Although most if not all Americans were somehow affected by the recession, there are some areas that we're and will be affected greater than others. In states such as California, Nevada, and Florida their economies have been hit hard. Mainly because of the declining housing market, which was the main reason for their past economic booms. Foreclosure rates in these states are higher than any other area. In cities such as San Diego over half of the people living there owe more on their houses than they are worth. 40% of home sales in Las Vegas in the past year have been foreclosure sales. This is also hurting the sale prices of homes that aren't foreclosure sales.
When these real estate markets hurt, they hurt the entire state economy. Unemployment rates in these states are soaring. This is causing business spending cuts, lower tax revenue and an increase on public spending, digging these cities into even bigger holes. In cities, who's economies used to rely on real estate are getting hit hard and it's going to take a while for them to get out.
For More Info: http://www.forbes.com/2008/10/15/economy-housing-recession-biz-beltway-cx_jz_1015econocities.html
3/7/10
The U.S. Needs To Get Greener
Right now all across the world, countries are making investments on green technology. The U.S however has been falling back in this. "Over 70% of all green systems and components in the U.S. is imported." Said Phil Angelides, chairman of the Apollo Alliance, a coalition of labour, business, environmental, and community leaders working on catalyzing clean energy and put millions of Americans at work on a new generation of clean energy "green collar," jobs. Angelides also stated that, "if we continue this trend, we stand to lose 100,000 clean energy manufacturing jobs by 2015, and nearly 250,000 by 2030."
China, our largest competitor is winning the race on making cleaner investments. However, China does not also have the same deficit that America has. Instead of America spending money and making investments on domestic green technology, major solar and wind energy companies are investing in countries where the demand for Green labour is high and wages are low. One way people are trying to green jobs in America is by trying to enact the "Investments for Manufacturing Progress and Clean Technologies Act." This act would support small and mid-sized manufacturers by providing capital investments in energy efficiency and for retooling and expanding into the clean energy supply chain. Green companies need to start making domestic investments, not only because we needs to start taking care of our own country, but also it would create jobs and lower our high unemployment rate.
For More Info Go To:
and
3/2/10
Could China Turn On Us?
Today AOL posted an interesting article on how China could possibly use it's US bond holdings as a weapon against the US. Lately tensions between the US and China have increased, after the US sold to Taiwan a $6.4 billion arms sale. As a response some Chinese military members have advocated that China's U.S treasury bond holdings can be used as a weapon against the U.S. The People's Republic of China has $755 billion in treasury bonds. If China started to pull out in their U.S investments, it would severly shatter the U.S economy, quite possibly completely bankrupting it.
But the truth is that the U.S and China have too strong of an economic bond. If China pulls out its investment here, they will also plummet into a dark economic storm. A flooded market would greatly decrease the value of China's remaining holdings. Also the demand of Chinese products in the U.S, which is what gives China its economic power, would decline greatly if not, totally killing any demand. Basically, China would severely disable our economy, but doing so they would bring theirs down as well. So the possibility of China ever using their U.S treasury bonds as a weapon against us is highly unlikely. But it is interesting on how much power China really does have over us.
To read the article on this go to: http://www.dailyfinance.com/story/will-china-weaponize-u-s-debt-after-arms-sale-to-taiwan/19373579/?icid=mainmaindl4link3http%3A%2F%2Fwww.dailyfinance.com%2Fstory%2Fwill-china-weaponize-u-s-debt-after-arms-sale-to-taiwan%2F19373579%2F
But the truth is that the U.S and China have too strong of an economic bond. If China pulls out its investment here, they will also plummet into a dark economic storm. A flooded market would greatly decrease the value of China's remaining holdings. Also the demand of Chinese products in the U.S, which is what gives China its economic power, would decline greatly if not, totally killing any demand. Basically, China would severely disable our economy, but doing so they would bring theirs down as well. So the possibility of China ever using their U.S treasury bonds as a weapon against us is highly unlikely. But it is interesting on how much power China really does have over us.
