Is The U.S. In A Recession?
Posted on February 28, 2008
Filed Under Ask Mark, Observations
While watching the evening news the past few weeks, there have been several stories about the “possibility” that the U.S. “might” be headed into a recession.
Might?
- One of the top news stories today was from Associated Press writer, Jeannine Aversa, titled, “Economy Slows To Near Crawl”. Hmmm, that doesn’t sound good.
- Earlier this week, another Associated Press writer, Alex Veiga, published an article titled, “U.S. Home Foreclosures Soar In January” stating that home foreclosures are up 57% as compared to the same time last year.
- According to information just released by the Federal Deposit Insurance Corp, charge-offs at credit card banks in 2007 were $49.3 billion, up 62.5%, as compared to the 2006 charge-off total of $27.0 billion.
- Yesterday oil hit an all-time high of $102 a barrel. On average, gas prices at the pump are up 33% as compared to this same time last year. Nationwide the current price for a gallon of gas is $3.15 compared to $2.37 last year.
- A quick look at any financial news source shows the U.S. dollar at an all-time low compared to other currencies around the world.
Yet today President Bush told reporters at a news conference that “I don’t think we’re headed into a recession”.
Huh?
You don’t need to have graduated from the Harvard Business School to know that we already are in a recession. Hello! Maybe certain business leaders or people in the government don’t want to “scare” the American public by actually uttering the word r-r-r-recession. How sweet of them.
But come on, give us a little credit here. We in the American public know exactly what’s going on. We’re not stupid. Things are not going that well financially for a lot of Americans right now. All you have to do is take a look around.
And you know what? As much as I hate to say it, I think it’s probably going to get worse before it gets better. You don’t just snap your fingers and halt a juggernaut overnight. It took years (perhaps a couple decades) for us to get to where we are right now, and I believe it’s going to take a few years or longer to get this thing turned around.
Sorry to sound like Mr. Doom-and-Gloom, but you can’t ignore the facts.
But in a strange way this cloud could have a silver lining. I actually think something good can come of these challenging financial times.
With all the financial pressure and uncertainty, we’re all eventually going to be forced to make some new choices that will require all of us to …
- Take a good hard look at the erroneous beliefs that created our current situation.
- Have the courage to ditch the stuff that isn’t working and adopt new beliefs about how we interact with each other and our environment.
- Try and remember who we are and what this human experience is really all about.
In a way, we’re going to have to re-invent ourselves.
From a financial perspective, we’ll going to need to reduce our debt burden and consume less and less. As we do that, things are going to settle down, and we’re going to start to experience freedom again by not having to work so many hours to support our previously stupid spending habits, and we’ll come to realize that we didn’t need half of the crap that we bought in the first place.
And maybe one day we’ll get back to the day where it’s socially acceptable to just sit on your back patio with your neighbors on a July evening and just listen to the baseball game … or play fetch with your dog … instead of checking your email 20 times a day from your iPhone.
Sign me up.
