Greetings, I do hope everyone’s been having a good weekend so far. As is the weekend, it’s time for another edition of Econ’ Notables & Quotable. For the newcomers, every weekend I try and find quotes from various people and article snippets that really stick out regarding the economy. This week, though, lets try something new. No, we’re still on the economy, I just want to make a format change of sorts from the previous versions.
A personal confession here, often when I see many quote boxes, especially if they’re found to be in a series of such, my eyes glaze past many of them. Hypocrisy, I know, from someone trying to put together a series of such animals. Thinking of this, to you readers out there, please keep in mind that while they’re all on the economy, they’re not directly connect. Well, let me rephrase that. It isn’t like a soap opera or sci fi series where if you miss an episode or two you’re lost. We do sections like “Banking” or “Trade” or other things. I know this topic in general can be dry, not exactly racy stuff here, so it’s easy to subconsciously say in the back of your mind “oh jeeze, not more?!?” when you come across a block of statistics or heavy text that you know is important but just can’t absorb it all in. No, while economics is serious stuff, this is the weekend dammit. Even here we can take a more relaxed approached to covering things! In this little blog writer’s opinion, a weekend piece should be light. Think of this as a …well…a “diet blog”! Pick and choose, it’s all good here, though sadly at times the news being covered may not be. Saying all this, and it looks as if I’ve said enough, I will keep this edition short. Like I said, trying something new, so I won’t torture you that much with my experiment (I feel a “mwahahaha” should be put in, but that would seem to be inappropriate). Ok, I’ve spoken too much on the intro, let’s start the show!
On the economic state of things…
Unlike his predecessor, Mr. Immelt is not one for verbal flamboyancy. He was speaking at a conference and remarked how the credit crisis was shaking down General Electric, particularly its once-profitable (or I should say most-profitable) division, GE Finance. Immelt went on to say that he felt that things should start to correct next year, due to the vast deployment of the various government initiatives. He figures one of ideas being used should work to rebuild the economy. As for the fate of GE Capital? Things remain dodgy, along with the status of the company’s dividend and credit rating. GE’s clients are halting orders from things like airplane engines, as they having difficulty financing those purchases.
Of course, not just companies are hurting and cutting back. The biggest pool of victims of the current crisis has been the average consumer. With many losing homes, jobs, and possesions, the yen to spend is simply not there. Demand is drying up on various catagory of goods. At the highest end of luxury goods, that have in the past sustained demand (we’re talking things like shoes that cost more than most folks’ cars) has now taken a shellacking; this a result in the meltdown in the realm of the Masters of the Universe like Bear Sterns, to the complete destruction of fortunes by the likes of Bernard Madoff. But getting back to the rest of us, they say in the past that in every bad economic times, sales of peanut butter and jelly skyrocket. Well add another gastronomical indicator, my friends…ramen!
Though I have to say, going back to business executives, one in particular had some insight that to me really it it out of the park. It was none other than one of my least favorite corporate suits, Microsoft’s own Steve Balmer, who laid it out succinctly. Speaking before some Democrats at a Virginia retreat, he told it as he saw it.
But wait, there’s more from Mister Balmer!
CNet got the gist of this actually from one of Microsoft’s own policy issue statements. Well we know that executives are meeting with the Democrats, but what about Washington in general? This past week the big them was the stimulus plan, or I should say the attempt to produce and pass a stimulus plan.
On the goings on in Washington
Partisans from both major parties didn’t miss a beat to attack the other. Both put on the airs of urgency, yet one side seems to want to stifle progress for the sake of advancing their political gains (not to mention monetary ones through tax cuts). The other side, while right on the infrastructure play, picked the wrong time to add in things that really aren’t as important as rebuilding bridges. The economy at this point is like the Lusitania, just as it is being hit by credit-default derivative torpedoes from a hedge fund U-boat, yet we have party that isn’t manning the life boats but adding more weight to the ship!
Actually the best quote on this whole partisan malarkey came from someone I have many disagreements with, Peggy Noonan. The conservative author and former special assistant to President Ronald Reagan did something I never thought she would do, call a pox on both houses of the body politic. Like I said, there are many issues which I (and perhaps suspect you as well) find in opposition to her, but reading her latest piece, something has changed in her. No, I don’t think she’s turning liberal, but she also doesn’t just live in the Washington bubble. Something tells me that unlike many on the right, she is seeing things as they are turning…for the worse.