Obama says there is no time to lose as he unveils economic team

Tuesday 25th November, 06:07 AM JST

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SushiSake3 at 04:27 PM JST - 25th November

Incredibly, U.S. Treasury Secretary Henry Paulson last week criticized Asian consumers for not buying enough US products as one of the reasons for the quagmire the U.S. finds itself in.

Just how arrogant can a person get?
mcheeky at 04:32 PM JST - 25th November

Sushi, are you sure he has not been taken out of context? I find it more likely he was citing a reason than leveling a criticism. If sales of U.S. products in Asia have flagged, then saying so is just a fact.
Sarge at 04:36 PM JST - 25th November

Rebuilding the U.S. economy after four years of Obama will be difficult, but have no illusions - it WILL happen!

Sushi, agree with you about Paulson - he's a real piece of work.
Sarge at 04:37 PM JST - 25th November

Sushi, I hear they're going to make a new bill with Paulson's picture on it. It's going to be the Gadzillion Dollar bill! Hee hee!
goodDonkey at 04:52 PM JST - 25th November

hereandthere said:

Nov 4, Obama said the U.S. economy was trapped in a “vicious cycle"

and really wants to look like he is doing something, so after market corrects itself, he can take credit for it....

In 1929 the market corrected itself. That is exactly what happened. People were acting like idiots by taking out loans and buying stock on a low margin, which was possible in those days. It was a ponzi scheme. The market has no conscious. What you call correcting itself would have been disastrous. If we let institution we have bailed out so far fail, our economy would be close to a depression in a very short time from now. That is what correcting itself means. We have made ridiculously bad decisions in this country lately in the financial markets.

As Betzee as repeatedly pointed out our addiction to debt has gone far beyond any reasonable level and in fact into the absurd. Destruction of the markets is part of correcting itself. The markets are based on fear and greed. We were headed for all out panic. These people who believe the market is magic and would know when to stop itself from falling too low or collapsing when panic is destroying every structure are not seeing the market for what it is.

The markets are simply the gauge, a measuring device, of panic at one end and exuberant confidence at the other. If what I am saying is not true than price to earnings ratios (P/E) would all be very close. The return on equity (ROE) would also be very close. There are functions of the market that would appear be the source of a "magic hand." When a stock splits two for one the opening bid inevitably will be within a fraction of a percent of exactly half the previous stock price (barring any other good news/bad news). The price of a stock compared to the overall worth of a corporation is not consistently reflected when comparing stocks one to another.

I do believe in the concepts of market correction. But believe me in 1929 there was a market correction.

Bush has made smart moves to stabilize our economy and restore confidence. Obama will aggressively pursue a set revitalization programs and policies to rebuild our financial structures, restore confidence and create jobs in America. Both should be credited each according to their efforts when the world economy is back on track.
apecNetworks at 04:57 PM JST - 25th November

President-elect Obama is a very, very lucky person. The US economy started to tank even before he was elected, and the estimation of the scale of the economic problems will be much more clearer before he is inaugurated 1/20/09. This would mean that historically, he will be seen as coming into office to fix the problem w/ almost no connection to the development of the problem. Also, he will be given slack w/ his drive into the Indian Ocean since it would be a legacy job from the present Administration. Things only have to improve for him to be re-elected. Very, very lucky politically.
SushiSake3 at 05:06 PM JST - 25th November

apecNetworks - agreed.

Had the economy imploded after Jan 20th, Americans' perceptions of who is to blame would be different.

As it stands, most of the blame is being laid at the feet of the captain of the U.S. Titanic, George. W. Bush.
Sarge at 05:18 PM JST - 25th November

apec - But Obama does have a connection to the development of the problem. He has on his staff people who were neck deep in Fannie Mae and Freddie Mac. Plus, his party, the Democratic Party, put pressure on these housing loan companies to extend loans to unqualified buyers because it's the "right of every citizen to own a home" blah blah blah...
Loki520 at 05:29 PM JST - 25th November

No connection to the problem? Someone's off their meds...
apecNetworks at 05:57 PM JST - 25th November

I'm talking about the individual, not the Democratic Party - he needs the Party to get elected. I have known lucky people, the kind of people who by chance are in the right place at the right time. Example would be going on a sales trip w/ zero chance of making the sale, but the person sitting next to him on the plane is the CEO's son/daughter who happens to like the company's products. Lucky people fascinates me - btw former Pres. Reagan was a lucky guy.
Athletes at 07:31 PM JST - 25th November

Stimulating the economy require huge amount of bail out & infrastructure budget. It is fair enough however Obama did not mention where does the money come from? Since the Bear Sterns collapsed, current govenment has already spent more than a trillion dollars from security bonds. In my knowledge, there is not much left in the treasury. Besides that there are no reserve & surplus revenue too. US has both trade & budget deficits.

