http://money.cnn.com/2008/12/01/news/economy/recession/?postversion=2008120115
Seriously, how long did it take for people to actually realize this?
Do you believe we are in a recession? What do you think can get us out? What are your feelings on this?
AHA. I totally knew it while my sister was denying that it was. America was just in denial, hoping it would turn for the better...
I don't know what the government in the past had done to get us out, but I'm hoping that as time naturally flows, it'll eventually get better once people start making better decisions about the economy. And yes, I'm pretty damn sure we're in a recession... after all, it's already been the minimum quarters that were sloping downwards to indicate that yes, it is a recession. "The ultimate cure of a recession is letting it run its course." <-- I agree with that statement.
And I do believe that there is a pretty hearty possibility that it can turn into a depression, especially at how the rate things are going.
Since December of '07...wwwooooowww
I think America was trying to put off calling it a 'recession' as long as it could - notice how confidence in the market plummeted even more when we actually put a label on it.
Yeah, I'm not really sure why they put off labeling it so, though it might be so that they don't scare the economy into getting even worse, but still, I believe that it's better to address the problem than to just address the results.
It's like trying to wipe blood off of a major injury when the person who is bleeding has hemophilia.
While a lot of us laypeople knew that we were in a recession because we were dealing directly with the effects of it, economists tend to take a wait-and-see approach to these things. They want to verify that there's been a trend for a certain amount of time and that it's broad-based rather than certain parts of the economy (like housing or retail).
Of course, now that they're getting around to declaring a recession, there's a very real possibility that we'll be ending up in a depression before too long, depending on what ultimately happens with the auto industry and what other businesses they take down with them if they go bankrupt.
But also bear in mind that humans are terrible and taking objective statistics. Without the tools that economists have, it would be like giving an athoritative likelyhood of death by way of plane crash...or more easier to relate, the likelyhood that a Black man will be good at basketball...hehe or an Asian at math. (but then its always racial with me ;D)
We need an FDR of the millennium, even though another dust bowl isn't imminent, the recession is bad enough, and parts of California are rationing water as well. Wonder why we always wait until it gets really bad to do something?
Quote from: wickedbi1ch on December 07, 2008, 09:13:26 AMWonder why we always wait until it gets really bad to do something?
We/they didn't, but what is constantly being done tends to not get noticed until things get really bad. Big changes require a lot of consensus and support. The people who can have been tweaking interest rates, issuing warnings, proposing and discussing things, and trying to correct whatever they can in a normal, non-emergency mode all along. It's just that, until things are declared drastically wrong, nobody notices all the work being done. A lot of little elves (maintenance people, sysadmins, even politicians, etc.) are working all the time, invisible to most people, always fixing things, improving things, and preventing a million things from going wrong. They're just usually not appreciated or even acknowledged until things blow up. There are just some things that require more power than people give the elves, and sometimes, things fall through the cracks. It's only when things get very bad that the people who need it get a big enough stick to thwack the irresponsible parties around and make big changes happen. And, even when big changes
do happen, all the irresponsible parties tend to get the most help. The world is built in such a way that Prometheus usually ends up being punished. Many banks that didn't make bad loans and are still strong and fully solvent were being told that they have to follow the same ultra-restrictive punitive standards that the government is imposing on those that are getting bailouts.
There's a very fine and tricky balance between "if it ain't broke, don't fix it", "haste makes waste", and "a stitch in time saves nine". How do you know when it's "broke" enough to fix? When is a fix too hasty? When is the right time for the stitch? Generally, the world is set up so that people who wait for things to break first are rewarded most. After all, if something goes wrong first, the people who come in and make things even a little better are lauded as heroes, even if it's only a mediocre and partial fix. They're usually given the most power to get their fixes implemented, the most leniency if their fix doesn't entirely work perfectly, and the most credit for anything that goes right. In contrast, those who try to fix things before they're broken end up with usually end up with no end of obstacles and criticism ("It wasn't broken! What did you change it!? I liked it the way it was before!") from people who don't understand (and will now never see) what potential disasters have been avoided by the fix.
It's a thankless job and an uphill battle to fix things
before they get bad, but there are people out there constantly trying to get it done even if most people never notice them.
