Mother Jones: Is A Double-Dip Recession—Or Worse—Finally Here?

[marmar]

For the US economy, the bad news keeps piling up, like that 60-mile, 11-day-long Chinese mega-traffic jam.

Sales of existing homes sank to a 15-year-low in July, the National Association of Realtors announced on Tuesday. The 27 percent drop surprised already pessimistic housing experts—a group of economists had told Dow Jones Newswires they expected sales to fall by just 14.3 percent. "The report shows the housing industry has hit more turbulence, is not leveling off, and is worried about a nose-dive," Mitchell Hochberg, who works for Madden Real Estate Ventures, told Dow Jones.

The grim news from the housing market comes at the heels of a startling uptick in the number of Americans applying for state jobless benefits for the first time. For the week of August 10-14, claims rose by 12,000 to 500,000, the Labor Department reported, marking the highest level since mid-November of last year, not long after the recession technically "ended." The increase in initial claims is indicative of a stagnant labor market and a 9.5 percent unemployment rate (and, for those of you keeping track, a real unemployment rate of 16.5 percent) that shows no sign of decreasing as the Obama administration's stimulus efforts start to wind down.

And there are plenty more negative indicators to point to. Home-builder confidence is dismally low; housing starts decreased last month; commercial real estate prices keep dropping; the Philadelphia Federal Reserve's Business Outlook Index suggested weakened manufacturing activity in August; and on and on.

So what to make of all this grim news? Has the economic recovery temporarily stalled? Are we headed for a double-dip recession—or worse? ............(more)

The complete piece is at: http://motherjones.com/politics/2010/08/double-dip-recession-housing-economy-zandi

[Orrex]

1. I don't know of anyone who feels that the Recession ever ended

At least, not outside of Washington and elements of the media.

[Cetacea]

3. +1

[xchrom]

2. recommend

[earthside]

4. Worse.

There is an element of simplicity if one thinks about it that explains the systemic, fundamental cause of our economic woes.

No economy would ever survive long if it ships over half of its manufacturing (and accompanying jobs) overseas -- at the same time letting millions of (exploitable) workers into the country who have the net effect of lowering the standard of living.

The very core of the U.S. economy has been hollowed out so that the mega-transnational corporations can make more profit.

Now, no amount of government "stimulus" money is ever going to do anything but temporarily 'goose' the economy under these conditions.

We have to make big changes like beginning a tariff system to start restoring manufacturing jobs here; start ending the underground exploitation of cheap labor (ie., putting employers of illegal immigrants in jail); reform Wall Street to make it an investment market and not just a glorified gambling pit; and downsize government -- and I mean the military/empire-complex and make it start functioning within its means.

If we don't demand those things, then we are doomed to be peasants for a long, long time.

[FirstLight]

5. +1000!

yes.
just as Bush gutted all the govt programs that were in place to protect us (EPA, FEMA, USDA, the list goes on...)

the military industrial complex and corporate-run labor needs to be gutted

I fear we are never going to see that happen. and serfdom is going to be our new 'freedom'

[laughingliberal]

6. Rec for exposure. nt

[mkultra]

7. meaningless fear mongering

Th dip is equivalent to the spike that we saw at the end of 2009 as a result of incentives.
This is my favorite little emotion pusher from the article:

And there are plenty more negative indicators to point to.

you can almost smell the glee.
Essentially, its a micro correction. Proof is that while we saw a dip in sales, prices not only held firm but increased on the main category (100K-250K.)
Housing supply hit very low levels at the end of 2009 as well, which resulted in a burst of new home building which is what actually created this dip.
We are now back to 1995 new and existing home sales numbers. which really weren't bad then and aren't bad now. The problem is people(like this article writer) think we should be getting back to 2004 housing levels which were unsustainable.


http://www.realtor.org/wps/wcm/connect/35f8140043b994d5a3d0eb34cafa6d66/REL0710P.pdf?MOD=AJPERES&CACHEID=35f8140043b994d5a3d0eb34cafa6d66
http://calculatedriskimages.blogspot.com/2010/08/distressing-gap-july-2010.html

[Odin2005]

8. But "Nobody could have predicted..."

:eyes:

[w8liftinglady]

9. in my area,the solution is to....cut taxes and lay off workers