Financial columnist, Terry Savage praises Obama economic team.

[DailyGrind51]

"I had the privilege of sitting in at President-elect Obama's press conference on Monday morning, where he announced his economic policy team. Although the President-elect was deliberately upbeat during the presentation, I was struck by the difference in style. The big campaign smile was replaced by a firm determination. Suddenly I could see why Presidents age in office. Dealing with this economic mess is a huge responsibility.

It does make you question the wisdom of the founding fathers in designating an election two and a half months before the inauguration. Clearly, they never envisioned instant communication by television and Internet as we have today. Still, the pause between the two events does ensure that nothing gets done precipitously.

The President-elect was very careful not to quantify the amount of money that would be needed, nor the type of stimulus plan his team would propose. I'm including below a column that will run in the Chicago Sun-Times on Tuesday, with more of my thoughts on this daunting task before the nation.

What worries me most is that many people seem to expect miracles, instant miracles. I was on a local call-in show Monday evening, and found that people in this particular audience were expecting a check to arrive in the mail. That was their vision of the upcoming economic "bailout"plan.

One caller complained that a few hundred dollars a person wasn't going to make much difference. Instead, he proposed that a check for $50,000 be sent to each American for the "bailout." He was serious! Asked where the money would come from, he responded quickly: "From the paychecks of all those rich CEOs that have been ripping us off!"

I guess that exchange balanced off the outrage of last week - the utter stupidity of the top auto execs private-jetting their way into Washington to ask Congress for money, without even presenting a plan. Were their expectations any more ridiculous than the sentiments of the guy on that phone call?

Can this get any more ridiculous, any more extreme? And, by the way, where are we going to get all this money for the "bailout" that everyone is expecting?

So here's the column - describing the tough job of raising hopes but damping expectations. Really, fixing this economic mess isn't going to be easy!

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Confidence. You either have it or you don't. It can't be bought, borrowed or faked. And President-elect Barack Obama certainly has given the country an economic team worthy of his own strong sense of confidence in the eventual recovery of the economy.

That was apparent as I sat at my first (pre)Presidential press conference, where the top players flanked the President-to-be, nodding as he acknowledged that the country's economic problems will get worse before things get better. "We need confidence in the markets," he said, "and we need to restore the confidence of middle class families who have been falling behind."

While refusing to give out specific details of his plan to create jobs, or of the amount of money that would now be needed to undertake that task, the President-elect said he was counting on the wisdom and ingenuity of his economic team as well as the resilience and spirit of the nation to work its way through the current problems. And, he left no doubt that he would bring the necessary financial resources to bear.

More than Money

Well, if all it takes is smart people, plenty of money, and lots of self-confidence, this should be an easy task. Unfortunately, and in spite of all our best wishes and respect for this new team, it can't be that easy.

The economy is like a giant snowball, rolling downhill, picking up speed and size as it falls farther. And all the money being thrown at the problem to date seems to have had little impact. According to a tally by Bloomberg News, the sum of all the government's pledges to help (including the latest pledge to back $306 billion of Citigroup debt) now totals roughly $7.75 TRILLION!

Of course, all that money may not be drawn down, but it is a staggering sum. It amounts to about 80 percent of the wealth that has been lost since the peak in the stock market. And, although the stock market rebounded yesterday for its best two-day gain in more than 20 years, it was interesting to see gold rise $20, to $822 an ounce, perhaps wondering where all that new money would come from.

The new President promises real solutions to home foreclosures and job losses and business failures. Just about anything the new administration can come up with will be an improvement on the ad hoc activities of those currently at the helm. But in spite our best hopes, given all those jobs lost and homes foreclosed, our country will require one more item to deal with the problem.

It is the one ingredient that no one mentions, because it can't be adjusted to fit our plans. That ingredient is TIME. It will take time for the economy to work through this mess, no matter what amount of money and how much self confidence we bring to the task. And that's The Savage Truth."


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