State of the Economy–August 2011Posted: September 2, 2011
Markets are anticipating a poor jobs report. Dow dropped 100+ point yesterday and will probably drop another 100+ today if report is poor. It will be interesting if the report exceeds estimates. US growth is projected around 1%, which is not recession, but near stagnation. Europe is more inclined to double dip this fall.
You can see the the indicators, as large European firms are letting people go to further streamline their operations. In the US consumer buying saw its best month in the last five this past review cycle, which speaks well for the fall.
Nuriel Rubini writes that we are collectively worse of than in 2008. Yes, if we all panic and start a down ward spiral… there is no buffer to slow the fall left. I personally think that we need a bit of positive thinking here… solutions rather than fear mongering. Nuriel is a publicity hound and the only way he seems to get attention is by yelling that the sky is falling.
I became a US citizen yesterday, so today I am asking my elected representatives: what are you doing to offer constructive solutions? I recently read about the White House plan to allow mortgage owners to refinance without having 20% in equity. I think that would be a great move. The concern is that the tax payer owned Freddy and Fanny would take the hit. Well yes, if you cut mortgage payments for millions of home owners those agencies will be hit, but if it stabilizes the housing market and prevents millions of homes from foreclosure and decline in property values the end outcome will be net positive for all.
The U.S. Department of Transportation announced last Tuesday that roughly $745 million of Florida’s portion of high-speed rail money had been “obligated” toward upgrades on heavily used Amtrak lines in the Northeast Corridor. So much for the large scale infrastructure project that would great opportunity for massive growth in the South East. The California high speed rail project is going forward, but estimated to be way over budget.
Savannah Port expansion project is going through environmental studies. It is a widely contested project, as it would be a major blow for Charleston harbor, but a big windfall for Georgia. Being Georgian I say to Charleston… you are free to compete, but don’t try to stop growth. The port project will require rail system upgrades to handle additional cargo traffic. I say lets look at passenger rail travel in Georgia as well. Let’s tie all the major cities to Atlanta and let’s build a new Amtrak terminal that says that we are serious about rail travel. I’d love to take a train ride to Savannah or even down to Orlando or Destin. Quantitative easing has not delivered… build infrastructure that will provide structures for economic growth will.
Sad but true… Georgia is Atlanta. My family loves driving South to the beach. We take the smaller roads and we stop to visit small Georgia towns on the way. It is truly sad to see those main streets on a day when they should be crowded. Boarded windows… ghost towns. The cotton and peanut industries are becoming more automated every year. We need to link those rural areas more effectively to Atlanta enabling companies to create 21st century jobs. We need to provide even higher incentives for manufacturing companies to build big plants in Georgia… free land, zero tax and labor services. Massive modern technology parks in Macon and Gainsville linked with Atlanta by a high speed train service. Why not take an hours train ride for a meeting in Macon. Why not setup offices in Macon and access Atlanta airport by high speed train? Would be faster than driving from some of the northern suburbs.