Monday, March 9, 2009

You are too pessimistic...

After months of being solemnly told how dire the economy is, we seem to be headed for a serious round of pep talks.

In his weekly address to a fretted nation Saturday, President Barack Obama assured Americans that bleak times will give way to better days. The economic crisis, he said, is this country's next "great opportunity."

In case we didn't get the message, he also said he was "absolutely confident" that Americans will persevere.

This follows Obama's odd, tipster-in-chief moment earlier in the week, when he noted that the stock market offered "a potentially good deal" for Americans.

Why the sudden pivot in emphasis?

Our pessimism is starving the economy.

Obama knows what any small business owner will tell you - that the country won't begin its recovery until consumers peek through the blinds, see some sunlight and realize it's OK to start spending a little money.

Yes, this economic crisis is rooted in spending that shouldn't have happened, but consumers have led the way out of many economic recoveries since World War II, and they will play a large role in the next recovery, whenever it happens.

Late last week, economic guru Mark Zandi told a small group of reporters, including McClatchy's Kevin Hall, that the economy's best chance rests on breaking through the dark pessimism afflicting Americans.

"Everything hinges on confidence, sentiment, of business, consumers and investors," said Zandi, chief economist of Moody's "And it's possible that the policy response (bank rescues and stimulus spending) shows some progress by the summer. And it won't take a lot to make people feel a lot better."

Here's how it could happen, Zandi says: "If you go from losing three-quarters of a million people (joining the unemployment ranks) in February to, say, only a quarter of a million people in July, even though that's Armageddon in other times . . . that's progress. And everybody will start to forecast that there will be a zero job decline come early next year. And we'll start looking at GE at $9 a share or a Miami condo for $200,000. . . . You may decide there is a lot of value, and things could turn more quickly than anticipated."

We should note that Zandi is pessimistic about this happening.

But is our pointing that out part of the problem? We certainly hear complaints at the Observer about the constant thumping of bad economic news. Is it making you grab your billfold more tightly?

Tell us what has you pessimistic, and what it will take to change your outlook.

Your Morning Edge:

Factories are finding there aren't many jobs left to cut, the Wall Street Journal reports.

MomsCharlotte Deal Diva Tara McAlister has the best grocery store bargains this week.

From CNN, three tips on making your severance last.


Anonymous said...

A recovery in housing/reduction in foreclosed homes on the market and a stable financial market. Without those two, I dont see a recovery. If Obama/Geithner were as fast to unveil a recovery plan as he was his spending bill, we wouldnt be in such uncertainty.

Anonymous said...

"If you go from losing three-quarters of a million people (joining the unemployment ranks) in February to, say, only a quarter of a million people in July, even though that's Armageddon in other times..."

"Other times" translates to "whenever a Republican is in office," I believe.

Anonymous said...

People are losing jobs, houses going into foreclosure, stocks going down and big companies asking for money.

My view currently is anything the President or the news says, is bull until I see the following.

People getting jobs, houses selling, stocks going up, and big companies paying back the money.

Vincent said...

Hello Kevin,
1: an inclination to emphasize adverse aspects, conditions, and possibilities or to expect the worst possible outcome.

Pessimism is like a wet roll of toilet paper, not good for anything even by the people that spew its concept in the most grandiloquent fashion.

After serving much thought on the matter, it has become pretty clear no one, especially myself mind you, but particularly in Washington has the slightest clue what really is the underlying problem, let alone how to fix it. Watching those folks spend all of our future earnings the way they are is like watching a drunk trying to fetch a set of keys, just inches from his grasp down a sewer drain on the darkest of nights. That is not pessimism is it? I call it grounds for contingency planning.

The ONLY answer to our current situation lies within the solvency of time. I don’t know about you but I really don’t want my kids, and grand kids’ tax dollars going to pay for this mess, how uncool is that? HOW SELFISH IS THAT? There is a commercial explaining that “if you spent a million dollars a day since the day Jesus was born ….” (YouTube that one) which has more effect on people’s subconscious these days than they care to admit until you ask them if they have seen it.

I bet if the powers that be, and especially the powers that want to be… came out with a PLAN of LOGICAL sustenance,, and not a blind three point shot attempt at a cure, and a set of visual aids(read: Perot charts) of where we were, where we are, and where we are going, and most effectively how to stop the incredibly irresponsible spree of spending unprinted money, and reverse the process of such , everyone may possibly, collectively, breathe a sigh of relief.

Every so often a hundred floods comes along, and wipes out a lot of natures progress, but once the pain of that drastic, and sudden change subsides, new growth emerges from what was becoming if not had become bogged down fields, that had lost direction and fertility to over farming and mismanagement.
People, places, things get hurt in that process, yes.

Pessimism is rampant in March of 2009, but I am a big enough believers in America, and Americans, and our forefathers utterly unselfish plan of action to see the bigger picture where we all realize the only place for pessimism is in yesterdays outhouse. Right now the glass is not half empty or half full; the glass has water in it, we can take more out or put more in, or be satisfied we can at least take a drink until we manage to find or create a more stable well from which to draw from.

Two world wars, a civil war, 911, “the great depression”, polio cure, civil rights, womens rights, go outside tonight and look at the full moon, Americans found a way to get from here to there and back, I think we can figure out a way to see beyond this mess and not lose ourselves in pessimism.

Anonymous said...

I'm an optimist - I have faith in our country and in our new President. I saw this economic mess coming when houses started selling for three times their value, when oil prices began their steep rise, and when the stock market "got drunk."
I'm an optimist because I prepared, and encouraged my family to prepare.
We're riding out the storm with no worries - buying at discounted deflated prices and positioning ourselves to make profits in the near future.
This economy will right itself before the end of the year, or early next year. Wait and see. :)

Anonymous said...

I see NOTHING in your president's stimulus pakage that is going to put people back to work. If someone can show me ONE THING that is going to put average Americans back to work please share.

Anonymous said...

"Other times" translates to "whenever a Republican is in office," I believe.

I thought it referred to Obama tripling the deficit prior to halving it. Only a Dem can increase the deficit and call it a reduction. Yeesh

Anonymous said...

Anonymous 10:00 AM,

Stimulus money for infrastructure projects will provide jobs. Does that count as one thing?

Anonymous said...

I really wich McCain and Palin had one. You could tell just by watching them and hearing them speak that they were truly masterminds when it comes to economic issues.

Anonymous said...

The captain of the worlds greatest ever invincible unsinkable cruize ship The Titanic reportedly was the worldest #1 optimist and even when he was told the ship had struck and iceberg and was sinking fast he refused to believe it saying this ship cannot and will not sink and went to his cabin quarters to finish his sleeping and was never heard of again ...
They say optimists always are the first to die and with a smile on their face.

Anonymous said...

I'm optimistic about the future. What people fail to realize is that we control the markets! Stop being so negative, spend the money if you have it. Hoarding your cash and then complaining about everything wonn't help solve the problem. Everything will turn around when Americans decide they really want it to turn around. We don't have to wait on government or anyone else. If you notice stocks fall dreadfully after CONSUMER reports come out.

It's so easy to blame everyone and point fingers, but again what good will that do? It's not about democrats or republicans. It's not about left or right views. It's about the American people pulling this country up by the boot straps and walking wtih our heads high!!!