In this case, I believe there was some fluctuation in the indicators earlier this year that confused the issue, so that they couldn't be sure until they had enough data to drown out the fluctuation.
I think that's the deal with it, the "consensus and support" needed has to come from everyone, not just those who noticed the problem and were already doing something. The public got stuck in the moment right before the top blew off and really couldn't get the momentum it needed to starting turning things around.
Since a lot of people are losing their jobs, would this make it harder for teens to get a job?
Quote from: JohnnyAR on December 16, 2008, 06:11:57 PM
Since a lot of people are losing their jobs, would this make it harder for teens to get a job?
Possibly, you have no job experience and restricted hours due to school (but at the same time, you can be hired at/can afford to work at minimum wage).
It sucks :( I have friends who haven't had a job in so long (and this isn't an easy time to be working for tips....god people penny-pinch on the tip despite spending $100+ on JUST the wine??? T.T )
Quote from: JohnnyAR on December 16, 2008, 06:11:57 PM
Since a lot of people are losing their jobs, would this make it harder for teens to get a job?
Yeah, considering that most teens get jobs at retail stores and restaurants. People can't afford a lot now, and won't buy. If people stop buying, then bosses need to lay off workers to restrict money loss on wages, and you can bet that the first ones to go will be the part-time teens.
I'm part of the general statistics, got laid off in October, supposedly due to budget cuts... Only to find out they hired a replacement for me that works for 1/2 the salary i use to make.
Darn, F@#$ing corporate america...
now in order to come close to what i used to make, I work 2 jobs now and barely have time to hang out with my family, roommates, and friends i havent seen literally (what its been over a year now :P)
Being a responsible adult (i.e. mortgage, all sorts of bills and etc) is tough. I wish i could borrow money from my parents. But they're dead. Being the youngest in my family, I really dont want to bother my older brothers and sisters, because I'm pretty sure everyone is struggling to make ends meet too. So I do what i have to do. and Boy do i cherish my time off or the ability to see and hang out with old and new friends here on the boards and every other walk(s) of life.
Ironically, when it comes to jobs being from the HR background... its not really WHAT you know. its really WHO you know. I'd like to think that I have a good educational background and experience, but time and time again ive been passed up on opportunities because of the refferal or beauty card played against me. :-\
Sometimes i wonder if this really is the land of equal opportunities sometimes :P
Quote from: Jerry on December 17, 2008, 01:23:17 PMIronically, when it comes to jobs being from the HR background... its not really WHAT you know. its really WHO you know.
I agree. A lot of people, especially the academically successful ones, don't see this until the best opportunities have passed. It's an unfortunate fact of life that it's important to have good friends in high places.
QuoteI'd like to think that I have a good educational background and experience, but time and time again ive been passed up on opportunities because of the referral or beauty card played against me. :-\
I agree that other factors tend to outweigh educational background and actual work experience. I think a lot of people "waste" their time in college concentrating too much on academics. I did that too, so I speak from experience. I didn't realize until after graduation that the price of going to a good college isn't to pay for better academics. It's not even there for paying to "learn how to learn". In retrospect, that line is a fairy tale along the lines of Santa Claus. All schooling has a component of providing an environment for people figure out how to deal with others, and only those who learned that lesson well manage to take full advantage of a good college.
For example, take Obama's advisory network. Because they took the opportunity to network with Obama (whether they recognized him to be smart and valuable or they just got lucky in being at the right place at the right time), they're pretty much guaranteed to ride through this recession (and probably the rest of their lives) just fine as long as they don't do something outrageously criminal or horrific. The access to that type of opportunity is the difference between an elite university and a mediocre one.
I wanted to mention that it's not all one or the other, though. Academic background, intelligence, experience, and willingness to work hard is still important because people still have to have enough value to contribute to their networks in order to maintain them. However, those things are not enough. It's important to be able to maintain a network too. In times of plenty, it's easy to take a chance on putting potentially useful people in high enough places. (Most people are nice and mean well, especially when times are good, so this happens naturally. I don't think people are intentionally installing allies as a hedge against bad times.) In times of recession, people just can't afford to do much more than pay back social debts to those who have taken care of them when they needed it.
