thats when gas shot up to $4 a gallon and that's what started this. It's history, and you can't say it ain't so. Then the morgage "crisis" banks went nuts loaning money to people who simply did not earn enough to pay it back. You are right. The bankers should go to prison. BUT they are Bush's friends, so they get 700 BILLION dollars and a nod. I pray to God the republicans get voted out to obilivion. And the same for any incumbent who voted YES! to the bail out.

I'm a dem but I have to admit I was proud to see Steve Latourette (R-OH) vote against the bailout along with Dennis Kucinich - don't see THAT too often.  To a large extent it appears to be a knee jerk reaction and I was disappointed that Obama didn't say "Everyone Relax" when  Paulson (?) tried to hold the country up and demand 750b with no oversight or responsibility - that was just way too bold.  I also subscribe to the theory (which is what economics is - theory) that money is a fiction.  If the authors (that would be us) decide that the next chapter is going to be a recession then that's what we're going to get - it's simply self fulfilling, because everyone is going to hold on tight to their money and the engine ceases up.  The first group ironically to hold on to their money were the banks.  Banks make money by loaning it out.  If they stop loaning then they stop making money.  Then, businesses start holding on to their money in part because they can't borrow money and then wonder why the consumer holds onto his or her money.  The media has blown the credit-crunch out of propotion as well.  I suspect this could have been a tolerable credit crunch if no one had freaked out.  I've lived on cash for quite a while and that's what most would have had to do while the credit markets were sorted out.  Obviously this discussion will go on for quite a while and we just might get what we wished for.

Yeah I would call it a depression.

The money spent for the war in Iraq was spent in the U.S. on high tech jobs and pay to the soldiers. In the same time we. the ordinary consumers, have spent 100 times more on japanese cars and chinese everything else. This is the real problem. Also, it is the democrats who forced Fanny and freddy to guarantee loans which nobody else would. Obama in 3 years collected more money from these 2 than any other senator in 30 years. open your eyes.

Senator ’s campaign manager was paid more than $30,000 a month for five years as president of an advocacy group set up by the mortgage giants Fannie Mae and Freddie Mac to defend them against stricter regulations, current and former officials say.

Senator's campaign manager is not running for the highest office in the land either.

This recession/depression will be (or has become) much worse because of impractical credit practices and mass media. 

Not EVERYONE is/was in the position to own a house.  Not EVERYONE is/was in the position to build one.  I worked for numerous homebuilders that are currently out of business... bankrupt.  Their product, like many products of my generation (30-somethings) are profit driven, not driven by the pride of workmanship.  Many builders that I worked with bought off inspectors, used fewer and less desireable workmanship and materials... and a bunch of the homeowners who bought their product are having trouble finding out whom to call because their foundation is crumbling, or their electrical system started a fire...

Plus, we have the media everywhere constantly telling us how much the market is down, or how many folks (like myself) are unemployed.  20, 30, and 40 years ago, we had to wait for the daily newspaper.  Now, it is right in front of our face and updated every few minutes.

Be smart, don't over-react, and take a job that would otherwise be "beneath" you if you find a pink-slip in your office mailbox.  This is no recession.

Well spoken oldgreymare. I'll add one more factor that is going to make this recession/depression worse than anticipated. Jobs are diminishing rapidly and job seekers are increasing much faster than should be due to the huge influx of immigrants. My town is losing jobs just like anywhere else. My son was laid off due to cutbacks in construction. My wife was laid off due to cutbacks in childcare facilities. At the same time the population of my town has almost doubled due to immigrants, both legal and illegal, adding to the unemployed standing in line at the employment office and temp services. My neice told me she went to apply for a job and immigrants were standing in line waiting for the office to open. They had blankets and pillows with them. They had obviously slept on the ground to get first place in line.

I really think this is going to be bigger than any of us remember unless you are 90 to 100 years old. It will definitely be worse than anything I've ever seen in my 50+ years, including the recession of the 70's.

Worse.

what recessions of the 80s? you mean the one reagan inherited?   there were none after that until 1991.

a 700 billion bale out and they spend 400 thousand in a spa, why not give the 300 billion ppl in the USA a million each to pay off their loans, and let them go to the spa and put money into the economy, it would save the government over 300 billion,

I don't know if it will be worse or not than before because I was really too young to care last time around in 1991 I was a senior in HS. In 2001, I just had a child so I wasn't working anyway. At that time my husband had a good job, and I don't remember times being bad. This time around, we have a few bad things going on in our personal life, having personally been screwed over by our bank when we bought a house 1 yr ago. And we have excellent credit. It all comes down to GREED. However, I do not believe that we will see an oil embargo or any type of oil cut-off from the Middle East. I believe they depend on us to make their millions just as much as we need them. I do think it is funny that they are crapping their pants right now since oil has come down in price. They have gotten used to the $$ that they make from doing nothing and are starting to get scared. I agree with an earlier poster, if things weren't constantly in our faces 24/7, people wouldn't be in so much of a panic right now. The media loves it, their ratings are soaring as people are constantly tuning to hear the latest bad news. A new President (Repub or Dem) will give the economy a boost. People are in need of a change and want to start feeling good again.

It's worse.  In the 1970's we were still a creditor nation (we owned more foreign assets and debts than we owed to foreigners) and our financial system was basically sound - I remember no major bank failures during this period.

Now, we are debtors to the world (unlike even the 1930's when we were creditors - a position we moved into during WWI) and our financial system is in partial collapse (the same as the 1930's, when the Austrian bank CreditAnstalt started a wave of collapses in Europe and here that wasn't stemmed in this country until FDR declared a bank holiday - he closed ALL US banks for upto 30 days - in order to go over their books and establish which banks were solvent and which weren't, halting a psychosis of runs  that had destroyed several thousand banks by 1933)

This crisis, in which our banks our doubtful, and we have NO money (just a pile debts we owe the world) is potentially worse than the 1930's.  Thinks Argentina over the last 35 years.

