You want to get somewhere and it is a matter of some urgency. But the driver is a boob. He does not know where he is going. He is easily distracted. He is constantly primping and gazing at himself in the mirror. He takes wrong turns. He drives into ditches. Satellite technology gizmos don’t help because he reacts too slowly to the GPS instructions. He is not prepared to make the turn when the turn is required. More gasoline, higher quality gasoline, won’t help. More speed won’t help because you succeed only in getting to the wrong places faster. What you need is a driver that knows what he is doing.
From a distance, watching the swerving boobery, the futility of the trip is easy to see. The disaster was predictable from the very beginning. If you get in a car with a boob driver, expect boobery. If you elect a boob, expect boobery and boobery on top of boobery. Nile Gardiner sees the boobery and the disaster to come for the driver and the passengers:
“In the aftermath of the hugely successful Special Forces operation that took out Osama Bin Laden and a modest spike in the polls for the president, the conventional wisdom among political elites in Britain is overwhelmingly that Obama will win another four years in the Oval Office. Add to this a widespread perception of continuing disarray in the Republican race, as well as a State Visit to London that had the chattering classes worshipping at the feet of the US president, and you can easily see why Obama’s prospects look a lot rosier from across the Atlantic. [snip]
Ultimately, the 2012 presidential election will be decided by the state of the economy, and new data released this week makes grim reading for the White House. In fact you cannot watch a US financial news network at the moment, from Bloomberg to CNBC to Fox Business, without a great deal of pessimism about the dire condition of the world’s biggest economy. 66 percent of Americans now worry the federal government will run out of money in the face of towering public debts.
To say this has been an extremely bad week for the Obama administration on the economic front would be a serious understatement. As The Wall Street Journal reported on Wednesday, home prices in the United States have sunk to their lowest levels since 2002, falling 4.2 percent in the first quarter of 2011. At the same time, employment growth is stalling, with only 38,000 Americans added to the workforce in May, the smallest increase since September. This compares with 179,000 jobs added in April. There has also been a steep slowdown in the manufacturing sector, and a downturn in the stock market on the back of weak economic news.”
Gardiner quotes Robert Reich:
“The US economy was supposed to be in bloom by late spring, but it is hardly growing at all. Expectations for second-quarter growth are not much better than the measly 1.8 per cent annualised rate of the first quarter. That is not nearly fast enough to reduce America’s ferociously high level of unemployment… Meanwhile, housing prices continue to fall. They are now 33 per cent below their 2006 peak. That is a bigger drop than recorded in the Great Depression. Homes are the largest single asset of the American middle class, so as housing prices drop many Americans feel poorer. All of this is contributing to a general gloominess. Not surprisingly, consumer confidence is also down.”
Gardiner cites the polls and the ramifications:
“Unsurprisingly, the polls are again looking problematic for the president. The latest Rasmussen Presidential Tracking Poll shows just 25 percent of Americans strongly approving of Obama’s performance, with 36 percent strongly disapproving, for a Presidential Approval Index rating of minus 11 points. In a projected match up between Obama and a Republican opponent, the president now trails by two points according to Rasmussen – 43 to 45. The RealClear Politics poll of polls shows just over a third of Americans (34.5 percent) agreeing that the country is heading in the right direction, with nearly three fifths (56.8 percent) believing it is heading down the wrong track. That negative figure rises to a staggering 66 percent of likely voters in a new Rasmussen survey, including 41 percent of Democrats.
There is no feel good factor in America at the moment. But there is a great deal of uncertainty, nervousness, even fear over the future of the world’s only superpower. This is hardly a solid foundation for a presidential victory for the incumbent. Even though we don’t know yet who he will be up against, Barack Obama could well go into 2012 as the underdog rather than the favourite he is frequently portrayed as. On balance we’re likely to see a very close race 17 months from now. But there is also the distinct possibility of an electoral rout of the president if the economy goes further south. “Hope and change” might have played well in 2008, but it is a message that will likely ring hollow in November 2012, with an American public that is deeply disillusioned with the direction Obama is taking the country.“
Kick the driver out of the car and get someone else.
Things are so bad that even the JournoLister heavy Politico is waving red flags:
“Economy shadows Obama ’12
A series of troubling signs for the U.S. economy threatens to dash hopes that 2011 would be a year of robust recovery — and that could prove troublesome for President Barack Obama’s reelection chances.