So, being successful requires having the right balance of social and technical skill. Also, too often, luck is a sufficient substitute for one, the other, or both.
QuoteSometimes i wonder if this really is the land of equal opportunities sometimes :P
No, such a land does not exist. I'm afraid life isn't fair. Not all opportunities are created equal. Pursuing the wrong opportunity or going about it in the wrong way gets people nowhere. The "right" opportunity and the "right" way are often a function of chance.
However, as far as leveling the playing field goes, I think this land does rather well. We all have access to some level of free public education. If we work hard and do well there, there is access to some level of funding for getting into a good college. If we succeed in that, the good college gives us some level of access to the future leaders of America. If we end up in the right situations with the right people, if we take the right opportunities, whether it's by skill or luck, we can do pretty well for ourselves. So, I think this land does carve out some small amount of equal opportunity in the face of vastly unfair circumstances.
Still, no matter how many technical and legal attempts are made to create equal opportunities, luck is never fair or equal. Furthermore, not everybody manages to make equal use of the same opportunities, and over time, all the missed opportunities add up.
In any case, best of luck with improving your situation. Since you have the skill and background, luck would probably be what you need most. Also, maybe it's worthwhile to make the time to enjoy yourself and play with your friends more often than once a year. All work and no play isn't just dull, but it also doesn't improve the level of "who you know". Besides, if your play makes you less stressed, more energetic, and more positive overall, then you stand a better chance of making a better social impression in general and more ready to seize potential opportunities too.
Speaking as someone who knows a lot of CEO's and other people in a position to hire, after many conversations with all of them, they all seem to be looking to FIRE people instead. Either that or trim their work force and hire people at a lower salary/cost point (Like what happened to Jerry).
Also speaking as someone who has tried to use his connections, it's hard. I've only got one viable offer out of the many dozens I have tried.
Quote from: Steve.Young on December 17, 2008, 07:56:26 PM
Speaking as someone who knows a lot of CEO's and other people in a position to hire, after many conversations with all of them, they all seem to be looking to FIRE people instead. Either that or trim their work force and hire people at a lower salary/cost point (Like what happened to Jerry).
Also speaking as someone who has tried to use his connections, it's hard. I've only got one viable offer out of the many dozens I have tried.
Do note that in CA, if the reason stated for the layoffs is for downsizing purposes, if the company
hires back a similar number of replacement workers, it may be in violation of fair employment labour
laws, and the laid-off employees may have grounds for a wrongful termination lawsuit. Most company
executives will be very, very careful about hirings any time soon after layoffs for that reason.
We've been seeing a lot of layoffs where former employees are hired back as "contractors" or "temps." This might be what Steve referred to as a lower cost point since the company does not have to pay as much in terms of benefits.
Note that a lot of employees are often under the "At will employment" which allows them to fire anyone for any reason. They don't have to state any reason.
I was also simply stating budgetary reasons...not downsizing as a whole. They are not the same thing.
Quote from: Steve.Young on December 21, 2008, 03:09:44 PM
Note that a lot of employees are often under the "At will employment" which allows them to fire anyone for any reason. They don't have to state any reason.
While that is in general true, employers have to be very careful to ensure they
aren't slapped with wongful termination lawsuits by terminated employees.
For example, if a group is 90% male, and 10% female, but the subset of
people laid off were 90% female, 10% male, there's a very good case for
the terminated group to argue that they were unfairly and discriminatorily
targeted for termination based on gender as the terminated group disproptionately
represented a protected class.
Likewise, if management downsizes employees and it turns out a larger than
representative portion were over 40 compared to the entire employee pool,
there would be grounds for a wrongful termination suit, as age discrimination
is also forbidden by law, and workers over 40 fall into a protected class.
But by and large, yes, you're right, with at-will employment, as long as the
employer doesn't take an action that could be seen as impacting a protected
class in an unfair and potentially discriminating fashion, there's not much you
can do.
In general, it seems like companies a lot of times cut two jobs and replace them with 1 job that pays less and shuffling some extra work around to other employees. You can't really blame them - if they're not making a profit, then they need to get more work for their buck, so that's how it goes. It sucks for the people who lost their job, but not allowing companies to fire employees would be even worse.