It's not worse yet but I really feel it will be.

I remember that we had recessions in the 70s and 80s...in the 80's I was a single mom with four kids to support, selling real estate in a very tough market.  How did I get through it?  I never lived beyond my means.  The kids had a nice place to live and food on the table every night.  They went to public schools.  They didn't have credit cards or drive BMW's, in fact, when they were old enough to drive they had to find a job and pay for their own car.  We weren't without our share of problems but they are all currently living happy productive lives.  I was fortunate enough to move into management and later to have an opportunity to buy into my company which sold to a franchise operation.  This was like winning the lottery to me.  Rather than blow it on stuff, I considered it my retirement nest egg and I never spent a dime...it went into savings and investments which have gone up and down over a twelve year period.  When I retired, I sold my primary residence (2005 just before the real estate downturn) and paid off all of my outstanding debt and the mortgages on all of my other real estate investments.  I purchased small retirement homes in low cost of living areas of the country and live comfortably, well below my means.  I have become more aware of this recession mainly because I'm retired now and my only source of income is my savings and investments, and we all know what is happening to those!  I have lost a lot of money in the stock market which I can hopefully recover over the next ten years or so, but I still have enough money to live worry free because I have no debt.  Unfortunately people have placed an additional burden on themselves because they have spent in excess on everything...buying more home than they need, running up credit cards, buying expensive cars, etc.  It's going to be a tough couple of years and some will lose everything and have to start over.  It's sad that the folks who managed their money well and made sacrifices so that they could have a comfortable retirement will now have to make additional sacrifices to pay for the excesses of others.  I try not to be angry or bitter...I just hope that the people who corrupted our financial system will be singled out and prosecuted to the fullest.  Many of them have walked away with millions and have left the taxpayer holding the bag! 

Yes, I remember and have studied our recessions.  This one will be worse psychologically, I believe. 

People are waking up to the price we have paid for Reagonomics.  Reagonomics just has not worked!  How naive we were to buy the trickle down philosophy.  It has turned out to be more "skim off the top" than "trickle down."  Drop the tariffs, free up the markets, profit, profit, profit ... how we have lost our way.

One of my GOP friends (and there are damned few) gave me the old "Our Country, Right or Wrong ... Our Country, Love it or Leave it" line the other day.  I love our Country, right now I just don't like it very much.  That has nothing to do with patriotism ... it has to do with critical thinking.  We have truly lost our way.  God, I hope George Bush is the end of the decline.

I don't want to make people worry by telling them what I know if the USA is growingworst than 1970 or 1980 its not healthy. An old person with heart condition may get a heart attack if I told you its the worst. However we needed to make a solution to every problem we have. I am a survivor but I must admit I am feeling the pain already. Having a hard time to find work that some say job are getting scarcer everyday.But in spite of thatI feel that people needed to turn to God. Its my feeling we need to believe and have the faith like what the christian have. Christian are believe and seen to be positive in spite of the unemployment and the crises.

Even during the B.C. when Moses help the Israelites to the promise land. They have sufferings on food among a lot of other things but because of their faith in God they survive up to now.

In respect to the problem our country have.I believe the best way our government should handle the crises is attack it at as if it was an enemy , -A strategy I read from the readers digest on how to be successfully. I believe the best way our government should handle the crises is attack the problem at its root. And that would be the foreign dept of $ 10 trillion dollars + dept that is causing us to have a deficit of 1 trillion dollars. Our government should find a way to payoff this$ 10 trillion dollars + dept . The government needed to do this for our country and our people.

Those were just speed bumps in the road. This one has been in the works for years. When the Government Employees and the "give me" groups out number the private sector work force - it is a given that bad times are ahead. You cannot give out more than you take in and that has been happening since around 1970.  The burden just keeps getting bigger and Obama will add to that with his so called "tax relief" of taking from the rich (Do you see him giving away his wealth or Biden - McCain signed a pre-nup so his wife controls her money).  I am not saying McCain will not add to it also but you cannot give away more than you have.  Obama will most likely decrease our military and all those people will be looking for jobs that do not exist, so we will have massive unemployment on top of the the rising interest rates and mortgage failures. People will just walk away from loans that are far higher than the value of their property. These properties will be a blight on neighborhoods resulting in slum areas when they are vandalized .

PS: For those of you who talk of cutting Foreign Giveaways - Obama wants to give the United Nations 150 billion more a year - with their bad habits, I think that is wrong.

I am not old enough to remember the last really bad recession, but things are getting pretty bad. My kids can't go to karate now. I had to cancel netflix and weight watchers. We hardly ever eat out or go to the movies anymore and we eat a lot less junk food now. My husband has been out of work for a year. He has just joined the National Guard to try to help make ends meet. I worry about him going away.

THE MILLION MAN MARCH WOULD LOOK SMALL IF ALL AMERICANS JUST STOP ON A CERTAIN DATE AND JUST STARTED TO MOVE IN ON WASHINGTON, ALL TRUCK DRIVERS, 18 WHEELER BLOWING HORNS, AND TENS ON TOP OF TENS OF MILLION AMERICANS.

NOW THAT THE REVOLUTION WE NEED. SOMEONE JUST HAS TO GET A DATE ON NATIONAL TV AND TELL ALL THATS CARES THIS IS THE DATE WE ALL GET OUR COUNTRY BACK.

LOCK AND LOAD WE ARE MARCHING DOWN AND TAKE OUR COUNRTY BACK

as mr.poetatohead sec/paulson, has stated.

you cant handle the truth,just give me the money and shut the f up.

america will go under and be in a GREAT DEPRESSION FOR YEARS THEY ARE TALKING AT LEAST 5 YEARS.

HAHAHAHAHAHAHAHAAH TO ALL THAT JUST WOULD NOT LET THEM FALL..JUST AS THEY HAVE LET TENS OF MILLIONS OF AMERICANS FALL UNDER BANKRUPY. THEY TOO SHOULD OF WANT THAT WAY. PERIOD.....

