[WorldofWarcraft]

Will it? How long do you think til it starts picking up? Hopefully soon...

[TeTe lol Chin]

Of course it will. Natural cycles will take their course. This country's dollar cannot stay down forever. We have too many resources, researching ability and technology to let it fall too far.

The declining value of the dollar isn't the end of the world. Many companies that went to Europe to open up shop have already started coming back the US because of the dollar. More and more jobs will come back and more dollars will be spent here. Not to mention foreigners have already be coming to the US to vacation because they can finally afford it, bringing more dollars into this country.

Drilling offshore will hurt speculations on oil and if we were to add a consumption tax to all foreign bought goods, we could bounce back very quickly.

[viruswitshoes]

i believe that the economy is manipulated by the fed. so when the economy is doing good, we borrow like crazy until it goes bad. that's when we tighten up and pay if off.

(takes off the tin foil hat)

[The Gem]

3-5 years things will not suck, we will have long-term plans in place, and the lower-middle class will no longer exist.

[InternetHero]

Yes. In the medium or long term the economy will rebound.

[megaseth7]

Originally Posted by viruswitshoes

i believe that the economy is manipulated by the fed. so when the economy is doing good, we borrow like crazy until it goes bad. that's when we tighten up and pay if off.

(takes off the tin foil hat)

I see it as a series of created bubbles. The Fed allowed for cheap mortgages, balloon mortgages and the repeal of the Glass / Steagall act...they know exactly what they are doing.

[megaseth7]

Originally Posted by WorldofWarcraft

Will it? How long do you think til it starts picking up? Hopefully soon...

After all everything gets written off and worked out of the system. I do see a general shift in U.S. policy away from cheap Chinese imports. That was 'officially' kicked off by the announcement and condemnation of the lead paint in toys (lead paint that the feds were well aware of for quite a long time). The U.S. then inflated the dollar in order to make those chinese imports much more expensive and also to deflate U.S. international debt. It was something that they had to do because of recommendations by the G8 which were a result of U.S. having an unsustainable economy (due to the fact that the manufacturing base had been exported). It will take some time to turn things around but as you may have noticed export products were 'unexpectedly' up as announced by the fed (due to a deflated dollar and thus cheaper U.S. exports).

I will give it a couple of years.

Another big point is the price of gas which has gone down in the two weeks following the international meeting of six nations which included Iran concerning Irans enrinched Uranium program. The deadline ends next weekend so the U.S. will basically announce more forceful sanctions against Iran which will in turn once again drive up the price of petrol. Wait and see....

[Throatpoker]

It will, in a few years, but if we let the government keep borrowing and printing money out of thin air, we can expect it to get much much worse.

[Heresy]

In the long run, Americans need to shift their spending habits to be more savings oriented, instead of debt oriented. I'm not saying stop spending, I just think people need to learn to not overextend themselves so much trying to keep up with their neighbors/friends/coworkers.

Shifting a portion of income to savings, instead of consumption, does a couple of things. It provides more capital for investment, which creates jobs, which is something I think everyone can agree on being a good thign. It will also provide people a margin of safety, when so many people are living on the edge.

Until that happens, any gains to the economy are just going to lead to the next bubble/recession.

In the short term, a reduction in consumer spending will adversely affect the economy, but it's something that absolutely has to happen. We have a nation full of people who spend way too much of their income servicing their debt, when they should be investing it.

To accomplish this, the Fed interest rates are going to have to start coming up, to make it worthwhile to save. It is not going to be painless, but in the long run, businesses are more likely to put the freshly available capital to a more productive use than the citizen depositing the money in the bank would be able to do on their own.

For examples of why encouraging your citizenry to save, instead of rack up unsustainable debt, is a good plan, see China.

[Maximinus Thrax]

Yes, but we need to learn from this and handle credit more respectfully and responsibly.

In the mean time, it might pay to be a contrarian. Everything is cheap right now. It's the opportunity of a lifetime to buy a house or jump into the stock market.