Quote from: mDuo13 on December 26, 2008, 12:59:19 AM
It sucks for the people who lost their job, but not allowing companies to fire employees would be even worse.
Something about unions and the auto industry?
It's just a careful balance between rights and profitability.
Quote from: mDuo13 on December 26, 2008, 12:59:19 AM
In general, it seems like companies a lot of times cut two jobs and replace them with 1 job that pays less and shuffling some extra work around to other employees. You can't really blame them - if they're not making a profit, then they need to get more work for their buck, so that's how it goes. It sucks for the people who lost their job, but not allowing companies to fire employees would be even worse.
yeah I totally agree.
Companies HAVE to make a profit.
The word "profit" might carry a negative connotation for some people but....
without profit - government cannot collect taxes
without profit - a company cannot expand to create new jobs
without profit - it gets a "little" difficult for an owner to pay his employees 8)
The Ferengi side of me says profit is good.
(https://forums.fanime.com/proxy.php?request=http%3A%2F%2Fwwwai.wu-wien.ac.at%2F%7Efranz%2FStartrek%2Fgifs%2FPersonen%2Fquark.gif&hash=131226ef8c936b8d391bdb7cce00b604e24d9dcf)
Quote from: ewu on December 26, 2008, 01:20:45 AM
Quote from: mDuo13 on December 26, 2008, 12:59:19 AM
It sucks for the people who lost their job, but not allowing companies to fire employees would be even worse.
Something about unions and the auto industry?
It's just a careful balance between rights and profitability.
That's NOT how the market works.
If the competition is producing widgets at a lower cost then there are two options:
1) go out of business and shut down the widget factory
2) find ways to cut expenses and if it means workers wages then so be it
You can sit here and argue all you want about workers "rights" but that's not going to change the cold hard truth, customers aren't going to buy your product if it costs more than the competition.
and one of the issues with the auto industry is that the unions are very resistant to cost cutting. To the point that they are driving their own livelihood into the ground. I am not certain of the details, but i know that union bosses can easily lose sight of the big picture and only see what harms the workers in the short run. They want the union dues to continue to flow in to pay their union boss salary....faced with a strike and a shut down vs. a long run loss, as an auto exec I would opt for the latter.
At one point, it looked like the UAW was cooperating with the auto execs in their plea for government support. Desperate times call for desperate measures. But then, the drama really came out in the details.
Alan Reuther's comments about Senator Corker's proposal earlier this month pretty much summed up the UAW attitude. Reuther "said labor leaders back in Detroit were astonished at what Mr. Corker was attempting to accomplish — a virtual rewriting of the U.A.W. contract, which typically takes the better part of a year to negotiate. 'That's one thing that our folks in Detroit were just amazed at,' Mr. Reuther said. 'Does Senator Corker really think he can do a restructuring of the industry in six hours?"
Considering they were trying to save an entire industry and didn't have "the better part of a year" before imminent collapse, they probably should have been a little more open to compromise. Now, Gettelfinger and UAW is hoping that Obama's administration will be open to change some of the requirements/conditions of the loans.
Any predictions?
Personally, I think the UAW is being greedy during a very unreasonable time, as they seem to be even very uncooperative even now.
again, it is the union bosses that are making the decisions and sitting at the negotiations. These people are not auto workers, they are professional politicians. Their motivation is to protect their members. Their motivation is to keep the union dues rolling in and their personal paychecks padded. I think unions are great to protect the rights of the people, but when the union is abused and no longer operates in the interests of the members and the greater industry, then it no longer serves it's purpose.
Quote from: astroboy on December 26, 2008, 01:41:31 AM
Quote from: ewu on December 26, 2008, 01:20:45 AM
Quote from: mDuo13 on December 26, 2008, 12:59:19 AM
It sucks for the people who lost their job, but not allowing companies to fire employees would be even worse.
Something about unions and the auto industry?
It's just a careful balance between rights and profitability.
That's NOT how the market works.