WERE HAVE A THE TRUE AMERICANS GONE, THE ONES WHO WILL FIGHT FOR AMERICA. WE NEED A REVOLUTION NOW PEOPLE
yep, and the pm in england said we are in a depression and america is right behind us and this will last for many years. not months but years.

so again americans wake up and lets take our country back. vote all reps and senator out of washington that have more than 2 terms in. get them out now.

GOOD. I HOPE THEY ALL FALL.

MAYBE THEN WILL AMERICANS WAKE UP TO THE FACT THAT BUSH AND COMPANY NEEDS TO BE DRAG OUT.

ITS TIME AMERICA FOR A REVOLUTION. TAKE OUR COUNTRY BACK.

SO KEEP TAKEING ALL MONEY OUT OF BANKS AND WALLSTREET/ 401,ANY PLACE YOU HAVE IT.

TAKE IT OUT NOW.. MARKET WILL HIT BELOW 6000 WITH IN ONE WEEK.

GET YOUR MONEY NOW

FDIC DOESN'T HAVE THE MONEY TO PROTECT YOU. THE 250000 IF YOU HAVE THAT IN THE BANK, YOU WOULD HAVE TO WAIT 1 TO 2 YEARS BEFORE YOU WOULD SEE ANY. ITS ALL A FRONT.

TAKE ALL MONEY OUT NOW..............................................................................

DAVID A BELANGER
VETERAN
for-america@hotmail.com

Yes, I remember the recession of the 70's and the double digit inflation.  The 80's seemed more like "party times," as Republicans deregulated the S&L industry and ran up the national debt, and then the S&L industry collapsed and we were faced, once again, with the reality of inflation caused by massive deficit spending.  Here we are, all over again.  This time, however, the jobs of workers that were laid off in the 70s have been moved offshore.  I expect this downturn to be worse, because it will be global.  The best (or worst) is yet to come.  Watch corporate earnings and forecasts through early next year.  The planet won't stop turning, but it is going to slow down, a lot!  On the bright side, this economic freeze might delay the effects of global warming (:>).  

This has happened many times before. I hope you will paste the following text into Google and then watch the movie. It opened my eyes.

"
The Money Masters - How International Bankers Gained Control of America
"

Please also note that Nader is running.

Thanks.

I am no economist by any means, but we had our first warning years ago when Enron bellied up.  All the while, subprime mortgages were being sold, and Wall Street was happy to sell them and fill their wallets...they also were pumping up the price of gasoline... and believe me, when you are putting your mortgage payment in your automobile to get to work, something has got to give.  Then, Greenspan kept dropping the interest rate....drop, drop, drop...hell,I told my banker at the current rate of dropping the rate, I'd be paying him to keep my money instead of him paying me interest.  GREED, GREED, GREED on Wall Street, Banks, CEO's and our elitist government representation is to blame.  All of these people knew this was coming and sat on their fat cat A+# and did nothing to stop it...they looked the other way while puttinig the money in their pockets, not giving one thought to the investors or the people putting their money into IRA's to have for retirement.  I don't believe that government should be running the banking industry or wall street....hell, they can't even do their job now when they were told over three years ago and bills were sent to be voted on to begin a process of regulating these crooks...they did nothing.  So, there is a lot of blame to go around, the Wall Street crooks, the CEO crooks, the banking crooks, Greenspan and our government representation crooks.  So just where does the American Tax Payer go from here?  It will be up to the people of the United States to straighten out this mess, and it will take time because we can depend on no one other than ourselves.

There  was  no  globalism  in  the  70's  and  in  the  80's.  This made  the  former  recessions  and  depressions  "local."  The  future  recessions  and  depressions  will  be  global.  But  I  see a  silver  lining  for  the  U.S.  Paradoxically, while the  entire  world  economy went    global,  psychologically  all nations (Russia  included),  still retained  a  dependency  on  the  U.S.  and  the  dollar ... despite the euro (in case of Europe). This is  seen  today  in  the  unusually  unmentioned fact,  that  dollar  has  been  dramatically appreciating  since  the  world markets first fell  913  points! How many Americans really know that, in this "dismal" economy their dollar has quietly appreciated colossal amounts? Not many! And yet those who live in Europe, know that!   Another  factor  that  is  just  emerging,  is  that  Asia  and  Russia and  Europe seem  to  be  panicking  much  more  than  the  U.S. Proof  of  that  is  that,  today,  these economic  blocks  have  suffered  far  greater  market  lossess,  and  increasingly  so  as  time  passes by.  Is it  possible that the  U.S.,  where  the  bubble  first  developed  a crack,  will  be  "rescued  by the  rest of  the  world's  faster market  demise? For,  in  a  global  economy collapse,  the  one  able to survive longer is  the  one  that  matters! 

The goal of "homeownership for all" was at the root pf the crisis. We need to have hearings to find out who really allowed and encouraged the loose lending practices that resulted in this mess. I'm sure we'll find blame on all sides, but Greenspan has to shoulder some of the blame, because anyone looking at the house price trend line could plainly see that price increases were getting out of line as early as 2003-2004. With "perceived" losses of $2 Trillion in stocks and almost $4 Trillion in house equity, people will be in a savings mood for some time to come, which will slow down any recovery. I'm sure the new President and Congress will throw a lot of money around to "jump start" the economy, but I suspect that it will just inflate the National Debt. Not a good time for new "Social Engineering" projects.

I remember recessions, but the financial crisis has already moved beyond a recession. We're headed into a long, drawn-out depression. The majority of people will struggle, but a select few will do well. For example, shortly after the AIG bailout was announced, AIG subsidiaries' executives and insurance representatives threw a bash at the pricey St. Regis resort in Southern California

The $440,000 tab included: $139,375.30 for rooms; $147, 301.71 for "banquets"; $1,488 for the Vogue Salon, which features manicures, pedicures and hairstyling; $6,939.09 on golf; $2,949 for tips; $5,016.32 at the Stonehill Tavern; and $3,064.71 for in-room dining and the lobby lounge.

