What you can learn from this ebook

The demise of Lehman Brothers can only be understood within the context of the current financial crisis, the biggest financial crisis since the Great Depression. The roots of this crisis have to be found in bad regulation, lack of transparency, and market complacency brought about by several years of positive returns. I will start by explaining these three roots and then I will discuss how Lehman contributed to its own demise and what the consequences of its filing for bankruptcy are.

There are millions out of work right now and there are fewer and fewer jobs available for those who are looking or work. Data that was released by the government on Friday showed that the recession is worse than it has been since the beginning of the recession right now.

It’s only expected to get worse because companies are still not hiring and most have no plans on creating jobs to start hiring.

It is so difficult to be unemployed right now because there are about 6.3 people applying for every one job opening. In comparison, when the recession officially began in 2007, there were only 1.7 workers competing for every one job opening in the united States.

Since the beginning of the decade, the largest amount of people who were competing for one job opening was in July 2003, when 2.8 people were looking for every one job opening.

From the beginning of the recession, employers have cut over 7 million jobs. Even though there are fewer and fewer job cuts with each job and unemployment report, there aren’t any jobs being created. Job creation is essential for the health of the economy.

So, people with jobs are feeling a bit more safe when it comes to their jobs. Job security can be priceless, but for those that were laid off or have found themselves unemployed, it is still quite difficult to find work.

It is, of course, more difficult to find work in some areas than others. Jobs are being created in some areas of the country, but there are other parts of the country that barely have any jobs available and are losing them much faster than they’re making them. The more industrial a town is, particularly in this recession, the more that town or county hurts it seems.

Hopefully, the job market will get a bit better sometime soon.

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It looks like the recession has made its way into pop culture. HBO has a new series called “Hung” and in its premier recently, it showed scenes of Detroit factories that were abandoned and had a voiceover talking of how the city has now fallen. The series focuses on a man named Ray Drecker, a guy that many can relate to these days.

Drecker was a star athlete in his younger days and is now having a hard time; he is divorced, behind on bills, and lost his job as a high school football coach because of some budget cuts the school had to perform.

The recession is going into its second year and the economy has found its way into pop culture; movies and tv shows have altered their scripts to put the tones of the recession in the stories. Also, plenty of books are offering frugal ideas and tips.

Long running tv shows like the Simpsons have also started talking about the recession. In one episode Homer and Marge have to sell their house because their mortgage payment had gone through the roof. On 30 Rock the characters had to deal with budget cuts. Even the kids from South Park had to learn a lesson about the recession.

Barry Ritholtz, author of Bailout Nation, said, “On the one hand, it’s good when it becomes part of popular culture because people are talking about it and thinking about it, But on the other hand, it’s bad when people are obsessing about it to the point of absurdity.”

In past downturns, the recession has been a way to escape from the problems, but this time, it seems as though pop culture wants to immerse itself in the current situations everyone is facing.

If you look back to shows like Dynasty, in the 1980’s the show was very popular and featured people with a very flamboyant lifestyle where they would flaunt their money. They also thrived during the 1980’s recession.

During the Great Depression big musicals also became very popular.

“If you’ve got a loved one dying of cancer, you may not want to watch, as your entertainment, movies of loved ones dying of cancer,” Thompson said.

I don’t necessarily enjoy watching people suffer in a recession, but I do really like to know that other people, even those in television shows, feel the same way that everyone else does. It makes me feel like Hollywood is connected to the real world and that at least the writers understand what is going on with the average American.

Art is supposed to imitate life I thought. This would be the best way to do so. People want to find solace, this is not a cancer.

What you can learn from this booklet

The bank’s unprecedented reach and power have enabled it to turn all of America into a giant pump-and-dump scam, manipulating whole economic sectors for years at a time, moving the dice game as this or that market collapses, and all the time gorging itself on the unseen costs that are breaking families everywhere – high gas prices, rising consumer-credit rates, half eaten pension funds, mass layoffs, future taxes to pay off bailouts. All that money that you’re losing, it’s going somewhere, and in both a literal and a figurative sense, Goldman Sachs is where it’s going: The bank is a huge, highly sophisticated engine for converting the useful, deployed wealth of society into the least useful, most wasteful and insoluble substance on Earth – pure profit for rich individuals.

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“As you know, 2008 was a challenging year,” said James Ziemer, who is retiring as Harley-Davidson Inc.’s president and chief executive officer May 1. “There’s no doubt our durability is being tested by one of the most challenging economic times since the Great Depression. We take our stewardship of this company very seriously. As a management team, we’ve been quite determined to make what we believe are wise choices in the short term that will give Harley-Davidson long-term success.”

