EconomicCrisis.US

Enough of the silly slogan that “government isn’t the solution, government is the problem.” Government, in fact, is the solution to a national economic calamity not seen since the 1930s.

Today’s painful conditions would have been more disastrous had Washington not stepped in with massive business bailouts. The remedy prescribed by ultraconservative Republicans—more tax cuts—would have healed nothing. In fact, tax cuts favoring the wealthy enacted during the George W. Bush years plus the voracious borrowing to pay for Iraq and Afghanistan wars accelerated today’s misery.
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The U.S. banking industry may have pulled back from the brink, but finance executives say they still face hurdles that will tighten credit and delay an economic rebound.

In recent months the industry has shown signs of recovery from the worst recession in 70 years, which crushed some of the nation’s biggest banks and forced others to write down tens of billions of dollars in toxic assets.

But with banks reluctant to lend and consumers afraid of borrowing, chances of a strong and quick economic recovery are slim, bankers and investors said at the Reuters Global Finance Summit this week.
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The homeless population of Los Angeles fell sharply during the past two years, a study released on Wednesday found, confounding expectations that the recession would drive more people into the city’s streets and shelters.

Some credit went to better programs to keep people off the streets, but experts say the worst economic slump since the Great Depression may also have played a role as rents declined and created more affordable housing.

Others disputed that notion, asserting that recent waves of foreclosures invariably drive more people into homelessness.

According to the latest census performed every two years by the Los Angeles Homeless Services Authority, an estimated 43,000 people are living on the streets, in cars, in abandoned buildings or in shelters and government-funded “transitional housing” facilities on any given night in greater Los Angeles.
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Wall Street’s breaking the Dow Jones’s 10,000 mark Wednesday was hailed as a further sign of the recession’s end, even as foreclosures rose to an all-time high and the official unemployment rate continued to edge toward 10 percent.

The New York Times called the Dow’s rise to 10,000 “a milestone of the stock market’s recovery from the depths of the financial crisis.”

Leading the market rally Wednesday were third quarter figures released by one of the country’s biggest banks, JPMorgan Chase, which took in $3.6 billion in profits, and by the computer chip giant Intel, which reported $1.9 billion in net earnings, an 18 percent increase over the last quarter.
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