Let them eat cake.

Marty Volk

To tell you the truth, I don't remember as I was working a steady job in railroading with enough seniority not to worry. It is a different story now as I am retired with a decent amount coming in each month. I have also owned my own home for 10 years with a 6.3% mortgage which is not burdensome. The ridiculous increases in everything have merely served to debase our phony currency which affects too many of us. 

If my 401k could talk, however, it might be a different story. It hasn't been hammered as bad as some folks since I moved everything into the total bond market fund at the outfit that manages the 401k. Last week I moved it all to a money market fund for further, I hope, protection until things settle down.

I feel the currrent mess we are in will probably be pretty bad since it is so widespread, there is so much wealth involved and the circumstances will have a more profound impact on regular people. By this I mean the fact that we have millions of people with 401k plans and others who have lost lots of money by investing in stocks.

Nobody understands the stock or financial markets but people try to manipulate them with transactions that are so complex that it is much like taking a shot in the dark, nobody knows what will happen with them. With so much money out there situations as we are in are going to have severe impacts like now if they go south. While there are no guarantees in the markets one would like to think such extreme risk taking would give people pause before playing these games.

The real estate meltdown I largely attribute to lenders and brokers who suspended prudent lending principals and loaned money to people who didn't have the resources to hold up their end of the deal. The lenders and brokers are supposed to be the professionals. There can be no doubt they knew what they were doing in hoping to make the big score. 

The same holds for the people who bundled flawed mortgages into securities and sold them to others hoping to make the big score. Well, the house of fraud collapsed and millions of us that had no part in this irresponsible business are paying a big price.

Now we have the spectacle of congress voting to bail out the big players who had the greatest hand in all this while ignoring the little guys who took the bait and are losing their homes by the thousands.

All this has done for many of us is make it plain that our government and congress truly do not represent the best interests of the American people. They have amply demonstrated that our so called market oriented capitalist economic system is a fraud while showing their true loyalties to the very people who have manipulated us into this mess.

We may work ourselves out of the economic turmoil but I think there may be fallout beyond that in the form of heightened cynicism and a realization that our economic and political system are seriously flawed. A loss of confidence in government in all its forms can and will be as devastating as would be a loss of confidence in the value of what we call money. And money, after all, is what lubricates the whole corrupt system.

Unbelievably, one can find even today ads on the net, at MSNBC for instance, offering hundreds of thousands of dollars in home loans with no SSN required. Maybe we should all apply. Where is this money coming from? 

the price of oil has dropped from 147 a bbl in july to mid 60's this week. our dollar compared to canada in the same time went from even to high 70's this week and we get a million bbls a day from canada. shouldnt gas be 2.00 dollars a gallon now? instead of 3.00? if 100 million americans saved 1.00 a gallon and 20.00 a week then wouldnt there be 2 billion a week to put back into the economy?

Brad, you are so correct!!!  This BS $150 a barrel was a hoax and we are still getting raped by the Big Oil companies. They started this big snow-ball rolling and now they are getting away with all of their greed. I f anyone really thinks we are almost out of oil??  Look at Enron when we were were OUT of electricity??  What a hoax. I have been a republican for years and I have seen nothing but GREED<GREED and more greed. Get over youselfs all of you sick money losing CEO's and oil barronss get gas to $1.90 where it belongs before us americans get sick of you and NATIONALIZE YOUR GREEDY BUSINESS MONOPOLY.

It's worse and going to be more so.  As others have said, we're a debtor nation instead of a creditor nation.  We (locally and globally) have fewer natural resources and the environment is in worse shape, which leads to well, a number of problems, but one is poorer health and poorer quality of food, which fewer people are able to do anything about.

Our public transportation and rail systems are in poorer condition, and there is more personal debt as well as national debt now.

Gov't needs to focus on some high need things like public trans and rails (save fuel and citizens' money if properly done). 

I don't know what the fix is for the increase in jobless rates but if that could be helped it would probably help out some with the mortgage problems, etc.

On a personal level, I and a lot of people I know are simply paying down/off debts as much as possible, living more simply, and putting some extra food on the shelf against possible unemployment.  So far we're doing all right, but it's never a bad idea to have some stores against either that or bad weather or other unforeseen problems.

I remember a mortage with an interest rate of over 13%.  I remember pulling into a gas station, not sure whether there would be any gas left to fill my Chev. Vega.  People today are spoiled, greedy, and always expecting papa government to bail them out.  Suck it up; grow up.

What about those of us who did not foolishly borrow against equity on a house whose market value was extremely jacked-up so they could pay off bills on credit to buy things/stuff they shouldn't have had in the first place?  I purchased a house for much less than the bank indicated I qualified for.  I'm making my payment on time and have money to spend on other things.  I'd rather spend less to fill up my car--read that car (never saw the need for a SUV) but will not hesitate to spend whatever the price might be.  I'd prefer public transportation, but once again, the U.S. hasn't done a great job in that area either.  Quit whining folks--you really could do with much less. 

Pull the kids out of those private schools.  They honestly won't die without a cell-phone or any of the other electronic gadgets either--nor will you.  Disconnect the cable, stay home and read a book--you can get them from the public library for free. Move in with relatives--help out your neighbors.  If you are still a have rather than a have-not, volunteer your time, donate canned goods, contribute more to your communities than smog and garbage.

Quit whining!  This is nothing compared the '70s/'80s or the 1930s for that matter, nor do I think it will be, unless the media continues to cause panic among the populace.  Neither democrats nor republicans can "fix" the problem--the problem is us!