The shareholder meeting was full of people who weren’t thrilled about the news, but everyone understood that if the company wanted to weather this financial storm then certain measures have to be taken.

The 81-82 recession, as well as the 73-75 recession, lasted 16 months. We will beat that figure if the current recession reaches past April.

Headlines comparing today’s recession to that of 81-82:

• In January, reports showed 207,000 manufacturing jobs vanished in the largest one-month drop since October 1982.
• Major automakers’ U.S. sales extended their deep slump in February, putting the industry on track for its worst sales month in more than 27 years.
• Struggling homebuilders have just completed the worst year for new home sales since 1982.
• There are 12.5 million people out of work today, topping the number of jobless in 1982.

Currently, the unemployment rates aren’t as high and he GDP hasn’t fallen as far, but it is getting closer and closer everyday. With the awful week Wall Street had last week, we can only hope that we’ll see a bottom soon.
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The measure passed in the test vote with 61 yeses, one more than the necessary 60 to go on to the House.

President Obama was on primetime TV last night trying to get support from U.S. citizens for the stimulus bill saying that the recession now is not an ordinary every day recession, but the worst since the Great Depression.

If the $838 billion measure passes, it could be on Obama’s desk by February 16th.

Many are weary about such a large bill because the last time we were told to act fast it was the bank bailout bill and that went horribly with little oversight and little idea about where our money was going. Hopefully, if this bill passes we will actually see some progress.

The Dow rose 258.30, or 2.94 percent, to 9,034.69, finishing the week up 6.1 percent. The blue chips last closed above 9,000 on Nov. 5, when they stood at 9,139.27.

The Dow, the oldest of the big market indexes, fell 33.8 percent in 2008, its worst performance since 1931, during the Great Depression.

Like the Dow, broader stock indicators also advanced for the third straight session. The Standard & Poor’s 500 index rose 28.55 percent, or 3.16 percent, to 931.80, its highest close since Nov. 5. The Nasdaq composite index rose 55.18, or 3.50 percent, to 1,632.21.

For the week, the S&P 500 finished up 6.8 percent, while the Nasdaq rose 6.7 percent.

The Russell 2000 index of smaller companies rose 6.39, or 1.28 percent, to 505.84. -AP

Perhaps the market is finding a bottom. I won’t judge anything because there were plenty of early predictions about 2008 that were horribly wrong. I won’t speculate, just enjoy a rally.

Source

In the 1920′s and 30′s depression, the government didn’t intervene before it was too late. Now, our government has taken many steps to stave off a depression. The FDIC is already in place, so there hasn’t been a run on the banks. There are federal work programs in place as well as unemployment insurance, so I don’t see unemployment reaching the 25% it was back then. Also, we aren’t facing a natural disaster like we did then (the Dust Bowl).

The government now, though, needs to put in regulations on the market. The SEC was created in the Great Depression, now there needs to be some other regulations put in place to help cut the losses and keep the credit crisis from happening again.

His reasons include that unemployment is nowhere near the 33% it was then, and the housing market should finally bottom out around the end of June next year.

He also lists safeguards put in place by the government to make sure something like that never happened again such as the FDIC, Social Security and unemployment insurance.

The Fed has cut the interest rate by so much, that deflation will certainly become an issue. Deflation was an economic indicator leading up to the Great Depression, and some fear that the deflation going on right now could indicate that the current recession we’re in could be longer than some expected.

I find it odd that just 3 months ago, headlines were saying that inflation was a huge weight on the economy. Since then, oil has declined almost $100 a barrel, and other commodity prices have fallen by 40%.

For the first time in years, stores (including large retailers like K-Mart) are advertising their layaway departments. However, many retailers are saying that layaway only accounts for a small percentage of already declining sales. Also, many consumers would rather make payments on something while they have it rather than pay on something that sits in storage at the store.

I remember when my parents would put things on layaway for Christmas. It was pretty funny because that was one of the only ways to keep my sister and I from knowing what we were going to get that year (my mom always waited until the last minute to wrap presents and Santa didn’t wrap presents at all). That’s another practical use for layaway…think about it.

Even though those on Wall Street were expecting new home constructions to be closer to 950,000 this year, perhaps the slow down in home construction means the 11 month surplus of homes can diminish and some of the housing problems can be fixed.

It honestly seems more like a good thing than a bad one in this case. However, I believe that people won’t be buying a lot of the homes already on the market because it’s just getting too hard for people without perfect credit to get a home loan. Well…maybe that’s not an awful thing either.