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pphilfran
9/20/2011, 10:29 AM
If this is the case unemployment will still be at 9% and Obama will be a one termer...

http://www.dailyfinance.com/2011/09/20/imf-sharply-downgrades-u-s-economic-outlook/

The International Monetary Fund has sharply downgraded its outlook for the U.S. economy through 2012 because of weak growth and concern that Europe won't be able to solve its debt crisis.

The international lending organization expects the U.S. economy to grow just 1.5 percent this year and 1.8 percent in 2012. That's down from its June forecast of 2.5 percent in 2011 and 2.7 percent next year.

The IMF has also lowered its outlook for the 17 countries that use the euro. It predicts 1.6 percent growth this year and 1.1 percent next year, down from its June projections of 2 percent and 1.7 percent, respectively.

The gloomier forecast for Europe is based on worries that Greece will default on its debt and destabilize the region.

"Fear of the unknown is high," said Olivier Blanchard, the IMF's chief economist. "Strong policies are urgently needed to improve the outlook and reduce the risks."

Overall, the IMF predicts global growth of 4 percent for both years. Stronger growth in China, India, Brazil and other developing countries should offset weaker output in the United States and Europe.

The U.S. economy grew at an annual rate of just 0.7 percent in the first six months of the year. And the U.S. unemployment rate has stayed above 9 percent for all but two months since the recession officially ended two years ago.

Financial turmoil and slow growth are feeding on each other in both the United States and Europe, IMF officials say. Europe's debt crisis is causing banks to reduce lending and hold onto cash. Sharp stock market drops in the United States over the summer have hurt consumer and business confidence and will likely reduce spending. That slows growth, which leads many investors to shift money out of stocks and into safer investments, such as Treasury bonds. In Europe, slower growth will make it harder for stressed nations to get their debt under control.

U.S. and European policymakers need to act more decisively to cut budget deficits, the IMF said. And European officials need to ensure that the region's banks have enough capital to withstand the debt crisis.

The IMF said in its report that the U.S. economy faces longer-lasting problems that go beyond high gas prices and disruptions caused by the Japan crisis.

Employers are adding few jobs and giving out meager pay raises. Many homeowners owe more on their mortgages than their homes are worth. Banks are keeping credit tight.

All those trends are holding back consumer spending. Unemployment is likely to average 9 percent next year, the IMF's report said, echoing a recent estimate by the Obama administration.

President Barack Obama's proposal to cut taxes and spend more on infrastructure should provide much-needed short-term stimulus, the IMF said. But it needs to be paired with a longer-term plan to reduce the deficit over, the report said. The timing of the budget cuts is key, Blanchard said.

Budget cuts "cannot be too fast or it will kill growth," Blanchard said in a statement. "It cannot be too slow or it will kill credibility."

The 187-member nation fund conducts economic analysis and lends money to countries in financial distress. It will hold its annual meetings with the World Bank later this week in Washington.

sappstuf
9/20/2011, 10:32 AM
Even a modest downturn and we will be in a full recession if we aren't already... Sharp? I'm afraid to think.

diverdog
9/20/2011, 11:34 AM
Phil:

Krugeman basically predicted this would happen if we did not spend a lot of money. He used Japan as the model. My question to would be if you think we need to spend more and how would you spend it?

badger
9/20/2011, 11:46 AM
I must say... much like the Republicans took an extremely popular situation and blew it in the mid aughts, the Democrats took a huge wave of Republican resentment and caused themselves to be resented.

Missed opportunities by both sides. More than anything, the United States needs a strong leader, whether its a Democrat or a Republican. Someone that people can trust and believe in. Pandering does nothing but get you disrespected.

SoonerProphet
9/20/2011, 12:34 PM
why in the hell do we still give a f*ck about the imf. it should have died with Bretton-Woods years ago.

sappstuf
9/20/2011, 01:23 PM
Phil:

Krugeman basically predicted this would happen if we did not spend a lot of money. He used Japan as the model. My question to would be if you think we need to spend more and how would you spend it?

We DID spend a lot of money.

pphilfran
9/20/2011, 01:24 PM
We DID spend a lot of money.

In the wrong places and in the wrong way...

pphilfran
9/20/2011, 01:25 PM
why in the hell do we still give a f*ck about the imf. it should have died with Bretton-Woods years ago.

I don't give a crap about data from most organizations...but using various sources helps improve understanding...just another group downgrading future world growth...

sappstuf
9/20/2011, 01:27 PM
In the wrong places and in the wrong way...

Too late. Obama could have taken control like a true executive concerning the stimulus(or anything else for that matter)... No Dem would have dared to oppose him and no Repub could have stopped him. Instead, he passed the power and responsibility to Harry and Nancy...

Bad, bad move. For him and our country.

pphilfran
9/20/2011, 01:32 PM
Phil:

Krugeman basically predicted this would happen if we did not spend a lot of money. He used Japan as the model. My question to would be if you think we need to spend more and how would you spend it?

Spending isn't "the" answer...only short term...consumer and corp confidence should be the prime target...

If they are going to raise taxes then do it...going to cut spending then do it....we need Congress to act like adults and complete a plan, any plan, in a timely manner....

I would boost infrastructure spending...ain't gonna be any cheaper down the road and it has been underfunded for decades...

Target the specific industries you want to grow and add incentives...

I would push the snot out of NG...I would be talking my head off about the Chesapeake Plan...

Somehow we need to clean up the housing mess...it is going to be a drag for a decade...I remember you quoting some source about how long it was going to take...it seems you were on target...

pphilfran
9/20/2011, 01:35 PM
Too late. Obama could have taken control like a true executive concerning the stimulus(or anything else for that matter)... No Dem would have dared to oppose him and no Repub could have stopped him. Instead, he passed the power and responsibility to Harry and Nancy...

Bad, bad move. For him and our country.

If all the latest growth projections are correct we will still be at 8% unemployment during the election cycle...bad news for Obama...

Their latest GDP projections have fallen back in line...look how badly they missed over the last year or so....

http://i264.photobucket.com/albums/ii187/pphilfran/iindelecproduction-1.jpg

pphilfran
9/20/2011, 01:40 PM
More recent data...

http://i264.photobucket.com/albums/ii187/pphilfran/indelec14.jpg

sappstuf
9/20/2011, 01:44 PM
More recent data...

http://i264.photobucket.com/albums/ii187/pphilfran/indelec14.jpg

What do you think the odds are that we enter another recession?

pphilfran
9/20/2011, 01:46 PM
I don't know....coin toss?

sappstuf
9/20/2011, 01:53 PM
I don't know....coin toss?

I wish... I'm thinking more like 60-75% that we will.

1Q growth was .4%.. 2Q was 1.0%.. I'm thinking it will be revised downward when the 3Q numbers come out.

Nothing has been done to give anyone any confidence in anything.. I hope I'm wrong...

SoonerProphet
9/20/2011, 02:39 PM
I don't give a crap about data from most organizations...but using various sources helps improve understanding...just another group downgrading future world growth...

What's to understand. Many people have seen this sh*tstorm coming for decades. The IMF is just as bad as the hacks on Wall Street, K-Street, and the like. Organized criminals who have done nothing but fritter and waste taxpayer money for years.