As far as a cure for the recession, we could try to infuse the economy with cash, and hope it reignites. BUT that might only provide temporary relief, until the markets once again try to right themselves. Then it's gonna be pretty glum looking for awhile.
I'm not saying it's not going to get better; but to deny things are getting bad is to walk around with a blindfold on, and then blame the folks you bump into.
The "cure" is gonna get painful. As someone else pointed out, there are a lot of baby boomers who are getting ready to retire...so the stock market's gonna continue to fall, simply because there are gonna be a lot more sellers than buyers for the next few years. Same for the housing market; as boomers look to downsize, there are gonna be fewer buyers than sellers. It's a simple function of supply and demand.
And that's just a part of what's going on. Boomers are more loyal to Detroit's products than the generations that follow, so it's only natural that Detroit's market share is slipping. And it's Detroit's unwillingness to acknowledge that fact--and to do something about it--that's a big part of what's wrong with their financial position.
Truth is, the recession's already happening, and it's either gonna last awhile, or it's gonna last a lot longer than that. The length will be determined by how long it takes for all this massive debt to be taken off the books, either by repayment or by foreclosures. If it mostly gets wiped away by foreclosures, it's gonna be a lot longer time before there's sufficient cash flowing through the hands of the masses--the middle class--to start spending in anything approaching a "normal" fashion.
If, on the other hand, banks and other financial institutions don't want to have to dispose of already-distressed assets at fire-sale prices--thereby increasing their losses--and they are willing to work with borrowers to get repayments back on track, the recession won't be nearly as deep or as long.
So I guess it depends on whether or not the financial institutuion yield to the "vultures" and clear their books, even if it means taking a major loss.
And if China decides to "foreclose" on some of the "security" for the debt they've purchased here in the US, then we're REALLY screwed. So let's pray that never happens. As Dave Ramsey says, credit is the most heavily marketed product in the US today. So if Americans succumbed to the siren song of the marketing, the folks who made out like bandits were the CEO's who encouraged this marketing, and then had "golden parachutes" in their contracts so that when the "stuff" hit the fan they come out smelling like a rose.
If you think it's bad now, it's only gonna get uglier for awhile. But I fear that we're in the "end times" of ancient prophecy, and I pray that we survive the outcome. Others will pray that I'm wrong.
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