It is worse than the 79/83 recession. At that time money was very difficult to obtain  but was there for a price$$ Interest rates soared 18 to 23 %. If you could afford it, you could have it. People were not losing their homes as they are today, because people were more frugal with their money and lifestyle. Banks & credit card companies were not so free with their money. They had a formula for credit worthiness and stuck with it. Today's easy to get money has caused the mess that we are now in. It has created an inflationary spiral. Low down payment loans have certainly helped Americans get into a home, but we are now all going to pay the price for FHA; Fredi and Fanie mae's liberal approach. Our government, through the lobying efforts of the Banking industry, and Home building industry have crafted this beautiful mortgage system to help bring down the financial system. If this easy money system was not LEGISLATED by our government, Wall Street, along with our Banks, Builders, and Real Estate industry, would not have the opportunity to exploit it/ or take advantage of it, as would be more eloquently put. I saw this coming in 2002/2003. As a matter of fact I was a frequent guest on a small local T.V. talk show and am on record as stating that what I saw happening in the real estate industry regarding inflation in housing, was going to create a bubble bigger the the one created in the Jimmy Carter administration (1976-80), which is what this article is comparing today's crisis too.........Buy the way, my credentials speak for themself. I have actively been in the Real Estate business since 1966, yes 42 years, and have seen one recession after another come and go. Each one getting worse and worse. This country better wake up and pay more attention to government and its workings. The educational system certainly won't teach it so you must find out for yourself its goings on. Don't keep making the same mistake and vote in the same "pork barrel" politicians over and over again. They are the cause of this mess!! and don't let them tell you different........Sorry for my frustration but I have never been so mad in my life and down on my countries government. They have really  let us down, big time. Physical restraint, don't we get it; at all cost!

If the government helps millions of people avoid foreclosure, what about those of us who lost our homes and got no help.  Some of us bought homes hoping for the Americian dream, only to be conned by money hungry conartists.  I think if the federal government steps in now to help other people, there will be lots of retaliation from those of us who have already lost our homes.  Not all of us refinanced our houses to live extravagent lifestyles.  If you are going to help people avoid foreclosure, you better help those of us who have lost our homes to it already.

Yes I remember the recessions of the 1970s and the 1980s. The recession of the 1970s I was a student and driving a truck to earn money to pay my way through college. My job paid $3.50 per hour. I had no wife or children so I was not impacted. The recession in the 1980s, I had finished school and was investing in real estate and playing the swings in the stock market. I had no family to support so again no problem.

Now I have one child in college, another starting college Jan 2009, and one in high school. The business that I have owned for almost thirty years has been impacted in a way that I have never seen. I have been a real estate broker in Florida since 1979, and I have been a mortgage broker since 1984. The mortgage business went by the way side in Aug 2007 followed by a slow, slower, ground to a halt real estate market.

This time the impact of the credit crisis is going to prove to be a long term event. The one sign of hope for the Florida real estate market will be the increased demand for offshore drilling. Up until now the supply points for equipment for the gulf platforms have been located in Texas and Louisiana. The west coast of Florida should benifit from the increased demand for drilling in the Gulf. 

The car sales market could be turned around perhaps if the auto makers in this country would lower the price of the cars and trucks that are being offered for sale. Houses back during the 1970s and 1980s recessions cost as much as the trucks that are being offered today. The auto and truck makers could demand these high prices because the length of car loans have been extended to five and six years. This can be reversed. House values along with stock prices are falling, where is the decrease in new car prices?

To conclude this recessioncan be the catalyst for change, the problem this time is that even though change is the mantra in this upcoming election real change starts in our own towns, not from Washington D.C.. I think that we are in for a long hard slog.

What about the large companies that decided to leave the United States to set up shop elsewhere for less payroll cost, more tax breaks, etc. etc.?  Why are we good enough to sell your products to but not to employ?  Just how much money do you need?  Leave our United States then keep your products where you moved to.  We need to get back our mills, farms, businesses, industry we need our jobs back.  Build your automobiles in Mexico, then sell them there.  We need to take back the high raises that our officals give themselves, the CEO's that just have to have how many millions to survive, get rid of them, put Congress, the Senate, the House of Representatives on Social Security at retirement time at the same rate we are paid.  Just how much do these men and women in our government actually pay in taxes, medicare, social security?  I have no problem paying my income tax, we need that money to run this country, but why can't we all pay the same % on the actual monies we make with no tax refunds at all?  Tax me 5% on my wages, keep it to run this country, I don't want a refund.  All of these large companies and wealthy people end up paying less than I do by the time they take every tax break they can.  No more tax breaks, just pay 5% of your million and I'll pay 5% of my $30,000.00 and our government can keep what use to be the refund to pay off our debts.  If you make zero money you pay nothing but you should not be receiving a tax refund or credit for something you never paid into.  If you are not a citizen of the United States, you should not have welfare, medical or any rights that  belong to the citizens.  If you want to have our rights then be like our great grandparents and our grandparents and do what it takes to become a citizen.  We are quite aware that we the citizens of the United States have less privleges than non- citizens.  Resession, depression what is the difference?  From where most people sit they mean the same, fear.

Get use to the MUSLIM..He might turn-out to be the BEST president you will ever have!!

Whichever, it's clearly time for innovation. Here's one way to replenish the treasury: Issue an Obama '08 sovereign made of real gold for sale to all those people around the world who would love to commemmorate this historic presidency. That's sure to get things going in a big way.

I'm not worried. Obama said that he would march in, and change the system, and fix it. That's why people voted for him. So what' the problem?

Rick

Rick--  The real Problem is--Obama is a Lawyer, he trained for that, sounds like that, & that's what he is!!  He speaks 'eloquent-speeches', with a 'silver-tongue'--he's trained to convince a Jury,or a Judge,even if his client is 'wrong'-because in Law, that's his Job! Now, let's go to the POINT--He is NOT a ECONOMIST!! 