If the competition is producing widgets at a lower cost then there are two options:
1) go out of business and shut down the widget factory
2) find ways to cut expenses and if it means workers wages tall the time hen so be it
You can sit here and argue all you want about workers "rights" but that's not going to change the cold hard truth, customers aren't going to buy your product if it costs more than the competition.
This is a gross simplification made in very basic (high-school level) economics that fails to take into account a lot of truths about the real world.
Take a look around you at real products. People buy Chevron gas for as much as 12 cents more than at the gas station across the street. People pay more for Seagate hard drives than Western Digital. People purchase Cheerios for about twice the cost of Oaty-O's. It's called "Product Differentiation". In other words, there's a third option you've neglected to mention, which is, "Give consumers a reason to pay more money for your widgets."
Sometimes, "friendlier' business practices (better benefits for your workers, ecological responsibility, etc.) can - if publicized properly - make up for the additional cost. More often, a brand that's associated with less obvious benefits like reliability, customer service, and consistent quality (e.g. you don't have to shop around because you know Nike shoes will be good enough for you) are the factors. Sometimes it's little benefits that are tangential to the product: like how Apple makes its computers aesthetically pleasing in addition to fast and useful.
The auto industry has been trying to do this, but they haven't been doing a good job of it. In fact, I'd say that the main reason the auto industry is in trouble is because of their poor methods of product differentiation. Japanese car brands have stronger reputations for reliability and gas-efficiency, especially among passenger cars, than American cars, and thus people will pay more for a Toyota than a similar Chrysler.
The American auto industry has been sucking for a while now, and this recession is the wake-up call that
should force them to get their act together.
Quote from: mDuo13 on December 27, 2008, 12:30:03 PMThis is a gross simplification made in very basic (high-school level) economics that fails to take into account a lot of truths about the real world.
Take a look around you at real products. People buy Chevron gas for as much as 12 cents more than at the gas station across the street. People pay more for Seagate hard drives than Western Digital. People purchase Cheerios for about twice the cost of Oaty-O's. It's called "Product Differentiation". In other words, there's a third option you've neglected to mention, which is, "Give consumers a reason to pay more money for your widgets."
I'm quite familiar with "Product Differentiation" thank you very much.
Quote from: mDuo13 on December 27, 2008, 12:30:03 PMSometimes, "friendlier' business practices (better benefits for your workers, ecological responsibility, etc.) can - if publicized properly - make up for the additional cost. More often, a brand that's associated with less obvious benefits like reliability, customer service, and consistent quality (e.g. you don't have to shop around because you know Nike shoes will be good enough for you) are the factors. Sometimes it's little benefits that are tangential to the product: like how Apple makes its computers aesthetically pleasing in addition to fast and useful.
Again I do not doubt the points you've made but not every situation applies.
You seem to have a ridiculously happy "Pollyanna" attitude towards the market.
It's as if you believe there is ALWAYS a solution that can be used to avoid loss and pain. ---> I disagree.
I believe that sometimes in life there is this thing called "NO solution".
Quote from: mDuo13 on December 27, 2008, 12:30:03 PM
The auto industry has been trying to do this, but they haven't been doing a good job of it. In fact, I'd say that the main reason the auto industry is in trouble is because of their poor methods of product differentiation. Japanese car brands have stronger reputations for reliability and gas-efficiency, especially among passenger cars, than American cars, and thus people will pay more for a Toyota than a similar Chrysler.
The American auto industry has been sucking for a while now, and this recession is the wake-up call that should force them to get their act together.
Totally disagree.
You've introduced an economic concept, so I guess it's my turn now.
The reason why the auto makers are in trouble is because of this concept called
"Over Capacity"When you have more widget factories producing more widgets then society can ever need then you're in trouble.
Cars and real estate are good examples.
It's pretty damn easy to determine if there's an over Over Capacity in restaurants, just walk inside and ask yourself is the restaurant full or empty?
Now walk along the entire street and do the same for all the other restaurants.
Furthermore try doing the same thing for gas stations, shopping malls, grocery stores, etc...
IMHO there is
"Over Capacity" in just about everything under the sun.
There is simply too many businesses out there who want to sell something that society can't afford to all buy.
That's the main reason why the auto industry is in trouble........my 2 cents.
Personally I think the media / the debate is giving too much attention to the unions.