To read the article on this go to: http://www.dailyfinance.com/story/will-china-weaponize-u-s-debt-after-arms-sale-to-taiwan/19373579/?icid=mainmaindl4link3http%3A%2F%2Fwww.dailyfinance.com%2Fstory%2Fwill-china-weaponize-u-s-debt-after-arms-sale-to-taiwan%2F19373579%2F
Fear of a Double Dip Recession
As the world is recovering from one its worst recessions of all time, there is a fear that lingers amongst the world's leading economies. The fear that the economy will slide back down into a double dip recession. With unemployment at double digits and bank lending at its lowest in over 7o years, consumer demand has dropped greatly. If things don't start to look better, then the economy could possibly take a sharp downturn.
In response to this fear, Federal Reserve Chairman Ben Bernanke assured investors that the central bank will continue to keep interst rates low. However, the truth is Europe's economy is going on a downward spiral, Japan's economy is not fairing well either, and China is starting to yield bank lending. This does not help our situation because investor's might start worry if the US's economy can be trusted to safely invest in. If this happens then a double dip recession is inevitable.
For more info go to: http://www.cnbc.com/id/35584141
In response to this fear, Federal Reserve Chairman Ben Bernanke assured investors that the central bank will continue to keep interst rates low. However, the truth is Europe's economy is going on a downward spiral, Japan's economy is not fairing well either, and China is starting to yield bank lending. This does not help our situation because investor's might start worry if the US's economy can be trusted to safely invest in. If this happens then a double dip recession is inevitable.
For more info go to: http://www.cnbc.com/id/35584141
Greece Not Looking So Good
The current economic recession has hit many countries very hard. Greece unfortunatly was hit harder than most. At the start of 2010 there were fears that a sovereign debt crisis in certain european nations such as Greece, Portugal, Spain, and Ireland. This led for investors to feel concerned whether these countries will be able to pay off their depts, creating bond yields and raising risk insurance for credit default swaps from France and Germany. This now not only puts these countries in a major debt but also not giving them any support to help them recover.
The Greek Prime Minister George Papandreou stated that the economic situation in Greece has "confirmed their worst fears." He is not asking other EU countries to pay off their debts for them, however he is asking for their cooperation and support as they struggle to avoid bankruptcy. What they need to do is regain investor confidence in their nation, and figure a way pay off the $20 billion that they got from previous investors by their due dates in April and May. Papandreou is also taking drastic measures to cut down the countries deficit. He plans on greatly increasing taxes, making lasge spending cuts, and having pension reforms.
Germany who has refused to pay off any debts for Greece is getting criticized by Athens. The Grrek government is not officially asking Berlin to pay off their debts. Instead they are trying to get Germany to pay off any unpayed reparations from the German occupation of Greece in WWII. Germany, however, claims that they have payed off all reparations. Prime Minister George Papandreou is going to Berlin on March 5th to meet with Chancellor Angela Merkel to discuss a way for Greece and Germany to come up with an agreement on how to fix this crisis.
One thing that is looking good for Greece is that Papandreou seems to have a large support by the citizens of Greece. They are ready to suffer for the good of their nation, which more than we can say for the US where all we want is lower taxes and more spending.
For more info on this go to: http://cnbc.com/id/35599317/site/14081545/for/cnbc/
The Greek Prime Minister George Papandreou stated that the economic situation in Greece has "confirmed their worst fears." He is not asking other EU countries to pay off their debts for them, however he is asking for their cooperation and support as they struggle to avoid bankruptcy. What they need to do is regain investor confidence in their nation, and figure a way pay off the $20 billion that they got from previous investors by their due dates in April and May. Papandreou is also taking drastic measures to cut down the countries deficit. He plans on greatly increasing taxes, making lasge spending cuts, and having pension reforms.
Germany who has refused to pay off any debts for Greece is getting criticized by Athens. The Grrek government is not officially asking Berlin to pay off their debts. Instead they are trying to get Germany to pay off any unpayed reparations from the German occupation of Greece in WWII. Germany, however, claims that they have payed off all reparations. Prime Minister George Papandreou is going to Berlin on March 5th to meet with Chancellor Angela Merkel to discuss a way for Greece and Germany to come up with an agreement on how to fix this crisis.
One thing that is looking good for Greece is that Papandreou seems to have a large support by the citizens of Greece. They are ready to suffer for the good of their nation, which more than we can say for the US where all we want is lower taxes and more spending.