How about a multi-facited approach that would include an economic stimulus program (wether by just sending out checks or offering substantive tax incentives) that would include incentives for retail stimulus credits for energy improvement, to include insulation,window replacement,upgrade burners,changeover to alternative energy fuels,more efficient appliances. all of which would stimulate retail sales,manufacturing,work in the construction trades-AND all of these would have the result of reducing dependence on foreign oil.  Seems like a no-brainer, and I can come up with a lot more similar actions that would positively impact our current situation, but am hoping for some other common sense approaches from the new administration.

I agree with Samantha. I don't understand the need to wait the last minute when people are almost out of their homes to assist them. I'm a homeowner and even though I'm paying my mortgage on time every month does not mean I'm not struggling. I've had to make sacrifices just so I have money to make my mortgage. Why can't the government pump the $700B bailout money to all Americans to help them. Why give it to the big businesses? If we as consumers are end-users in the economy, why not divvy the bailout money to working Americans? Yea so what they gave us the $800/1600 check in what they called the stimulus package. Can anyone honestly tell me that it helped them tremendously? What is the downside to giving the money back to the Americans that put it in the governments hands in the first place? If someone is more knowledgeable than me, please chime in.

Maybe the oil companies could help bailout the auto industry . After all, they have record profits.  A large loan wouldn't hurt them.  As for the home owners, maybe the real estate companies that were so eager for them to get into a house could help them, along with some help from the mortgage people.  

Oh, yes, I do.  This one is worse already, I think.  I don't think they should have passed that humongous amount of money for a "bailout" without covering all that it would be used for BEFORE it was approved.  How does any of this help me, the working poor American?  I have a mortgage and struggle every month to pay it -- but I'm PAYING it!!  We just make sacrifices in other areas to afford it.  Not a big place, either.  Just a mobile home on a little over an acre, but it's heaven to us!  I don't get a break, not even when I was unemployed and looking hard for a new job -- nobody "bailed" me out!!

One solution to the auto industry crisis, would be to issue tax incentivized Bonds to be bought by the public. This would be similar to an industrial bond, but would be sold with various redemption dates, and would provide a tax reduced income for the investors. Since Americans have been taxed on savings interest, the savings rate in this country has dwindled and we are only valued as " Consumers".

Well since our confidence has been shattered, we need to provide for a way to save the auto industry and also to rekindle America's intrest in saving money. One criteria to be set forth to the auto makers will be to produce fuel efficient cars that get between 45 and 60 miles to the gallon and work on various fuels. Trust me we can once again lead the world in our manufacturing capabilities.

Thank you

This crisis has been, not 8, but 30 years in the making and it will take time to fix. I believe we will be in recession for at least a year and when we do emerge, it will be to no or slow growth over several years.  We will have to adjust to our new, reduced status in the world financial system. If we weren't so large a presence, we would already be a banana republic, overwhelmed by debt and a debased currency.  Thirty years ago, the American people made a decision to embark on a new experiment with essentially unfettered financial capitalism. Government was the problem, "free" markets the solution. "Globalism" and "free' trade would take us to new heights. We would have "small" government (code for cutting regulation and slashing the safety net). Taxes would be cut and those cuts would pay for themselves(there is a reason they call it the "laffer" curve). And we would cut "waste, fraud and abuse" so that the budget would be in balance.  Well, Americans dislike government in general and love government in particular and one man's waste is another man's essential service. So instead we cut taxes and borrowed money by the trillions. And, by the way, did nothing about the large and growing stream of dollars going overseas for imported oil and consumer goods, first from Japan then China.  We kept our standard of living artificially high by emulating the government and borrowing tons of money.  Meanwhile,  jobs moved overseas or across the border and with a wink and a nod, we allowed an illegal immigrant invasion which will change our country in ways we can't predict.  Having always seen the next boom just over the horizon, this pattern was repeated time and again. Lots of people got rich; most people were kidding themselves.  Leading politicians kept our minds off the reality that was enriching their friends by dividing us on "value" issues. Those things that separate us made good politics.  Sooner or later, unsustainable behavior becomes unsustainable. We threw ourselves a 30 year drunk, and this is the hangover.  It's going to be a bad one and the nation will emerge less of a force in world power and economics, or it will break itself trying to do things it can no longer afford.   It has been said that, in a democracy, we get the government we deserve.  We can come back as a nation, but only if we can overcome the legacy of political division, failed policy and restore some sense of fairness to our economic systems. 

I think this recession is going tobe substantially worse then 1970's and 80's.  I don't think we have the slightest conception how the creation of credit and financial markets have assisted in growing new businesses and keeping unemployment down.  How the success of businesses (not the businesses that have populated our news headlines) have helped hire people and grow payroll and business tax revenues.

When private businesses that have existed for 30 years walk into the bank and turn over the keys to the bank, it is a sign that our financial system is not only not working but that it will be a long time before a secure business will be formed to take the place of the one just shut.  These businesses are not the General Motors or the Chrysler Corporations, but the family who have had enough trust in the financial opportunities created in this great country to hire and grow his business.

The GM's and Chryslers will use the bailout money to further slash hiring, close plants and downsize.  The businesses we need to support are the people that hired additional people each year.  The only solution to this is to get the banks to work with these group to help their businesses survive, because they will be the folks that will rehire the quickest. 

The only issue is that banks, even with the financial bailout are not lending.  There will be a whole generation of lending officers that are now focused on salvaging the first dollar from the closure of a business.  Many bankers are saying the first dollar is the best dollar in terms of business closure.  Therefore, focus on taking back property and then closing

I agree.  The government should not save the companies whose CEOs ran them into the ground.  The banks should fail as well if they are not willing to renegotiate loans.  Think of all the money they would not lose if they simply did that.  Instead, they let the homeowners forclose and loose out since the real estate market is stagnant.  If no one buys the bank owned property then the bank really loses out.  They are too greedy and that is why they are in this situation in the first place. 