Selling out the more treasury bonds or printing out more dollars are only options. Raising tax is unimagineable. It is unreasonable for expecting the foreign countries to supply the unlimited finance. They are facing their economic downturn too. Printing more dollar notes will sky rocket the inflation.

It is a tremendous task for new admininstration for recovering the economy. What ever happen in tomorrow, Obama is the dim light from end of the dark tunnel.
Betzee at 10:00 PM JST - 25th November

SedanDelivery.

(I almost wrote "sedanchair" as your handle!) Yes, and the comment was written in response to a column by William Kristol, resident NYT's neocon, praising the caliber of Obama's team while questioning whether "more government spending" is the answer. Predictably, neither he nor any other balking conservative has proposed an alternative. Perhaps they don't want to acknowledge there isn't one as the ailing financial sector looks like it needs another infusion of funds to flush out all the bad loans.

Of course taking on all this debt is worrying, particularly after what we've incurred over the past eight years. But it beats waiting for the market to correct itself. In the absence of action that will happen, but the correction will entail destroying what remains of our economy. Neither we, nor others, want that.

After we get through this I hope the Obama team will look hard at where the economy should go and where growth should come from rather than just leaving it to "the market" that morphed into a form of "cannabalizng capitalism." It's long overdue frankly; there's been very little discussion over the past few decades about out-sourcing of jobs and our heavy reliance on imported consumer goods which resulted in a ballooning current account deficit.
Betzee at 10:30 PM JST - 25th November

Is that the only way to stimulate the economy is by making Americans spend money on crap they don't need/can't afford?

Too many Americans live paycheck to paycheck in order to purchase an HDTV or whatever new gadget has just hit the shelves. (I hate going to the mall for just that reason; it's discouraging to see this in action at cash register after cash register.) Other countries are now going to have to get their citizens to pick up the slack and keep the global economy afloat. In places where saving is still a priority this may be a hard sell.
Betzee at 05:00 AM JST - 26th November

Glenn Greenwald at salon.com has voiced some concerns, which he picked up from the Op-Ed pages of papers like the NYT's on the uncritical enthusiasm, relief really at the prospect of adults being back in charge, which Obama's line up has elicited:

Trillions of dollars flying around. Deals being cut in the dark, with virtually no oversight, scrutiny or even public awareness until after the fact. All sorts of overlapping relationships and influence-peddling at the heart of these transactions. And people like Rubin, Geithner, and Summers have all long been a part of that system, and in many cases, important components of the key precipitating events. That is some rather substantial ground for concern.

This is all true but also predictable. Anyone with a long resume and experience has been on the wrong side of a few issues and not taken advice, in retrospect, they should have. Their hands are a lot cleaner than those of Phil Gramm, who has come out to say the deregulation of the derivative market legislation he sponsored (and Summers backed) has nothing to do with this mess. Yeah right.

The alternative is to go with someone outside the system. Some members of the Left, disheartened by the reappearance of so many clintonistas, have been complaining Obama hasn't appointed enough fresh faces to promote his progressive agenda. An outsider with an anti-Wall Street bias is most unlikely to appreciate how intricate financial markets work and would, moreover, probably make it a lot worse. Ditto for the bail-out critics on the Right who don't want more government involvement, seeing that as the source of the problem. Just let Wall Street go under seems to be their view (if I'm reading Sarge's posts correctly). That would also be an economic catastrophe. Sooo, on balance, I'm happy with Obama's team.
JoiceRojo at 05:58 AM JST - 26th November

Yup.....Microsoft did sooooo bad under the Republicans.

Of course with products with so low quality that his corporate image tainted the image of U.S. products.

I give credit Obama to being smart in choosing people for his economic team, let's see how they will cope up to the challenge