The Obama team has long hoped that the president’s 2012 campaign would be underpinned by an economy that was clearly accelerating out of the Great Recession, showing strong growth and job creation. But recent economic data paint a picture of an economy stuck in low gear, held down by continued high personal debt, a moribund housing market, high food and gas prices, persistent weather disasters and widespread unease about what the future holds. [snip]
Some economists had hoped the killing of Osama bin Laden might ease general American anxiety and lead to stronger consumer sentiment. No such luck. Consumer confidence dropped to a weak reading of 60.8 this month, down from 66 in April, according to data out Tuesday from the Conference Board.
Corporate chief executives, meanwhile, appear unwilling to use their run of strong profits to go on significant hiring campaigns until economic signals point in a more positive direction and consumer spending trends suggest more robust demand.
Other recent weak signals include a much-worse-than-expected 4.2 percent drop in home prices in the first quarter as measured by the S&P/Case-Shiller index. The housing market is now clearly in a “double-dip” decline, back to levels not seen since well before the recession. Pending homes sales dropped 11.6 percent in April, and consumer spending grew a tepid 0.4 percent, the smallest increase in three months.
The Commerce Department recently left its estimate for first-quarter gross domestic product growth unchanged at 1.8 percent. Many economists had expected an upward revision to around 2.2 percent, setting the stage for second-quarter growth of roughly 3 percent.
In addition, weekly jobless claims, which tend to drop sharply as the economy improves, have resumed an upward trend and now consistently come in above 400,000, suggesting no positive hiring momentum. [snip]
All of this presents significant political problems for Obama as he heads into next year’s reelection race.”
‘Not to worry’, says Obama. ‘There is light at the end of the tunnel.’ As Politico notes “Skeptics would say they have heard such hopeful claims many times before.”
The Obama boosting New York Times sees the ditch the car and driver are about to hit:
“Employment Data May Be the Key to the President’s Job
No American president since Franklin Delano Roosevelt has won a second term in office when the unemployment rate on Election Day topped 7.2 percent.
Seventeen months before the next election, it is increasingly clear that President Obama must defy that trend to keep his job.
Roughly 9 percent of Americans who want to go to work cannot find an employer. Companies are firing fewer people, but hiring remains anemic. And the vast majority of economic forecasters, including the president’s own advisers, predict only modest progress by November 2012.“
What we wrote in February of 2009 is still applicable today. The problem is that there is boob in charge. The boob does not know what he is doing. The boob has many excuses but the bottom line is that what is required is a plan that makes sense. All the “jobs programs”, all the “stimulus programs”, all the uncoordinated schemes in the world won’t work because there is a boob in charge:
“But Christina Romer, who headed the president’s Council of Economic Advisers until fall 2010, said in a recent speech at Washington University in St. Louis that no part of the government was addressing unemployment with sufficient urgency or hope.
“Urgency, because unemployment is a tragedy that should not be tolerated a minute longer,” she said. “And hope, because prudent and possible policies could make a crucial difference.”
Romer is right that the United States needs prudent and possible policies that will make a difference. But the problem is that Obama is only capable of stunts and gimmicks – not a coordinated plan of attack – like Bill Clinton and FDR had. Therefore no matter how much money is poured into new programs, how many publicity stunts to boost confidence, no matter how many Bin Laden style distractions pop up – the problem is the boob behind the wheel.
USAToday is on the hunt for the “recovery” one year after the “recovery summer” publicity stunts of 2010. “Recovery summer” 2011 is as elusive as “recovery summer” 2010:
“Don’t look now, but the economic recovery that barely exists in the eyes of many Americans is 2 years old.
By historical standards, that should be a milestone signifying robust economic expansion and strong job gains, especially in light of the severity of the Great Recession, which officially ended in June 2009.
But instead of mimicking dramatic turnarounds that followed similarly bruising downturns in the 1970s and 1980s, the upswing looks more like the modest rebounds after milder recessions in the early 1990s and 2001. Like the recent slump, those were tainted by credit crises that gummed up critical gears of the economy.
Last week’s economic news — below-forecast economic growth and a weaker-than-expected improvement in consumer spending in the first quarter — raises inevitable questions about whether the economy’s halting comeback has hit another speed bump.
