Random Notes About the Recession

I have very mixed feelings about the Recession right now. On the one hand, Wall Street seems to be doing well. Steve's firm just paid back all its TARP money with interest this month. There were ready to give the money back a few weeks ago, but Elizabeth Warren was worried that that they couldn't really afford to give the money back yet. She made them sit on the cash for a few weeks.

So, can't we just say bailing out banks was a good policy and that we can stop it with the damn tea parties?

On the other hand, Wall Street may have picked itself enough to pay back its loans, but people aren't seeing a rebound in other industries or in their pockets.

Megan McArdle has been writing about the economic downturn and the middle class. She has a nice Atlantic article on what the middle class is spending on during the recession. When it's online, I'll link to it. She also blogged about what happens to friendships when there are wealth disparities. The 11D household is going to be watching every cent until the rest of the year and is avidly following stories regarding budgeting.

Barbara Ehrenreich has a great article and short audios about how the poor are faring during the recession.

Comments

[MH]

"So, can't we just say bailing out banks was a good policy and that we can stop it with the damn tea parties?"

Meh. The direct bailout isn't the only thing Wall Street is getting. Extra FDIC guarantees, a huge artifically maintained interest spread, interest on their reserves, implicit government guarantees, etc.

I'm still waiting to riot over the BofA thing as I lost a great deal but the Merrill traders got their bonuses.

[Amy P]

"So, can't we just say bailing out banks was a good policy and that we can stop it with the damn tea parties?"

Your household's share of the federal debt is over half a million dollars (that's what, roughly ten times the median household income?). Obviously, not all of that happened in the past five months, but at some point a tipping point arrives. Things can't go on like this forever.