State of Affairs

Jim Fairthorne’s take on the political scene in America

Archive for the ‘Economy’ Category

The Bailout, Big Business and the Ballot Box

Posted by yoozur on October 10, 2008

As the Presidential election edges closer with each passing day, it seems to have taken a back seat to what appears to be the biggest economic crisis in 70 years. Issue #1 for most Americans is the economy, and how it is going to affect their lives. For virtually everyone, it appears that dark clouds are either on the immediate horizon, or are already directly overhead. When looking at this crisis in regards to each Presidential candidate’s campaign, certain questions begin to percolate. What will the fallout be? How will each of the candidates deal with the problems that will no doubt rear their heads over the coming years?

First, let’s take a look at what the experts say. The Economist, Forbes Magazine, and most other reputable business news outlets all predict that we are headed for a recession, with the only disagreement coming at how deep and sharp it will be. The wellspring of credit, which has been available to American consumers virtually consequence-free for over a decade, has almost completely dried up. Even after (or if) the credit freeze unthaws, banks and loaners are going to think twice about granting credit to people with a less-than-sterling credit history.

Either John McCain or Barack Obama are going to have to deal with the fallout from the disastrous sub-prime lending fiasco, and their positions haven’t really been clearly defined from one another. The McCain-led Bailout bill has not seemed to calm fears on Wall Street, but the bill was supported by Obama as well, albeit lukewarmly. Barack’s only caveat to the bill seemed to be the wish that the taxpayer not be unduly put at risk.  McCain has faced harsh scrutiny from Republicans for his willingness to put taxpayers in the line of fire (something that goes against core Republican tenents) while Barack Obama faced criticism for not having a clearly defined position on the matter. While the Bailout bill itself has been passed through Congress, it has not yet taken effect. The planning of the Bailout continues, with former Goldman Sachs CEO, and current US Treasury Secretary Henry Paulson at the helm. Paulson intends to bring in top industry experts to divvy up the unprecedented 700 Billion dollars granted to him to fix the problem.

John McCain’s Presidential campaign hit a hitch when the first Bailout bill was defeated in Congress on Monday, September 29. His name was directly tied to it’s success, and it’s failure in the house was a large blow to McCain’s credibility on the campaign trail. However, McCain was somewhat vindicated when the DOW Industrial Average (America’s benchmark stock market) plunged 777 points; the biggest point drop in American history. Opponents of the bill were raked over the coals on National Television, Democrat and Republican alike. The market seemed to send the right message, because on the Friday of that week, an amended bill passed through Congress and was signed into law by President Bush, with many of the representatives that had originally voted against the bill putting their vote behind it.

As Americans sit back and watch things unfold, one thing is for certain: things are going to get very interesting on the campaign trail over the coming weeks.

Posted in Economy, Politics | Leave a Comment »

No One Thinks The Economy Is Improving

Posted by yoozur on September 23, 2008

A new poll from the American Research Group.

Like this comes to a shock to anyone. Considering the DOW has dropped 600 points in the last two days, is there anyone that can possibly put a good spin on this? Anyone? Even the Europeans are keeping their distance.

Posted in Economy | Leave a Comment »