I understand that people wanted too much as well, but if you have someone telling you that you can afford it and they dangle it in front of you, then you will most likely go for it and not think of the future.  The realtors are also to blame.  They are the ones who suggest the prices and have inflated them for years.  After all, their commissions are based upon them.  This whole housing situation is a mess.  I feel sorry for President Elect Obama.  He sure has one hell of a situation to handle.  And congress is ridiculous on not handling this situation immediately and waiting till January to do something.  We cannot afford to wait until then.  More and more people are losing jobs and therefore losing their pants.  Although my family is making it right now, who knows what will happen down the line.  We are all one pink slip away from losing it all.  No one is safe.

Part of the problem is us.  We look to the government and regulations to help us decide what is right and wrong.  A good example of regulation as not being the answer is how quickly business figured out how to get around some of the provisions enacted by congress in the 700 billion bail out package. 

Banks worked on how to get around the reserve requirements on mortgage financing, and first looked at setting up seperate state corporations aimed at just holding the mortgages, buying them from the bank.  Then we went to securitizing and packaging the loans and selling them off, again getting around the reserve requirements of bank regulations.  Securitization helped fund more money into the system.

Mark to market, a regulation that requires banks to report assets (collateral) at current market values, has caused another downward spiral in housing.  A downward spiral that is as unrealistic as the upward spiral that was fueled by the securitization of mortgages.

We need courage on the part of business leaders.  That courage was done by Citigroup last week in an announcement that they would renegotiate mortgage loans with those that would qualify under a set of rules they established.  The amount of wealth that has been taken out of the Global and Domestic economy has stimulated very little thinking about how to look at loans and assets.  In a downward cycle that is being fueled by consumer fear, the real values of real estate, stocks are set by fear not a real market valuation.  It takes real courage to stop and say, that the real underlying value of an asset is above where fear has driven the market.  Think of the fact that a piece of real estate as asset but for which there are no buyers because of fear.  There used to be three prices in real estate:  the price you wanted for the property, the price a buyer would pay given a reasonable listing time, and the price of either a forced sale or a sale that would occur quickly.  Today, there is a fourth, the price a buyer that really doesn't want the property will pay, just to hold onto the property until better times. 

Courage, judgement, and an environment not being fueled by fear.  Unfortunately for many, there is fear of foreclosure, there is fear of not having any money, there is fear that your life savings has been completely evaporated.  We need to consider what is driving the fear and go after that aspect.  We need people not government to do this.  We don't need more regulation, and we don't need to look at who to blame.  In part, it is us, and we are the only ones going to be able to solve the problem.

This is already worse than i can remember.I was born im1953.I remember my father talking about the great depression,it didnt sound too great to me.This is just the beginning.If those crooked lawmakers would have used OUR money to pay OUR debts instead of giving it to their fast buck buddies it would have lessened the impact.They would have been paid and we would be free of debt.

This thing is worse than anything I remember. I was born in 1976. I don't see bread lines around the corner, but I do see hundreds of thousands more losing their jobs over the next year. I see hundreds of billions more spent by our gov't to restart the economy over the next year. I hope to see an end to the $200 billion/year war in Iraq. I hope to see a nationalized electricity grid. I hope to see a reduction to the use of foreign oil and an increase in domestic energy production. I hope to see universal healthcare coverage within the next two years. I'd like to see the housing prices bottom out over the next two years when I expect to be in the market.

I'm scared, but I'm hopeful. The hope was given to me by the more than 66 million people who voted for hope and change from our current mess.

Yes, I remember the recession in the 80's.  I opened a small business in 1986 and people thought I was crazy.  This is in San Antonio, TX and we were in the middle of savings and loan failures and the oil industry bust.  But, I had faith in my clients, my employees and myself.  I worked hard, saved money, paid off debt and had a great time to boot!  I don't think it's any worse now...but, it sure sounds like it from the 'doom and gloom' news we hear everyday.  That's the downside of techology...we're bombarded with bad news 24/7.  We didn't have to think about it all the time in 70's and 80's.  So if it was so terrible, we didn't care....we were young, happy, and hard-working.  Maybe "ignorance is bliss" isn't such a bad thing.          

We can't really compare the great depression to current times.

The bad debt this country owes far outweighs what we owed 80 years ago. On top of that we didn't have a political oligarchy in the 30's like we do today where special interest groups run our federal and state governments. Add to fact the central bank has poor control over our treasury compared to the 1930's where they may have actually created the great depression.

Today we live in economic bubbles that cater to Financials, Insurance and Real Estate instead of sound manufacturing industries of the 30's and 40's. 80 years ago were the days before the corporate raiders trashed family owned businesses who felt more obligation to their employees than to the stockholders.

80 years ago unions really meant something, today Reaganomics has done away with virtually all unions and is relegated to being used as a 6 letter foul word.

We didn't have 46 trillion dollars in bad financial instruments in the 1930's and a national debt of $10-11 trillion with an unending war benefitting only the profiteers at the taxpayer's expense. Add an economically unsound healthcare system, and we're heading for a disaster far worse than the great depression. Only thing is that leaders won't fix the system, instead they will try and ride it out creating a much worse scenario 15-20 years into the future.

I am not surprised that our government would not want to backour jobs here in the USA..look at how many have left with their blessings. We spend billions on country's that will be happy to see this country fail...but in comparison very little on the people here....why is that?

We need the jobs badly that they, our congress, is more than willing to let go. Congressmen from states with honda and the like will be very happy to see competition for their products go away.  What happens afterward though...what about the lost taxes....who will make it up ? Will the taxes be raised to pay for more of their mistakes? How about if they ,Congress, takes a cut in pay...or a reduction in their benefits..that would help reduce costs to us, the tax payers.

Our Government needs to wake up....join the main street they talk about....see just where we are.