What can be done? ---> nothing
I believe that in life sometimes you'll get stuck with a bad situation and there is "NO solution".
I think my previous post may have a been too abrasive so perhaps this one will smooth things out.
The auto industry's business model works on the assumption that you and I are going to replace our cars every 7 years.
I don't know about you guys but I'm driving a 12 year old car and if I pass smog, I'm going to squeeze another 2 years out of my car before getting a replacement.
Maybe 14 years is aiming kind of high but I'm willing to bet there's an awful lot of 10 year old cars on the road today.
Obviously this is not something a CEO of an auto company (any company) wants to hear.
This is why I'm not optimistic about the US auto industry.
Even if they pull a rabbit out of their hat and created some amazing innovation *doubtful* that still does not change the fact that consumers aren't really in the mood to buy another car *any car* at least not for awhile.
The auto industry (entire industry not just the USA) is going to contract and there is absolutely nothing government can do about it.
There's some truth to that, in at least that car sales in general are falling. GM had a 41% decline, Toyota posted its first loss since 1941 (http://www.nytimes.com/2008/12/23/business/worldbusiness/23toyota.html?bl&ex=1230181200&en=4637c51b4c895cd8&ei=5087%0A), etc. The used car space isn't looking much better, but is still relatively solid; as of September, they'd only declined 4% from last year (http://www.autonews.com/article/20081013/ANA06/810109939/-1).
My company is in the used-car space, so I'm hoping the lack of new-car sales now will translate into greated used-car sales in the future.
Overall, the auto industry is huge, so there IS some validity in the "we're too big to fail" argument. But it's more of a quantitative one than qualitative, which is what the financial bailout was about (and which makes it much more scary). In that sense, it would be extremely painful if it fails, but painful in a different way than if the banks were to fail. Realistically, we could endure a very harsh few decades, let Japan expand and fill the void, and hope that the market brings forth new automakers that grow to compete. It's not impossible, but like I said - it would be a very painful few decades.
Also keep in mind that there'd be a chain reaction if you see auto manufacturers fail. Companies that supply parts to auto manufacturers would suffer greatly because they'd lose a ton of business, as an example. In turn, companies that supply the metal to make those parts would also see a large dropoff in business, and so on down the line. It won't be pretty.
The goal with an auto bailout is that you need to prevent the industry from falling apart completely, but you don't want to reward irresponsible/unsustainable business models.
The trick to this - and it's a very difficult trick - is to offset pain caused by the greater overall economic crisis, but not to offset pain that auto makers have self-inflicted. I suspect that a relatively small bailout (certainly less than auto makers request), in which companies are obligated to pay back their debts to the government in full, is the right approach here; but that's a moderately uninformed opinion and not really a strong belief.
There is no right way to react to this situation. All of actions are just the government taking risk on the economy, trying to see what will workout best.
Current assumption is to react in a way which is similar to 30's depression. Pump capital into the economy, create jobs, get people back to work and they will start to spend. However, the events which brought us into the recession are very different than from the past. Furthermore, our economy system is not fundamentally structured. Main cause being the jobs being out sourced and importing more than exporting.
The people seem to be hoping that "Green jobs" would be the solution to our economy problems. They are trying to make it the hot new thing to invest and invent in.
Yesterday, I heard a person on tv saying to buy all american as much as we can. It just sounded like as if American products are scarce in America as a result of foreign trading and out sourcing.
I also share some agreement with Peter Schiff, who thinks that the government should let the bad companies go down and the let the economy take its course. I kind of view the economy as a boxer who has taken a good beating in the ring. Instead of letting the boxer lose, learn from the mistakes and fight some other day, the trainer keeps pumping the player with PCP(Or whatever is the drug called that numbs the pain) and putting him back into the fight. The player might end up wining the fight, but his body might not be able to fight every another match.
But that is just an analogy, and not how the economy works.
----
Without reading others posts
In order to replenish our economy, we need companies to use more secure polices on their customer's investments. No-one wants to lose out on money :( yet everyone seems to be getting ripped off(at least from the angle I'm at). I'm considering buying some CVS stock, but would prefer buying some bonds from Fanime Con ;)