For more info on this go to: http://cnbc.com/id/35599317/site/14081545/for/cnbc/
An Olympic Debt
With the Vancouver Olympics being the first "post 2008 recession Olympics" many people are wondering if it's a good thing for countries to spend so much money on sporting events when countries right now are already in great debt. Canada, who is hosting the winter olympics, has already a bumpy history of being able to pay off olympic debts. When the summer olympics were in Montreal in 1976, it created a financial disaster for the city. The city just payed off it's last debts from the olympics last year, over 30 years later. Taxes were raised and people were layed off and poverty increased in Montreal after the games and since they've never fully recovered.
Also China who's olympics in 2008 cost $40 billion, has also seemed to have dug themselves in a hole they can't seem to get out of. China anticipated that the Beijing Olympics would create a major increase in tourism to their country. I hasn't, and that's because Olympics are short lasting and after they are finished people forget about them. People don't want to see where past Olympics were, it simply doesn't interest them.
Vancouver is quite possibly going to put itself and the rest of Canada in years of debts. What they need to do is make sure that all of their facilities will be built for long term use, so that ticket sales for post olympic events help lower their debt. Fortunately many of the venues for the olympics will be places that were already built beforehand, unlike in China were almost all the venues were completely new.
As for the US, we lucked out in having the 2016 Summer Olympics be in Rio de Janeiro and not Chicago. With our countries debt already being $12.5 trillion, I think we should start figuring out ways to start saving and stop spending.
Learn more at: http://network.nationalpost.com/np/blogs/fullcomment/archive/2009/01/13/national-post-editorial-board-vancouver-s-very-own-olympics-debt-debacle.aspx
and
http://boston.com/bostonglobe/editorial_opinion/oped/articles/2008/08/22/caught_under_a_mountain_of_olympic_debt/
Also China who's olympics in 2008 cost $40 billion, has also seemed to have dug themselves in a hole they can't seem to get out of. China anticipated that the Beijing Olympics would create a major increase in tourism to their country. I hasn't, and that's because Olympics are short lasting and after they are finished people forget about them. People don't want to see where past Olympics were, it simply doesn't interest them.
Vancouver is quite possibly going to put itself and the rest of Canada in years of debts. What they need to do is make sure that all of their facilities will be built for long term use, so that ticket sales for post olympic events help lower their debt. Fortunately many of the venues for the olympics will be places that were already built beforehand, unlike in China were almost all the venues were completely new.
As for the US, we lucked out in having the 2016 Summer Olympics be in Rio de Janeiro and not Chicago. With our countries debt already being $12.5 trillion, I think we should start figuring out ways to start saving and stop spending.
Learn more at: http://network.nationalpost.com/np/blogs/fullcomment/archive/2009/01/13/national-post-editorial-board-vancouver-s-very-own-olympics-debt-debacle.aspx
and
http://boston.com/bostonglobe/editorial_opinion/oped/articles/2008/08/22/caught_under_a_mountain_of_olympic_debt/
China Being Cautious
Even in a time when China's economy is booming, they are still skeptical and safe with their economic decisions. On Febuary 12, 2010 China said that they need to increase their reserve requirement for their banks. This is not because China wants the US and other economies to decline, they are doing because they want to contain their economic growth. Too much economic growth can cause a speculative investment bubble which they don't want. A speculative bubble is caused by making exaggerated expectations of future growth of the economy, causing bad investments and lowering securities.
As a result of China's actions, the Dow Jones fell greatly the day China announced their increase in reserves. This is because the US greatly relies on China for their investments and if it looks like China is going to pull back, that greatly hurts us. Also with Greece's growing dept that they can't seem to pay off and other European nations following, investments in other countries seems a little reliable at the moment.
Learn more about this at: http://www.cnbc.com/id/35372634/site/14081545/for/cnbc/
As a result of China's actions, the Dow Jones fell greatly the day China announced their increase in reserves. This is because the US greatly relies on China for their investments and if it looks like China is going to pull back, that greatly hurts us. Also with Greece's growing dept that they can't seem to pay off and other European nations following, investments in other countries seems a little reliable at the moment.
Learn more about this at: http://www.cnbc.com/id/35372634/site/14081545/for/cnbc/
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