Economic gloom and doom

In a column at Counterpunch, Dave Lindorff expresses the unpopular view that the economic recovery is not yet underway:

While the Obama administration and the Treasury and the Fed are bulldozing funds into the coffers of the big banks, allegedly to get them to lend, the banks, from the largest to the smallest, are pulling back, afraid that borrowers will end up going bust on them. So much for economic stimulus efforts…

With official unemployment approaching 10%... and real unemployment, as measured the way it used to be back in 1980, at closer to 20 percent, the majority of Americans not only have friends and family members who are unemployed or working part-time or at odd jobs involuntarily, but are worried about getting the axe themselves…

Bond yields and commodity prices are spiking as investors are waking up to the reality that massive borrowing by the US Treasury and massive printing of money by the Federal Reserve are going to lead to serious, perhaps even hyperinflation of the dollar. That in turn will force the Fed at some point, probably fairly soon, to raise interest rates…

Meanwhile, crude oil prices rose to over $70/barrel—an odd thing given the significant decline in demand caused by the global recession, but evidence that investors are anticipating a dollar slump and aren’t interested in supply and demand issues. Other commodity prices are also jumping for the same reason…

Obama’s wars in Iraq and Afghanistan are going from bad to worse. There is no savings coming out of Iraq, as he had claimed would happen during last year’s presidential campaign…

So far, most Americans remain unaware of the scale of this crisis. The news media continue to tout shamelessly whatever signs of recovery they can detect, leaving all those whose personal finances are falling apart to feel like it’s just their problem…

More at the link. One might view the piece as a sour grapes rant by someone whose home equity line of credit was cut, but it at least expresses publicly what a lot of people are feeling privately. The major media outlets do tend to focus their attention on any visible "green shoots" indicating economic improvement.

In a related piece, an article at the Guardian today quotes the chief of the International Monetary Fund as saying that the "worst lies ahead" for the world economy:

"Their (G8) stance is that we are beginning to see some green shoots but nevertheless we have to be cautious... The large part of the worst is not yet behind us."

G8 ministers discussed... how to begin withdrawing the extraordinary stimulus they have injected into the world economy in the shape of record low interest rates, big budget deficits and flooding their economies with money...

Separately, Eurostat reported that eurozone employment plunged by a record 0.8%, or 1.22 million people, in the first quarter from the fourth quarter of 2008. That was twice the drop seen in the fourth quarter and the third successive quarterly drop in employment.