“We’re two years into a recovery, and everybody’s yelling, ‘Are we there yet?'” says Wells Fargo economist Mark Vitner. “You should be putting the recession behind you and talking about where growth is coming from. Instead, we’re still dealing with residual problems from the recession.”
No, we are not there yet – the driver is a boob.
But what about the “glimmers of hope” we heard about in 2009? What about the bright economic spots?:
“All of the economy’s bright spots show some tarnish. Corporate earnings are at record levels, but much of the growth is overseas, and efficiency gains have allowed companies to limit hiring. Small businesses are posting better sales, but many can’t get loans to expand, says Ami Kassar, CEO of MultiFunding, a loan adviser for small businesses. Consumers are opening their wallets wider, but they’re constrained by 9% unemployment, still-heavy debt and high gasoline prices.”
Trapped with a boob driver, do not expect to go forward to a celestial choir dawn:
“Welcome back to the sour economy.
It didn’t take long after the Memorial Day break to get the latest signs that the recovery remains in the gutter. The housing market has been looking like it was headed for a double dip for some time. On Tuesday, we got confirmation that it happened. According to the S&P/Case-Shilller housing index, home prices hit a new low since the beginning of the bust in the first quarter of the year. According to Case-Shiller, houses now cost about what they did in 2002, erasing much of the gains of the 2000s housing boom. In the past year alone, residential real estate has fallen 5%, and prices have now dropped nearly a third from their peak five years ago.
In more bad economic news, the mood among consumers fell in May as well. One of the most commonly watched measures of confidence dropped to a six-month low, on inflation worries and fears that the slow jobs recovery would end. [snip]
What’s more, many economists are predicting that interest rates will soon rise.”
The manufacturing sector was supposed to be the engine that would make the trip a success. But the driver is a boob:
“U.S. economy: Manufacturing slowdown the latest sign the recovery is faltering
The economic recovery is faltering, and Washington is running out of ways to get it back on track.
Two bright spots over the past few months — manufacturing and job creation by private companies — both slowed in May, according to new reports Wednesday. The data come amid other reports of falling home prices, declining auto sales, weaker consumer spending and a rising pace of layoffs.
Stocks tumbled Wednesday on the discouraging economic news, with the Standard & Poor’s 500-stock index off 2.3 percent. It was the index’s steepest decline since August.
Just a few months ago, the economy seemed poised to finally strengthen. [snip]
But those hopes are being dashed.”
There is plenty of blame redistribution from Barack Obama. Obama and his hapless henchmen blame oil prices, earthquakes, tornadoes, stubbed toes, ingrown nails, gray hairs, and insufficient time to golf. However, a strong economic recovery would have withstood even extraordinary economic shocks:
“But it is the underlying weakness of the U.S. economy that may have allowed these developments to knock the recovery off course.
“We’re structurally in a place where we’re going to be more vulnerable to downside risks than if the economy was growing strongly, and that’s what we’re seeing right now,” said Robert A. Dye, senior economist at PNC Financial Services Group. “We’re not far above stall speed.”
Get rid of the driver!
“But the outlook, as projected by economic forecasters and implied in government data, is clearly dimming. Economists at J.P. Morgan Chase on Wednesday lowered their projection for 2011 growth in gross domestic product to 2 percent. A week ago, those same economists had reduced the figure to 2.5 percent.
Reflecting rising pessimism, the interest rate that the Treasury Department must pay to borrow money for 10 years fell to 2.95 percent Wednesday, from 3.06 percent on Tuesday and 3.74 percent in February. As investors grow anxious, they are moving money into the safety of government bonds. Investors are also anticipating that the Federal Reserve will seek to support the recovery by keeping interest rates low for longer than previously expected.
Among the economic information that unsettled markets was a report by the Institute for Supply Management, which said that its index of manufacturing activity fell to 53.5 in May from 60.4 in April. Numbers above 50 indicate expansion, and analysts had expected a more modest pullback to 57.1. The new numbers showed the slowest rate of factory expansion since September 2009. [snip]
Also Wednesday, ADP, the payroll processing company, said that the rate of job creation at private businesses slowed sharply last month. Firms added 38,000 jobs, ADP estimated, compared with 179,000 jobs added in April.”
