The myth of this economic "rebound"

[loudnclear]

I feel as though I have been vindicated for one of my posts two weeks ago. I opined that this so-called economic "recovery" was more smoke and mirrors and that the tax cuts were not the big reason for the seeming turnaround. I just saw a short on MSNBC that indicated that more and more people are living pay-day-to-pay day and the reason for it is that they are broke shortly after being paid.

Now, all of this talk about people spending more is absolutely correct BUT most middle-incomers and above are spending and have spent their home mortagage refinances or loans. That money accounted far more for the spending than the Bush tax cuts. The rest of us who were too poor to own a home just incurred credit card debt to keep up with the rest of our family that was doing finanacially better than we were. That debt will be home for Christmas and after. My millionaire cousin let me know in no uncertain terms that the tax cut meant nothing to his household but the huge amount of money he garnered by refinancing his home enable him to pay off all debts...yacht, two cars, mobile home, and redecorations. The actual tax cut was laughable to him. Now that most of us good patriotic Americans have refinanced and spent the economy into a recovery what will we do in the next two quarters...after Christmas when we have bought all we will ever want or need and the mounting debt keeps us scared shitless that one of the two-income earners in the household will lose his or her job?

Well, don't worry, Bush will start a new conflict to keep your hearts and minds off of what is really happening to you on the home front...including that bogus Medicare reform. Two years from now, the country will begin to really feel the harm those tax cuts have done to the boomers and their children...and the Republicans will still be blaming Clinton somehow.

[izzie]

1. People are really doing some strang things.

Alot of these people are living high on the hog by re-morg their homes which is a good deal to go down in int, rates but they are pushing out morg. for years and spending the money as they up the morg. I recall my father saying pay off your home as he did in 5 years. Look at the money that would give you. So that is odd I know but these people must be nuts. Take out a bigger morg, and pay off your car and the payment last 20 years. Oh well so be it, I am too old to worry about it. I just hope SS last and my saving last.I feel ill at ease about what is going on.

[mlawson]

2. You are probably correct.

Income is just income, wherever it comes from, so far as spending goes. The test will be how consumer confidence holds up next Spring, and that statistic is similar to how people feel about the way the country is headed.

I don't place much credence in Xmas shopping figures, either -- the media has so taken over the whole thing, just driven people into FRENZIES by harping unmercifully about the "Holidays" (barf), that I suspect consumers will spend WAY more than they can afford to, because they have been made to think they HAVE TO!!! But then what heppens in January?? That will tell the tale.

[rustydog]

3. I've come to the conclusion that when "they" talk about

the economic recovery, they are not including us normal Americans but the 10% of people who actually make money in investing, and it IS a rebounding Economy for them because it doesn't matter if 5,000 people are laid off at ACME manufacturing or whatever.
What matters to corporate America is the bottom-line. Profits. and if you ship 5,000 jobs to China or Cambodia, you have just increased your profit 10-fold without having to bring a new product to market.
so yes the economy is booming for the richest people in America.

It does not matter that ten million are jobless as long as corporate America keeps raking in the off-shore banked bucks.

[loudnclear]

4. You are right on that too.

But talk to your neighbors in about a year from now. You'll see what I mean.