In an article published on CNNMoney.com details the economic outlook for 2008.
In short, 2008 will not really be a good year, we may also face a recession sometimes in the middle of the year.
And, even though the Fed may cut more interest rate, it may not help much, as it all depends on the expectations and not so much on the actual Fed’s rate cut.
Most people tend to not like uncertainty. And since 2001, the economy has never really recovered. Consumers are still not sure what’s going to happen next.
Iran, North Korea, etc., and now Pakistan, all these still play a big role of uncertainty, and what’s happening elsewhere in the world certainly affects how we feel and spend here in America.
Most Americans have money, but they just don’t want to spend it because of some of these uncertainties, and even though the Fed may cut the rate, the consumer will still not borrow as expected.
Pakistan has 60 nuclear weapons, which no one really knows how secure these can be or some may end up in the hands of those who hate peace and advocate hate and violence.
This Christmas, has not really been like any other past Christmases, consumer spending and expectation were still low. Not because of weather or whatever, but simply because people are just not certain.
And ever since Bernanke took over, I just never had any trust or hope in him. Greenspan was more effective and he still is. When he spoke, everyone listened, and that too plays a role – the faithless and trust-less some have in Bernanke’s leadership.