Tomorrow, the Labor Department will publish data on May job growth along with unemployment statistics. The expectations are slowing growth in jobs and a tick down to 8.9 percent in the unemployment rate.
At CNBC, they are worried:
“The last month has been a horror show for the U.S. economy, with economic data falling off a cliff, according to Mike Riddell, a fund manager at M&G Investments in London.
“It seems that almost every bit of data about the health of the US economy has disappointed expectations recently,” said Riddell, in a note sent to CNBC on Wednesday.
“US house prices have fallen by more than 5 percent year on year, pending home sales have collapsed and existing home sales disappointed, the trend of improving jobless claims has arrested, first quarter GDP wasn’t revised upwards by the 0.4 percent forecast, durables goods orders shrank, manufacturing surveys from Philadelphia Fed, Richmond Fed and Chicago Fed were all very disappointing.”
“And that’s just in the last week and a bit,” said Riddell.
Pointing to the dramatic turnaround in the Citigroup “Economic Surprise Index” for the United States, Riddell said the tumble in a matter of months to negative from positive is almost as bad as the situation before the collapse of Lehman Brothers in 2008.”
“President Obama’s top fund-raisers, meeting in Chicago on Wednesday were asked by Obama campaign manager Jim Messina to raise $60 million for the Obama 2012 re-elect and the Democratic Party by the end of June, I’ve been told. [snip]
Obama and First Lady Michelle, I’ve learned, will hit the fund-raising trail again this month in a quest to raise big money early on for the Obama 2012 re-elect and the DNC.”
Obama is golfing and raising money while Main Street and even Wall Street are in a panic:
“”What we’ve got right now is almost near panic going on with money managers and people who are responsible for money,” he said. “They can not find a yield and you just don’t want to be putting your money into commodities or things that are punts that might work out or they might not depending on what happens with the economy.
“We need to find real yield and real returns on these assets. You see bad data, you see Treasurys rally, you see all bonds and all fixed-income rally and then the people who are betting against the U.S. economy start getting bearish on stocks. That’s a huge mistake.”
Stocks extended losses after the manufacturing fell below expectations in May and the private sector added only 38,000 jobs during the month.
“Interest rates are amazingly low and that, thanks to Ben Bernanke, is driving everything,” Yastrow said. “We’re on the verge of a great, great depression. The [Federal Reserve] knows it.
“We have many, many homeowners that are totally underwater here and cannot get out from under. The technology frontier is limited right now. We definitely have an innovation slowdown and the economy’s gonna suffer.”
Obama is raising money for himself and attempting to bamboozle the public by claiming the bailout of junk car companies is a great victory. But that transfer of billions of dollars of wealth to car companies that will eventually go under, because they produce junk the public does not want, was not a success.
Garbage car companies and health insurance companies have gotten oodles of money from Barack Obama, who will soon be asking for some of that cash back for himself. Liberal Democrats like Brent Budowsky make plaintive pleas but fail to understand that Barack Obama is a boob and the very source of the problem:
“On behalf of the 15.9 percent of Americans who compose the real jobless rate and their moms, dads, brothers, sisters, sons and daughters who compose the 30 percent of Americans suffering misery from unemployment, I write this angry dissent against the culture of callousness of official Washington, which is doing virtually nothing to create jobs in America.
The ugly housing numbers released Tuesday suggest a double-dip collapse below earlier crash levels. The ugly jobs numbers released Wednesday by ADP remind us why 55 percent of Americans believe the nation is in a recession or depression, according to a recent Gallup poll. [snip]
My mission here is to give voice to the jobless, who have little voice in this town. I must offend some friends as well as adversaries.”
Budowsky is rightly outraged, but no one is going to listen to him. Certainly Barack Obama is too busy golfing and fundraising to take heed of people who won’t donate money to him. Barack Obama has his own interests and his own concerns:
“I angrily dissent from a Federal Reserve policy that provided some $20 trillion to bankers in the greatest trickle-down exercise in world history, which created vast wealth at the top, rampant speculation throughout markets, the cash-starving of small businesses and a tidal wave of foreclosures by bailed-out bankers who showed neither common sense, basic decency nor economic patriotism.”
Budowsky’s “dissent” would be more credible if he stopped flattering Barack Obama and declared it was long past time to get rid of Barack Obama. Until then, Budowsky, for all his outrage, is driving with Obama – into a ditch.