What makes it stop?

Foreclosures, layoffs, bankruptcies, and other bad news keeps accelerating like a runaway train. Predictions of recovery come from all over, and every time frame. If seems like the phrase “It should turn around later this year” has been the standard answer since 2005.

The question to ask is not when it turns around, by why it stops. Once a reason can be determined of why the recession/depression will end, then you can start to figure out when it will happen.

We need to start by figuring out why we are in a recession in the first place. Incomes, jobs, home values, and business revenue is declining because their levels were not genuine to begin with. Theoretically, when the levels get to where they are all supported by real value and production, the decline will stop.

Unfortunately we now have to go down further to make up for the prior debt that was accumulated, and also the new debt that is being called the stimulus.

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Once all that get’s absorbed and paid for, the decline will stop and the country can start building up its economy and business again. With no further accumulation of debt, that should be 2022.

However, we are still accumulating debt because of the interest we have to pay on the current debt.

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Maybe we can get that under control by 2050. Instead, wy not write it off and default on the debts? We’ve done it before.

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~ by Dave on February 14, 2009.

2 Responses to “What makes it stop?”

  1. [...] the Greater Depression of 2010 - 2030. We’ve suggested that the recession will get worse, layoffs will continue, municipal services are in jeopardy, and that the financial crisis is too [...]

  2. [...] and which can withstand a realistic debate of their merits? In February I wrote an article titled “What makes it stop?” which makes the point that we should stop asking WHEN the economy recovers, but first figure out [...]

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