The job losses are a trend that are non-inclusive of the recent turmoil in the markets. Savy business leaders were trimming staff before the most recent market turmoil and discussion of bailouts. These cutbacks are an agnostic recognition of the facts and are not tied to the 'sentiment' of a bailout or rescue plan.
I have heard allot about the 'confidence' or the 'sentiment' that the bailout would provide the markets. Emotive outlooks on economics do not change the facts, as an example the increase of deposit insurance is a fact not a sentiment. Insurance ceiling changes can encourage the repatriation of dollars to liquidfy banks. The comments that somehow the bailout will initiate another 'bubble' of confidence is simply not warranted; it will not do that. It is my bet that the market has more losses in store and that inter-bank lending will remain difficult.
The purpose of the bailout is to provide a means to prevent scenarios where say 'breaking the buck' does not spill into segments of the economy that should be behind a firewall. Wachovia yesterday demonstated what the bailout is for. Wachovia limiting withdrawals to educational isntitutions was a clear signal why intervention is needed.
For those who have laid-off employees, or let them go; when you run into those people later often the thought is: "What could I have done as a manager to have done better to have avoided doing that." I'm of course excluding the group that were fired. But really the job loss report reflects the agnostic facts that this economy has been in bad shape, is in bad shape, and will remain in bad shape for some time to come.
Politically, I guess starting with 250billion without all the pork barrel add-ons would have been fine with me, and then a progress report for subsequent issuance of monies as it was realized that the deflation was off-setting the accrued debt, that cost averaging would allow some of the assets to be profitable, and that this is indeed the right thing to do.
I think that in hindsight that we still don't appreciate the size of the challenge before this nation and the global economy, that roughly 1/3 of the bailout will be performed poorly, 1/3 at eventual wash, and a 1/3 at profit. I also feel that as difficult as it is to politically get a deal to move forward with this legislation that we need to do so. I think our progress can be quicker than the Euro here say Germany must agree to bail out the French. Our acting quickly can help to avert still larger notional losses.
Is main street and wall street connected?
Ask the unniversities that requested their monies.
Will jobs erode further? Bet on it.
Is the dollar the real refuge in these turbulent times? Yes. And I don't make that statement from a nationalist or smug attitude, it is just a fact that really no country wants to be taxed to bail out another. We are taught as individuals that finance is a zero sum game, when gloabl economics is not necessarily so. A political paradox difficult to sell and will cripple the Euro.
On the debate, well Palin did prove she was not a cartoon character, though the eye-winking was strange in a slow motion loop. Biden unquestionably won the debate and really gave the best performance witnessed in recent debate history. And the press claiming it was a tie?? well that is about as accurate as describing the bailout as a sentiment buy signal. The facts just don't suuport a Palin did well or a economic recovery is a vote away.
Truth is this, we need the bail out/recovery plan. That the economic recovery will take much more time than most realize. And though Palin thankfully didn't collapse on an INTERNATIONAL stage, she certainly didn't win the debate.
I also add this as a fundamental truth, raising the FDIC limit is the most effective immediate remedy to the liquidity crisis.
My opine... that the bailout is laden with pork and even the energy bill should be stripped out (even though I'm supportive of the legislation). And the energy bill is a measure that should be voted seperately.
These are just the facts and the way I see it.
Look at a stronger dollar, chaos in the Euro, fall in gold and oil, and an Obama win in November.
Thems the facts, agnostically presented.