I remember the recession of the 80/90 like it was yesterday. Ilost my business in mid 70. Those two recessions were minor glitches compared to what has happend already and what is still comming. This is much more than a recession,this is worldwide and is going to effect everyone. Nothing of this magnitude has ever happend to effect the whole world since world war 2. Ever since we were taken off the gold standard by Nixon the country has been heading toward this collapse. Credit card companies started hot and heavy back then. The government started printing worthless paper money back then. This happens to every country after a long period of time doing this fiat system. the problem is the people in control of this very bad system start printing money 24/7. Why not there is absolutely nothing to back it up. Would not you do the same if you could? It is human error and nature of the beast. Reaganomics was the next screw up to deal with. There will always be wars. We can not blame what we are going to be subjected to on that factor alone. The fact is this is now comming to a head because we have been in a world economy for quite a few years now. I theorised many years ago when I first heard the words WORLD ECONOMY Isaid there is no way this great country can compete in aWORLD ECONOMY unless it is on a spiraling downward scale. We would have to lower are standard of living greatly. Well I sure wish Iwas not right, but this is where we are headed right now. This whole country is being downsized,house by house, bank by bank, business by business, down to person by person. This is the only way we can compete for our piece of the pie in a third world generated economy.It is time for someone else to be king of the hill, monitarily anyway, not militarily.So start tightening our belts, cut back fast and tighten your seat belts, keep your hands in the window, it will be a ride like we have never been on before. WE will prevail this is AMERICA we are RESLIENT PEOPLE . GOD BLESS YOU ALL AND GOD BLESS AMERICA. Sorry I got too wordy.       Thank you, Peter C.

I remember the 80's and 90's and it was tough on a lot of folks and families. Nothing like what it appears to be this time around. Those recessions were not enough to impress upon enough people in charge that change was needed.

Major players in finance, housing, insurance and the auto industry are really hurting and rightfully so, they have earned their demise. The top of the list of course is our government and policies our legislative body has used to support special interest in return for votes and more of the same.

Leaders in both government and business, not just in the United States but the world over, were blind sided by this sudden turn of attitude. The very fact that no one seen it coming. If they did see it, no one had the guts to stand up and say this can not continue. If they said it, no one listened because the good times are going to keep on rolling on!

The focus is on the wrong end of the horse this time. Bail out the big, because they are to big to fail, is the battle cry. The truth is those same people, leaders, are heavily invested in failed ideas. Bailouts will continue those failed policies. Think, would you change the way you do business if you could get a finanicial bail out? No, you would continue on your marry way until more money was needed and you would be back for more from your sugar daddy.

The leaders of these failed policies, for that matter for big businesses for the first time in years have to reach out and understand the needs of individuals and families of the world. They are the true resource of any nation or any business. They are the ones that will suffer, readjust and prosper in spite of the stupid and rediculous decisions our supposedly leaders promote.

The real challenge is to regain the confidence from these individuals and families. Government can bail out, talk and legislate all sorts of regulations, to encourage lending, but without confidence, the bottom line is, who is going to step up and borrow the money.

Confidence and trust, money can not buy it. Government and big businesses must earn it and when it is gone no one cares, government and big businesses become irrelevant in the lives of individuals and families.

Would you like to make sure that Obama is a natural born citizen?  Please sign a petition that will be sent directly to your U.S. Senators.  Thank you

www.rallycongress.com

It hasn't reached the 80-82 recession levels yet----not even close.  If the government let's these businesses fail, and it should, we may reach the unemployment level of 10.3% ?  BUT, the prime rate then hit a high level of 20% plus and inflation hit 15% or so. We have a long way to go for that. I believe that with the recovery we'll see high inflation especially with energy , I.E. gas and oil. When housing returns, it'll go up big quickly. You'd have to be 45 or so to remember the '82 recession.     

FACING A DEPRESSING DEPRESSION

Well, I'm feeling pretty depressed right now!!

I retired last year, but now I have to go back to work to make up for prices going up across the board, and my barely adequate savings becoming merely inadequate. I'm not broke, but I have to do it now that I'm still healthy, for God help me if/when I get sick!!! (Never mind gasoline and housing and housing prices coming down...  they went up a long time ago, now that balloon's busted!) 

Gasoline and housing are a promise of things to come. First you have inflation as the government prints money to take care of its mounting mountains of debt. Then when that has drained us of all our savings and property equity and driven us into whatever debt we can still find, then and only then, after everybody's broke, prices begin to fall. Don't rejoice at the falling prices because that only begins to happen when everybody's already broke!!! So "wherefore rejoice?"

So the falling prices in gasoline and housing prices actually represent the leading edge of the deflation that drives an economy into a semi-permanent depression. That's what happens when people have to give up on what they can't afford. It's merely started with driving (travel and new cars .... get it!) and living quarters (housing!).

Next it will be education and educational products including toys (Xmas spending), health, nutritious meals, recreation and exercise, clothes (garment district), new computers etc..., and so on and so on. It's all very depressing. Japan's started in the 1990's and they haven't turned it completely around yet, and Japan has already started on the second decade of depression. We have to find a way to avoid that.

I think THEY found a way to avoid that--the  500-700 billion revitalization that will go into infrastructure and possibly create new jobs.  Then we move into the next phase that is created by high wages and prices - inflaltion.

Stan, I agree with almost everything you said except the inflation rate. I think we will enter a period of deflation, housing leading the way. And, with regard to energy prices, with a depressed economy, demand for energy will decline, decreasing the prices for those commodities. Ditto, for consumer goods and services. By the way, I'll be 62 next month and remember every recession we've had since the great depression. I, also, know this. Government had very little to do with correcting our economic woes including the 29 stock market crash and our recovery in the early 40's, although liberals will tell you otherwise. On the other hand, I'm not an advocate of starting a world war to get the job done. I do suggest, however, to the extent that government can keep from taking money out of the economy, they do so. Again, the less government gets involved from my perspective, the sooner a "free" economy can correct itself.

PS The CCC and WPA programs did nothing to correct the economy during the Roosevelt era, although they did releave a lot of suffering. So, to the extent that the government realizes that, I wouldn't mind seeing a "moderate" amount of infrastructure maintenance and/or re-vitalization.