Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Preparing for the Coming Crises in Jobs, Funding


Financial turmoil is only first phase of emergency.


Yesterday's consumer-confidence reading clearly indicates how afraid Americans are right now - both about the financial system and the economy. I'm not so sure, however, that they don't have their fears backwards at this point: While I hear a lot of chatter about the next problem in the financial food chain, I myself am much more concerned about jobs and the economy (as well as the future funding emergency) than I am about this phase of the financial crisis.

Next on Deck

I could be wrong, of course. But I think this phase of the financial turmoil is probably in its eighth inning, insofar as the government isn't going to let any major entity (financial or otherwise) go bust at this juncture. While folks are worried about financial institutions, their real concern ought to be about the economy.

For several years now, as regular readers know, I've discussed my view regarding how weak the economic environment would be in my "next time down" scenario - when real estate, stocks, and the economy all fed on each other to the downside. Of course, I first proposed that idea before I saw the ultimate insanity that was our real-estate bubble/credit bubble.

Actionable ideas, instant analysis. Real-time from bell to bell.
Minyanville's Buzz & Banter - 14 day FREE trial

In the last expansion, economic growth was almost entirely about real estate. GDP growth, excluding mortgage-equity extraction, was almost nonexistent. In addition, when you consider that 30% to 40% of all jobs were real-estate-oriented, it's clear how hollow the economy was liable to be going forward.

Given the capital destruction and credit contraction now underway, I have a hard time seeing where new jobs will come from to handle all the layoffs that are going to take place. Additionally, given how wild consumer spending has been, there are lots of marginal businesses that are simply not going to make it, on top of all the carnage in anything related to real estate or finance.

< Previous
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

Featured Videos