When the economy heads south, why do employers not consider less drastic strategies to reduce labor costs?

• 1 comment

Will the massive Fed rate cut actually help the economy? Not if banks don't change their lending standards...

• Login or register to post comments

Past recessions and recoveries were mainly dependent on American consumption patterns, because of the sheer wealth of the country. Its 300 million or so citizens decided the economic fate of the world thanks to relatively large disposable incomes. However, with the emergence of BRIC (Brazil, Russia, India and China) countries and the EU things have changed and rather than 300 million people, 3 billion people now have an influence on consumption of goods and services. That is why the effects of the current recession are also heightened, but will also be the catalyst of a much faster recovery than past history suggests. With the amount of government intervention and support, it is only a matter of time before confidence in the markets returns. Once the US recovers, the world will follow and so will 3 billion consumers.

• Login or register to post comments

Black Friday shoppers rationalize their consumerism with "spending supports the economy" patriotism.

• 2 comments

In a striking admission, Paulson said that buying up distressed mortgage assets "is not the most effective way" to use government funding.Purchasing these so-called "toxic" assets was once the cornerstone of the rescue plan for financial markets and was almost the entire focus of Congress when the TARP package was being debated before its enactment in September. But almost as soon as Treasury received the money, it decided that giving capital to banks in return for preferred stock was a better use of the funds. Some analysts have accused Paulson of "flip-flopping" on every plan and it doesn't look like he has a plan at all.

• 1 comment