adventures of my mind

Presidential Placebo

March 8th, 2009 by | Word Count: 881 | Reading Time 3:26 4,213 views

As we experienced the full tilt run-up to our Presidential election at the end of last year, everyone was hoping that anointing Obama, our country’s savior in waiting, would cure our financial market woes as far as confidence was concerned. On Obama’s first day as our newly minted President, the Dow Jones Industrial Average stood at 9,616.60 at the opening bell. While it was below the 10,000 watermark, it was nothing to be worried about as being a catastrophic situation. In just 16 days, on November 21, the DJIA had fallen to 7,552.37… an almost 22% decline.

Now, we have passed the initial 50 days of Obama’s term and the DJIA stands at 6,595.16 as we prepare to enter an even more tumultuous economic period. As of right now, the DJIA has had nearly 32% of its value sheared off. Since November, over 2.5 million workers have lost their job… since the beginning of the recession (officially started December 2007) 4.4 million jobs have been lost. It’s fairly obvious that electing our “saving grace” did nothing to cure the confidence in our markets.

These declines have occurred even with Obama pushing massive spending bills through Congress in an effort to stimulate our economy. Bush injected over $750 billion into the economy before he left office along with untold billions of dollars in ancillary stimulus money. Obama has trumped that bill by handing out nearly $800 billion and writing into the federal budget, another $750 billion for 2009. On top of that, Obama has agreed to spend over $400 billion in “health care reform.” Obama’s stimulus plan was pushed upon society as the great job saving machine that would generate 3.5 million jobs… over the next 2 years.

Looking at the analyst’s forecast for the next 2 years, they predict that unemployment will reach 9% this year… it’s at 8.1% as of this article. Next year, they are predicting well over 10% unemployment. These are estimates that were made AFTER Obama’s stimulus plans… wrap your mind around that, or better yet, your wallet… People are unrealistically focused on the unemployment rate when they should be watching the under-employment rate. The under-employment rate takes into account people who have completely given up looking for work and also includes people who are working part time jobs who need full time jobs but cannot find one. This number represents the true state of our job market.

So where does that number stand at today? Try 14.8% on for size. 8.1% unemployment supposedly equals 12.5 million people according to the government stats. 14.8% equals nearly 23 million people either out of work, given up on finding work, or involuntarily working part time jobs. These numbers are based on the idea that 155 million or so Americans work for a living.

Right now, let’s just round off the spending that we know of to $3 trillion. That means that our government has spent almost $20,000 per working American in an effort to stop the bleeding. Have you seen this 20k in your bank account? Have you seen your taxes reduced by 20k this year? Have you seen your house value go up 20k or lose multiple times that in value? Has your stock portfolio increased by 20k or dropped even more? Where is this money going? If the money was going to those who “create” jobs, then why is the economy shedding our jobs at a much faster pace since the money was injected than before?

Common sense would make you think that the injection of these massive amounts of money should have at least given us a plateau in job losses. I understand that the Democrats in the house say that the current economic hardships are the results of the Bush administration’s legacy. Let’s put some rationale to that ideology. The Democrats were in charge of both the House and Senate and also controlled almost 75% of state governorships since 2006. The recession started in December 2007. The Bush administration’s legacy from 2000-2006 was far from a recession. In those years, the Republican Party controlled the majority of political power seats. Sure, the effects of everything takes time to truly pan out, but the turning point was the date the Democrats took control of our country and their inability to curtail their partisanship and hatred of Bush. They allowed their political feelings affect how they governed our country and now we are all paying the price for their failings.

Where did our Presidential placebo go? The bounce we were so focused upon receiving did not happen. Rather than an uptick in our financial markets, a curtailing of our job losses, and a wealthier nation, we are now at a point where we are just entering the deepest valleys of this recession. I am convinced that we are going to see even worse times as we search for the rock bottom of our economic downturn. Millions more Americans will lose their jobs, billions more American taxpayer dollars will be spent without our agreement, and our stocks will continue to fall while we watch the foreclosure signs weather in our yards and our bank accounts shrink into penny savings. The placebo didn’t work and neither is spending money we don’t have. Placebo… we need the real deal.

4 Responses »

  1. Jeanie
    on March 8th, 2009 at 9:33 pm:

    Excellent article. This is what me and I’m sure, most of America is now asking.. What’s the deal? I would say the honeymoon’s over, but don’t you have to have one first?

    Robert
    on March 8th, 2009 at 10:23 pm:

    I’m sure when the natural economic cycle returns to the more favorable side of things, Obama and his administration will take all the credit for the turnaround. Just as Clinton and his crony Al Gore took credit for the Internet boom…

    I don’t think things will ever return to the glory days of credit backed wealth. At least I hope it doesn’t. You just cannot fund true wealth with debt and lines of credit. And that is what the Obama administration is trying to do, fund an economic turnaround with debt that will take a generation to pay down.

  2. jag
    on March 9th, 2009 at 6:31 pm:

    I Agree!!!! Our financial institutions are just looking for a hint of confidence from our government, but there seems to be a lack of that.

    Not only are they destroying our financial markets and destroying lives of hard working Americans, they are trying to set up a system in this county to destroy the morals that have been built by our forefathers. This country will not be recognizable by the end of Obama’s first term.. If you have noticed things are happening very fast morally as well because our new government can use the jobs and the financial downturn as a screen to sneak immoral programs right through.

    This President is out of control, but unfortunately Americans usually don’t get it until it hits their pocket book. I give it another two months and just maybe some of the drunk Cool-aid drinkers will start to sober up.

    Just a reminder since the President has taken office, 144 babies are murdered every hour in the good old USA by abortion factories. Now that the new administration has released millions to support abortions, it is expected to increase to over 400 an hour and that is just in the US. Not only do they want to support murdering babies on our home land, but they are reaching out all over the world to kill as many as they can.

    This is not what our country is built on, but remember if they can keep us focused on our financial woes right now, ( which is very bad don’t get me wrong ) they can keep us blind to what really matters… Morals…..and that is something you can’t buy.

    Robert
    on March 9th, 2009 at 10:13 pm:

    We are definitely looking for someone to give us the confidence that things will be ok. I haven’t seen that from our government. In fact, they make me fear for the worst that could happen. The more this administration does, the worse things will be for our future in my opinion. Everything they are doing has the smell of socialism.

    As for the abortion policies of Obama, he is one of the most supportive politicians of pro-abortion policy known to man. Today, he reversed the 8 year policy put in place by the Bush administration involving federal assistance for stem cell research. Now, the aborted babies can be mined for stem cell research… Not only are our tax dollars funding the murder of innocent life, we are now funding the factories and scientists harvesting their carcasses. By the way, stem cell research can be accomplished without the need for embryonic stem cells.

    As for morals, a report came out today that showed Christianity is on the decline in America. As if we couldn’t see that for ourselves. The report shows that more and more people are turning to no religion at all… they are becoming atheists.

    It looks as if we are becoming a European nation after all. Europe and their socialistic tendencies have infected our government and now their religious perspectives are invading our once proud Christian nation. Hope is not lost, but it is under fire.

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